Exhibit 10.6
CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION, PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
EXECUTION COPY
CONFIDENTIAL
INTERACTIVE MARKETING AGREEMENT
This Interactive Marketing Agreement (the "Agreement"), dated as of
January 1, 1998 (the "Effective Date"), is between America Online, Inc. ("AOL"),
a Delaware corporation, with offices at 00000 XXX Xxx, Xxxxxx, Xxxxxxxx 00000,
and 800-Flowers, Inc. ("1-800-Flowers"), a New York corporation, with its
principal offices at 0000 Xxxxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000. AOL and
1-800-Flowers may be referred to individually as a "Party" and collectively as
"Parties."
INTRODUCTION
AOL and 1-800-Flowers are parties to the Interactive Marketing
Agreement, dated May 1, 1997 (the "Existing Agreement"), whereby AOL promotes
and distributes an interactive site referred to in the Existing Agreement as the
Online Area. AOL and 1-800-Flowers each desires to enter into a separate
interactive marketing relationship whereby AOL will promote and distribute an
interactive site referred to (and further defined) herein as the Affiliated
1-800-Flowers Site. This relationship is further described below and is subject
to the terms and conditions set forth in this Agreement. Defined terms used but
not defined in the body of the Agreement will be as defined on Exhibit B
attached hereto.
TERMS
1. PROMOTION, DISTRIBUTION AND MARKETING.
1.1. AOL PROMOTION OF AFFILIATED 1-800-FLOWERS SITE. AOL will
provide 1-800-Flowers with the promotions on XXX.xxx for the
Affiliated 1-800-Flowers Site which are described on Exhibit A
(the "Promotions"). AOL reserves the right to redesign or
modify the organization, structure, "look and feel,"
navigation and other elements of the AOL Network at any time.
In the event such modifications materially and adversely
affect any specific Promotion, AOL will work with
1-800-Flowers to provide 1-800-Flowers, as its sole remedy, a
comparable promotional placement (i.e., placement which is no
less valuable than the Promotion being replaced).
1.2. IMPRESSIONS. With respect to any Impressions targets specified
on Exhibit A, AOL will not be obligated to provide in excess
of any of such target amounts in any year. Any shortfall in
Impressions at the end of a year will not be deemed a breach
of the Agreement by AOL; such shortfall will be added to the
Impressions target for the subsequent year. In the event there
is a shortfall in Impressions as of the end of the Term (a
"Final Shortfall"), AOL will provide 1-800-Flowers, as its
sole remedy, with advertising placements through "run of
service" advertising on the AOL Network which have a total
value, based on an advertising rate of [****] per thousand
Impressions, equal to the value of the Final Shortfall
(determined by multiplying the percentage of Impressions that
were not delivered by the total, guaranteed payment provided
for below).
1.3. CONTENT OF PROMOTIONS. The Promotions will link only to the
Affiliated 1-800-Flowers Site and will promote only those
Products 1-800-Flowers is allowed to sell pursuant to Section
2.1. The specific 1-800-Flowers Content to be contained within
the Promotions (including, without limitation, advertising
banners and contextual promotions) (the "Promo Content") will
be determined by 1-800-Flowers, subject to AOL's technical
limitations, the terms of this Agreement and AOL's
then-applicable policies relating to advertising and
promotions. 1-800-Flowers will consistently update the Promo
Content on no less than twice per week, and the Parties will
jointly consult regarding the Promo Content to ensure that it
is designed to maximize performance. Except to the extent
expressly described herein (e.g., the placements described in
Exhibit A), the specific form, placement,
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under
Rule 406 of the Securities Act of 1933, as amended.
duration and nature of the Promotions will be as determined by
AOL in its reasonable editorial discretion (consistent with
the editorial composition of the applicable screens).
2. AFFILIATED FLOWERS SITE.
2.1. CONTENT. In the event that 1-800-Flowers wishes to offer any
categories or types of Content or Products in addition to
those categories or types specifically allowed pursuant to the
Existing Agreement (the "Additional Content"), 1-800-Flowers
will notify AOL in writing. 1-800-Flowers' right to offer any
such Additional Content will be subject to AOL's prior written
approval, which shall not be unreasonably withheld.. In
addition, 1-800-Flowers acknowledges and agrees that (a) its
ability to sell or promote [****] products [****] may be
limited by AOL's arrangements with third-party [****]
product retailers and (b) in the event 1-800-Flowers
desires to create an area or sub-area related to [****]
within the Affiliated 1-800-Flowers Site that is promoted
hereunder by AOL, 1-800-Flowers will not be entitled to do
so until the Parties have mutually agreed in writing upon
the terms and conditions relating to such area. All sales
of Products through the Affiliated 1-800-Flowers Site will
be conducted through a direct sales format; 1-800-Flowers
will not promote, sell, offer or otherwise distribute any
products through any format other than a direct sales format
[****] without the prior written consent of AOL. 1-800-Flowers
will review, delete, edit, create, update and otherwise manage
all Content available on or through the Affiliated
1-800-Flowers Site in accordance with the terms of this
Agreement. 1-800-Flowers will ensure that the Affiliated
1-800-Flowers Site does not in any respect promote, advertise,
market or distribute the products, services or content of any
other Interactive Service.
2.2. PRODUCTION WORK. Except as agreed to in writing by the Parties
pursuant to the "Production Work" section of the Standard
Legal Terms & Conditions attached hereto as Exhibit F,
1-800-Flowers will be responsible for all production work
associated with the Affiliated 1-800-Flowers Site, including
all related costs and expenses.
2.3. HOSTING; COMMUNICATIONS. 1-800-Flowers will be responsible for
all communications, hosting and connectivity costs and
expenses associated with the Affiliated 1-800-Flowers Site. In
addition, 1-800-Flowers will provide all computer, telephone
and other equipment or resources necessary for 1-800-Flowers
to access the AOL Network. In the event that 1-800-Flowers
elects to create a mirrored version of the Affiliated
1-800-Flowers Site in order to comply with the terms of this
Agreement, 1-800-Flowers will bear responsibility for the
implementation, management and cost of such mirrored site.
1-800-Flowers will utilize a dedicated high speed connection
to maintain quick and reliable transport of information to and
from the 1-800-Flowers data center and AOL's designated data
center.
2.4. TECHNOLOGY. 1-800-Flowers will take all reasonable steps
necessary to conform its promotion and sale of Products
through the Affiliated 1-800-Flowers Site to the then-existing
technologies identified by AOL which are optimized for the AOL
Service. AOL will be entitled to require reasonable changes to
the Content (including, without limitation, the features or
functionality) within any linked pages of the Affiliated
1-800-Flowers Site to the extent such Content will, in AOL's
good faith judgment, adversely affect any operational aspect
of the AOL Network. AOL reserves the right to review and test
the Affiliated 1-800-Flowers Site from time to time to
determine whether the site is compatible with AOL's
then-available client and host software and the AOL Network.
2.5. PRODUCT OFFERING. Subject to Section 2.1, 1-800-Flowers will
use all commercially reasonable efforts to ensure that the
Affiliated 1-800-Flowers Site includes substantially
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under
Rule 406 of the Securities Act of 1933, as amended.
all of the Products including any features, offers or contests
that are then made available by or on behalf of 1-800-Flowers
through any Additional 1-800-Flowers Channel; provided,
however, that (a) such inclusion will not be required where it
is commercially or technically impractical to either Party
(i.e., inclusion would cause either Party to incur substantial
incremental costs) or where it is prohibited as of the
Effective Date by a then-existing written agreement; (b) the
specific changes in scope, nature and/or offerings required by
such inclusion will be subject to AOL's review and approval
and the terms of this Agreement; and (c) in the event a third
party promotes, markets or distributes its products or Content
through a 1-800-Flowers Additional Channel, 1-800-Flowers will
offer AOL a substantially similar opportunity.
