WEB SITE DESIGN AND CONSULTING AGREEMENT
Agreement, effective as of June 1, 1999, by and between XXXXX
E-COMMERCE CORP, a Delaware corporation having an address at 0 Xxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000 ("Developer") and DIPLOMAT DIRECT MARKETING CORPORATION, a
Delaware corporation having an address at 000 Xxxxxx Xxxxxx, Xxxxxxx, XX 00000
("Client"), regarding Client's interest in securing the services of Developer
to design, develop, test, implement, launch and service a World Wide Web Site
which will be owned by Client and to provide various additional consulting and
other services after the site is successfully launched (the "Project").
The parties hereby agree as follows:
1. The Site. Client is planning to launch a new World Wide Web Site
tentatively entitled "_______" in conjunction and with the cooperation of
Developer as the initial hosting company (with the hosting company being
identified as the "Collaborator") and which will be devoted, at least
initially, to issues related to the women's apparel and accessories industry
and infants' apparel and accessories industry, and the Client's products and
services, including but not limited to women's apparel and accessories,
infants' apparel and accessories, and other materials and services
manufactured and/or distributed, or otherwise provided, by the Client (the
"Site"). The Site, as presently contemplated, will consist of the initial
components set forth in Exhibit A (the "Site Components"). The Site
Components, as well as the contents therein and all aspects whatsoever of the
Site, may change as the Site is designed and developed, and, thereafter from
time to time as specified by Client (subject to Developer's right to terminate
this Agreement under Paragraph 9.1). All aspects of the Site shall be subject
to Client's approval, in its reasonable discretion. As between Developer and
Client, Client shall be solely responsible for the editorial content of the
Site.
2. Developer's Services. Developer confirms that it is experienced in the
custom design, development, launch and delivery of web sites and agrees to
provide the following services for the Site, all subject to Client's approval:
a) The Site and Launch Module. During Phase I of the Project, the
Developer shall design, develop, test, implement and launch the overall Site
structure and programming and shall develop the Site Components, both for the
initial version of the Site to be launched (the "Launch Module") and so as to
accommodate Additional Modules (see Paragraph 2(b) below). During Phase I of
the Project Developer shall deliver to Client's reasonable satisfaction all
materials, information, software, source code, documentation, guides, manuals
and similar material as are necessary for Client to maintain, update, edit,
modify, terminate, redesign and otherwise operate and service the Site.
Developer shall be
responsible for the design, structure and implementation of all aspects of the
Site to Client's reasonable satisfaction (other than the gathering and
delivery to Developer of editorial content therefor, which shall be the
responsibility of Client). As part of Developer's services required hereunder,
but not in limitation thereof, Developer shall:
(i) work and confer with Client throughout the design process to
ascertain both Client and Collaborator's design needs and requirements for the
Site;
(ii) design the look, operation, and programming of the Site,
including, without limitation, the functional specifications, user interface
and user interface specifications, technical design specifications, search and
retrieval software and graphic elements of the Site design (such as layout,
typeface, illustrations and photographs), both to accommodate Client's current
needs and so as to accommodate modifications and additions thereto as the Site
expands and changes;
(iii) develop and deliver necessary HTML programming;
(iv) incorporate Client Content (as hereinafter defined in Paragraph
3.1) for the launch;
(v) transfer Site files to Client's server;
(vi) fully test (and correct where needed) the Site and all Site
Components and aspects (conduct a soft launch - a Beta test in the staging
area) to Client's reasonable satisfaction;
(vii) launch the Site;
(viii) provide Client with all technical and design documents as well
as a troubleshooting guide needed to ensure that Client can with ease
maintain, update, modify, edit, cancel and otherwise operate the Site;
b) Additional Modules. At Client's request from time to time during
the Development Term (as defined in Paragraph 5), as Phase II of the Project
Developer agrees, if requested, to design, develop, implement, test and launch
Additional Modules subject to the fee schedule contained on Exhibit B, but
only to the extent that the requests are made in accordance with the Schedule
annexed hereto as Exhibit B (the "Schedule"). Additional Modules may update
and expand the entire Site, but also may include new material for the original
Launch Module.
c) Delivery. Developer agrees to submit to Client for its approval,
and in accordance with the Schedule, all of the Phase I Deliverables set forth
in Exhibit C and all of the Phase II Deliverables for each Additional Module
requested in
-2-
accordance with the conditions of Paragraph 2(b) above (collectively, the
"Deliverables," and each separate item a "Deliverable"). Upon receipt, Client
shall promptly review and determine whether each such Deliverable materially
satisfies the acceptance criteria set forth in Exhibit C (as supplemented for
the acceptance criteria with respect to any Additional Modules). Client shall
give Developer prompt written notice if Client determines that a Deliverable
does not materially satisfy the acceptance criteria, and such notice shall in
detail set forth the deficiencies found in the Deliverables by Client.
