EXHIBIT 10.20
[AMERICA WEST AIRLINES LOGO]
AMERICA WEST FLIGHTFUND INCENTIVE MILES AGREEMENT
-------------------------------------------------
THIS AGREEMENT, effective as of the 1st day of July, 1999 (the "Effective
Date") between AMERICA WEST AIRLINES, INC. ("America West"), a Delaware
corporation, whose principal business address is 0000 Xxxx Xxx Xxxxxx Xxxxxxxxx,
Xxxxxxx, XX 00000, and Netcentives Inc. ("Participant"), a California
corporation, whose principal business address is 000 Xxxxx Xxxxxx, Xxx
Xxxxxxxxx, XX 00000, sets forth the terms and conditions, and mutual
consideration, by which Participant has agreed to participate in the America
West Incentive Miles Program, as defined herein.
1. Definitions
"Miles" shall mean the fixed amount of miles credited to a FlightFund
member's account upon receipt of appropriate documentation verifying that
such FlightFund member has participated in the Netcentives Program pursuant
to the terms and conditions hereof. No travel on America West is required
to be awarded Miles.
"FlightFund Program" or "FlightFund" shall mean the frequent flyer
recognition program, as established and maintained by America West as of
the date of this Agreement, and from time to time thereafter, whereby
America West customers who become members receive travel benefits based
upon air travel mileage accumulated on America West or other designated air
carriers or through the use or purchase of the goods or services of another
designated vendor. The FlightFund Program may be amended, modified,
canceled, terminated or otherwise managed at any and all times in the sole
and absolute discretion of America West.
"Incentive Miles Program" shall mean the program, as established and
maintained by America West as of the date of this Agreement, and from time
to time thereafter, whereby new or existing FlightFund members accumulate
air travel mileage redeemable on America West or other designated air
carriers through the use or purchase of the goods or services of another
designated vendor. The Incentive Miles Program may be amended, modified,
canceled, terminated or otherwise managed at any and all times in the sole
and absolute discretion of America West.
"Limited Exclusivity" means America West's agreement not to sell FlightFund
Miles to any Direct Competitor of Netcentives as defined above. America
West and Netcentives shall have a relationship of Limited Exclusivity
during the Term.
"Netcentives Program" shall mean any of the Internet-based programs
operated by Netcentives which provide for the grant of points which are
redeemable for airline frequent flyer miles and/or other incentives to end-
users. Under the Netcentives Program, end-users may accrue points through
earning transactions ("Earning Transactions") by performing various
activities, and later, redeem points through redemption transactions
("Redemption Transactions") by requesting that the points be redeemed for
specific goods and services.
1
"Direct Competitor of Netcentives" means any third-party program or entity
which rewards Internet, online, or e-mail activities, (a) where end-users
may earn points at multiple web sites, at multiple online service areas, or
via e-mail-based services, or (b) where end-users may redeem points for the
incentive awards of more than one company. Direct Competitors of
Netcentives include, without limitation, the companies listed in Exhibit B
attached hereto.
2. FlightFund Miles Earned by Participant's Customers
A. FlightFund Miles earned by a FlightFund member for participation in
the Netcentives Program may be used by said member toward FlightFund
award benefits in the same manner, and subject to the same terms,
conditions and restrictions, as any other FlightFund mileage
accumulation.
B. Participant shall transmit to America West by computer tape, all
pertinent data necessary to enable America West to credit FlightFund
Program mileage. This data shall be provided in a format compatible
with America West's computer systems, as specified in Exhibit A,
America West Partner Standard Interface Record Layout. Upon receipt
of such data, America West shall credit the appropriate FlightFund
member's accounts. FlightFund data to be provided must include, at
minimum, FlightFund member name and identification number, mileage
amount to be credited and the information necessary to identify Miles.
The tape containing this information shall be delivered by Participant
to America West weekly and posted by America West within one (1) to
three (3) business days upon receipt of such tape, addressed to:
America West Airlines, Inc.
0000 X. Xxxxxxxxxx (00X-XXX)
Xxxxx, XX 00000
Attn: Tape Librarian
Credit of FlightFund Program miles is contingent upon America West's
timely receipt of such computer tape.
3. Exclusivity
A. The parties hereto acknowledge that they shall have a relationship of
Limited Exclusivity during the Term of this Agreement. Any violation
of this Section 3 shall be considered a material breach of this
Agreement.
B. America West shall not sell or grant FlightFund Miles to any Direct
Competitor of Netcentives during the term of this Agreement. America
West shall not permit access (including, without limitation, access
through regular mail or e-mail) to its FlightFund members by any
Direct Competitor of Netcentives during the term of this Agreement.
