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EXHIBIT 10.17
CABLE AFFILIATION AGREEMENT
THIS AGREEMENT is made as of the 23rd day of February, 1998, by and between WINK
COMMUNICATIONS, INC., a California corporation ("Wink"), whose address is 0000
Xxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx, XX 00000 and INTERMEDIA PARTNERS SOUTHEAST, a
California general partnership ("Affiliate"), whose address is 000 Xxxxxx
Xxxxxx, Xxxxx 0000, Xxxxxxxxx, Xxxxxxxxx 00000.
1. GRANT OF LICENSE
1.1 Wink hereby grants to Affiliate the non-exclusive license to use the
Wink ITV Studio, Wink ITV Broadcast Server, and Wink ITV Response Server
versions 1.0 and 1.x updates (hereinafter collectively referred to as "Wink
Software") to deliver "enhanced broadcasting" to all of Affiliate's cable
systems in the continental United States.
1.2 This License is not transferable outside of the Affiliate's System
Operating Area, nor any rights hereunder, may be transferred, assigned or
sublicensed in whole or in part without Wink's prior written consent, which
shall not be unreasonably withheld.
1.3 For purposes of this Agreement, the "Operating Area" of any system
in which the Wink "enhanced broadcasting" is launched in accordance with
Section 4.1, shall mean, with respect to a cable television system, the
geographical areas where Affiliate is authorized to construct, operate, manage
or maintain a cable television system by appropriate governmental authority.
1.4 Affiliate agrees to evaluate the Wink Software on all advanced
analog and digital cable set-top boxes in use by a subscriber in the Operating
Areas.
2. TERM
2.1 The term of this Agreement shall commence on the date of execution
of this Agreement and terminate three (3) years thereafter.
2.2 Except as otherwise provided herein, neither Affiliate nor Wink may
give notice of its intent to terminate this Agreement prior to a date occurring
six (6) months from the launch date. After such initial six-month period,
Affiliate or Wink may terminate upon sixty (60) days written notice. Upon
Affiliate's or Wink's notice and during such sixty (60) day period, Wink may
take steps to cure any outstanding issues of nonperformance to Affiliate's
satisfaction, provided that Affiliate shall have ultimate discretion in
deciding whether to accept any cure tendered by Wink. If Affiliate or Wink
terminates this Agreement, Wink must buy back the server hardware utilized for
Wink services from Affiliate within thirty (30) days of such termination date
and at the same cost Affiliate paid for such hardware.
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3. INTEGRATION
3.1 Affiliate will distribute "enhanced broadcasting" through its
Operating Area head-ends. For the purposes of this Agreement, "enhanced
broadcasting" consists of video generated by and originating from a national
broadcaster or a cable programming network that has been enhanced through the
use of Wink Software. The "enhanced" nature of the video shall be evident in
the manner in which the Wink Software shall enable the viewer to access
information on shows, sporting events, other broadcast or syndicated programs,
and/or virtual channels through the capabilities embedded in the Vertical
Blanking Interval (the "VBI"). Wink Software also shall enable the reception
and processing of requests for information and/or purchases of product through
the viewer's use of a cable remote in conjunction with a Wink-enabled set-top
box. Affiliate does not and shall not relinquish any of its proprietary rights
in the use of, control over, or ownership of the VBI.
3.2 Wink also agrees to perform all Wink related work necessary to
integrate the Wink Software with advanced analog and digital cable set-top
boxes at no charge to Affiliate. Wink also agrees to perform all Wink related
work necessary to maintain such integrated solution involving the Wink Software
and Affiliate's advanced analog and digital cable set-top boxes.
3.3 Affiliate agrees to provide the necessary resources to meet an
Affiliate system launch date of May 1, 1998 for Affiliate's Kingsport Operating
Area.
3.4 Both parties will use their best efforts to complete all integration
work per the dates mentioned above.
3.5 Affiliate agrees to allow Wink to install and use Wink Response
Servers located in individual Affiliate cable headends to collect, aggregate,
and route responses for national "enhanced broadcasting" applications through
Wink's Alameda Data Center. Wink agrees to provide Affiliate with online
Internet access to daily reports detailing all response traffic generated by
Affiliate's subscribers.
4. RATES AND DEPLOYMENT
4.1 Affiliate agrees to provide Wink "enhanced broadcasting" as part of
its advanced analog offering to its subscribers in Kingsport, Tennessee
Operating Areas (the Launch Market) by May 1, 1998.
4.2 (a) Effective at launch, Affiliate agrees to remit a license fee
payment of [ * ]* for the Launch Market during the first eighteen months of the
Term of this Agreement.
