Execution Copy
SPONSORSHIP AGREEMENT
This Agreement ("Agreement") is entered into on September 3, 1999, (the
"Effective Date") by and between XxxxxxXx.xxx, Inc., a Delaware corporation
("PlanetRx") with offices at 000 Xxxxxx Xxxxx Xxxx., Xxxxx 000, Xxx Xxxxxxxxx,
XX 00000 and iVillage Inc. a Delaware corporation ("iVillage") with offices at
000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
1. Promotion. During the term of this Agreement, and in connection with
iVillage's existing U.S. English language version Web site located at
xxx.xXxxxxxx.xxx (the "iVillage Network), iVillage agrees to promote PlanetRx in
the manner and on the areas of the iVillage Network described on Exhibit A and
achieve the impression commitments described in Exhibit A during the periods
described in Exhibit A. In the event iVillage delivers the specific relevant
impressions commitments described on Exhibit A with respect to a particular
promotion prior to the end of the relevant period, iVillage agrees that it will
not discontinue any of the "Permanent Placement" promotions or "share of voice"
promotions prior to the end of such relevant period.
2. Online Impressions. During the term of this Agreement, iVillage agrees to
deliver to PlanetRx, a minimum of 950,000,000 online-impressions which shall be
placed throughout the iVillage Network and shall be in the form of permanent
placements, advertising banners, text copy, logos, buttons, "Don't Miss" sponsor
special mentions, and newsletter mentions as placed throughout the iVillage
Network as more specifically set forth in Exhibit A. iVillage agrees to use best
efforts to deliver each type of impression described on Exhibit A during the
relevant Periods described on Exhibit A. iVillage agrees to deliver at least the
following number of user impressions during the term of this Agreement: during
the first 12 months, 190 million impressions; during the second 12 months, 298
million impressions; and during the third 12 months, 462 million impressions.
3. Off-line Promotions/Impressions Commitment. During the term of this
Agreement, iVillage agrees to promote PlanetRx in the manner described on
Exhibit B and achieve the impression commitments described in Exhibit B during
the periods described in Exhibit B. During the Term, iVillage agrees to deliver
a minimum of 50 million off-line impressions.
4. Differential in Impressions.
A. Differential per Channel.
(i) In the event iVillage delivers less than 100% but greater than 80%
of the relevant on-line impression commitments for any specific channel
described on Exhibit A in the relevant display period (a "Minor Channel
Differential"), such Minor Channel Differential shall not be considered a breach
of the Agreement by iVillage: provided that, iVillage provides such impressions
(or other substantially and materially similar impressions mutually agreed upon
by the parties and may include "media" impressions within the relevant channel)
"within the first three (3) months following the end of such relevant period.
(ii) In the event iVillage delivers less than 80% of the relevant
impression commitments for any specific channel in the relevant period (a
"Significant Channel Differential"), such Significant Channel Differential shall
not be considered a breach of the Agreement by iVillage: provided that, iVillage
provides the Minor Channel Differential (or other substantially and materially
similar impressions mutually agreed upon by the parties and may include "media"
impressions within the relevant channel) and 1.5 times the number of impressions
over the Minor Channel Differential (or other
substantially and materially similar impressions mutually agreed upon by the
parties and may include "media" impressions within the relevant channel) within
the first three (3) months following the end of such relevant period.
B. Overall Impression Differentials in any given year.
(i) In the event iVillage fails to deliver between 1-10% of the overall
on-line impressions promised in the first year of this Agreement or if iVillage
fails to deliver between 1-15% of the overall on-line impression commitments
promised in year two (2) of this Agreement or if iVillage fails to deliver
between 1-20% of the overall on-line impressions promised in year three (3) of
this agreement as described on Exhibit A (each a "Minor Overall Differential"),
such Minor Overall Differential shall not be considered a breach of the
Agreement by iVillage: provided that, iVillage provides such impressions (or
other substantially and materially similar impressions mutually agreed upon by
the parties) within the first three (3) months following the end of such
relevant year.
(ii) In the event iVillage delivers less than 90% of the overall
on-line impressions guaranteed in the first year of this Agreement or if
iVillage delivers less than 85% of the overall on-line impressions guaranteed in
the second year of this Agreement or if iVillage delivers less than 80% of the
overall online impression commitments guaranteed in year three of this agreement
respectively, (each a "Significant Overall Differential"), such Significant
Overall Differential shall not be considered a breach of the Agreement by
iVillage: provided that, iVillage delivers 1 times the number of the Minor
Overall Differential impressions (or other substantially and materially similar
impressions mutually agreed upon by the parties) and delivers 1.5 times the
number of the Significant Overall Differential less the Minor Overall
Differential for such year (or other substantially and materially similar
impressions mutually agreed upon by the parties) within the first three (3)
months following the end of the relevant year.