2.6. [****] AND TERMS; [****] 1-800-Flowers will ensure that the
[****] for Products in the Affiliated 1-800-Flowers Site do
[****] the [****] for the Products or substantially similar
Products offered by or on behalf of 1-800-Flowers through
any Additional 1-800-Flowers Channel. For purposes of
judging 1-800-Flowers' compliance with the foregoing, to
the extent 1-800-Flowers charges any shipping, handling or
similar charges or any processing, service or similar
charges (collectively, the "Service Charges"), the Service
Charges will not be considered as part of the prices for
the Products in the Affiliated 1-800-Flowers Site; provided,
however, that 1-800-Flowers must comply with Section 1.7
of the Existing Agreement.
2.7. SPECIAL OFFERS. 1-800-Flowers will, on a reasonably periodic
basis, promote through the Affiliated 1-800-Flowers Site
special offers exclusively available to AOL Members and/or AOL
Users (the "Special Offers"). 1-800-Flowers will provide AOL
with reasonable prior notice of Special Offers so that AOL can
market the availability of such Special Offers in the manner
AOL deems appropriate in its editorial discretion, subject to
the terms and conditions hereof. 1-800-Flowers will ensure
that the Special Offers are [****] made available by or on
behalf of 1-800-Flowers through any Additional
1-800-Flowers Channel during the same time the Special
Offers are made available; provided that the foregoing
shall not apply to a Special Offer to the extent that
1-800-Flowers cannot make such offer available in the event
such offer requires certain support technology from AOL
which AOL cannot, or elects not to, provide.
2.8. OPERATING STANDARDS. 1-800-Flowers will ensure that the
Affiliated 1-800-Flowers Site complies at all times with the
standards set forth in Sections 2.5, 2.6 and 2.7 of the
Existing Agreement and with Exhibit D hereto.
2.9. ADVERTISING SALES. Neither Party will sell promotions,
advertisements, links, pointers or similar services or rights
through the Affiliated 1-800-Flowers Site unless and until the
Parties have mutually agreed upon a written advertising
program whereby the Parties coordinate to establish
advertising inventory space and share mutually agreed revenues
generated from such advertising sales.
2.10. TRAFFIC FLOW. 1-800-Flowers will take reasonable efforts to
ensure that AOL traffic is either kept within the Affiliated
1-800-Flowers Site or channeled back into the AOL Network
(with the exception of advertising links sold and implemented
pursuant to the Agreement). The Parties will work together on
implementing mutually acceptable links from the Affiliated
1-800-Flowers Site back to the AOL Service.
3. AOL EXCLUSIVITY OBLIGATIONS. 1-800-Flowers will be the
exclusive provider of fresh-cut flowers and Gift Plants on
XXX.xxx (the "XXX.xxx Exclusive Products"), as follows:
AOL will not (i) promote, market or advertise within
XXX.xxx any entity (other than 1-800-Flowers) that provides
"XXX.xxx Exclusive Products," including but not limited to
any entity listed on Exhibit C (each entity so listed, a
"1-800-Flowers Competitor") and (ii) will not allow any
provider of the XXX.xxx Exclusive Products, including but
not limited to any 1-800-Flowers Competitor, to sell, or
offer to sell the XXX.xxx Exclusive Products within XXX.xxx;
[****].
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under
Rule 406 of the Securities Act of 1933, as amended.
4. PAYMENTS.
4.1. GUARANTEED PAYMENTS. During the Term of this Agreement,
1-800-Flowers will pay AOL a total guaranteed amount of
US$1,500,000, as follows: during the first eighteen (18)
months of the Term and during each of the two (2) twelve-month
periods thereafter (each of the foregoing three periods, a
"Payment Period"), 1-800-Flowers will pay AOL $500,000 as
follows: (i) 1-800-Flowers will pay AOL an amount equal to
[****] of all Transaction Revenues in each quarter of each
Payment Period (such amount, an "XXX.xxx Revenue Share"),
payable within thirty (30) days of the end of such quarter;
and (ii) as of the end of such Payment Period, if the
cumulative XXX.xxx Revenue Share during such Payment Period
pursuant to clause (i) does not equal or exceed $500,000,
1-800-Flowers will pay AOL the shortfall within thirty (30)
days of the end of such Payment Period.
4.2. ALTERNATIVE REVENUE STREAMS. In the event 1-800-Flowers or any
of its affiliates (a) receives or desires to receive, directly
or indirectly, any compensation in connection with the
Affiliated 1-800-Flowers Site other than Transaction Revenues
[****] (an "Alternative Revenue Stream"), 1-800-Flowers
will promptly inform AOL in writing, and the Parties will
negotiate in good faith regarding whether 1-800-Flowers
will be allowed to market Products producing such
Alternative Revenue Stream through the Affiliated
1-800-Flowers Site, and if so, the equitable portion of
revenues from such Alternative Revenue Stream (if
applicable) that will be shared with AOL. In the event the
Parties cannot in good faith reach agreement regarding such
Alternative Revenue Stream within ten (10) days of AOL's
request to negotiate, either Party will have the right to
have such matter submitted to dispute resolution pursuant
to Section 6.
4.3. LATE PAYMENTS. All amounts owed hereunder not paid when due
and payable will bear interest from the date such amounts are
due and payable at [****] in effect at such time.
4.4. AUDITING RIGHTS. 1-800-Flowers shall maintain complete, clear
and accurate records of all expenses, revenues and fees in
connection with the performance of this Agreement. For the
sole purpose of ensuring compliance with this Agreement, AOL
shall have the right, at its expense, to direct an independent
certified public accounting firm to conduct a reasonable and
necessary inspection of portions of the books and records of
1-800-Flowers which are relevant to amounts payable to AOL
pursuant to this Agreement. Any such audit may be conducted
once per year after twenty (20) business days prior written
notice; provided that no such audit shall occur during the
months of July or August. Any audit shall be at AOL's sole
cost and expense unless a discrepancy of the greater of
[****] is found, in which case 1-800-Flowers will pay all
reasonable costs and expenses related to the audit, not to
exceed [****]. In the event 1-800-Flowers has good faith
grounds to question AOL's tracking and reporting of
Impressions, 1-800-Flowers will be
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under
Rule 406 of the Securities Act of 1933, as amended.
entitled to a report issued by a qualified independent auditor
describing AOL's methodologies regarding tracking and
reporting of Impressions and certifying AOL's compliance with
those methodologies and AOL's compliance with its obligations
hereunder. (These reports are currently being provided to AOL
for distribution to its partners by the Audit Bureau of
Circulations).
4.5. TAXES. 1-800-Flowers will collect and pay and indemnify and
hold AOL harmless from, any sales, use, excise, import or
export value added or similar tax or duty not based on AOL's
net income, including any penalties and interest, as well as
any costs associated with the collection or withholding
thereof, including attorneys' fees.
4.6. REPORTS. Each Party will each provide the other Party with
reports evidencing the reporting Party's compliance with its
obligations under the Agreement. All reports will be provided
in the form and manner that each Party is obligated to provide
pursuant to Section 4.8 of the Existing Agreement.
5. TERM; RENEWAL; TERMINATION.
5.1. TERM. Unless earlier terminated as set forth herein, the term
of this Agreement will commence on the Effective Date and
expire on June 30, 2001 (the "Term").
5.2. TERMINATION FOR BREACH. Except as expressly provided elsewhere
in this Agreement, either Party may terminate this Agreement
at any time in the event of a material breach of the Agreement
by the other Party which remains uncured after thirty (30)
days written notice thereof to the other Party (or such
shorter period as may be specified elsewhere in this
Agreement); provided that the cure period with respect to
either Party's failure to make any payment to the other Party
required hereunder shall be ten (10) days from the date
receipt of written notice regarding such payment provided for
herein. Notwithstanding the foregoing, in the event of a
material breach of a provision that expressly requires action
to be completed within an express period shorter than 30 days,
either Party may terminate this Agreement if the breach
remains uncured for the applicable time period after written
notice thereof to the other Party.
