EXHIBIT 10.26
ONLINE PARTNER AGREEMENT Xxxxxxxx.xxx, Inc.
1. CDU Positioning on US-Style
US-Style will be an online mall featuring select U.S. online retailers. The
US-Style site itself will be completely in Japanese and features both
navigational and support tools. The site uses a "frame solution" so that
the CDU Japanese site will be viewable within the US-Style frame yet fully
under CDU's control.
The focus of US-Style is currently on the Japanese market, however, in the
future, as an introduction of US-Style is deemed appropriate for other
Asian markets, US-Style reserves the right of first refusal from CDU
(assuming this Agreement is in effect, see 8. Agreement Term) to handle
those markets including (but not limited to, China, Hong Kong, Singapore,
Korea, and Taiwan).
2. Linking
As part of the US-Style online mall concept, US-Style agrees to display the
CDU name and logo prominently on the US-Style site (xxx.xx-xxxxx.xxx) as
well as link directly to the Japanese version of the CDU site. CDU agrees
to incorporate a link and graphical element from its home page
(xxx.xxxxxxxxxx.xxx) to the Japanese version of its site. Further, CDU
agrees to include a script linking the Japanese version of CDU to
xxx.xx-xxxxx.xxx. Both parties agree to maintain integrity and structure of
these links. US-Style will furnish CDU with scripts, text and graphical
elements for these purposes (see 4. Japanization of CDU Site).
3. Japanese Internet Promotion of US-Style
The success of US-Style depends greatly on its ability to achieve high-end
promotion in Japan. US-Style is currently in negotiations with Yahoo!Japan,
to have US-Style promoted throughout xxx.xxxxx.xx.xx and, ultimately, in
Yahoo!Japan's soon-to-be-launched Shopping Property. There can be no
assurance that US-Style will reach an agreement on acceptable terms with
Yahoo!Japan, through US-Style knows of no reason why such an agreement will
not be reached. In the event that the Yahoo!Japan promotion does not occur,
US-Style will pursue in good faith other promotional initiative including
agreements with 'Goo' search engine, AOL Japan and other large sites in
Japan.
4. Japanization of CDU Site
US-Style will provide Japanization and translation for 1) CDU's home page,
2) information page--including customer service and shopping policies,
company background and history, 3) shopping basket and check-out, and 4)
Navigational tools (e.g., buttons for site navigation and purchase). As
more fully set forth in Exhibit A (see I. Partner Guidelines, A. Web Site
and Web Server), these changes will be integrated into CDU's existing site
and back-end. Additional site Japanization is possible but falls outside
the parameters of this proposal and can be preformed by US-Style under
separate agreement.
5. Japanese/English Customer Support Emails
US-Style will provide Japanese-language email customer support for all
Japanese shoppers who shop on the Japanese version of CDU (as described
above under "4. Japanization of CDU site"). Phone-based customer support is
not covered by this proposal.
Customer support emails are broken down into two main groups-A) those from
the online retail partner (i.e., CDU) to the Japanese customer (a.k.a.,
"partner-originated emails") and B) email inquiries from the Japanese
customer to the online partner (a.k.a., "customer-originated emails").
In regard to "partner-originated emails", these are the automated emails
sent to customers, typically at the time of purchase, order confirmation,
order delivery, etc. US-Style will Japanize each automated
"partner-originated email" and deliver the appropriate email to the
Japanese customer. In executing the delivery of such messages, it is
necessary for CDU to send all customer communication to US-Style where the
emails will be translated into Japanese and then forwarded to the customer.
This process is triggered instantaneously so that the customer will not
experience a delay in receiving the email. As set forth in this Agreement,
US-Style will support up to 15 different automated "partner-originated
emails" (i.e., "thank you for your order", "your order has been shipped",
etc.) per year for CDU. Additional automated "partner-originated emails"
will incur additional expense.
In regard to "customer-originated email", these are the customer specific
inquiries ("case-by-case") which comes from the Japanese customer to the
online partner. "Case-by-case" emails are received by US-Style, translated
immediately upon receipt and then forwarded to CUD's customer support
operations. The response (in English) is then translated into Japanese and
forwarded to the customer. US-Style operates translation facilities to
coincide with Japan's peak online shopping hours.
