MARKETING AGREEMENT ("Services Agreement")
THIS AGREEMENT, dated as of May 21, 1999, is made and entered into by
and between XXXXXX INTERACTIVE CORP., a New York corporation with its office at
000 Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Xxxxxxxx.xxx"), and
STAPLES, INC., a Delaware corporation with its principal offices located at 000
Xxxxxxx Xxxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx 00000 ("Staples").
WHEREAS, Xxxxxxxx.xxx engages in the business of domain name
registration and registrar services on the Internet ("Services");
WHEREAS, Staples and, through its web site, Xxxxxxx.xxx, are engaged in
the business of selling Office Supplies (as defined in Section 2 below);
WHEREAS, all mentions of Permanent ("permanent" or "Permanent")
placement in the Marketing Agreement in Exhibit A attached hereto shall remain
only in effect during the duration of this Agreement;
WHEREAS, Staples and Xxxxxxxx.xxx desire to enter into this Agreement
whereby Xxxxxxxx.xxx will be the exclusive provider of Internet domain name
registrar and registration Services on Xxxxxxx.xxx's web site as set forth in
this Agreement, and Staples will be the exclusive provider of Office Supplies
that are advertised or promoted on Xxxxxxxx.xxx's web site as set forth in this
Agreement;
NOW, THEREFORE, in consideration of mutual promises and covenants of
the parties hereinafter set forth, the receipt and sufficiency of which are
hereby acknowledged, Xxxxxxxx.xxx and Staples mutually agree as follows:
1. Grant of Exclusive Rights to Xxxxxxxx.xxx. During the Term (as defined in
Section 4 below), Staples grants to Xxxxxxxx.xxx the exclusive right to market
and solicit the Services across all of Staples' branded properties, including,
but not limited to, Xxxxxxx.xxx's web site and the Staples retail stores.
Staples shall promote and advertise the Services in the scope and manner
specified in Exhibit A attached hereto. In furtherance of, but in no way
limiting, the foregoing, Staples covenants and agrees that, during the Term, it
will not enter into any agreement with any company engaged in the business of
registration Services whereby such company shall have the right to (i) advertise
such Services on Xxxxxxx.xxx web site or in Staples' retail stores in any manner
whatsoever, or (ii) form a partnership, strategic or otherwise, with Xxxxxxx.xxx
or with Staples. During the Term, Staples shall not enter any marketing
agreements similar to those described herein with any entity whose primary
(greater than 50% of revenues) lines of business include domain name registrar
and registration services, including but not limited to, Network Solutions, Inc.
and any subsidiaries or affiliates thereof.
2. Grant of Exclusive Rights to Staples. During the Term, Xxxxxxxx.xxx grants to
Staples the exclusive right to market and solicit Office Supplies on
Xxxxxxxx.xxx's web site. Xxxxxxxx.xxx shall promote and advertise such Office
Supplies in the scope and manner specified in Exhibit A attached hereto. In
furtherance of, but in no way limiting, the foregoing, Xxxxxxxx.xxx covenants
and agrees that, during the Term, it will not enter into any agreement with any
company engaged in the business of Office Supplies whereby such company shall
have the right to (i) advertise on Xxxxxxxx.xxx's web site in any manner
whatsoever or (ii) provide Office Supplies to Xxxxxxxx.xxx's customers. During
the Term, Xxxxxxxx.xxx shall not enter any marketing agreements similar to those
described herein with any entity that derives more than 20% of its revenues from
sales of Office Supplies. For purposes of this Agreement, the term "Office
Supplies" means office supplies other than computer equipment, business services
(including, but not limited to, printing services), software, furniture, and
business machines. Prohibited companies include, but are not limited to, Online
Office Supplies, Megadepot, OfficeMax, Office Depot and any subsidiaries or
affiliates thereof.
3. Promotion. During the Term, Staples and Xxxxxxxx.xxx agree to promote each
other's services and products as provided on Exhibit A attached hereto.
4. Term. The Term of this Agreement shall commence on June 1, 1999 and shall
continue until May 31, 2002. The initial Term of this Agreement shall
automatically be extended for additional, consecutive one (1) year periods,
unless either party gives written notice to the other party at least sixty (60)
days prior to the expiration of the then-current Term of its intention not to
extend such Term.