Developer shall, at no cost to Client, promptly correct any such deficiencies.
Upon completion of the corrective action by Developer, Client will reconsider
acceptance of the Deliverable. If the Deliverable still does not materially
satisfy the acceptance criteria within thirty (30) days of Client 's notice of
disapproval, and the end of such period is beyond the specific dates for
Deliverable delivery in the Schedule (as it may be supplemented), Client may:
(i) terminate this Agreement in accordance with Paragraph 9; or (ii) require
Developer to continue to attempt to correct the deficiencies, reserving the
right to terminate in accordance with Paragraph 9. It is understood that
Client may be obligated to obtain the approval also of Collaborator.
d) Ongoing Consultation. Developer agrees to consult, strategize and
coordinate with Client and, if requested by Client, with Collaborator,
throughout the provision of Developer's services hereunder to ensure Client's
reasonable satisfaction with and reasonable approval of each aspect of the
Site.
e) Maintenance, and Ongoing Service.
(i) If requested by Client, and for consideration to Developer as
specified on Exhibit D, Developer agrees to provide, at its sole cost and
expense, all maintenance required to correct defects, bugs, viruses, design
flaws and similar inherent problems in the Site, during the Development Term
and for a period of one year thereafter (the "Maintenance Term"); provided,
that the Developer is not obligated to provide additional maintenance services
requested by Client during periods beyond the Maintenance Term, without its
specific written approval, which approval may be withheld in Developer's full
discretion; and further provided, that the Developer shall at no time be
obligated to provide such maintenance services in the event that such services
are required due to Client's modification or editing of the Site without
Developer's written approval thereof, Client's destruction of the Site, or
Client's license of the Site for use and/or operation by any other person
without Developer's prior written consent.
(ii) In addition, but only during the Development Term, Developer
agrees to provide other specified design, maintenance and other services
requested by Client, at the fees set forth on Exhibit D; provided, that
Developer shall have the ability to reject such requests(s) based upon
Developer's reasonable determination of Client's inability to pay timely for
such services.
-3-
3. Client Provided Content.
3.1. Client shall be responsible for obtaining all licenses,
sublicenses, assignments, permissions, waivers or other rights or clearances
necessary for Developer 's incorporation of any content provided by Client
("Client Content") into the Deliverables. Client shall deliver one (1) copy of
each item of Client Content to be provided by Client to be incorporate into a
Deliverable. Client shall provide to Developer as part of that copy all
credits and/or attributions which must be included in the Deliverable.
Developer shall use each item of Client Content provided by Client only in
conjunction with the Deliverable for which it was provided.
3.2. In the event that Client does not obtain the licenses,
sublicenses, assignments, permissions, waivers or other rights or clearances
necessary to use particular materials as Client Content in a Deliverable,
Developer shall not be obligated to incorporate such materials into the
Deliverable.
4. Rights in Deliverable.
4.1. Developer acknowledges that Client shall retain all title to and
all rights in any intellectual property provided by Client to Developer under
this Agreement.
4.2. The original content component of the Deliverables produced by
Developer shall be considered to be works made for hire for all purposes,
including for purposes of interpretation under the U.S. Copyright Law, 17
U.S.C. ss.101 et seq. To the extent that such Deliverables are not construed
to be works made for hire, Developer shall, and hereby does, perpetually, and
without further consideration, assign all right, title and interest to such
Deliverables to Client. All right, title and interest in the original content
component of the Deliverables produced by Developer, including any copyright
or other proprietary right in the Deliverables, shall be the sole property of
Client. Notwithstanding the foregoing, except as provided in Section 4.3,
nothing herein should be construed to vest ownership of any right, title or
interest to any computer software component ("Software") of a Deliverable
under this Agreement.