2
4. Advertising/Promotion Opportunities
A. America West will make available the opportunity for Participant to
insert promotional or advertising material in FlightFund Program
member communications at least one (1) time per year. The foregoing
inserts must be printed at Participant's expense, in conformity with
America West's standards for size and content, and delivered by
Participant to America West or its designated vendor in sufficient
time to be incorporated into the desired mailing. Participant shall
submit promotional or advertising material to America West for written
approval prior to printing. All copy generated by Participant that
refers to America West in any way must receive prior written approval
by America West.
B. America West will make available the opportunity for Participant to
include an article in the FlightFund newsletter at least one (1) time
per year to promote the Netcentives Program.
C. America West will include Participant, or its brands, such as
ClickRewards, at Participant's sole discretion, in FlightFund program
materials in which partners are listed, including without limitation,
print and electronic materials, as a FlightFund earning partner. When
possible, such materials will include a link to the Participant's web
site at a URL to be specified by Participant.
D. Participant shall include America West and/or the FlightFund Program
in Participant's printed and electronic materials consistent with
other airline partner exposure.
E. Participant shall give America West the opportunity to participate in
promotions targeting Participant's member base and other e-commerce
consumers in the event that such promotions are undertaken by
Participant.
5. Use of Logos and Service Marks
A. Participant agrees that any brochure or other promotional material or
advertising media, which may include print, radio, television, and the
Internet, that mentions America West must include the then current America
West logo (as provided by America West from time to time), provided,
however, that no such use shall constitute a license to Participant to use
for its own purposes (other than as set forth in this Agreement) any of
America West's trademarks, service marks or other similar intellectual
property, all of which shall remain the sole and exclusive property of
America West. All promotional material which mentions America West, and/or
uses its logo, shall be submitted to America West for written approval
prior to publication, provided, however, that promotional materials which
are identical to materials which were previously submitted for approval do
not need to be resubmitted, and shall be deemed to be approved. America
West shall not unreasonably disapprove of any such use. Participant agrees
to neither take nor permit any action that would infringe or interfere with
America West's exclusive ownership of its logo, trademarks and service
marks. Subject to this Section 5A, Participant shall have the right to use
the America West trademarks, service marks or other
3
similar intellectual property (i) on its Internet web site(s), (ii) on any
mirror, co-branded, or satellite site of its web site, (iii) on information
pages regarding Participant's programs or products, which pages are housed
at the web sites of its customers, and (iv) in its promotional materials,
provided that any such uses shall be for the sole purpose of promoting
Participant's participation in the FlightFund Program.
B. America West agrees that any brochure or other promotional material or
advertising media, which may include print, radio, television, and the
Internet, that mentions Participant shall include Participant's then
current logo, provided, however, that no such use shall constitute a
license to America West to use for its own purposes any of Participant's
trademarks, service marks or other similar intellectual property, all of
which shall remain the sole and exclusive property of Participant. All
brochures which mention Participant, and use its logo, shall be submitted
to Participant for written approval prior to publication and Participant
shall not unreasonably disapprove of any such use, provided, however, that
promotional materials which are subsantially similar to materials which
were previously submitted for approval do not need to be resubmitted, and
shall be deemed to be approved. America West agrees to neither take nor
permit any action that would infringe or interfere with Participant's
exclusive ownership of its logo, trademarks and service marks. Subject to
this Section 5B, America West shall have the right to use the Participant
trademarks, service marks or other similar intellectual property (i) on its
Internet web site(s), (ii) on any mirror, co-branded, or satellite site of
its web site, and (iii) in its promotional materials, provided that any
such uses shall be for the sole purpose of promoting Participant's
participation in the FlightFund Program.
6. Payment by Participant
A. For all Miles credited to FlightFund members' accounts, Participant
shall pay America West the amount of $.015 per mile together with
any and all transportation or excise taxes, including without
limitation, the 7.5% transportation tax assessed on the sale or
purchase of frequent flyer miles in respect of the grant of the Miles
pursuant to this Agreement.
B. In the event that the payments made to America West pursuant to
Paragraph A above (exclusive of any taxes) are less than $10,000 in
any contract year, Participant shall pay to America West the
difference between the amount paid for such contract year and $10,000
promptly upon notice from America West of such shortfall. For purposes
hereof, "contract year" shall mean each twelve month period during the
term hereof commencing after the Effective Date.
4
C. America West shall submit monthly invoices to Participant, setting
forth the amounts due and such invoices shall be due and payable
within thirty (30) days from receipt.
D. Payments shall be made either by (i) wire transfer to America West in
accordance with the following wire transfer instructions:
Bank One, Arizona, N.A.
Phoenix Arizona
ABA No. 000-000 000
For the Account of America West Airlines, Inc.