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* Confidential treatment has been requested with respect to certain
portions of this exhibit pursuant to a request for confidential treatment filed
with the Securities and Exchange Commission. Omitted portions have been filed
with the Commission.
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(b) Thereafter, Affiliate agrees to remit a license fee payment
of [ * ] for the Launch Market. Wink will negotiate the procurement of engine
software from NextLevel Systems for all CFT-2200 set-top boxes acquired prior
to January 1, 1998, at no charge to Affiliate. Affiliate will provide all
server hardware needed for deployment, subject to the terms set forth in
Section 2.2 of this Agreement.
4.3 Affiliate may evaluate the possibility of the delivery of "enhanced
broadcasting" to all of Affiliate's cable systems in the continental United
States that have advanced analog or digital cable set-top boxes. Affiliate has
up to seven (7) months after deployment in the Launch Market to deploy Wink
Software in other Affiliate markets that have Wink capable set-top boxes and
retain pricing per Section 4.2(b), and may deploy Wink Software in such other
Affiliate markets according to the rates and under the terms and conditions set
forth in this Agreement upon written notice to Wink at any time during such
seven (7) month period.
4.4 Affiliate commits to distribute to its digital and advanced analog
subscribers within the Operating Areas, "enhanced broadcasting" delivered from
National Broadcasters and National Cable Programming Services (hereinafter
collectively referred to as "Programmers") in the VBI of the Programmers Video
Signal. Affiliate agrees to keep the appropriate headend and server equipment
in good working order to facilitate uninterrupted carriage of "enhanced
broadcasting". If Affiliate experiences problems with the "enhanced
broadcasting" delivery system, Affiliate shall restore "enhanced broadcasting"
service as soon as possible. Affiliate agrees not to charge Programmer for
carriage of Wink's "enhanced broadcasting" on the VBI or for use of the VBI in
connection with the delivery of Wink's "enhanced broadcasting" for the term of
the Agreement. Affiliate does not and shall not relinquish any of its
proprietary rights in the use of, control over, or ownership of the VBI.
4.5 Wink agrees to Share Revenue with Affiliate, based upon the amount
of revenue received by Wink as a result of all Wink generated purchase and
request transactions by Affiliate's Subscribers in Operating Areas offering
Wink's "enhanced broadcasting" for the term of this Agreement. Wink will pay
Affiliate at rates specified in Schedule A of this Agreement.
4.6 For purposes of this Agreement, the term "Wink Subscriber" shall
mean each Affiliate residential customer and commercial or business
establishment receiving and separately paying for xxxxx television service with
a digital or advanced analog box in all of Affiliate's Operating Areas.
4.7 Any reasonable and necessary shipping or travel costs incurred by
Wink in support of on-site installation, maintenance, support, or consulting
under this Agreement shall be payable by Affiliate, provided that Wink shall be
responsible for those costs associated with on-site installation, maintenance,
support, or consulting that are necessary as the result of the failure of
Wink's "enhanced broadcasting" to enable the viewer to access and/or request
information or make purchases of products through the cable remote when used
with a Wink-enabled set-top box as intended by the parties to this Agreement
and as is described in Section 3.1.
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4.8 Affiliate may choose to utilize other products and services of Wink
from time to time under this Agreement.
5. PAYMENT TERMS
5.1 On or before the thirtieth (30th) day following each month during
which period of time that Wink's product is functional and being used in
Affiliate's cable systems throughout the term of this Agreement, Affiliate
shall remit to Wink all fees owed for services rendered in the previous month.
5.2 Wink's failure, for any reason, to send an invoice for a particular
monthly payment shall not relieve Affiliate of its obligation to make any
payment in a timely manner consistent with the terms of this Agreement.
Past-due payments shall bear interest at a rate equal to one and one-half
percent (1 -1/2%) per month, and if either party is obligated to incur costs in
order to enforce any provision of this Agreement (including collection of
amounts due), the prevailing party shall be entitled to reimbursement for all
reasonable costs so incurred, including reasonable attorney's fees and costs.
6. PROMOTION AND RESEARCH
6.1 Affiliate agrees to promote and market the Wink service to
Subscribers within the Operating Area of each launched system. Advertising,
promotional, marketing and/or sales materials concerning the Wink service which
are provided to Affiliate by Wink may be used at the discretion of Affiliate.