4.3. Developer, or its licensors, shall retain all right, title and
interest to Software. Developer hereby grants, which Developer represents it
has full right, power and authority to grant, to Client a perpetual,
worldwide, royalty-free license, or sublicense, to duplicate, exhibit,
perform, transmit, broadcast, distribute, maintain and modify Software,
provided that such Software is only used by Client in accordance with this
Paragraph 4.3 in connection with substantially all of the content component of
the Deliverables provided by Developer to Client for use in connection with
the Site.
-4-
4.4. Developer agrees to execute and deliver any documents and take
all such other actions as may be necessary or desirable in order to carry into
effect the provisions of this Paragraph 4, including, without limitation, the
execution of assignments, copyright registrations and patent applications.
5. Term. The term of this Agreement during which period Developer shall be
obligated to provide to Client the services described in Paragraph 2
(collectively, the "Developer Services") shall extend for a period of twelve
(12) months from the date of this Agreement (the "Development Term"). The
parties may extend the Development Term of this Agreement by mutual written
agreement.
6. Reserved.
7. Client's Services and Deliverables. Client shall be responsible for
a) obtaining and securing a domain name and address for the Site;
b) preparing, gathering and/or writing all Client Content (including
illustrations, photographs, charts, graphs and similar information and
material to accompany the editorial content) to be included in the Site,
including all licenses, etc., as referenced in Paragraph 3 of this Agreement;
c) delivering to Developer fully edited editorial content in a
mutually agreed upon digital format;
d) housing the Site on Client's server; and
e) coordinating with Collaborator on all aspects of the Site
development, design and operation.
8. The Schedule. In order to meet the Client's requirements for the Project,
Client and Developer have together developed the Schedule. Developer shall
provide all of its services under this Agreement in accordance with the
Schedule, unless Client and Developer agree otherwise. No changes may be made
in the Schedule without the written consent of Client and Developer.
9. Termination.
9.1.
a) Client may terminate upon ten (10) days' prior written notice this
Agreement in the event (i) Client has rejected any Deliverable in accordance
with the provisions of Paragraph 2(c) and Developer has failed to correct the
deficiencies during the specified time period, (ii) Developer fails to meet
any deadline in the Schedule (following a 15-day cure period), or (iii)
Developer
-5-
otherwise materially breaches any of its obligations, representations or
warranties under this Agreement.
b) Developer may terminate this Agreement upon ten (10) days' prior
written notice in the event that (i) Client fails to pay to Developer when
due, after three (3) days' prior notice of such failure to pay, the
compensation amounts required to be paid pursuant to Paragraph 12 and Schedule
D, (ii) Client materially changes the parameters for development of the Site
or the Site Components, (iii) Collaborator, other than Developer, unreasonably
withholds its approval of Developer's work product under this Agreement to the
extent its approval is necessary to launch the Site (if the initial
collaborator is other than Developer) or augment or maintain the Site, or (iv)
Client otherwise materially breaches any of its obligations, representations
or warranties under this Agreement.
9.2. Either party may terminate this Agreement, effective immediately
upon written notice if: (i) all or a substantial portion of the assets of the
other party are transferred to an assignee for the benefit of creditors or to
a receiver or to a trustee in bankruptcy; (ii) a proceeding is commenced by or
against the other party for relief under bankruptcy or similar laws and such
proceeding is not dismissed within sixty (60) days; or (iii) the other party
is adjudged bankrupt or insolvent. Termination of this Agreement shall not
relieve either party of any obligation accrued prior to the termination date.
9.3. In the event Developer terminates this Agreement other than in
accordance with Paragraph 9.1(b) or Client terminates this Agreement in
accordance with Paragraph 9.1(a), then Client shall have no obligation to pay
any amounts owing under Paragraph 12, except for fees under Paragraph 12(a)
incurred prior to termination and the Royalties (as herein after defined) as
provided under Paragraph 12(b).