5. Notices. Any notice required to be given by a party hereunder shall be given
in writing and delivered personally or shall be sent by certified mail, return
receipt requested, to the other party at the addresses hereinabove set forth or
at such other addresses as a party hereunder may hereafter notify the other of
in such manner. Any notices sent by certified mail shall be deemed given on the
day such notice is mailed.
6. Assignment. All of the terms of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns. No party may assign this Agreement or any of its rights,
interests or obligations hereunder without the written consent of the other
party hereto.
7. Governing Law. This Agreement shall be construed according to the laws of the
State of New York and all actions and disputes hereunder shall be brought in the
state or federal courts of New York.
8. Agency. Except as Staples may be specifically authorized in writing by
Xxxxxxxx.xxx, nothing herein contained shall be construed as authorizing Staples
to bind Xxxxxxxx.xxx in any way nor as constituting Staples an agent or
representative of Xxxxxxxx.xxx. Except as Xxxxxxxx.xxx may be specifically
authorized in writing by Staples, nothing herein contained shall be construed as
authorizing Xxxxxxxx.xxx to bind Staples in any way nor as constituting
Xxxxxxxx.xxx as an agent or representative of Staples.
9. Entire Agreement. This Agreement, including the Exhibits referred to herein
and attached hereto, constitutes and contains the entire understanding between
the parties hereto with respect to the subject matter hereof, supersedes the
Investment and Marketing Agreement dated May 17, 1999, between the parties
(including Exhibit B thereto) to the extent such Agreement (including Exhibit B
thereto) affects the subject matter hereof, and cannot be amended, modified or
waived except in writing signed by the parties hereto.
10. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, but all of which taken together
shall constitute one and the same Agreement.
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11. Indemnification by Xxxxxxxx.xxx. Xxxxxxxx.xxx represents that it has full
authority to enter into this Agreement and to perform its obligations hereunder.
Xxxxxxxx.xxx further represents that it has the right to publish the contents of
any promotions or advertisements provided by Xxxxxxxx.xxx to Staples for
promotion or advertisement hereunder, without infringement of any rights of any
third party. Xxxxxxxx.xxx shall, at its own expense, indemnify, defend and hold
harmless Staples, its employees, representatives, agents and affiliates
(including, without limitation, Xxxxxxx.xxx) from and against any liabilities
resulting from or arising out of any claim, suit, action, or other proceeding
alleging that the content provided by Xxxxxxxx.xxx to Staples hereunder,
including, without limitation, any material, data, or product produced or
provided by Xxxxxxxx.xxx or any material presented on any site on the Internet,
which is material produced, maintained, or published by Xxxxxxxx.xxx, infringes
in any manner any intellectual property right of any third party or contains any
material or information that is unlawful, obscene, defamatory, libelous,
slanderous, or that otherwise violates any rights of any person, including,
without limitation, rights of publicity, privacy or personality, or advertises
an illegal product or service, or has otherwise resulted in any tort, injury,
damage or harm to any person or entity. Xxxxxxxx.xxx will pay any and all costs,
damages, and expenses, including, but not limited to, reasonable attorneys' fees
and costs awarded against or otherwise incurred by Staples in connection with or
arising from any such claim, suit, action or proceeding. It is understood and
agreed that Staples does not intend and will not be required to edit or review
for accuracy or appropriateness the content of any material provided by
Xxxxxxxx.xxx to Staples hereunder. Xxxxxxxx.xxx agrees that is does not have any
right, title or interest, and agrees that it will not claim any, in or to the
name "Staples" or any other names, trademarks, logos or other indicia owned or
controlled by Staples, Inc., its subsidiaries and affiliates (the "Staples
Marks"). Xxxxxxxx.xxx acknowledges that this Agreement does not create or vest
in Xxxxxxxx.xxx any right, title or interest in the Staples Marks. Whenever
Xxxxxxxx.xxx uses any Staples Marks in connection with the promotional
activities, Xxxxxxxx.xxx shall clearly and prominently indicate Staples'
ownership of the Staples Marks in a form designated by Staples. All uses of the
Staples Marks shall inure to the benefit of Staples. This Section 11 shall
survive termination of this Agreement.