6.2 Wink may, from time to time, undertake marketing tests and surveys,
rating polls and other research in connection with Affiliate's use of Wink's
product provided that such activities do not interfere or compete with
Affiliate's operations. Affiliate shall provide Wink with reasonable assistance
in conducting such research with respect to Affiliate's subscribers. Affiliate
agrees that Wink will have access to any and all research performed to gauge
the deployment and launch of Wink's services and the usage of Wink's services
by Affiliate's subscribers. Wink shall not disclose to any third party any
information deemed by Affiliate to be proprietary and confidential. Such
obligation not to disclose to any third party any and all proprietary and
confidential information shall survive the expiration of this Agreement and
shall continue until Affiliate notifies Wink otherwise. Information regarding
the aggregate usage of Wink's services and information required for
Wink-related transaction processing shall not be deemed proprietary and
confidential.
7. NOTICES
7.1 All notices, statements, and other communications given hereunder
shall be in writing and shall be delivered by personal delivery, certified
mail, return receipt requested, or by next day express delivery, addressed, if
to Wink, as follows: WINK COMMUNICATIONS at 0000 Xxxxxx Xxxxxxx Xxxxxxx,
Xxxxxxx, XX 00000; and if to Affiliate, as follows: InterMedia, PO Box
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3608, 000 Xxxx Xxxxx Xxxxx, Xxxxxxxxx, XX 00000, with a copy to InterMedia Legal
Department, 000 Xxxxxx xxxxxx, Xxxxx 0000, Xxxxxxxxx, XX 00000. The date of such
personal delivery or the next day if by express delivery, or the date three (3)
days after mailing, shall be deemed the date on which such notice is given and
effective.
8. TRADEMARKS
8.1 All right, title and interest in and to the service provided or
developed by Wink or other rights, of whatever nature, related to and developed
from such Wink service, shall remain the property of Wink. Further, Affiliate
acknowledges and agrees that all names, logos, marks, copyright notices or
designations utilized by Wink in connection with the service are the sole and
exclusive property of Wink, and no rights or ownership are intended to nor
shall be transferred to Affiliate.
9. REPRESENTATION AND INDEMNIFICATION
9.1 Wink represents and warrants to Affiliate that (i) it is a
corporation duly organized and validly existing under the laws of the State of
California; (ii) Wink has the corporate power and authority to enter into this
Agreement and to fully perform its obligations hereunder (iii) Wink is under no
contractual or other legal obligation which in any way interferes with its
ability to fully, promptly and completely perform hereunder.
9.2 Affiliate represents and warrants to Wink that (i) Affiliate is a
corporation/limited partnership duly organized and validly existing under the
laws of the State of California; (ii) Affiliate has the requisite power and
authority to enter into this Agreement and to fully perform its obligations
hereunder; (iii) Affiliate's Operating Areas are operating, with respect to any
cable television system, pursuant to valid franchise agreements, or licenses or
other permits duly authorized by proper local authorities; (iv) Affiliate is
under no contractual or other legal obligation which in any way interferes with
its ability to fully, promptly and completely perform hereunder.
9.3 Affiliate and Wink shall each indemnify, defend, and forever hold
harmless the other, and their affiliated companies and people, from any and all
losses, liabilities, claims, costs, damages and expenses (including, without
limitation, fines, forfeitures, attorney's fees disbursements and court or
administrative costs) arising out of any breach of any term of this Agreement or
any warranty, covenant or representation contained herein (excluding any and all
losses, liabilities, claims, costs, damages and expenses [including, without
limitation, fines, forfeitures, attorney's fees, disbursements and court or
administrative costs] arising out of the negligence or willful misconduct of the
other). Without limiting the provisions set out in this Section, Wink will
indemnify, defend and forever hold Affiliate and Affiliate's affiliated
companies, agents, representatives and employees harmless from and against any
and all losses, liabilities, claims, costs, damages and expenses (including,
without limitation, fines, forfeitures, attorney's fees, disbursements and court
or administrative costs) caused by or arising directly or indirectly out of (i)
any content delivered by or through Wink or Wink's processes, (ii) any claim
that the
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Licensed Product infringes the copyright, trade secret or trademark rights of a
third party, provided that Affiliate notifies Wink of such claim promptly in
writing and gives Wink the exclusive authority to defend or settle such claim.
Affiliate shall provide reasonable cooperation and assistance to Wink in its
efforts to settle or defend against any such claim. If the Licensed Product
becomes, or if Wink reasonably believes it may become, the subject of any claim
for infringement or the Licensed Product is determined by a court of competent
jurisdiction to infringe, then Wink may, at its option and expense, either (i)
procure for Affiliate the right to sell or use, as appropriate, the Licensed
Product with other suitable and reasonably equivalent software so that the
Licensed Product becomes non-infringing or (ii) if (I) and (ii) are not
commercially practicable, Wink may terminate this Agreement.
