CALLIDUS SOFTWARE INC.<BR>SOFTWARE LICENSE AGREEMENT<BR>NOTICE -- READ THIS BEFORE DOWNLOADING, COPYING OR USING THE SOFTWARE. <BR>BY INSTALLING OR USING ANY PART OF THE SOFTWARE, YOU AND THE ENTITY OR COMPANY THAT YOU REPRESENT ("YOU") ARE UNCONDITIONALLY CONSENTING TO BE BOUND BY AND ARE BECOMING A PARTY TO THIS SOFTWARE LICENSE AGREEMENT ("AGREEMENT"). IF YOU DO NOT UNCONDITIONALLY AGREE TO ALL OF THE TERMS OF THIS AGREEMENT, YOU WILL NOT HAVE ANY RIGHT TO USE THE SOFTWARE. CALLIDUS SOFTWARE INC. ACCEPTANCE IS EXPRESSLY CONDITIONED UPON YOUR ASSENT TO ALL THE TERMS AND CONDITIONS OF THIS AGREEMENT, TO THE EXCLUSION OF ALL OTHER TERMS; IF THESE TERMS ARE CONSIDERED AN OFFER, ACCEPTANCE IS EXPRESSLY LIMITED TO THESE TERMS. IF YOU DO NOT ACCEPT THESE TERMS, YOU MUST DELETE THE SOFTWARE FROM YOUR HARDWARE.<BR> PLEASE NOTE THAT YOU MAY NOT USE, COPY, MODIFY OR TRANSFER THE PROGRAM OR DOCUMENTATION OR ANY COPY, EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT.<BR> 1. LICENSE. All or any portion of this software program (the “Program”) and the accompanying on-line read-me, help files, installation guides, reports and manuals (collectively the “Documentation”) are licensed, not sold, to you by Callidus Software Inc. (“Licensor”). The term “Program” shall also include any new releases, enhancements, updates and upgrades of the Program licensed to you by Licensor. Subject to the terms of this Agreement, you have a non-exclusive, nonsublicenseable and nontransferable limited license to use the Program and Documentation for non-commercial purposes (e.g. not for resale or rental or the like) and solely for your internal business operations. You may use this Program in the United States and its territories or any other country to which this Program is legally exported. This Agreement allows you to run the Program only as received at the time of download, in a single production instance, for the number of authorized users you have licensed. You acknowledge and agree that the Program and Documentation are Licensor’s confidential information and as such you agree to use your best efforts to prevent and protect the contents of the Program and Documentation from unauthorized disclosure or use by third parties. You will make the Program and Documentation available only to employees with a need to know to perform the obligations under this Agreement. Licensor and its licensors reserve all rights not expressly granted to you. This Agreement does not give you any rights not expressly and unambiguously granted herein. You understand that Licensor or its licensors may modify or discontinue offering the Program at any time.<BR> 2. Limitation on Use. You shall not, nor permit anyone else to, directly or indirectly: (i) copy, modify, or distribute the Program; (ii) reverse engineer, disassemble, decompile or otherwise attempt to discover the source code or structure, sequence and organization of all or any part of the Program (except that this restriction shall not apply to the limited extent restrictions on reverse engineering are prohibited by applicable local law); or (iii) rent, lease, or use the Program for timesharing or service bureau purposes, or otherwise use the Program for any commercial purpose. You shall maintain and not remove or obscure any proprietary notices on the Program and Documentation, and shall reproduce such notices exactly on all permitted copies of the Program and Documentation. We may audit your use of the Program annually, at our expense, subject to reasonable prior notice and so as not to unreasonably interfere with your business operations. <BR> 3. Support; Equipment. Unless otherwise agreed to between you and Licensor in writing, this Agreement entitles you only to email support for the Program (collectively, “Support”). Support is effective until Program licenses are terminated. You shall be responsible for obtaining and maintaining any equipment or ancillary services needed to connect to, access, or otherwise use the Program, including, without limitation, modems, hardware, software, and long distance or local telephone service. You shall be responsible for ensuring that such equipment or ancillary services are compatible with the Program.