Given the variable causes that might affect the volume of "customer-
originated case-by-case emails", the manner in which these emails are
handled will be evaluated at the end of the first six months of CDU's
presence on the US-Style site. At that time, the handling process may be
adjusted to utilize more automated processes (such as US-Style access to
CDU database for immediate information regarding a Japanese customer's
specific question, or US-Style's recommendation for an increase or change
in the level of Japanization on the CDU site). Any such changes must be
agreed upon mutually by CDU and US-Style in writing.
Likewise, under the terms of this proposal, only automated "partner-
initiated" emails to Japanese customers are covered. In the case of a
partner error or mishap, US-Style (as part of this proposal) will work with
the partner in developing and automated email notification to handle the
situation--such emails contribute to the 15 "automated partner-originated
email" limit above.
Lastly, in the case of "customer-originated" emails regarding orders placed
on the English-version of CDU, US-Style will redirect the inquiry to a CDU
English-speaking support staff.
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6. Customer Tracking
US-Style will provide a log of all Japanese shoppers who buy from the
online partner site.
7. Online Partner Guidelines
Please reference Exhibit A. attached.
8. Agreement Term
Subject to section 14, this agreement is for the duration or one year--
beginning on the date of US-Style's launch and terminating on the one-year
anniversary. CDU shall have an option of renewal in one-year terms,
exercisable with 30 days notice to US-Style.
9. Notification of content changes
CDU agrees to inform US-Style of changes to customer service and
fulfillment policies and other major changes in advance so as to allow
sufficient time for US-Style to maintain the accuracy of CDU's Japanese
pages. Further, US-Style must receive advanced notice about the
introduction of new scripts and added features affecting the Japanese
functionality of the CDU site.
10. Date of Launch
US-Style is scheduled to launch in December 1998. A firm date has not been
set but will be announced as soon as possible.
11. Fee Structure
CDU will pay US-Style an amount equal to 10% of all sales of CD's through
CDU's Japanese site. Also, CDU will pay US-Style an amount equal to 15% of
all sales of Video's through CDU's Japanese site. Lastly, CDU will pay
US-Style an amount equal to 15% of all sales of accessories through CDU's
Japanese site. The commission on new merchandise areas will be determined
at the time of their offering. As described in "2. Linking", the two points
of entry to the CDU Japanese site will be (1) xxx.xx-xxxxx.xxx and
(2) xxx.xxxxxxxxxx.xxx
The percentage of sales fee will be on the total amount of purchases minus
shipping, taxes or any other non-product charges. The sales-percentage fee
is in exchange for the services described herein.
12. Payment
The commission to US-Style will be paid monthly. Net 15 days, CDU will send
US-Style a check for the commissions earned on products that were shipped
during that month, less any taxed withheld as may be required by law. If
the monthly check is projected to exceed $10,000, then CDU will pay
US-Style twice per month. Payments of less than $100 may be withheld until
the total accrued amount exceeds $100.
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13. Modifications
No change, amendment or other modification of this Agreement, including the
Commission Schedule, shall be valid unless set forth in a written
instrument signed by both parties.
14. Termination
This Agreement will be in effect for the amount of time as described above
(see 8. Agreement Term). Giving at least 60 days prior notices, CDU may
terminate the relationship prior to this date if US-Style does not fulfill
in all material respects its obligations as described in this agreement.
Likewise, giving at least 60 days notice, US-Style may terminate the
relation ship prior to this date if the online partner dose not fulfill in
all material respects its obligations as described above (see 7. Online
Partner Guidelines 11. Fee Structure and 12. Payment)
If CDU chooses to terminate the Agreement for reasons other than described
above, CDU will be required to pay US-Style the total direct and indirect
expenses associated with the promotion, Japanization and customer support
of the online partner's shopping site. This payment is not exceed $15,000.
All copies of images, scripts and any other content created by US-Style for
CDU for the purposes described in this contract shall be returned to
US-Style as these remain the property of US-Style and may only be used by
CDU while this Agreement is in effect.
15. Limited License
Both parties grant each other nonexclusive, revocable rights to use each
other's icons and messages as well as any other proprietary, trademarked of
copyrighted material to use solely for the purposes covered by this
Agreement and as otherwise needed to assist in generating sales and
customer satisfaction. US-Style is granted permission to modify CDU's
icons, messages, other images, and scripts only insofar as is required for
Japanization purposes described in this Agreement. Both parties reserve all
of our rights in the icons, messages, and any other images, scripts, trade
names, and trademarks, and all other intellectual property rights. Either
party may revoke the above license by giving notice as stipulated in 14.