10. CONFIDENTIALITY
10.1 Neither Affiliate nor Wink shall disclose to any third party (other
than its respective employees, in their capacity as such), any information
marked "confidential" without prior written consent. The parties agree to keep
the terms of this Agreement confidential, but acknowledge that certain
disclosures may be required by law.
10.2 Wink commits to Affiliate that Wink will implement high levels of
security on the network for the collection, storage, and routing of subscriber
information to the degree necessary for both Wink and the Affiliate to comply
with Section 631 of the Cable Communications Act of 1984, as amended (47 U.S.C.
Section 551). Wink further agrees to release individual subscriber information
only to entities that the particular subscriber involved decides should have
that information. Choice as to which entities will be permitted access to
subscriber information shall be determined by the subscriber through their
deliberate interaction with a Wink enhanced broadcast application with regard
to such entities.
11. TERMINATION
11.1 Notwithstanding any other provision herein, either party shall have
the right to terminate this Agreement or all or any licenses granted herein in
accordance with the terms and conditions of this Section if the other party
fails to comply with any of its material obligations under this Agreement.
Should either party elect to exercise this right to terminate for
nonperformance, it must be done in writing specifically setting forth those
items of nonperformance. The defaulting party will then have thirty (30) days
from receipt of such notification. In the event Affiliate is the defaulting
party and Affiliate fails to correct items of nonperformance, then Wink shall
have the right to enter upon Affiliate's premises to repossess and remove any
Wink-owned Products provided that such repossession does not unreasonably
interfere with Affiliate's operations. In addition, the termination of this
Agreement in accordance with this Section shall be without prejudice to any
other remedies the terminating party may have, including, without limitation,
all remedies with respect to the unperformed balance of this Agreement;
provided, however, that if the defaulting party has not made payment of the fees
or charges due hereunder and such nonpayment continues
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thirty (30) days after receipt of prior written notice, then the non-defaulting
party may terminate this Agreement or any license granted herein.
11.2 Upon expiration of the term (including any extensions thereof) of
this Agreement or upon the termination of this Agreement or of any license
granted hereunder for any reason, all rights of Affiliate to use the Products
will cease and Affiliate will immediately (i) grant to Wink access to the
Products and allow Wink to remove the Products, (ii) purge all copies of all
Products from all computer processors or storage media on which Affiliate has
installed or permitted others to install such Products, and (iii) when
requested by Wink, certify to Wink in writing, signed by an officer of
Affiliate, that all copies of the Products have been returned to Wink or
destroyed and that no copy of any Product remains in Affiliate's possession or
under its control.
11.3 Nothing in this Section shall affect the rights of the parties as
enumerated in Section 2.2. In the event of a conflict between the provisions in
this Section and those set forth in Section 2.2, those in Section 2.2 shall
control.
11.4 FORCE MAJEURE. The performance of each party hereto shall be
excused by any prevention, delay or stoppage due to strikes, lockouts,
picketing, boycotts, governmental restrictions, regulations or controls, enemy
or hostile government action, civil commotion, fire, acts of God, flood,
earthquake, tornado, hurricane, unseasonable weather, energy shortages or other
causes beyond the reasonable control of the parties.
12. GENERAL
The parties agree that in the event it is necessary to employ attorneys
to enforce the terms of this Agreement, the prevailing party in any lawsuit
shall be entitled to an award of reasonable attorneys' fees and court costs.
a) This Agreement may not be assigned without the prior written mutual
consent of Affiliate and Wink.
b) This Agreement may be amended only by an instrument in writing,
executed by Affiliate and Wink.
c) This Agreement will be governed in all respects by the laws of the
State of California.
d) This Agreement represents the entire agreement between the parties
and supersedes and replaces all prior oral and written proposals,
communications and agreements with regard to the subject matter hereof between
Affiliate and Wink.
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IN WITNESS WHEREOF, the parties by their duly authorized representatives have
entered into this Agreement as of the Effective Date.
WINK COMMUNICATIONS, INC. INTERMEDIA
PARTNERS
SOUTHEAST
By: /s/ Xxxxxx Xxxxxxxxxxx By: /s/ Xxxxx Xxxxxxxx
Name: Xxxxxx Xxxxxxxxxxx Name: Xxxxx Xxxxxxxx
Title: President and CEO Title: Chief Operating Officer
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