5. Exclusivity. During the first two years of this Agreement and as long as
PlanetRx is not in breach of any agreement with iVillage, iVillage shall not
accept promotional paid advertising on the iVillage Network from any entity
whose primary business is the online retailing of a broad array of prescription
and over the counter medicinal products; provided however, the forgoing shall
not prohibit iVillage from completing its obligations under the agreement
described in Exhibit D. Without limiting the generality of the forgoing,
entities which are specifically excluded from placement on the iVillage Network
are: Xxxxxxxxx.xxx, XXX.xxx, XXX.xxx, Xxxx.xxx, xxxxxxxxxxx.xxx, xxxxxxxxxx.xxx,
xxxxxxxxxx.xxx, xxxxxxxx.xxx, xxxxxxxxxxxx.xxx; express scripts/valuerx,
enutrition, megarx, healthzone, homepharmacy pcs health systems, acumins
eckerds, homepharmacy, xxxxxxxxxxxx.xxx, xxxxxxxxx.xxx, xxxx.xxx,
xxxxxxxxxxxx.xxx, xxxxxxxx.xxx, xxxxxxxxx.xxx, xxxxxxxxxxxxx.xxx and Xx.xxx and
any successor sites of the same. During the third year of this agreement,
iVillage will not accept promotional paid advertising on the iVillage Network
from any entity whose primary business is the online retailing of prescription
and over-the-counter medications (e.g., xxxxxxxxx.xxx, xxxxxxxxx.xxx, Walgreens,
XXX.xxx, Xxxx.xxx, xxxx.xxx, xxxxxxxx.xxx, eckerds, etc.) Notwithstanding the
foregoing, iVillage shall not be prohibited from: (i) accepting advertising from
manufacturers of prescription and over the counter medicinal and related
products; or (ii) accepting advertising from small, specialty, private label
retail entities who engage in the retail of their own private label prescription
and over the counter medicinal products, or a specialty niche commerce partner
that sells a maximum of three product lines, provided that PlanetRx's prior
approval is received, such approval not to be unreasonably withheld. With
respect to those offline large mass merchandise retailers which sell a broad
array of prescription and over the counter products as well as other lines of
products (such as Walmart), iVillage agrees that it shall not specifically
promote the purchase of prescription or over the counter products, or medicinal
products (e.g. vitamins, herbs, and other alternative health products) sold by
such entities.
6. Payment.
A. Subject to the terms of this Agreement, in consideration of the terms of
this Agreement, PlanetRx agrees to pay iVillage a total amount of U.S.$
15,000,000, payable as follows:
(i) Year One Payments: Total of $3,150,000, payable in the
following way: $787,500 upon execution of this Agreement and
three equal quarterly installments of $787,500, the first of
which is due three months after a date which is either thirty
(30) days after the execution of this Agreement or on the
Launch Date, whichever is earlier ("Initial Quarterly Payment
Date"), and the second and third payment of which is due every
three months after the Quarterly Payment Date;
(ii) Year Two Payments: Total of $4,699,500, payable in four equal
quarterly installments of $1,174,875, the first of which is
due three months after the last payment made in year one; and
(iii) Year Three Payments: Total of $7,150,500, payable in four
equal quarterly installments of $1,787,625, the first of which
is due three months after the last payment made in year two.
B. iVillage agrees to send PlanetRx an invoice for the above-mentioned
payments at least thirty days prior to the payment date. To the extent any of
the above-mentioned fees owing to iVillage are outstanding and due to iVillage,
this Section 4 shall survive termination of this Agreement until such fee has
been paid to iVillage.
C. All payments made via wire transfer should be directed as follows: Chase
Manhattan Bank, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000; Account name: iVillage
Inc.; ABA#: 00000000 1; Account #: 020-923406; Reference: PlanetRx All payments
made via check, should be sent to: iVillage Inc., 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000; Attention: Accounts Receivable.
7. Term and Termination.
A. The term of this Agreement shall commence on the Effective Date and shall
extend for a period of three (3) years thereafter, unless terminated earlier as
set forth herein.