9.4. In the event Developer terminates this Agreement in accordance
with Paragraph 9.1(b) or Client terminates this Agreement other than in
accordance with Paragraph 9.1(a), then Client shall be obligated to pay (i)
the amounts owing under Paragraph 12(a) incurred prior to the date of
termination, (ii) in the event that such termination occurs prior to the
Developer's receipt from Client of aggregate Royalties of $500,000 Client
shall continue to be obligated to pay to Developer in cash (U.S. Dollars),
within thirty (30) days of the date of termination of this Agreement, the
difference between $500,000 and the aggregate amount of Royalties delivered to
Developer prior to the date of termination of this Agreement (which amount
shall be credited as the payment of Royalties for purposes of Paragraph
12(b)), and (iii) the Royalties owing under Paragraph 12(c).
9.5. Termination of this Agreement shall not limit either party from
pursuing any remedies available to it for any breach of this Agreement. All
obligations of
-6-
either party set forth in Paragraphs 4,9,12,16 and 17 of this Agreement shall
survive termination of this Agreement.
10. Credit. Provided Developer fully performs its obligations hereunder,
Developer shall be entitled to receive the following credit in the Site, the
size and placement of which shall be mutually determined by Client and
Developer:
"----------------------"
11. Ownership. Client shall own the Site and all aspects thereof, except as
set forth in Paragraphs 3 and 4. Client shall have the right to modify, edit,
destroy, license, exploit or use the Site in any way, without compensation or
consultation with Developer, subject to the provisions of Paragraph 2(e).
12. Consideration. In recognition and acknowledgment of the market consulting
and e-commerce content services previously provided by Client to Developer,
for which services Developer has previously advanced $500,000 to Client, in
full consideration for all of Developer's services and Deliverables provided
hereunder for Phase I and Phase II through and including launch of Site and
completion and launch of the scheduled Additional Modules pursuant to
Paragraph 2(b), if any, and the Schedule, Client shall compensate Developer as
follows:
a) Developer shall receive the related fees and other compensation as
set forth on Exhibit D; and
b) Developer shall receive royalties (the "Royalties") based upon
sales (whether direct or indirect), fees, licenses, royalties, consulting, or
any other forms of revenue or compensation which are derived, directly or
indirectly, from electronic commerce [(which includes but is not limited to
commercial transactions which are in any way solicited, or initiated, or
conducted, or concluded, or otherwise consummated (subject to subsequent
delivery or transfer of the subject matter of the transactions) through use of
Worldwide Web Sites or otherwise through use of the Internet], with the
exception only of revenue or compensation generated under written agreements
entered into with Xxxxxxxxxxx.xxx, Inc. and Catalog City (the "Royalty
Activities"), which Royalties shall equal 5% of all quarterly revenues, net of
returned merchandise, generated by Client and its consolidated subsidiaries,
as determined under generally accepted accounting principles ("GAAP"),
consistently applied for purposes of Client's financial reporting obligations
with the Securities and Exchange Commission (the "SEC") from Royalty
Activities (which for purposes of this subparagraph, 12(b) only shall also
include revenue and compensation generated under written agreements entered
into with Xxxxxxxxxxx.xxx, Inc. and Catalog City), until Developer has
received Royalties in cash the aggregate amount of which equals $500,000. The
amount of Royalties for which Client is obligated to pay Developer under the
terms
-7-
of this Subparagraph 12(b) shall be paid to Developer within forty-five days
following the last day of each fiscal quarter of client, commencing with the
quarter ended June 30.
c) Client shall pay to Developer annually, not later than the Payment
Date (as defined herein), Royalties equal to twenty percent (20%) of Net EBIT
(as defined herein) generated by Client and its consolidated subsidiaries,
from Royalty Activities, in perpetuity, as provided herein. The period during
which Developer shall receive Royalties equal to twenty percent (20%) of Net
EBIT shall commence after Developer receives $500,000 from Client as provided
in subparagraph 12(b) above. For purposes of Paragraph 12(c), all as
determined under GAAP consistently applied by the Client's regular auditor for
purposes of Client's financial reporting obligations with the SEC, the
capitalized terms shall have the following meanings:
"Net EBIT" shall mean the amount, but not below zero, equal to EBIT
for the applicable fiscal year less the amount, if any, in the Offset Account.