5.3. TERMINATION FOR BANKRUPTCY/INSOLVENCY. Either Party may
terminate this Agreement immediately following written notice
to the other Party if the other Party (i) ceases to do
business in the normal course, (ii) becomes or is declared
insolvent or bankrupt, (iii) is the subject of any proceeding
related to its liquidation or insolvency (whether voluntary or
involuntary) which is not dismissed within ninety (90)
calendar days or (iv) makes an assignment for the benefit of
creditors.
5.4. TERMINATION ON CHANGE OF CONTROL. In the event of a Change of
Control of 1-800-Flowers resulting in control of 1-800-Flowers
by an Interactive Service, AOL may terminate this Agreement by
providing thirty (30) days prior written notice of such intent
to terminate.
6. MANAGEMENT COMMITTEE/ARBITRATION. If the Parties are unable to resolve
any dispute, controversy or claim arising under this Agreement
(excluding any disputes relating to intellectual property rights or
confidentiality) (each a "Dispute"), such Dispute shall be submitted to
the Management Committee for resolution. If the Management Committee is
unable to resolve the Dispute within ten (10) business days after
submission to them, the Dispute shall be solely and finally settled by
expedited arbitration in New York, New York, under the auspices of the
American Arbitration Association; provided that the Federal Rules of
Evidence shall apply IN TOTO to any such Dispute and, subject to the
arbitrators' discretion to limit the time for and scope of discovery,
the Federal Rules of Civil Procedure shall apply with respect to
discovery; and
provided further that, consistent with the parties' desire to avoid
waste of time and unnecessary expense, any Dispute arising from any
provision of the Agreement which expressly provides for the parties to
reach mutual agreement as to certain terms therein shall not be
submitted to arbitration but shall be resolved in good faith by the
Management Committee. The arbitrator may enter a default decision
against any Party who fails to participate in the arbitration
proceedings. For purposes herein, the "Management Committee" shall mean
a committee made up of a senior executive from each of the Parties for
the purpose of resolving Disputes under this Section and generally
overseeing the relationship between the Parties contemplated by this
Agreement.
7. STANDARD TERMS. The Standard Online Commerce Terms & Conditions set
forth on Exhibit E attached hereto and Standard Legal Terms &
Conditions set forth on Exhibit F attached hereto are each hereby made
a part of this Agreement.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
Effective Date.
AMERICA ONLINE, INC. 800-FLOWERS, INC.
By: /s/ Xxxxx X. Xxxxxxx By: /s/ Xxxxxxxxxxx XxXxxx
------------------------------- -------------------------------
Print Name: Xxxxx X. Xxxxxxx Print Name: Xxxxxxxxxxx XxXxxx
------------------------ ------------------------
Title: Senior Vice President Title: Senior Vice President
----------------------------- -----------------------------
EXHIBIT A
PLACEMENT/PROMOTION
------------------------------------------------------ ----------------------------- -----------------------
PLACEMENT FLIGHT IMPRESSIONS(1)
DATES
------------------------------------------------------ ----------------------------- -----------------------
HOLIDAY BLITZ PROGRAM - allocated to run-of-site [****] [****] PER FLIGHT
banner advertising(2)
------------------------------------------------------ ----------------------------- -----------------------
SHOPPING CHANNEL ANCHOR TENANT POSITION (STANDARD [****]
ANCHOR TENANT PACKAGE, INCLUDES PROMOTIONS AND
PLACEMENT FOR 1-800-FLOWERS IN SHOPPING CHANNEL
DEPARTMENT)
------------------------------------------------------ ----------------------------- -----------------------
SEARCH RESULTS
------------------------------------------------------ ----------------------------- -----------------------
Search Results Pages - [****] of banner ads for
following search terms (the "1-800-Flowers Search [****]
Terms"):
[****]
------------------------------------------------------ ----------------------------- -----------------------
----------
(1) The holiday blitz promotional commitments will be deemed
fulfilled once the Impression estimates have been reached. Prior to November
of each year, in order to avoid imbalanced allocation of 1-800-Flowers' [****]
annual Impressions, the Parties will work together to mutually agree upon a
media plan that allocates such Impressions among specific holiday periods.
(2) The holiday blitz will include promotion on an XXX.xxx homepage button
during the [****] preceding Valentine's Day and the [****] period preceding
Mother's Day and the combined Impressions from such [****] will not exceed
[****] without 1-800-Flowers' prior written approval.
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under Rule
406 of the Securities Act of 1933, as amended.
------------------------------------------------------ ----------------------------- -----------------------
Search Results Pages - [****] rotation on banner ads [****]
for following additional search terms during
specified flight dates:
[****]
------------------------------------------------------ ----------------------------- -----------------------
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under
Rule 406 of the Securities Act of 1933, as amended.
EXHIBIT B
DEFINITIONS
The following definitions will apply to this Agreement:
ADDITIONAL 1-800-FLOWERS CHANNEL. Any other online or Internet-based
distribution channel (e.g., an Interactive Service other than AOL) through which
1-800-Flowers makes available an offering comparable in nature to the Affiliated
1-800-Flowers Site.
AFFILIATED 1-800-FLOWERS SITE. The specific area to be promoted and distributed
by AOL hereunder through which 1-800-Flowers can market and complete
transactions regarding its Products.
AOL INTERACTIVE SITE. Any Interactive Site which is managed, maintained, owned
or controlled by AOL or its agents.
AOL LOOK AND FEEL. The elements of graphics, design, organization, presentation,
layout, user interface, navigation and stylistic convention (including the
digital implementations thereof) which are generally associated with Interactive
Sites within the AOL Service or XXX.xxx.
AOL MEMBER. Any authorized user of the AOL Network, including any sub-accounts
using the AOL Network under an authorized master account.
AOL NETWORK. (i) The AOL Service, (ii) XXX.xxx and (iii) any other product or
service owned, operated, distributed or authorized to be distributed by or
through AOL or its affiliates worldwide through which AOL elects to offer the
Affiliated 1-800-Flowers Site (and including those properties excluded from the
definitions of the AOL Service or XXX.xxx).
AOL PURCHASER. Any person or entity who enters the Affiliated 1-800-Flowers Site
from the AOL Network including, without limitation, from any third party area
therein (to the extent entry from such third party area is traceable through
both Parties' commercially reasonable efforts), and generates Transaction
Revenues (regardless of whether such person or entity provides an e-mail address
during registration which includes a domain other than an "XXX.xxx" domain).
AOL SERVICE. The narrow-band U.S. version of the America Online(R) brand
service, specifically excluding (a) XXX.xxx or any other AOL Interactive Site,
(b) the international versions of the AOL Service (e.g., AOL Japan), (c)
"Driveway," "AOL NetFind(TM)," "AOL Instant Messenger(TM)" or any similar
product or service offered by or through the U.S. version of the America
Online(R) brand service, (d) any programming or content area offered by or
through the U.S. version of the America Online(R) brand service over which AOL
does not exercise complete or substantially complete operational control (e.g.,
third-party Content areas, any Interactive Site containing "xxxxxxx.xxx.xxx" as
part of its URL and "Digital City(TM)," "WorldPlay(TM)," "Entertainment
Asylum(TM)," the "Hub(TM)," or any similar "sub-service"), (e) any yellow pages,
white pages, classifieds or other search, directory or review services or
Content offered by or through the U.S. version of the America Online(R) brand
service and (f) any co-branded or private label branded version of the U.S.
version of the America Online(R) brand service, (g) any version of the U.S.
version of the America Online(R) brand service distributed through any broadband
distribution platform or through any platform or device other than a desktop
personal computer and (h) any property, feature, product or service which AOL
may acquire subsequent to the Effective Date.