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12. Indemnification by Staples. Staples represents that it has full authority to
enter into this Agreement and to perform its obligations hereunder. Staples
further represents that it has the right to publish the contents of any
promotions or advertisements provided by Staples to Xxxxxxxx.xxx for promotion
or advertisement hereunder, without infringement of any rights of any third
party. Staples shall, at its own expense, indemnify, defend and hold harmless
Xxxxxxxx.xxx, its employees, representatives, agents and affiliates, harmless
from and against any liabilities resulting from or arising out of any claim,
suit, action, or other proceeding alleging that the content provided by Staples
to Xxxxxxxx.xxx hereunder, including, without limitation, any material, data, or
product produced or provided by Staples or any material presented on any site on
the Internet, which is material produced, maintained, or published by Staples,
infringes in any manner any intellectual property right of any third party or
contains any material or information that is unlawful, obscene, defamatory,
libelous, slanderous, or that otherwise violates any rights of any person,
including, without limitation, rights of publicity, privacy or personality, or
advertises an illegal product or service, or has otherwise resulted in any tort,
injury, damage or harm to any person or entity. Staples will pay any and all
costs, damages, and expenses, including, but not limited to, reasonable
attorneys' fees and costs awarded against or otherwise incurred by Xxxxxxxx.xxx
in connection with or arising from any such claim, suit, action or proceeding.
It is understood and agreed that Xxxxxxxx.xxx does not intend and will not be
required to edit or review for accuracy or appropriateness the content of any
material provided by Staples to Xxxxxxxx.xxx hereunder. Staples agrees that is
does not have any right, title or interest, and agrees that it will not claim
any, in or to the name "Xxxxxxxx.xxx" or any other names, trademarks, logos or
other indicia owned or controlled by Xxxxxx Interactive Corp., its subsidiaries
and affiliates (the Xxxxxx Marks). Staples acknowledges that this Agreement does
not create or vest in Staples any right, title or interest in the Xxxxxx Marks.
Whenever Staples uses any Xxxxxx Marks in connection with the promotional
activities, Staples shall clearly and prominently indicate Xxxxxxxx.xxx's
ownership of the Xxxxxx Marks in a form designated by Xxxxxxxx.xxx. All uses of
the Xxxxxx Marks shall inure to the benefit of Xxxxxxxx.xxx. This Section 12
shall survive termination of this Agreement.
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13. Default. Either party may be declared in default of the Agreement if
(i) it breaches any material provision hereof and fails,
within thirty (30) days after receipt of notice of default, to
correct such default or to commence corrective action
reasonably acceptable to the other party and proceed with due
diligence to completion; or
(ii) it becomes insolvent, makes an assignment for the benefit
of creditors, a receiver is appointed or a petition for
bankruptcy is filed with respect to it and such proceeding is
not dismissed within sixty (60) days.
In the event of a default by any party as set forth above, the non-defaulting
party may then terminate this Agreement immediately and pursue all other
available remedies. In the event of a termination by Xxxxxxxx.xxx because of a
material breach of Section 3 hereof by Staples in accordance with the provisions
of clause (i) above, then, as its sole and exclusive remedy, Xxxxxxxx.xxx shall
be entitled to recover from Staples liquidated damages in the amount of $2.4
million. The right to receive and the receipt of such liquidated damages shall
in no way limit the rights of Xxxxxxxx.xxx under Section 12 or the right of
Xxxxxxxx.xxx to pursue all available remedies for a breach of any provision of
this Agreement other than a breach of Section 3.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first above written.
XXXXXX INTERACTIVE CORP.:
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
STAPLES, INC.:
By: /s/ Xxxxxx Xxxxxxxx
--------------------------------
Name:
Title:
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Exhibit A.
Marketing Agreement
Xxxxxxxx.xxx Will Perform the Following:
300,000 monthly banners(468 x 60)impressions provided by Staples to be run on
the register Web Site;
One Staples branded permanent and fixed button and up to two (2) lines of text
in the Business Resource section of the register Web Site;
One permanent and fixed Staples branded button on the left-hand tool bar, "below
the fold";
One "opt-out" email opportunity in which new customers will be given the choice
to receive a specific Staple's offer via email. This opt-out opportunity is
currently located for all new users between Steps 3 and 4 of the register Web
Site;
Staples will be included, both text and logo, on the Partners Page of the
register Web Site.