"EBIT" shall mean revenues, net of returned merchandise, generated by
Client and its consolidated subsidiaries from Royalty Activities, less the sum
of:
(i) all direct expenses incurred in the Royalty Activities,
including, without limitation, cost of goods sold, costs of maintaining the
Site and any other Royalty Activities - related world wide web sites developed
by the Client or its consolidated subsidiaries, but excluding interest,
amortization and income taxes allocable to the Royalty Activities;
(ii) all variable indirect expenses of Client and its consolidated
subsidiaries allocable to the Royalty Activities (consistent with Client's
normal accounting procedures and practice, as such practices and procedures
may be amended from time to time), including, without limitation, costs of
order-entry, distribution and fulfillment, allocated based on the ratio of net
revenue of the Royalty Activities to net aggregate revenue of the Client and
consolidated subsidiaries; and
(iii) all fixed indirect expenses of Client and its consolidated
subsidiaries allocable to the Royalty Activities (consistent with Client's
normal accounting procedures and practice, as such practices and procedures
may be amended from time to time), including, without limitation, catalog
production and mailing costs, merchandising and marketing costs, allocated in
accordance with GAAP and Client's consistently applied reasonable allocation
procedures, as such procedures may be amended from time to time in accordance
with GAAP;
-8-
(iv) with the calculation of EBIT, and each component thereof, being
all as determined under GAAP consistently applied by Client's regular auditor
for purposes of Client's financial reporting obligations with the SEC.
"Offset Account" shall mean the amount equal to, but not below zero,
of the aggregate negative EBIT for all periods, reduced by any EBIT.
"Payment Debt" shall mean the 105th day after the last day of the
Client's fiscal year for purposes of Client's financial reporting obligations
with the SEC.
d) The obligation to pay Royalties to Developer, except by operation
of law, shall not be assignable by Client to any person without the written
consent of Developer, which consent may be withheld in Developer's full
discretion; and provided, further, that at the option of Developer, in the
event of the sale, conveyance or disposition of all or substantially all of
the assets of Client, the effectuation by the Client of a transaction or
series of related transactions in which more than 50% of the voting power of
the Client is disposed of, for the consolidation, merger or other business
combination of the Client with or into any other Person (as defined below) or
Persons when the Client is not the survivor, the Developer may terminate this
Agreement on ten (10) days' written notice and Client shall be required to
distribute, upon consummation of and as a condition to any such transaction(s)
an amount equal to the difference between $750,000 and the aggregate amount of
Royalties previously distributed to Developer (which amount shall be credited
as the payment of Royalties for purposes of this Paragraph 12). "Person" shall
-9-
mean any individual, corporation, limited liability company, partnership,
association, trust or other entity or organization.
e) Along with any payment of Royalties made under this Agreement,
Client shall provide to Developer a written statement showing the detailed
formula for and the calculation of such Royalties (the "Statement"), which
Statement shall be certified by the Client's Chief Financial Officer or
regular auditors that made the related calculation of Royalties. In the event
that Developer disputes the amount of any payment of Royalties made by Client
under the terms of this Agreement, Client and its Chief Financial Officer or
auditors shall promptly submit such documentation for review by Developer and
its representatives as shall be reasonably requested by Developer within five
business (5) days following written request being given by Developer therefor.
In the event that Developer and Client fail to agree upon the amount of the
related Royalties payment within twenty-one (21) days following Developer's
receipt of the Statement, Developer shall be entitled to submit, but not later
than 90 days following Developer's receipt of the Statement, such dispute to
arbitration by the American Arbitration Association ("AAA"), through the
adjudication by a single arbitrator, in New York, New York, with the decision
of such arbitrator to be final and binding upon all parties. The fees, costs
and expenses of such arbitration, as submitted by the AAA, shall be borne
equally by both Client and Developer; provided, that each of Client and
Developer shall pay the fees, costs and expenses of its own counsel,
accountants and other representatives in connection with such arbitration. The
parameters of the AAA proceedings undertaken in accordance with this
subparagraph 12(f) shall be prescribed such that a decision shall be rendered
within sixty (60) days following the initial written reference of the related
dispute to AAA arbitration by Developer. All disputes with respect to the
amount of any Royalties payment under the terms of this Agreement shall be
resolved by arbitration in accordance with this subparagraph 12(f).