<BR>4. Transfer. You may not sublicense, assign, delegate, rent, lease, time-share or otherwise transfer this license or any of the related rights or obligations for any reason. Any attempt to make any such sublicense, assignment, delegation or other transfer by you shall be void.<BR> 5. Backup and Copyright. The Program and related Documentation are copyrighted by Licensor and its licensors. You may make one copy of the Program for backup, development, test or other non-production purposes if Licensor’s copyright notice is included on such copy. You may make one copy of the Documentation and print one copy of any on-line documentation or other materials provided to you in electronic form. Any and all other copies of the Program and any copy of the Documentation made by you are in violation of this license. <BR> 6. Ownership. You agree that the Program and Documentation belong to Licensor and its licensors. You agree that you neither own nor hereby acquire any claim or right of ownership to the Program and Documentation or to any related patents, copyrights, trademarks or other intellectual property. Licensor and its licensors retain all right, title and interest in and to the Documentation and the Program and all copies thereof at all times, regardless of the form or media in or on which the original or other copies may subsequently exist. Licensor’s licensors are the intended third party beneficiaries of this Agreement and have the express right to rely upon and directly enforce the terms set forth herein. This license is not a sale of the original or any subsequent copy. All content accessed through the Program is the property of the applicable content owner and may be protected by applicable copyright law. <BR> 7. Intellectual Property Warranty. As a condition to your use of the Program, you represent, warrant and covenant that you will not use the Program: (i) to infringe the intellectual property or proprietary rights, or rights of publicity or privacy, of any third party; (ii) to violate any applicable law, statute, ordinance or regulation; (iii) to disseminate, transfer or store information or materials in any form or format ("Content") that are harmful, threatening, abusive, harassing, tortious, defamatory, vulgar, obscene, libelous, or otherwise objectionable or that otherwise violate any law or right of any third party; (iv) to disseminate any software viruses or any other computer code, files or programs that may interrupt, destroy or limit the functionality of any computer software or hardware or telecommunications equipment, or violate the security of any computer network; or (v) to run Maillist, Listserv, “bots,” “robots,” any form of auto-responder, or "spam," or any processes that run or are activated while you are not logged in. You, not Licensor, remain solely responsible for all Content that You upload, post, e-mail, transmit, or otherwise disseminate using, or in connection with, the Program. You acknowledge that all Content you access through use of the Program is accessed at your own risk and you will be solely responsible for any damage or liability to any party resulting from such access.<BR>8. Term and Termination. This license is effective until terminated. You may terminate this license at any time by destroying the Program and Documentation and the permitted backup copy. This license automatically terminates if you fail to comply with its terms and conditions. You agree that, upon such termination, at Licensor’s option, you will either destroy (or permanently erase) all copies of the Program and Documentation, or return the original Program and Documentation to Licensor, together with any other material you have received from Licensor in connection with the Program. <BR> 9. DISCLAIMER OF WARRANTY. LICENSOR AND ITS LICENSORS PROVIDE THE PROGRAM AND THE DOCUMENTATION “AS IS” WITHOUT WARRANTY OF ANY KIND EITHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR INFRINGEMENT OF THIRD-PARTY INTELLECTUAL PROPERTY RIGHTS. ALL THE FOREGOING DISCLAIMERS ALSO APPLY IN FULL WITH RESPECT TO LICENSOR’S LICENSORS, SUPPLIERS, DISTRIBUTORS, CONTRACTORS AND AGENTS. SOME STATES DO NOT ALLOW THE EXCLUSION OF IMPLIED WARRANTIES, SO THE ABOVE LIMITATIONS MAY NOT APPLY TO YOU. All risk of quality and performance of the Program and the Documentation is with you. Should the Program prove defective, you and not Licensor assume the entire cost of any service