AOL USER. Any user of the AOL Service, XXX.xxx or the AOL Network.
XXX.XXX. AOL's primary Internet-based Interactive Site marketed under the
"XXX.XXX" brand (or any successor or substitute brand for the "XXX.XXX" brand),
specifically excluding (a) the AOL Service, (b)
any international versions of XXX.xxx, (c) "Driveway," "AOL Instant
Messenger(TM)" or any similar product or service offered by or through such site
or any other AOL Interactive Site, (d) any programming or content area offered
by or through such site or any other AOL Interactive Site over which AOL does
not exercise complete or substantially complete operational control (e.g.,
third-party Content areas, any Interactive Site containing "xxxxxxx.xxx.xxx" as
part of its URL and "Digital City(TM)," "WorldPlay(TM)," "Entertainment
Asylum(TM)," the "Hub(TM)," or any similar "sub-service"), (e) any yellow pages,
white pages, classifieds or other search, directory or review services or
Content offered by or through such site or any other AOL Interactive Site, (f)
any co-branded or private label branded version of such site (other than a
version otherwise prohibited by Section 3 hereof, e.g., a version distributed by
FTD), (g) any version of such site distributed through any broadband
distribution platform or through any platform or device other than a desktop
personal computer (other than a platform or device otherwise prohibited by
Section 3 hereof, e.g., a platform owned by FTD), (h) any property, feature,
product or service which AOL may acquire subsequent to the Effective Date and
(i) any version of "AOL NetFind(TM)" distributed through any Interactive Site
other than XXX.xxx.
CHANGE OF CONTROL. (a) The consummation of a reorganization, merger or
consolidation or sale or other disposition of substantially all of the assets of
a party; or (b) the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1933,
as amended) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under such Act) of more than 50% of either (i) the then outstanding
shares of common stock of such party; or (ii) the combined voting power of the
then outstanding voting securities of such party entitled to vote generally in
the election of directors.
CONFIDENTIAL INFORMATION. Any information relating to or disclosed in the course
of the Agreement, which is or should be reasonably understood to be confidential
or proprietary to the disclosing Party, including, but not limited to, the
material terms of this Agreement, information about AOL Members, AOL Users, AOL
Purchasers and 1-800-Flowers customers, technical processes and formulas, source
codes, product designs, sales, cost and other unpublished financial information,
product and business plans, projections, and marketing data. "Confidential
Information" will not include information (a) already lawfully known to or
independently developed by the receiving Party, (b) disclosed in published
materials, (c) generally known to the public, or (d) lawfully obtained from any
third party.
CONTENT. Information, materials, features, Products, advertisements, promotions,
links, pointers and software, including any modifications, upgrades, updates,
enhancements and related documentation.
[****]
IMPRESSION. User exposure to the page containing the applicable promotion or
advertisement, as such exposure may be reasonably determined and measured by AOL
in accordance with its standard methodologies and protocols.
[****]
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under
Rule 406 of the Securities Act of 1933, as amended.
INTERACTIVE SITE. Any interactive site or area, including, by way of example and
without limitation, (i) a 1-800-Flowers site on the World Wide Web portion of
the Internet or (ii) a channel or area delivered through a "push" product such
as the Pointcast Network or interactive environment such as Microsoft's Active
Desktop.
LICENSED CONTENT. All Content offered through the Affiliated 1-800-Flowers Site
pursuant to this Agreement or otherwise provided to AOL by 1-800-Flowers for
related purposes (e.g., Promotions, AOL "slideshows" , etc.), including in each
case, any modifications, upgrades, updates, enhancements, and related
documentation.
1-800-FLOWERS INTERACTIVE SITE. Any Interactive Site (other than the Affiliated
1-800-Flowers Site) which is managed, maintained, owned or controlled by
1-800-Flowers or its affiliates.
1-800-FLOWERS LOOK AND FEEL. The elements of graphics, design, organization,
presentation, layout, user interface, navigation and stylistic convention
(including the digital implementations thereof) which are generally associated
with Interactive Sites owned, maintained or operated by 1-800-Flowers.
PRODUCT. Any product, good or service which 1-800-Flowers (or others acting on
its behalf or as distributors) offers, sells, provides, distributes or licenses
to AOL Users directly or indirectly through (i) the Affiliated 1-800-Flowers
Site (including through any Interactive Site linked thereto), (ii) any other
electronic means directed at AOL Users (e.g., e-mail offers), or (iii) an
"offline" means (e.g., toll-free number) for receiving orders related to
specific offers within the Affiliated 1-800-Flowers Site requiring purchasers to
reference a specific promotional identifier or tracking code, including, without
limitation, products sold through surcharged downloads (to the extent expressly
permitted hereunder).
TRANSACTION REVENUES. Aggregate amounts paid by AOL Purchasers in connection
with the sale, licensing, distribution or provision of any product, good or
service which 1-800-Flowers or its agent offers, sells or licenses to AOL Users
through the Affiliated 1-800-Flowers Site, including, in each case, handling,
shipping, service charges, and excluding, in each case, (a) amounts collected
for sales or use taxes or duties, (b) credit card processing fees to the extent
charged and/or collected by the credit card issuer and (c) credits and
chargebacks for returned or cancelled goods or services, but not excluding cost
of goods sold or any similar cost.
SITE REVENUES. The combination of Transaction Revenues, Advertising Revenues and
Additional Revenues.
EXHIBIT C
LIST OF 1-800-FLOWERS COMPETITORS
[****]
These entities also include any of their affiliates whose primary business is
the sale of the XXX.xxx Exclusive Products. During the first two (2) years
following execution hereof, FLOWERS can replace any of the above bullet points
with another entity whose primary business is the sale of the XXX.xxx Exclusive
Products.
**** Represents material which has been redacted and filed separately with
the Commission pursuant to a request for confidential treatment under
Rule 406 of the Securities Act of 1933, as amended.
EXHIBIT D
OPERATING STANDARDS
1. [intentionally omitted].
2. HOSTING; CAPACITY. 1-800-Flowers will provide all computer servers, routers,
switches and associated hardware in an amount reasonably necessary to meet
anticipated traffic demands, adequate power supply (including generator back-up)
and HVAC, adequate insurance, adequate service contracts and all necessary
equipment racks, floor space, network cabling and power distribution to support
the Affiliated 1-800-Flowers Site.
3. SPEED; ACCESSIBILITY. 1-800-Flowers will ensure that the performance and
availability of the Affiliated 1-800-Flowers Site (a) is monitored on a
continuous, 24/7 basis and (b) remains competitive in all material respects with
the performance and availability of other similar sites based on similar form
technology. 1-800-Flowers will use commercially reasonable to ensure that: (a)
the functionality and features within the Affiliated 1-800-Flowers Site are
optimized for the client software then in use by AOL Users; and (b) the
Affiliated 1-800-Flowers Site is designed and populated in a manner that
minimizes delays when AOL Users attempt to access such site.
4. USER INTERFACE. 1-800-Flowers will maintain a graphical user interface within
the Affiliated 1-800-Flowers Site that is competitive in all material respects
with interfaces of other similar sites based on similar form technology. AOL
reserves the right to conduct focus group testing to assess compliance herewith.
5. SERVICE LEVEL RESPONSE. 1-800-Flowers agrees to use commercially reasonable
efforts to provide the following service levels in response to problems with or
improvements to the Affiliated 1-800-Flowers Site:
o For material functions of software that are or have become
substantially inoperable, 1-800-Flowers will provide a bug fix or
workaround within two (2) business days after the first report of such
error.
o For functions of the software that are impaired or otherwise fail to
operate in accordance with agreed upon specifications, 1-800-Flowers
will provide a bug fix or workaround within three (3) business days
after the first report of such error.
o For errors disabling only certain non-essential functions,
1-800-Flowers will provide a bug fix or workaround within sixty (60)
days after the first report of such error.
o For all other errors, 1-800-Flowers will address these requests on a
case-by-case basis as soon as reasonably feasible.