13. No Obligation to Publish. Nothing in this Agreement shall obligate Client
to launch, publish or continue to publish the Site; provided, that in the
event that Client (i) fails to launch the Site on or before September 1, 1999,
or (ii) fails to continue to publish the site for a period of at least five
(5) years from the date hereof (the "Publication Period"), and at all times
during the Publication Period Client does not use its best efforts to generate
significant revenue from use of the Site, or otherwise from electronic
commerce generally, then within thirty (30) days following its receipt of
written notice from Developer of a breach by Client of either subprovision (i)
or (ii), Client shall be obligated to pay to Developer the difference between
$500,000 and the aggregate amount of Royalties previously distributed to
Developer (which amount shall be credited as the payment of Royalties for
purposes of Paragraph 12) within thirty (30) days of written notification
therefor given to Client by Developer.
-10-
14. Representations and Warranties.
14.1. Developer represents and warrants to Client that: (i) Developer
has the full right, power and authority to enter into and to fully perform
this Agreement; (ii) the design of the Site and all design and programming
aspects of the Site as delivered by Developer shall be original and shall be
owned by Client as work for hire or by transfer of all rights, including the
copyright thereto; (iii) neither the design nor programming of the Site, nor
any other material or facet added to the Site by Developer (other than Client
Content supplied by Client) contains any libelous material or any material
which constitutes an invasion of privacy or publicity, or infringes any
trademark, copyright, patent, trade secret, or other intellectual property
right; and (iv) the Site as delivered by Developer shall be free of "bugs,"
viruses, defects or design flaws.
14.2. Client represents and warrants to Developer that: (i) Client
has the full right, power and authority to enter into and to fully perform
this Agreement; (ii) to the extent that Client is required to obtain rights,
permissions and credit and/or attribution information with respect to the
Client Content, Client will do so accurately and completely; and (iii) the
Client Content provided by Client will not contain any libelous material or
any material which constitutes an invasion of any right of privacy or
publicity, or infringes upon any trademark, copyright, patent, trade secret or
other intellectual property right.
14.3. No party shall in any circumstances be liable to the other
party or any other party for any loss of business or profits, or any other
indirect, consequential, incidental, punitive or similar damages arising from
the breach of this Agreement, even if it has been advised of the possibility
of such damages.
14.4. THE WARRANTIES STATED HEREIN ARE LIMITED WARRANTIES AND THE
ONLY WARRANTIES MADE BY THE PARTIES. THE PARTIES WAIVE ALL OTHER WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
15. Indemnification.
15.1. During the Term of this Agreement and for one (1) year
thereafter, Developer shall indemnify and hold Client harmless from and
against any and all claims, demands, actions, losses, liabilities, damages,
costs and expenses (including, but not limited to, reasonable attorneys' fees)
arising out of or resulting from Developer 's material breach of Paragraph
14.1 of this Agreement, provided that Client (i) notifies Developer promptly
of any written claims or demands against Client, (ii) gives Developer the
opportunity to defend or settle any such claim at Developer 's expense, and
(iii) cooperates with Developer , at Developer 's expense, in defending or
settling such claim.
-11-
15.2. During the Development Term of this Agreement and for one (1)
year thereafter, Client shall indemnify and hold Developer harmless from and
against any and all claims, demands, actions, losses, liabilities, damages,
costs and expenses (including, but not limited to, reasonable attorneys' fees)
arising out of or resulting from Client's material breach of Paragraph 14.2 of
this Agreement, provided that Developer (i) notifies Client promptly of any
written claims or demands against Developer , (ii) gives Client the
opportunity to defend or settle any such claim at Client's expense, and (iii)
cooperates with Client, at Client's expense, in defending or settling such
claim.
16. Confidentiality.
16.1. Each party shall retain in confidence and shall not, without
the prior written consent of the other party (the "Disclosing Party"),
disclose in any manner or use, except under the terms and prior to the
termination of this Agreement, any materials disclosed to a party (the
"Receiving Party") by the Disclosing Party and either marked at the time of
disclosure as being confidential or identified in writing by the Disclosing
Party within thirty (30) days of disclosure to the Receiving Party as being
confidential ("Confidential Information"); provided, that if the receiving
Party is compelled by law (whether through court order or subpoena) to
disclose such Confidential Information, the Receiving Party shall provide the
Disclosing Party with prompt notice of such compelled disclosure.