B. In the event of a material breach by either party of any term of this
Agreement, the non-breaching party may terminate this Agreement by written
notice to the breaching party if the breaching party fails to cure such material
breach within thirty (30) days of receipt of written notice thereof. In
addition, either party may terminate this Agreement effective upon written
notice stating its intention to terminate in the event the other party (i)
ceases to function as a going concern or to conduct operations in the normal
course of business, or (ii) has a petition filed by or against it under any
state or federal bankruptcy or insolvency law which petition has not been
dismissed or set aside within ninety (90) days of its filing,
C. Except for termination of this Agreement by iVillage for material breach
of the Agreement by PlanetRx, upon any early termination of this Agreement, in
addition to any other remedies available to the parties as a result of such
termination (if any), iVillage agrees to refund to Advertiser the Pro-rata
Refund Amount for the impressions paid for by PlanetRx and not yet delivered by
iVillage. The value of such impression calculated at the termination date will
be based on the value of Effective Date of this Agreement. The following
sections shall survive any expiration or termination or this Agreement: Sections
4, 7(c), 8, and 13-17.
8. Ownership. All intellectual or proprietary property and information, supplied
or developed by either party shall be and remain the sole and exclusive property
of the party who supplied or developed same. Upon termination of this Agreement
and upon written request, the party in receipt of the requesting party's
intellectual or proprietary property and/or information pursuant to this
Agreement shall return such information to the requesting party.
9. Licenses. PlanetRx grants to iVillage, during the term of this Agreement, a
royalty-free, nonexclusive, worldwide license to use, reproduce, display,
distribute, perform and produce PlanetRx's tradenames, trademarks, service marks
and logos (collectively, the "PlanetRx Marks") but solely to perform its
promotional obligations as described herein and in connection with this
Agreement. Except as set forth herein, no right, title, license, or interest in
any PlanetRx Marks owned by PlanetRx or any of its affiliates is intended to be
given to or acquired by iVillage by the execution of or the performance of this
Agreement. iVillage shall not use the PlanetRx Marks for any purpose or activity
except as expressly authorized or contemplated herein. iVillage acknowledges
that PlanetRx is the sole and exclusive owner of all trademarks, service marks,
copyrights and other intellectual property of any kind in the PlanetRx Marks.
iVillage agrees that (i) it shall do nothing inconsistent with such ownership
either during the term of the Agreement or afterwards; (ii) it shall use the
PlanetRx Marks in a manner that does not deviate from PlanetRx's rights in the
PlanetRx Marks; and (iii) it shall take no action that shall interfere with or
diminish PlanetRx's right in the PlanetRx Marks. iVillage agrees that all use of
the PlanetRx Marks shall inure to the benefit of PlanetRx and that iVillage will
use the PlanetRx Marks in the form and style required by PlanetRx and in
compliance with the PlanetRx reasonable quality control guidelines as provided
to iVillage from time to time.
10. Submissions. As appropriate, iVillage must receive all PlanetRx submissions
at least 5 business days prior to the scheduled date of publication for each
relevant graphic (GIF) file, or file of such other format as iVillage may
designate from time to time, supplied by PlanetRx to be published by iVillage on
the iVillage Network and which may contain a link to PlanetRx's Web site or to a
Web site specified by PlanetRx or any and all information and items necessary
for iVillage's publication of any material supplied by PlanetRx, including
changes and updates thereto (collectively, "PlanetRx Submissions" and each, a
"PlanetRx Submission"). In the event iVillage does not receive a PlanetRx
Submission prior to the applicable deadline, with consent from PlanetRx which
shall not be unreasonably withheld iVillage may publish in substitution any
prior PlanetRx Submission until such time as iVillage can reasonably begin
publication of the promotion. If no such prior PlanetRx Submission is available,
iVillage may publish in substitution, any material it reasonably deems
appropriate, subject to PlanetRx's reasonable approval, until such time as
iVillage can reasonably begin publication of the promotion. All changes to
and/or cancellations of PlanetRx Submissions must be made in writing, with an
e-mail copy sent to xxx@xxxx.xXxxxxxx.xxx, and received by iVillage prior to the
applicable deadline.
11. Reports and Tracking.
A. iVillage shall provide PlanetRx with a user name and password to access
online reporting through DART (Doubleclick) or other similar service. Any
customization of reports requested by PlanetRx or its agent or representative
shall be subject to reasonable customary charges generally applicable to other
iVillage partners as determined by iVillage.