6. MONITORING. AOL Network Operations Center will work with a
1-800-Flowers-designated technical contact in the event of any performance
malfunction or other emergency related to the Affiliated 1-800-Flowers Site and
will either assist or work in parallel with Flowers' contact using 1-800-Flowers
tools and procedures, as applicable. The Parties will develop a process to
monitor performance and member behavior with respect to access, capacity,
security and related issues both during normal operations and during special
promotions/events.
7. TELECOMMUNICATIONS. The Parties agree to explore encryption methodology to
secure data communications between the Parties' data centers. The network
between the Parties will be configured such that no single component failure
will significantly impact AOL Users. The network will be sized such that no
single line runs at more than 70% average utilization for a 5-minute peak in a
daily period.
8. SECURITY REVIEW. 1-800-Flowers and AOL will work together to perform an
initial security review of, and to perform tests of, the 1-800-Flowers system,
network, and service security in order to evaluate the security risks and
provide recommendations to 1-800-Flowers, including periodic follow-up reviews
as reasonably required by 1-800-Flowers or AOL. 1-800-Flowers will use
commercially reasonable best efforts to fix any security risks or breaches of
security as may be identified by AOL's Operations Security. Specific services to
be performed on behalf of AOL's Operations Security team will be as determined
by AOL in its sole discretion.
9. TECHNICAL PERFORMANCE. 1-800-Flowers will perform the following technical
obligations (and any reasonable updates thereto from time to time by AOL):
o 1-800-Flowers will design the Affiliated 1-800-Flowers Site to support
the Windows version of the Microsoft Internet Explorer 4.0 browser, and
make commercially reasonable efforts to support all other AOL browsers
listed at: "xxxx://xxxxxxxxx.xxxx.xxx.xxx/XxxxXxxxx.xxxx."
o 1-800-Flowers will configure the server from which it serves the site
to examine the HTTP User-Agent field in order to identify the "AOL
Member-Agents" listed at: "xxxx://xxxxxxxxx.
xxxx.xxx.xxx/Xxxx0Xxxx.xxxx."
o 1-800-Flowers will design its site to support HTTP 1.0 or later
protocol as defined in RFC 1945 (available at
"xxxx://xx.xxxxxxxx.xxx/xxx/xxx0000.xxxx") and to adhere to AOL's
parameters for refreshing cached information listed at
"xxxx://xxxxxxxxx.xxxx.xxx.xxx/XxxxxXxxx.xxxx."
EXHIBIT E
STANDARD ONLINE COMMERCE TERMS & CONDITIONS
1. AOL NETWORK DISTRIBUTION. 1-800-Flowers will not authorize any third party to
distribute or promote the Affiliated 1-800-Flowers Site or any 1-800-Flowers
Interactive Site through the AOL Network absent AOL's prior written approval.
The Promotions and any other promotion or advertisement purchased from or
provided by AOL will link only to the Affiliate 1-800-Flowers Site (or the
1-800-Flowers Interactive Site under the Existing Agreement, as applicable).
2. PROVISION OF OTHER CONTENT. In the event that AOL notifies 1-800-Flowers that
(i) as reasonably determined by AOL, any Content within the Affiliated
1-800-Flowers Site violates AOL's then-standard Terms of Service (as set forth
on the America Online(R) brand service), the terms of this Agreement or any
other standard, written AOL policy or (ii) AOL reasonably objects to the
inclusion of any Content within the Affiliated 1-800-Flowers Site (other than
any specific items of Content which may be expressly identified in this
Agreement), then 1-800-Flowers will take commercially reasonable steps to block
access by AOL Users to such Content using Flowers' then-available technology. In
the event that 1-800-Flowers cannot, through its commercially reasonable
efforts, block access by AOL Users to the Content in question, then
1-800-Flowers will provide AOL prompt written notice of such fact. AOL may then,
at its option, restrict access from the AOL Network to the Content in question
using technology available to AOL. 1-800-Flowers will cooperate with AOL's
reasonable requests to the extent AOL elects to implement any such access
restrictions.
3. CONTESTS. 1-800-Flowers will take all steps necessary to ensure that any
contest, sweepstakes or similar promotion conducted or promoted through the
Affiliated 1-800-Flowers Site (a "Contest") complies with all applicable
federal, state and local laws and regulations.
4. NAVIGATIONAL ICONS. Subject to the prior consent of 1-800-Flowers, which
consent will not be unreasonably withheld, AOL will be entitled to establish
navigational icons, links and pointers connecting the Affiliated 1-800-Flowers
Site (or portions thereof) with other content areas on or outside of the AOL
Network.
5. DISCLAIMERS. Upon AOL's request, 1-800-Flowers agrees to include within the
Affiliated 1-800-Flowers Site a product disclaimer (the specific form and
substance to be mutually agreed upon by the Parties) indicating that
transactions are solely between 1-800-Flowers and AOL Users purchasing Products
from 1-800-Flowers.
6. LOOK AND FEEL. 1-800-Flowers acknowledges and agrees that AOL will own all
right, title and interest in and to the AOL Look and Feel, subject to Flowers'
ownership rights in any 1-800-Flowers trademarks or copyrighted material within
the Affiliated 1-800-Flowers Site and the 1-800-Flowers Look and Feel. AOL
acknowledges and agrees that 1-800-Flowers will own all right, title and
interest in and to the 1-800-Flowers Look and Feel and the 1-800-Flowers
Affiliated Site, subject to the AOL Look and Feel.
7. MANAGEMENT OF THE AFFILIATED 1-800-FLOWERS SITE. 1-800-Flowers will manage,
review, delete, edit, create, update and otherwise manage all Products available
on or through the Affiliated 1-800-Flowers Site, in a timely and professional
manner and in accordance with the terms of this Agreement. 1-800-Flowers will
ensure that each Affiliated 1-800-Flowers Site is current, accurate and
well-organized at all times. 1-800-Flowers warrants that the Products and other
Content contained therein: (i) will not infringe on or violate any copyright,
trademark, U.S. patent or any other third party right, including without
limitation, any music performance or other music-related rights; (ii) will not
violate AOL's then-applicable Terms of Service; and (iii) will not violate any
applicable law or regulation, including those relating to contests, sweepstakes
or similar promotions. Additionally, 1-800-Flowers represents and warrants that
it owns or has a valid license to all rights to any Licensed Content used in AOL
"slideshow" or other formats embodying elements such as graphics, animation and
sound, free and clear of all encumbrances and without violating the rights of
any other person or entity. 1-800-Flowers also warrants that a reasonable basis
exists for all Product performance or comparison claims appearing through the
Affiliated 1-800-Flowers Site. AOL will have no obligations with respect to the
Products available on or through the Affiliated 1-800-Flowers Site, including,
but not limited to, any duty to review or monitor any such Products.
8. DUTY TO INFORM. 1-800-Flowers will promptly inform AOL of any information
related to the 1-800-Flowers Service or Affiliated 1-800-Flowers Site which
could reasonably lead to a claim, demand, or liability of or against AOL and/or
its affiliates by any third party.