and repair. This disclaimer of warranty constitutes an essential part of this Agreement. <BR> 8. LIMITATION OF REMEDIES. UNDER NO CIRCUMSTANCES AND UNDER NO LEGAL THEORY, INCLUDING, BUT NOT LIMITED TO, TORT, CONTRACT, NEGLIGENCE, STRICT LIABILITY, OR OTHERWISE, SHALL LICENSOR BE LIABLE TO YOU OR ANY OTHER PERSON (I) FOR ANY INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY CHARACTER OR (II) FOR ANY MATTER BEYOND ITS REASONABLE CONTROL. LICENSOR’S LIABILITY FOR DAMAGES OF ANY KIND WHATSOEVER ARISING OUT OF THIS AGREEMENT SHALL BE LIMITED TO THE TOTAL FEES PAID BY YOU TO LICENSOR, EXCEPT WHERE NOT PERMITTED BY APPLICABLE LAW, IN WHICH CASE LICENSOR’S LIABILITY SHALL BE LIMITED TO THE MINIMUM AMOUNT PERMITTED BY SUCH APPLICABLE LAW. ALL THE FOREGOING LIMITATIONS SHALL APPLY EVEN IF LICENSOR HAS BEEN INFORMED OF THE POSSIBILITY OF SUCH DAMAGES. ALL THE FOREGOING LIMITATIONS ALSO APPLY WITH RESPECT TO LICENSOR’S SUPPLIERS, LICENSORS, DISTRIBUTORS, CONTRACTORS AND AGENTS. SOME STATES DO NOT ALLOW THE EXCLUSION OR LIMITATION OF INCIDENTAL OR CONSEQUENTIAL DAMAGES, SO THE ABOVE LIMITATION AND EXCLUSION MAY NOT APPLY TO YOU.<BR> 10. Indemnity. You agree that Licensor and its licensors, distributors, contractors and agents shall have no liability whatsoever for any use you make of the Program. You shall indemnify and hold harmless Licensor and its licensors, suppliers, distributors, contractors and agents from any claims, damages, liabilities, costs and fees (including reasonable attorneys’ fees) arising from Your use of the Program as well as from your failure to comply with any term of this Agreement. To the maximum extent permitted by applicable law, you hereby release, and waive all claims against, Licensor and its licensors, suppliers, employees and agents from any and all liability for claims, damages (actual and consequential), costs and expenses (including litigation costs and attorneys’ fees) of every kind and nature, arising out of or in any way connected with use of the Program. If You are a California resident, You waive Your rights under California Civil Code § 1542, which states, "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor." Residents of other states and nations waive their rights under all analogous laws, statutes or regulations.<BR>11. Applicable Law. This license will be governed by the laws of the State of California, without reference to conflicts of laws principles. The United Nations Convention on Contracts for the Sale of Goods does not apply to this license.<BR> 12. Export Controls. The Program and the underlying information and technology may not be downloaded or otherwise exported or re-exported (i) into (or to a national or resident of) Cuba, Iraq, Libya, Yugoslavia, North Korea, Iran, Syria or any other country to which the U.S. has embargoed goods; or (ii) to anyone on the U.S. Treasury Department’s list of Specially Designated Nationals or the U.S. Commerce Department’s Table of Deny Orders. By downloading or using the Program, you are agreeing to the foregoing and you represent and warrant that you are not located in, under the control of, or a national or resident of any such country or on any such list. <BR> 13. U.S. Government End Users. The Program is a “commercial item,” as that term is defined at 48 C.F.R. 2.101 (Oct. 1995), consisting of “commercial computer software” and “commercial computer software documentation,” as such terms are used in 48 C.F.R. 12.212 (Sept. 1995). Consistent with 48 C.F.R. 12.212 and 48 C.F.R. 227.7202-1through 227.7202-4 (June 1995), all U.S. Government End Users acquire only those rights in the Program and the Documentation that are provided by this Agreement.<BR> 14. No Other Agreements. This Agreement constitutes the entire agreement between the parties with respect to the Program and the Documentation, and supersedes any other written or oral agreement.<BR> 15. Severability and Waiver. If any provision of this Agreement is held invalid, the remainder of this Agreement shall continue in full force and effect. This Agreement excludes any wavier of claims simply because Licensor fails to exercise our rights. <BR>If you have any questions, please contact in writing: Callidus Software Inc., 160 W. Santa Clara Street, Suite 1500, San Jose, California 95113, Attention: General Counsel.