Staples Will Perform the Following:
A Xxxxxxxx.xxx branded permanent and fixed text and graphic link, possibly with
a dialog box (minimum of 88x31) on the home page of Staples Web Site;
A Xxxxxxxx.xxx permanent and fixed text link and graphic link (minimum of 88x31)
along with a dialog box for domain name selection in the business section of
Staples Web Site, with placement to be included above the fold, in a manner no
less prominent than any other company in the Staples Web Site business center;
300,000 monthly banners (154 x 84) impressions provided by xxxxxxxx.xxx and to
be run on Staples Web Site;
Staples will include a promotional offer from xxxxxxxx.xxx in emails to new and
existing customers of Staples, with a minimum delivery to at least 50,000
customers per month;
Staples will include xxxxxxxx.xxx as a strategic partner in mentions of
partnerships in a manner no less prominent than any other strategic partner
wherever Staple's mentions their strategic partnerships;
Staples will give away mousepads with the xxxxxxxx.xxx logo to all new
Xxxxxxx.xxx customers as a part of the standard welcome package. Staples and
xxxxxxxx.xxx will share the expenses resulting from the manufacturing of this
item. Staples will take responsibility for all costs incurred in distributing
this product;
Staples will include a promotional offer from xxxxxxxx.xxx in no less than
250,000 (per quarter) brochures about getting a domain name and starting an
Internet business at least one point of distribution in each Staples store.
Staples will provide Xxxxxxxx.xxx with accurate forecast regarding the number of
brochures required for all of Staples retail locations. This brochure will
feature Xxxxxxxx.xxx's services and be co-branded xxxxxxxx.xxx/xxxxxxx. Staples
will design the brochure utilizing Xxxxxxxx.xxx's content. Staples and
xxxxxxxx.xxx will share the expenses for development and printing costs. In the
event that Staples and Xxxxxxxx.xxx determine it to be appropriate to broaden
the selection of products and services in the brochure to include those of other
vendors, Xxxxxxxx.xxx's share of the costs will be reduced proportionately;
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Staples will include xxxxxxxx.xxx on each Call Center "wait" tape, the tape
Staples' customers hear when they call in to the service Center with questions
and wait for a customer service representative. This message will run in
rotation with other messages no less than two weeks per calendar quarter.
Xxxxxxxx.xxx will provide input into the content of the text for this message;
Staples will produce and distribute the recording;
Staples will include xxxxxxxx.xxx in no less than 250,000 (per quarter) mail
order and in- store catalogues as either a "blow-in" or "onsert". Xxxxxxxx.xxx
will provide creative and cover printing costs; Staples will produce and
distribute materials;
Staples will use reasonable commercial efforts to cross-promote the Xxxxxxxx.xxx
Services with the sale of computer software, including, but not limited to
intent browsers. Xxxxxxxx.xxx will provide the text and logo and cover the
printing expenses; Staples will distribute all materials;
Staples will include xxxxxxxx.xxx in credit card statement or other direct
mailing inserts to its customer base when appropriate. Staples will include
xxxxxxxx.xxx in no less than 300,000 statements or direct mailing inserts per
year. Xxxxxxxx.xxx will provide the text and logo and cover the printing
expenses; Staples will distribute the inserts;
Staples will include xxxxxxxx.xxx in all international expansion efforts when
applicable;
Staples will include a promotional offer from xxxxxxxx.xxx including two (2)
lines of text, a logo (if possible) and a hot link to a co-branded domain name
registration page on 20%
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of all email order confirmations to customers who are buying supplies at Staples
Web Site;
Staples will use reasonable commercial efforts to leverage its buying position
with OEM software suppliers to include Xxxxxxxx.xxx as part of the software
package or in joint promotional activities.
Staples and Xxxxxxxx.xxx will mutually determine and provide for co-promotion of
other parties' services as follows:
Staples and Xxxxxxxx.xxx will use their future and existing marketing
relationships in order to help promote the sale of the other parties products
and services in a commercially reasonable manner.
To the extent that both parties believe that the specific programs listed above
are not performing on a commercially reasonable or acceptable basis both
parities will use commercially reasonable efforts to develop substitute programs
of comparable value. This analysis will be performed on a quarterly basis after
an initial three (3) month period.
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Look and Feel:
All promotional and marketing materials, look, feel and/or user interface or
other content (including without limitation any banner advertising) must be
approved by both parties in writing. In the event either party substantially
changes its look, feel and/or user interface, it will use its reasonable efforts
to provide the other party with substantially similar promotion and
representation as indicated in this Exhibit A; provided that the other party
shall have the right to approve, in its sole discretion, such altered promotion
and representation.
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