9. CUSTOMER SERVICE. It is the sole responsibility of 1-800-Flowers to provide
customer service to persons or entities purchasing Products through the AOL
Network ("Customers"). 1-800-Flowers will bear full responsibility for all
customer service, including without limitation, order
processing, billing, fulfillment, shipment, collection and other customer
service associated with any Products offered, sold or licensed through the
Affiliated 1-800-Flowers Site, and AOL will have no obligations whatsoever with
respect thereto. 1-800-Flowers will receive all emails from Customers via a
computer available to Flowers' customer service staff and generally respond to
such emails within one business day of receipt. 1-800-Flowers will receive all
orders electronically and generally process all orders within one business day
of receipt, provided Products ordered are not advance order items. 1-800-Flowers
will ensure that all orders of Products are received, processed, fulfilled and
delivered on a timely and professional basis. 1-800-Flowers will offer AOL Users
who purchase Products through such Affiliated 1-800-Flowers Site a money back
satisfaction guarantee. 1-800-Flowers will bear all responsibility for
compliance with federal, state and local laws in the event that Products are out
of stock or are no longer available at the time an order is received.
1-800-Flowers will also comply with the requirements of any federal, state or
local consumer protection or disclosure law. Payment for Products will be
collected by 1-800-Flowers directly from customers. Flowers' order fulfillment
operation will be subject to AOL's reasonable review.
10. PRODUCTION WORK. In the event that 1-800-Flowers requests AOL's production
assistance in connection with (i) ongoing programming and maintenance related to
the Affiliated 1-800-Flowers Site, (ii) a redesign of or addition to the
Affiliated 1-800-Flowers Site (e.g., a change to an existing screen format or
construction of a new custom form), (iii) production to modify work performed by
a third party provider or (iv) any other type of production work, 1-800-Flowers
will work with AOL to develop a detailed production plan for the requested
production assistance (the "Production Plan"). Following receipt of the final
Production Plan, AOL will notify 1-800-Flowers of (i) AOL's availability to
perform the requested production work, (ii) the proposed fee or fee structure
for the requested production and maintenance work and (iii) the estimated
development schedule for such work. To the extent the Parties reach agreement
regarding implementation of agreed-upon Production Plan, such agreement will be
reflected in a separate work order signed by the Parties. To the extent
1-800-Flowers elects to retain a third party provider to perform any such
production work, work produced by such third party provider must generally
conform to AOL's production Standards & Practices (a copy of which will be
supplied by AOL to 1-800-Flowers upon request). The specific production
resources which AOL allocates to any production work to be performed on behalf
of 1-800-Flowers will be as determined by AOL in its sole discretion.
11. OVERHEAD ACCOUNTS. To the extent AOL has granted 1-800-Flowers any overhead
accounts on the AOL Service, 1-800-Flowers will be responsible for the actions
taken under or through its overhead accounts, which actions are subject to AOL's
applicable Terms of Service and for any surcharges, including, without
limitation, all premium charges, transaction charges, and any applicable
communication surcharges incurred by any overhead Account issued to
1-800-Flowers, but 1-800-Flowers will not be liable for charges incurred by any
overhead account relating to AOL's standard monthly usage fees and standard
hourly charges, which charges AOL will bear. Upon the termination of this
Agreement, all overhead accounts, related screen names and any associated usage
credits or similar rights, will automatically terminate. AOL will have no
liability for loss of any data or content related to the proper termination of
any overhead account.
12. AOL USER COMMUNICATIONS. To the extent 1-800-Flowers sends any targeted
form of communications to AOL Users, 1-800-Flowers will promote the
Affiliated 1-800-Flowers Site as the location at which to purchase Products
(as compared to any more general or other site or location). In addition,
1-800-Flowers will not send any targeted form of communications that
encourages AOL Users to take any action inconsistent with the scope and
purpose of this Agreement, including without limitation, the following
actions: (a) using Content other than the Licensed Content; (b) bookmarking
of Interactive Sites other than the Affiliated 1-800-Flowers Site; (c) using
Interactive Sites other than those covered by the revenue-sharing provisions
herein; (d) changing the default home page on the AOL browser; or (e) using
any Interactive Service other than AOL. This section 12 will not affect
1-800-Flowers' ability to send mailings to its general customer base (e.g.,
print catalog).
13. MERCHANT CERTIFICATION PROGRAM. 1-800-Flowers will participate in any
generally applicable "Certified Merchant" program operated by AOL or its
authorized agents or contractors. Such program may require merchant participants
on an ongoing basis to meet certain reasonable, generally applicable standards
relating to provision of electronic commerce through the AOL Network (including,
as a minimum, use of 40-bit SSL encryption and if requested by AOL, 128-bit
encryption) and may also require the payment of certain reasonable certification
fees to the applicable entity operating the program. Each Certified Merchant in
good standing will be entitled to place on its affiliated Interactive Site an
AOL designed and approved button promoting the merchant's status as an AOL
Certified Merchant.
EXHIBIT F
STANDARD LEGAL TERMS & CONDITIONS
1. PROMOTIONAL MATERIALS/PRESS RELEASES. Each Party will submit to the other
Party, for its prior written approval, which will not be unreasonably withheld
or delayed, any marketing, advertising, press releases, and all other
promotional materials related to the Affiliated 1-800-Flowers Site and/or
referencing the other Party and/or its trade names, trademarks, and service
marks (the "Materials"); provided, however, that either Party's use of screen
shots of the Affiliated 1-800-Flowers Site for promotional purposes will not
require the approval of the other Party so long as America Online(R)is clearly
identified as the source of such screen shots. Each Party will solicit and
reasonably consider the views of the other Party in designing and implementing
such Materials. Once approved, the Materials may be used by a Party and its
affiliates for the purpose of promoting the Affiliated 1-800-Flowers Site and
the content contained therein and reused for such purpose until such approval is
withdrawn with reasonable prior notice. In the event such approval is withdrawn,
existing inventories of Materials may be depleted. Notwithstanding the
foregoing, either Party may issue press releases and other disclosures as
required by law or as reasonably advised by legal counsel without the consent of
the other Party and in such event, prompt notice thereof will be provided to the
other Party.
2. LICENSE. During the Term of this Agreement, 1-800-Flowers hereby grants
AOL a non-exclusive worldwide license to market, license, distribute, reproduce,
display, perform, transmit and promote the Licensed Content (or any portion
thereof) through such areas or features of the AOL Network solely in accordance
with the terms and conditions hereof. 1-800-Flowers acknowledges and agrees that
the foregoing license permits AOL to distribute portions of the Licensed Content
in synchronism or timed relation with visual materials prepared by 1-800-Flowers
or by AOL on behalf of 1-800-Flowers solely at Flowers' request (e.g., as part
of an AOL "slideshow"). Subject to such license, 1-800-Flowers retains all
right, title and interest in the Licensed Content. In addition, AOL Users will
have the right to access and use the Affiliated 1-800-Flowers Site.
3. TRADEMARK LICENSE. In designing and implementing the Materials and
subject to the other provisions contained herein, 1-800-Flowers will be entitled
to use the following trade names, trademarks, and service marks of AOL: the
"America Online(R)" brand service, "AOL(TM)" service/software and AOL's triangle
logo; and AOL and its affiliates will be entitled to use the following trade
names, trademarks, and service marks of 1-800-Flowers (collectively, together
with the AOL marks listed above, the "Marks"): 1-800-1-800-Flowers, Gift
Concierge Service, World's Favorite Florist, Freshness Care System and Fresh
Thoughts; provided that each Party: (i) does not create a unitary composite xxxx
involving a Xxxx of the other Party without the prior written approval of such
other Party; and (ii) displays symbols and notices clearly and sufficiently
indicating the trademark status and ownership of the other Party's Marks in
accordance with applicable trademark law and practice.
4. OWNERSHIP OF TRADEMARKS. Each Party acknowledges the ownership of the
other Party in the Marks of the other Party and agrees that all use of the
other Party's Marks will inure to the benefit, and be on behalf, of the other
Party. Each Party acknowledges that its utilization of the other Party's
Marks will not create in it, nor will it represent it has, any right, title,
or interest in or to such Marks other than the licenses expressly granted
herein. Each Party agrees not to do anything contesting or impairing the
trademark rights of the other Party, including, without limitation, seeking
to register the other Party's Marks as part of a composite xxxx.
