EXHIBIT 10.7
Amendment Number 2
to the
Alliance Agreement
between
Cisco Systems, Inc. ("Cisco")
and
KPMG Consulting Inc. ("KPMG")
WHEREAS, Cisco and KPMG LLP entered into an Alliance Agreement, dated
December 29, 1999 and amended December 1, 2000 (as amended, the "Alliance
Agreement");
WHEREAS, KPMG LLP assigned the Alliance Agreement to KPMG in conjunction
with the spin-off of KPMG from KPMG LLP;
WHEREAS, Cisco and KPMG wish to amend the Alliance Agreement as set forth
in this Amendment Number 2 (the "Amendment").
NOW, THEREFORE, Cisco and KPMG agree to amend the Alliance Agreement as
follows:
1. Use of Terms. All capitalized terms not defined herein will have the
meaning assigned to them in the Alliance Agreement.
2. Modification of the Alliance Agreement:
(a) Section 3.1. In the second sentence of Section 3.1, second to last line of
the sentence, the word "consulting" is hereby deleted.
(b) Section 3.1.2. The first sentence of Section 3.1.2 is hereby deleted.
(c) Section 3.1.4. Section 3.1.4 is hereby deleted in its entirety and replaced
with the following:
3.1.4 Conflicting bidding situations. The parties agree that in
situations where Cisco is bidding as the prime contractor in a bid in which a
customer requests both hardware and services, and Cisco chooses a party other
than KPMG as the services subcontractor, KPMG may make a separate bid to the
customer as the prime contractor for such hardware and services, subject to the
limitations set forth in Section 3.1 above. In the situation in this Section
3.1.4 that KPMG makes a separate bid, or in any other bid situation likely to
create a conflict with a bid from Cisco, KPMG will notify Cisco's account team
or alliance team of such situation, as soon as possible.
(d) Section 3.1.5. Section 3.1.5 is hereby deleted in its entirety and replaced
with the following:
3.1.5 Cisco Competitive Account. Subject to the limitations
set forth herein, the parties agree that KPMG may submit its bid to a client
which primarily uses products of a Cisco Competitor. In such case, KPMG shall,
in the spirit of good partnership, make every commercially reasonable efforts to
inform Cisco's customer account team or Cisco's Strategic Alliance
representative of such situation and assist Cisco in promoting Cisco
architecture and equipment within the target customer.
(e) Section 3.3.2. Section 3.3.2 of the Alliance Agreement is hereby deleted in
its entirety and replaced with the following:
CONFIDENTIAL MATERIAL APPEARING IN THIS DOSCUMENT HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH RULE
24b-2(b) OF THE EXCHANGE ACT OF 1934, AS AMENDED. OMITTED INFORMATION HAS
BEEN REPLACED WITH ASTERISKS.
3.3.2. In the event that, pursuant to Section 4.10 of the Stock Purchase
Agreement, Cisco designates an entity as a Cisco Competitor which entity was not
a Cisco Competitor in the prior period as (such newly-designated entity a "New
Cisco Competitor") and KPMG has an existing contract with such New Cisco
Competitor, then nothing in this Section 3 shall be interpreted to require KPMG
to terminate, breach, curtail, change or amend any such contract;
***KPMG***CISCO***.
(f) Section 4.1 of the Alliance Agreement (beginning "4.1 Recruiting. KPMG
shall" and ending "KPMG shall not be in default under this Agreement.") is
hereby deleted in its entirety and replaced with the following: "4.1
Intentionally left blank."
(g) Section 4.2 of the Alliance Agreement (including 4.2.1, 4.2.2 and 4.2.3) is
hereby deleted in its entirety and replaced with the following:
4.2 Training and Resource Development. KPMG agrees to develop
skills in new Cisco products to ▇▇▇▇▇▇ the rapid assimilation of such products
into the market. When Cisco and KPMG are developing a joint solution, KPMG
agrees to train at least the number of engineers on the design, planning and
implementation management of the technologies associated with the solution
necessary to achieve the purpose of the solution. KPMG agrees to maintain the
level of competence in its staff already trained on Cisco products and
technologies as of July 1, 2001. Yearly, KPMG will agree on a program of update
events to be defined during the alliance annual planning exercise. KPMG agrees
to meet the training requirements set forth in Exhibit A.
4.2.1 Intentionally left blank.
4.2.2. In conjunction with the foregoing training, Cisco will
provide resources and materials at a substantial discount off the MSRP, as set
forth in Exhibit B as shall be amended by the mutual agreement of the Parties
from time to time, to enable KMPG to develop and deliver the forgoing training
in support of the Alliance. Such resources will include product experts for
ongoing training and education of new Cisco technologies and will support
required training sessions to build expertise within KPMG on new products prior
to market availability. KPMG shall be responsible for all costs associated with
development and execution of the its training.
4.2.3 Cisco shall grant KPMG a worldwide, nonexclusive license
to use, reproduce and distribute Cisco training materials which are purchased
from Cisco by KPMG, in whole or in part, solely for internal use to train KPMG
personnel, including the right to incorporate the whole or portions thereof in
KPMG's training materials; provided that KPMG shall not remove, overprint or
deface any notice of copyright, trademark, logo, legend, or other notices of
ownership from any originals or copies (whether of the whole or a portion)
thereof.