B. In the event a third party advertisement serving and measurement company
("Ad Server") is used and the iVillage report indicates a number of impressions
delivered that is greater than the Ad Server report, then the number of
impressions indicated by iVillage's report shall be deemed to be the number of
impressions delivered during the reporting period.
12. Publicity. iVillage agrees to publish a mutually agreed upon press release,
no later than five (5) business days after the execution of this Agreement. The
press release and any quotes from each party's sources must be approved by the
public relations department of the other party (unless otherwise required to be
disclosed to a government or administrative agency), which also must be made
aware of any pre-briefings with outside parties in advance of any pre-briefing.
Notwithstanding the foregoing, this Section shall not restrict either party from
complying with any governmental or administrative order or requirement.
13. Representations, Warranties, Covenants and Indemnification.
A. iVillage represents, warrants and covenants that: (i) it is authorized to
do business under the rules of the state in which it is incorporated; (ii) it is
authorized to enter into this Agreement and to perform its obligations; (iii) it
has all required permits, licenses, and other governmental authorizations and
approvals necessary to perform its obligations hereunder; (iv) it shall comply
with all local, state, federal, and international laws and regulations in
performing its obligations hereunder; and (v) the services to be performed and
the materials provided by it (a) do not infringe or violate any third party US
patent, copyright, trade secret, trademark, or other proprietary right of any
third party, (b) do not violate any applicable law, statute, ordinance or
regulation; (c) are not knowingly defamatory or libelous; (d) are not lewd,
pornographic or obscene; (e) do not knowingly violate any laws regarding unfair
competition, anti-discrimination or false advertising; (f) do not promote
violence or contain hate speech; or (g) do not knowingly contain viruses, Trojan
horses, worms, time bombs, cancelbots or other similar harmful or deleterious
programming routines,
B. PlanetRx represents, warrants and covenants that: (i) it is authorized to
do business under the rules of the state in which it is incorporated; (ii) it is
authorized to enter into this Agreement and to perform its obligations; (iii) it
has all required permits, licenses, and other governmental authorizations and
approvals necessary to perform its obligations hereunder; (iv) it shall comply
with all local, state, federal, and international laws and regulations in
performing its obligations hereunder; (v) the operations of the pharmacy
services on the XxxxxxXx.xxx site shall comply with all local, state, federal
and international laws and regulations and (vi) the services to be performed and
the materials provided by it (a) do not infringe or violate any third party U.S.
patent, copyright, trade secret, trademark, or other proprietary right; (b) do
not violate any applicable law, statute, ordinance or regulation; (c) are not
knowingly defamatory or libelous; (d) are not lewd, pomographic or obscene; (e)
do not knowingly violate any laws regarding unfair competition,
anti-discrimination or false advertising; (f) do not promote violence or contain
hate speech; (g) do not knowingly contain viruses, Trojan horses, wonais, time
bombs, cancelbots or other similar harmful or deleterious programming routines;
C. As the sole and exclusive remedy for any breach of the representation,
warranty and covenant described in section 13 (A)(v) above, iVillage agrees to
defend and hold harmless PlanetRx and its parent, subsidiaries, affiliates,
successors and assigns against any awarded damages and/or settlements costs,
losses, and awarded legal fees, incurred in connection with a third party claim
against PlanetRx arising out of a breach of section 13 (A)(v) above by iVillage,
provided, however, that in any such case: (i) PlanetRx provides iVillage with
prompt notice of any such claim; (ii) PlanetRx permits iVillage to assume sole
control over the defense and settlement of such action; and (iii) upon
iVillage's written request, and at iVillage's expense, PlanetRx will provide to
iVillage reasonable information and assistance necessary for iVillage to defend
and settle such claim. PlanetRx may participate in such defense or settlement at
its sole expense.
D. As the sole and exclusive remedy for any breach of the representation,
warranty and covenant described in section 13 (B)(vi) above, PlanetRx agrees to
defend and hold harmless iVillage and its parent, subsidiaries, affiliates,
successors and assigns against any awarded damages and/or settlements
costs, losses, and awarded legal fees, incurred in connection with a third party
claim against PlanetRx arising out of a breach of section 13(B)(vi) by PlanetRx,
provided, however, that in any such case: (i) iVillage provides PlanetRx with
prompt notice of any such claim; (ii) iVillage permits PlanetRx to assume sole
control over the defense and settlement of such action; and (iii) upon
PlanetRx's written request, and at PlanetRx's expense, iVillage will provide to
PlanetRx reasonable information and assistance necessary for Planet to defend
and settle such claim. iVillage may participate in such defense or settlement at
its sole expense.