16.2. This Paragraph 16 shall impose no obligation upon the Receiving
Party with respect to any Confidential Information: (i) in the public domain
at the time received by Receiving Party; (ii) which enters the public domain
other than by breach of the Receiving Party's obligations hereunder; (iii)
known to the Receiving Party prior to receipt from the Disclosing Party; (iv)
received by Receiving Party from a third party if such third party has the
right to make such disclosure; or (v) independently developed by the Receiving
Party without access to Confidential Information.
16.3. Upon the Disclosing Party's request or termination of this
Agreement, the Receiving Party will, at its election, either promptly deliver
to the Disclosing Party or destroy all Confidential Information in every form
in the Receiving Party's possession.
-12-
17. General.
17.1. The relationship between the parties shall be that of
independent contractors. Nothing in this Agreement shall create, or be deemed
to imply the creation of, any partnership, joint venture or other
relationship. Neither party shall have the authority to incur any obligation,
contractual or otherwise, in the name or on behalf of the other party. Each
party shall bear its own costs and expenses in connection with performance of
this Agreement.
17.2. This Agreement and any exhibits or appendices hereto constitute
the entire agreement between the parties with respect to the subject matter
hereof and supersede all prior and contemporaneous communications. Neither
this Agreement nor any exhibits or appendices hereto shall be modified except
by a written agreement dated subsequent to the date of this Agreement and
signed on behalf of the parties by their respective duly authorized
representatives.
17.3. If this Agreement shall be terminated or held by a court of
competent jurisdiction to be invalid, illegal or unenforceable as to
particular provisions, this Agreement shall remain in full force and effect as
to the remaining provisions.
17.4. No waiver of any breach of any provisions of this Agreement
shall constitute a waiver of any prior, concurrent or subsequent breach of the
same or any other provisions hereof or thereof, and no waiver shall be
effective unless made in writing and signed by the duly authorized
representative of the party to be charged.
17.5. All notices that Developer or Client may give to the other
pursuant to this Agreement shall be in writing and shall be hand delivered or
sent by registered or certified mail postage prepaid, return receipt
requested, by facsimile (with confirmation back), or by overnight courier
service, postage prepaid, to the parties at the addresses provided above or to
such other address or as either party shall designate by written notice given
in accordance with this Section, with notice being deemed given five days'
after being deposited with the United States mail, upon hand delivery, upon
receipt of confirmation back that a facsimile was received and one day after
deliver to a nationally recognized overnight courier service (if so deposited
or delivered as described above).
17.6. This Agreement shall be binding on Developer and Client and the
respective successors and permitted assigns of each party. Except as permitted
in this Agreement, no party may assign any of its rights or delegate any of
its obligations under this Agreement to any third party without the express
written consent of the other party, which consent may be withheld in either
party's sole discretion.
-13-
17.7. This Agreement between Developer and Client is not exclusive
and the parties are free to engage in other relationships of a similar nature
with other parties.
17.8. Client hereby grants Developer its permission to (i) disclose
to potential customers of Developer that Client is a customer of Developer ,
and (ii) duplicate, exhibit, perform, transmit, broadcast and distribute
Deliverables to potential customers of Developer for purposes of publicizing
Developer's services.
17.9. This Agreement shall be governed and construed in accordance
with the internal substantive laws of the State of New York without regard to
its conflicts of laws principles.
17.10. The section headings contained in this Agreement are for
purposes of convenience and reference only and shall not affect in any way the
meaning or interpretation of this Agreement.
17.11. Neither party shall be in material breach if failure to
perform any obligation hereunder is caused solely by supervening conditions
beyond that party's control, including acts of God, civil commotions, strikes,
labor disputes and governmental demands or requirements.
17.12. This Agreement may be executed in counterparts which, when
taken together, shall constitute one and the same instrument.
-14-
IN WITNESS WHEREOF, the parties hereto, each acting with proper
authority, have executed this Agreement under seal as of the 27TH day of July,
1999.
XXXXX E-COMMERCE CORP. DIPLOMAT DIRECT MARKETING CORPORATION
By: /s/ XXXXX XXXXXXXXXX By: /s/ XXXXXX X. XXXXXX
---------------------------- ----------------------------
Xxxxx Xxxxxxxxxx, President Xxxxxx X. Xxxxxx, President
-15-