(h) Section 4.3 of the Alliance Agreement is hereby deleted in its entirety and
replaced with the following:
4.3 Opportunity and Sales Management. Cisco and KPMG will work
jointly in the field to identify, pursue and track sales opportunities, deploy
resources, generate proposals and sell and deploy solutions in support of
Service Provider Market and Enterprise Market customers. In furtherance of this
goal, the Parties agree:
o KPMG shall deploy dedicated contacts to field
operations locations to facilitate field interaction.
o KPMG shall assign dedicated representatives in each
region, as dictated in number and locations by the
business need, to serve as main contact points and
regional coordinators for field engagement activities.
o Cisco shall provide a single point of contact in the
field for KPMG representatives to enable real-time
field interaction.
o Cisco shall provide resources to assist with field
opportunity identification and notification. The
Parties shall cooperate in joint marketing efforts and
shall encourage participation in joint account planning
sessions.
(i) Section 4.4. The first paragraph of Section 4.4 of the Alliance
Agreement (beginning "4.4 Facilities and Infrastructure. Subject to" and ending
"one per calendar quarter.") is hereby deleted and replaced with the following:
4.4 Facilities and Infrastructure. Subject to Section 4.9, KPMG will establish
an agreed upon number (but not less than one (1) per joint solution developed
under this Alliance Agreement) Solution Centers for development, training and
client demonstration. Subject to Section 4.9 and any written agreement between
the parties at the time of the definition of the joint solution, KPMG shall make
commercially reasonable efforts to have new solution centers staffed and
operational not later than the launch date of the new solution.
(j) Section 4.6. The last clause of Section 4.6 of the Alliance Agreement "as
specified in Exhibit A and any subsequent Resource Allocation Schedule during
the term of this Agreement" is hereby deleted.
(k) Section 4.8(b) of the Alliance Agreement is hereby deleted in its entirety
and replaced with the following:
(b) that the marketing budget to promote the Alliance and the Alliance
Solutions for each party will be dictated by the budget requirements
to meet the objectives of the mutually agreed upon Marketing and
Business Plans.
(l) Exhibit A of the Alliance Agreement is hereby deleted and replaced with
Exhibit A attached to this Amendment.
3. No Other Modifications. Except as specifically amended by this Amendment,
the Alliance Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed, effective as of this day of , 2001.
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Cisco Systems, Inc.: KPMG Consulting Inc.:
By: /s/ ▇▇▇▇▇▇ ▇. Steinhiller By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------- ------------------------------
Name: ▇▇▇▇▇▇ ▇. Steinhiller Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------- ------------------------------
Title: Vice President Title: GEVP and COO
---------------------------- ------------------------------
Date: 3/4/02 Date: 12/18/01
---------------------------- ------------------------------
CONFIDENTIAL MATERIAL APPEARING IN THIS DOSCUMENT HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION IN ACCORDANCE WITH RULE
24b-2(b) OF THE EXCHANGE ACT OF 1934, AS AMENDED. OMITTED INFORMATION HAS
BEEN REPLACED WITH ASTERISKS.
Exhibit A
Resource Allocation Schedule
I. Requirements For Consulting Professionals And Cisco Literate Consultants.
A. INTENTIONALLY LEFT BLANK.
B. SCHEDULE FOR DEPLOYMENT OF CONSULTING PROFESSIONALS AND CISCO
LITERATE CONSULTANTS.
KPMG shall maintain the level of competence on Cisco products and
technologies of its Consulting Professionals and Cisco Literate Consultants who
are trained on Cisco products and technologies as of July 1, 2001. In addition,
KPMG shall maintain the number of its Consulting Professionals and Cisco
Literate Consultants who are trained on Cisco products and technologies as of
July 1, 2001. Yearly, KPMG will agree on a program of update events to be
defined during the alliance annual planning exercise.
C. SKILL ALLOCATION OF CISCO LITERATE CONSULTANTS.
1. INTENTIONALLY LEFT BLANK.
2. KPMG shall provide Cisco with updated records on a periodic basis of
all current KPMG staff holding Cisco certifications, including which
certification each individual holds.
3. To ensure that at all times, KPMG has on staff sufficient personnel
to competently take responsibility for Cisco related projects, KPMG agrees that
***% of KPMG's network engineering personnel will be Cisco CCxx certified. ***%
of those Cisco CCxx certified shall be Cisco Certified Networking Professionals
("CCNP") or Cisco Certified Design Professional ("CCDP).
II. "Cisco Literate" Definition.
Cisco Literate Consultant means a person directly employed by KPMG, any
entity which is a member of KPMG International, any other entity that has the
right to use the name "KPMG", any other entity over which KPMG has actual
control or any other entity in which KPMG has the ability to direct the
deployment of such person, in a consulting capacity in one of the following
areas:
o Cisco Certified Professionals
Obtained one of the levels of Cisco Certification specified in Section I.C.3.
above and assigned to any practice to provide network engineering services to
either Enterprise Market or Service Provider Market clients.
o Service Provider Practice
Attended training on Service Provider Market Fundamentals and be on track to
complete the training relevant to their job function. These individuals will be
focused at the Service Provider Market . Skills of such individuals may include
project management, OSS/BSS integration, business development and technical or
network integration
o Enterprise Practice
Attended training in Cisco BCG products such as Geotel, Webline, etc or
completed training appropriate to their job in co-branded solutions as defined
by the Cisco solution development manager responsible for the development and
deployment of each solution and be on track to complete the training relevant to
the job function.
Training may include business development, best practices and ISV technologies
such as Ariba, Broadvision, Extricity, etc.
Without limiting KPMG's obligations set forth herein, in all cases, the number
and location of new trainees will be determined by the business requirement and
volume of projects to be completed.
Cisco has the right to audit the list of trained professionals (consulting
professionals and Cisco Literate Consultants) at its discretion.