14. Confidentiality. Other than as required or appropriate for securities laws
disclosure, iVillage and PlanetRx agree to keep in confidence, not use or
disclose any Confidential Information, except as authorized by the disclosing
party. Confidential Information means (a) any material non-public information,
communication or data, in any form, of the other party. Without limiting the
generality of the forgoing, PlanetRx Confidential Information shall specifically
include PlanetRx-branded advertisements and promotional elements prior to
publication, and the PlanetRx end user click through data made available by
iVillage to PlanetRx through the DART system ("PRX DART Data") . All
Confidential Information of a party shall remain the sole property of the such
party and its confidentiality shall be maintained and protected by the other
party with at least the same degree of care as the receiving party uses for the
protection of its own confidential and proprietary information. Neither party
shall disclose the other party's Confidential Information to any third party.
These restrictions shall not apply to any Confidential Information: (v) after it
has become generally available to the public without breach of this Agreement by
the receiving party; (w) is rightfully in the receiving party's possession
before disclosure to it by the disclosing party, except in the case of PRX DART
Data; (x) is independently developed by the receiving party; (y) is rightfully
received by the receiving party from a third party without a duty of
confidentiality; or (z) is required to be disclosed under operation of law or
administrative process. Upon expiration or termination of this Agreement for any
reason, PlanetRx will promptly and at the direction of iVillage, either destroy
or return to iVillage, and will not take or use, all items of any nature which
belong to iVillage and all records (in any form, format or medium) containing or
relating to Confidential Information.
15. Limitation of Liability . EXCEPT FOR A BREACH OF SECTION 14 ABOVE
("CONFIDENTIALITY"), NEITHER PARTY SHALL HAVE ANY LIABILITY FOR ANY INDIRECT,
SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES INCLUDING, WITHOUT LIMITATION, LOSS
OF PROFIT OR BUSINESS OPPORTUNITIES, WHETHER OR NOT THE PARTY WAS ADVISED OF THE
POSSIBILITY OF SUCH.
16. Warranty Disclaimer. EXCEPT AS EXPRESSLY SET FORTH HEREIN, NEITHER PARTY
MAKES ANY, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS ANY REPRESENTATIONS OR
WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE SERVICES CONTEMPLATED BY THIS
AGREEMENT, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR
COURSE OF PERFORMANCE.
17. Miscellaneous Provisions. Nothing in this Agreement shall imply any
partnership, joint venture or agency relationship between the parties and
neither party shall have the power to obligate or bind the other except for what
is stated in this Agreement. Commencing on the first day after the date that
each of the aforementioned payments are due, PlanetRx shall be liable for a
monthly rate of interest of not more than 11/2%, which interest shall be in
addition to such fees due and owing to iVillage. Except as other-wise expressly
provided in this Agreement, neither party shall be liable for any breach of this
Agreement for any delay or failure of performance resulting from any cause
beyond such party's reasonable control, such as: weather, strikes or labor
disputes, war, terrorist acts, riots or civil disturbances, government
regulations, acts of civil or military authorities, or acts of God provided the
party affected takes all
reasonably necessary steps to resume full performance. This Agreement
constitutes the binding agreement between the parties, represents the entire
agreement between the parties and supersedes all prior agreements relating to
what is stated in this Agreement and any changes to this Agreement must be in
writing and signed by both parties. The rights granted under this Agreement to
PlanetRx shall be applicable to iVillage existing Web sites and shall not apply
to any future acquisition by iVillage of Web sites or content, joint ventures or
similar business combinations. This Agreement shall be governed by the laws of
the State of California without regard to the conflicts of laws principles
thereof and both parties agree to the exclusive jurisdiction of the state and
federal courts of San Francisco, California. Neither party shall sell, transfer
or assign this Agreement or the rights or obligation hereunder, without the
prior written consent of the other party, except to an entity that obtains all
or substantially all of the business or assets of such party. Any notices
required or permitted to be given under this Agreement shall be in writing and
shall be delivered to the address set forth below or to such address as provided
for by such party.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first above written.
XxxxxxXx.xxx, Inc. iVillage, Inc.
Xxxxxxxxx Xxxxxx Xxxxxx Xxxxx
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(Name) (Name)
Co-Founder, VP of Business Development SVP Business Affairs
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(Title) (Title)
9/3/99 9/7/99
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(Date) (Date)
/s/ Xxxxxxxxx Xxxxxx /s/ Xxxxxx Xxxxx
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(Signature) (Signature)