Partnership Termination.
16. Relationship of Parties
US-Style and CDU are independent legal entities, and nothing in this
Agreement will create any actual or constructive partnership, joint venture
agency, franchise, sales representation or other relationship between the
parties. Neither party has any authority to make or accept any offers of
representations on either party's behalf. Neither party to this Agreement
will make statements that reasonably would contradict anything in this
Section 16.
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17. Limitation of Liability
Neither party will be liable for indirect, special or consequential damages
(or loss of revenue, profits, of date) arising in connection with this
Agreement, even if either party has advised the other of the possibility of
such damages. Further, any aggregate liability arising with respect to this
Online Partnership will not exceed the total commission payable under this
Online Partnership.
18. Disclaimers
Neither Party makes any express or implied warranties or representations
with respect to the Agreement or any products sold through the Online
Partnership (including, without limitation, warranties of fitment,
merchantability, non-infringement, or any implied warranties arising out of
a course of performance, dealing, or trade usage). In addition, neither
party make any representation that the operations of the sites will be
uninterrupted or error-free and we will not be liable for the consequences
of any interruptions or errors.
19. Indemnification
CDU agrees, at its own expense, to defend or at its option, to settle any
claim or action brought against US-Style regarding on the issue of
infringement of any trademark, service xxxx, copyright or other proprietary
items arising from the use of any content provided by CDU, developed by CDU
or used with CDU's permission in any web site developed by US-Style or CDU,
and to identify US-Style against all damages and cost, including legal
fees, which may be assessed against US-Style under any such claim or
action; provided that US-Style provides CDU with (i) prompt written notice
of such claim or action, (ii) sole control and authority over the defense
or settlement of such claim or action (unless the settlement involves
injunctive-type relief against US-Style, in which case US-Style's written
consent shall be required for settlement), and (iii) proper and full
information and reasonable assistance to defend and/or settle any such
claim or actions. In the event that any of such contest, is held, or in
CDU's reasonable discretion after consultation with US-Style may be held,
to constitute and infringement, CDU, at its option and expense, may either
(a) modify the content so that it becomes non-infringing. (b) Replace the
content with content which does not constitute an infringement and which is
reasonably acceptable to CDU, or (c) discontinue positing the content, CDU
agrees that it is solely responsible for obtaining any necessary or
advisable registration of any marks, icons, text or other materials with
the Japanese government of any other government.
Each party agrees to indemnify and hold harmless the other party from and
against any cost, loss or expense (including attorney's fees) resulting
from any and all claims by third parties, (other than those provided for in
the prior paragraph) for loss, damage or injury (including death) allegedly
caused by the actions of the indemnifying party, of any or their respective
agents or employees. The indemnifying party shall have the right to
participate at its expense in any such dispute. Claims against US-Style for
product liability or breach of warranty relating to any item sold by CDU
shall be considered "caused by the actions" of CDU.
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21. Confidentiality
Confidential information, which includes all information or material
disclosed or provided by either party (the "disclosing party") to the other
party (the "recipient") either orally or in writing concerning any aspect
of the business or affairs of the disclosing party, shall be held by the
recipient in strictest confidence and shall not be disclosed to any person
or entity unless required by law (in which case prompt, and if practicable,
prior, notice shall be given to the disclosing party). Confidential
information shall not include information or material that (i) is publicly
available or becomes publicly available through no action or fault of the
recipient, (ii) was already in the recipient's possession or known to the
recipient prior to being disclosed. All confidential information disclosed
by the disclosing party is owned solely and exclusively by the disclosing
party.
22. Disputes
Any and all disputes arising under this Agreement shall be resolved through
hinging arbitration according to the rules of the American Arbitration
Association. The arbitration shall take place in Fairfield County,
Connecticut, at American Arbitration, Association, JAMS/ENDISPUTE or (other
Arbitration Association) to be determined by the party first bringing the
claim. The decision of the arbitrators shall be final and binding on the
parties and may be entered and enforced in any court of competent
jurisdiction by either party.
Agreed: For Xxxxxxxx.xxx Inc
/s/ 11/5/98
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M______ X. Xxxxxx Date
President
Xxxxxxxx.xxx Inc.
Agreed: for CD Universe
/s/ Nov. 4, 1998
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Xxxxxxx Xxxxxxx Date
President
CD Universe
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