5. QUALITY STANDARDS. Each Party agrees that the nature and quality of its
products and services supplied in connection with the other Party's Marks will
conform to quality standards set by the other Party. Each Party agrees to supply
the other Party, upon request, with a reasonable number of samples of any
Materials publicly disseminated by such Party which utilize the other Party's
Marks. Each Party will comply with all applicable laws, regulations, and customs
and obtain any required government approvals pertaining to use of the other
Party's marks.
6. INFRINGEMENT PROCEEDINGS. Each Party agrees to promptly notify the other
Party of any unauthorized use of the other Party's Marks of which it has actual
knowledge. Each Party will have the sole right and discretion to bring
proceedings alleging infringement of its Marks or unfair competition related
thereto; provided, however, that each Party agrees to provide the other Party
with its reasonable cooperation and assistance with respect to any such
infringement proceedings.
7. REPRESENTATIONS AND WARRANTIES. Each Party represents and warrants to the
other Party that: (i) such Party has the full corporate right, power and
authority to enter into this Agreement and to perform the acts required of it
hereunder; (ii) the execution of this Agreement by such Party, and the
performance by such Party of its obligations and duties hereunder, do not and
will not violate any
agreement to which such Party is a party or by which it is otherwise bound;
(iii) when executed and delivered by such Party, this Agreement will constitute
the legal, valid and binding obligation of such Party, enforceable against such
Party in accordance with its terms; and (iv) such Party acknowledges that the
other Party makes no representations, warranties or agreements related to the
subject matter hereof that are not expressly provided for in this Agreement.
8. CONFIDENTIALITY. Each Party acknowledges that Confidential Information
may be disclosed to the other Party during the course of this Agreement. Each
Party agrees that it will take reasonable steps, at least substantially
equivalent to the steps it takes to protect its own proprietary information,
during the term of this Agreement, and for a period of two years following
expiration or termination of this Agreement, to prevent the duplication or
disclosure of Confidential Information of the other Party, other than by or
to its employees or agents or affiliates who must have access to such
Confidential Information to perform such Party's obligations hereunder, who
will each agree to comply with this section. Notwithstanding the foregoing,
either Party may issue a press release or other disclosure containing
Confidential Information without the consent of the other Party, to the
extent such disclosure is required by law, rule, regulation or government or
court order. In such event, the disclosing Party will provide at least five
(5) business days prior written notice of such proposed disclosure to the
other Party. Further, in the event such disclosure is required of either
Party under the laws, rules or regulations of the Securities and Exchange
Commission or any other applicable governing body, such Party will (i) redact
mutually agreed-upon portions of this Agreement to the fullest extent
permitted under applicable laws, rules and regulations and (ii) submit a
request to such governing body that such portions and other provisions of
this Agreement receive confidential treatment under the laws, rules and
regulations of the Securities and Exchange Commission or otherwise be held in
the strictest confidence to the fullest extent permitted under the laws,
rules or regulations of any other applicable governing body.
9. LIMITATION OF LIABILITY; DISCLAIMER; INDEMNIFICATION.
9.1. LIABILITY. UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE
OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY
DAMAGES (EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES), ARISING FROM BREACH OF THE AGREEMENT, THE SALE OF PRODUCTS, THE USE OR
INABILITY TO USE THE AOL NETWORK, THE AOL SERVICE, XXX.XXX OR THE AFFILIATED
FLOWERS SITE, OR ARISING FROM ANY OTHER PROVISION OF THIS AGREEMENT, SUCH AS,
BUT NOT LIMITED TO, LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST BUSINESS
("COLLECTIVELY, "DISCLAIMED DAMAGES"); PROVIDED THAT EACH PARTY WILL REMAIN
LIABLE TO THE OTHER PARTY TO THE EXTENT ANY DISCLAIMED DAMAGES ARE CLAIMED BY A
THIRD PARTY AND ARE SUBJECT TO INDEMNIFICATION PURSUANT TO SECTION 9.3. EXCEPT
AS PROVIDED IN SECTION 9.3, (I) LIABILITY ARISING UNDER THIS AGREEMENT WILL BE
LIMITED TO DIRECT, OBJECTIVELY MEASURABLE DAMAGES, AND (II) NEITHER PARTY WILL
BE LIABLE TO THE OTHER PARTY FOR MORE THAN THE AGGREGATE AMOUNT OF PAYMENT
OBLIGATIONS TO BE PAID TO AOL BY FLOWERS HEREUNDER IN THE YEAR IN WHICH
LIABILITY ACCRUES; PROVIDED THAT EACH PARTY WILL REMAIN LIABLE FOR THE AGGREGATE
AMOUNT OF ANY PAYMENT OBLIGATIONS OWED TO THE OTHER PARTY PURSUANT TO SECTION 4.
9.2. NO ADDITIONAL WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, NEITHER PARTY MAKES ANY, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS
ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE AOL
NETWORK, THE AOL SERVICE, XXX.XXX OR THE AFFILIATED FLOWERS SITE, INCLUDING ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND
IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE.
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AOL SPECIFICALLY DISCLAIMS ANY
WARRANTY REGARDING THE PROFITABILITY OF THE AFFILIATED FLOWERS SITE.
9.3. INDEMNITY. Either Party will defend, indemnify, save and hold harmless
the other Party and the officers, directors, agents, affiliates, distributors,
franchisees and employees of the other Party from any and all third party
claims, demands, liabilities, costs or expenses, including reasonable attorneys'
fees ("Liabilities"), resulting from the indemnifying Party's material breach of
any duty, representation, or warranty of this Agreement, except to the extent
Liabilities result from the negligence or misconduct of the other Party or
material breach of any duty, representation or warranty by the other Party.
9.4. CLAIMS. Each Party agrees to (i) promptly notify the other Party in
writing of any indemnifiable claim and give the other Party the opportunity to
defend or negotiate a settlement of any such claim at such other Party's
expense, and (ii) cooperate fully with the other Party, at that other Party's
expense, in defending or settling such claim. Each Party reserves the right, at
its own expense, to assume the exclusive defense and control of any matter
otherwise
subject to indemnification by the other Partyhereunder, and in such event, such
other Party will have no further obligation to provide indemnification for such
matter hereunder.
9.5. ACKNOWLEDGMENT. AOL and 1-800-Flowers each acknowledges that the
provisions of this Agreement were negotiated to reflect an informed, voluntary
allocation between them of all risks (both known and unknown) associated with
the transactions contemplated hereunder. The limitations and disclaimers related
to warranties and liability contained in this Agreement are intended to limit
the circumstances and extent of liability. The provisions of this Section 9 will
be enforceable independent of and severable from any other enforceable or
unenforceable provision of this Agreement.
10. SOLICITATION OF AOL USERS. During the term of this Agreement, and for
the one-year period following the expiration or termination of this
Agreement, neither 1-800-Flowers nor its agents (acting at 1-800-Flowers
direction) will use the AOL Network to (i) solicit, or participate in the
solicitation of AOL Users when that solicitation is for the benefit of any
AOL Competitor (as defined in the Existing Agreement) or (ii) promote any
services which could reasonably be construed to be in competition with AOL in
its business or providing Internet or online services. In addition,
1-800-Flowers may not send AOL Users e-mail communications promoting Flowers'
Products through the AOL Network without a "Prior Business Relationship." For
purposes of this Agreement, a "Prior Business Relationship" will mean that
the AOL User has either (i) engaged in a transaction with 1-800-Flowers
through the AOL Network or (ii) voluntarily provided information to
1-800-Flowers through a contest, registration, or other communication, which
included notice to the AOL User that the information provided by the AOL User
could result in an e-mail being sent to that AOL User by 1-800-Flowers or its
agents. A Prior Business Relationship does not exist by virtue of an AOL
User's visit to an Affiliated 1-800-Flowers Site (absent the elements above).
More generally, 1-800-Flowers will be subject to any standard policies
regarding e-mail distribution through the AOL Network which AOL may implement.
11. COLLECTION OF USER INFORMATION. 1-800-Flowers is prohibited from
collecting AOL Member screennames or AOL User email addresses from public or
private areas of the AOL Network, except as specifically provided below.
1-800-Flowers will ensure that any survey, questionnaire or other means of
collecting AOL Member screennames or AOL User email addresses, names, addresses
or other identifying information ("User Information"), including, without
limitation, requests directed to specific AOL Member screennames or AOL User
email addresses and automated methods of collecting such information (an
"Information Request") complies with (i) all applicable laws and regulations and
(ii) any privacy policies which have been issued by AOL in writing during the
Term (the "AOL Privacy Policies"). Each Information Request will clearly and
conspicuously specify to the AOL Users at issue the purpose for which User
Information collected through the Information Request will be used (the
"Specified Purpose").
12. USE OF USER INFORMATION. 1-800-Flowers will restrict use of the User
Information collected through an Information Request to the Specified Purpose.
In no event will 1-800-Flowers (i) provide User Information (excluding any such
information (e.g., name) that was received by 1-800-Flowers from an AOL User via
another 1-800-Flowers sales channel and was not overlaid against or otherwise
derived from other information received from such user via the AOL Service or
XXX.xxx) to any third party (except to the extent specifically (a) permitted
under the AOL Privacy Policies or (b) authorized by the members in question),
(ii) rent, sell or barter User Information, (iii) identify, promote or otherwise
disclose such User Information in a manner that identifies AOL Users as
end-users of the AOL Service, XXX.xxx or the AOL Network or (iv) otherwise use
any User Information in contravention of Section 10 above. Notwithstanding the
foregoing, in the case of AOL Members who purchase Products from 1-800-Flowers,
1-800-Flowers will be entitled to use User Information from such AOL Members as
part of 1-800-Flowers's aggregate list of Customers; provided that
1-800-Flowers's use does not in any way identify, promote or otherwise disclose
such User Information in a manner that identifies such AOL Members as end-users
of the AOL Service, XXX.xxx or the AOL Network.
13. EXCUSE. Neither Party will be liable for, or be considered in breach of
or default under this Agreement on account of, any delay or failure to perform
as required by this Agreement as a result of any causes or conditions which are
beyond such Party's reasonable control and which such Party is unable to
overcome by the exercise of reasonable diligence, provided: (i) the delayed
Party gives the other Party written notice of such cause or condition promptly
and (ii) uses its reasonable best efforts to promptly correct such failure or
delay. For purposes of this provision, a delay or non-performance shall not be
deemed beyond the reasonable control of the Party affected if such delay or
non-performance would not have occurred had the affected Party been performing
in accordance with the provisions of the Agreement.
14. INDEPENDENT CONTRACTORS. The Parties to this Agreement are independent
contractors. Neither Party is an agent, representative or partner of the other
Party. Neither Party will have any right, power or authority to enter into any
agreement for or on behalf of, or incur any obligation or liability of, or to
otherwise bind, the other Party. This Agreement will not be interpreted or
construed to create an
association, agency, joint venture or partnership between the Parties or to
impose any liability attributable to such a relationship upon either Party.
15. NOTICE. Any notice, approval, request, authorization, direction or other
communication under this Agreement will be given in writing and will be deemed
to have been delivered and given for all purposes (i) on the delivery date if
delivered by electronic mail on the AOL Network or by facsimile; (ii) on the
delivery date if delivered personally to the Party to whom the same is directed;
(iii) one business day after deposit with a commercial overnight carrier, with
written verification of receipt, or (iv) five business days after the mailing
date, whether or not actually received, if sent by U.S. mail, return receipt
requested, postage and charges prepaid, or any other means of rapid mail
delivery for which a receipt is available, to the person(s) specified below at
the address of the Party set forth in the first paragraph of this Agreement (or
otherwise changed on written notice). In the case of AOL, such notice will be
provided to both the Senior Vice President for Business Affairs and the Deputy
General Counsel.
16. NO WAIVER. The failure of either Party to insist upon or enforce strict
performance by the other Party of any provision of this Agreement or to exercise
any right under this Agreement will not be construed as a waiver or
relinquishment to any extent of such Party's right to assert or rely upon any
such provision or right in that or any other instance; rather, the same will be
and remain in full force and effect.
17. RETURN OF INFORMATION. Upon the expiration or termination of this
Agreement, each Party will, upon the written request of the other Party, return
or destroy (at the option of the Party receiving the request) all confidential
information, documents, manuals and other materials specified the other Party.
18. SURVIVAL. Sections 4.4 and 6 of the body of the Agreement and Sections 8
through 12 of this Exhibit F, will survive the completion, expiration,
termination or cancellation of this Agreement.
19. ENTIRE AGREEMENT. This Agreement sets forth the entire agreement and
supersedes any and all prior agreements of the Parties with respect to the
transactions set forth herein. Neither Party will be bound by, and each Party
specifically objects to, any term, condition or other provision which is
different from or in addition to the provisions of this Agreement (whether or
not it would materially alter this Agreement) and which is proffered by the
other Party in any correspondence or other document, unless the Party to be
bound thereby specifically agrees to such provision in writing.
20. AMENDMENT. No change, amendment or modification of any provision of this
Agreement will be valid unless set forth in a written instrument signed by the
Party subject to enforcement of such amendment, and in the case of AOL, by a
senior vice president.
21. FURTHER ASSURANCES. Each Party will take such action (including, but not
limited to, the execution, acknowledgment and delivery of documents) as may
reasonably be requested by any other Party for the implementation or continuing
performance of this Agreement.
22. ASSIGNMENT. Except for assignment, transfer or delegation by either
Party to an affiliate or successor by way of merger, consolidation or sale of
all or substantially all of such Party's outstanding voting securities or
assets, neither Party shall assign (voluntarily, by operation of law or
otherwise) this Agreement or any right, interest or benefit under this Agreement
without the prior written consent of the other Party. Subject to the foregoing,
this Agreement shall be fully binding upon, inure to the benefit of and be
enforceable by the Parties hereto and their respective successors and assigns.
23. CONSTRUCTION; SEVERABILITY. In the event that any provision of this
Agreement conflicts with the law under which this Agreement is to be construed
or if any such provision is held invalid by a court with jurisdiction over the
Parties to this Agreement, (i) such provision will be deemed to be restated to
reflect as nearly as possible the original intentions of the Parties in
accordance with applicable law, and (ii) the remaining terms, provisions,
covenants and restrictions of this Agreement will remain in full force and
effect.
24. REMEDIES. Except where otherwise specified, the rights and remedies
granted to a Party under this Agreement are cumulative and in addition to, and
not in lieu of, any other rights or remedies which the Party may possess at law
or in equity; provided that, in connection with any dispute hereunder, neither
Party will be entitled to offset any amounts that it claims to be due and
payable from the other Party against amounts otherwise payable to such other
Party.
25. APPLICABLE LAW; JURISDICTION. This Agreement will be interpreted,
construed and enforced in all respects in accordance with the laws of the
Commonwealth of Virginia except for its conflicts of laws principles.
26. EXPORT CONTROLS. Both Parties will adhere to all applicable laws,
regulations and rules relating to the export of technical data and will not
export or re-export any technical data, any products received from the other
Party or the direct product of such technical data to any proscribed country
listed in such applicable laws, regulations and rules unless properly
authorized.
27. HEADINGS. The captions and headings used in this Agreement are inserted
for convenience only and will not affect the meaning or interpretation of this
Agreement.
28. COUNTERPARTS. This Agreement may be executed in counterparts, each of
which will be deemed an original and all of which together will constitute one
and the same document