No. 2312 4479
or (ii) check made payable to America West Airlines at the following
address:
America West Airlines, Inc.
X.X. Xxx 00000
Xxxxxxx, XX 00000-0000
7. Customer Service and Operations
Each party shall designate a specific individual employee of such party to
be the contact person for any operations or customer service issue
inquiries which may arise during the term of this Agreement. Each party
shall respond to such issues within no more than seven (7) days of receipt
of such inquiry.
8. Reporting
America West shall report, on a monthly basis, the number of generated
Miles that have been credited to the FlightFund database on account of
transactions with Participant. This report shall include, at a minimum,
the member's account to which the Miles were credited, and the applicable
number of Miles credited. FlightFund transactions will be reconciled, by
both America West and Participant, monthly and reviewed quarterly. Any
differences in numbers will be discussed and mutual agreement on the final
position will be determined. If a mutual agreement is not reached, within
sixty (60 days) of receipt of written notice, the America West base control
sheets will be the final position. In the event that any transactions are
rejected, America West shall notify Participant in writing of the reasons
for such rejection within ten (10) days.
9. Retention of Records/Audit Rights
Participant shall retain records relating to Miles earned pursuant to this
Agreement for at least two (2) years from the date qualifying purchases
were reported to America West. At all reasonable times, upon not less than
ten (10) days prior notice, America West or its designated representatives
shall have access to such records in order to verify such information as
may be reasonably necessary, during regular business hours, in America
West's judgment, to effectively
5
and correctly implement the terms and conditions of this Agreement. Any
such audit will occur at mutually agreeable times and locations, and at the
sole expense of America West. In the event that America West identifies
deficiencies in any such matters, Participant will take all necessary
action to correct all such deficiencies promptly and without charge to
America West. America West agrees that all such records and information
shall be held strictly confidential and not disclosed for any purpose
whatsoever to any third party.
10. Term and Termination
A. This Agreement shall commence on the Effective Date and shall
terminate on June 30, 2001, unless sooner terminated by either party
pursuant to the provisions herein.
E. This Agreement may be terminated by either party at any time upon not
less than ninety (90) days written notice. Except for obligations
accruing prior to the effective date of termination, such termination
will be with no liability whatsoever to either party except as
expressly provided herein.
F. Notwithstanding Section 10(B) above, if either party defaults in the
performance of any provision of this Agreement then the non-defaulting
party may give written notice to the defaulting party that if the
default is not cured within thirty (30) days, the Agreement will be
terminated. If the non-defaulting party gives such notice and the
default is not cured during the thirty (30) day period, then the non-
defaulting party may terminate the Agreement immediately at the end of
that period.
D. For a period of six (6) months after the effective date of termination
of this Agreement, America West will continue to credit FlightFund
Miles on account of Earning Transactions which occurred prior to such
effective date of termination. Points earned through the Netcentives
Program through Earning Transactions which occurred after the
effective date of such termination will not be redeemable for
FlightFund Miles.
11. Miscellaneous
A. Assignment This Agreement may not be assigned except with the prior
----------
written consent of the non-assigning party, and shall inure to the
benefit of the successors and assigns of either party.
B. Publicity After the execution of this Agreement, Participant may
---------
issue a press release which may, among other things, confirm the
existence of a relationship between the parties and may request that
America West issue a similar press release. Any other information
regarding the relationship between the parties including the other
terms of this Agreement and any other agreement between the parties
shall be considered Confidential Information under the definition set
forth herein.
C. Confidentiality Each party agrees to protect as confidential, and not
---------------
use or disclose for any purpose other than performance of the express
provisions of this Agreement, data,
6
information, trade secrets, research, customer lists or business or
strategic information of any kind or nature, furnished or obtained
from the other party in connection with the performance of this
Agreement, and to not disclose such information to any third party
whatsoever. Upon termination of this Agreement each party shall return
and deliver to the other party within a reasonable time, not to exceed
thirty (30) days after the effective date of termination, all such
data and information of the other party in its possession.
D. Access To Data Base Not less than two (2) times per year, upon
-------------------
request, and subject to the terms of any other relevant
confidentiality or privacy agreements, the parties shall each provide
access to their respective customer databases to the other party for
direct promotional purposes, and such access may be through a third
party vendor provided such vendor has executed a confidentiality
agreement satisfactory to the parties. Access to Participant's
database is through e-mails only. Due to the terms of Participant's
privacy policy, it may require that such e-mails come from Participant
itself, and that the offers promoted be ClickRewards offers. Each
party agrees that any database information obtained from the other
party for special promotions will be used only for such promotion(s)
and will not be retained or merged into the receiving party's database
or the database of any third party, provided, however, that
information obtained from customers responding to such promotion(s)
may become part of the database of the party receiving such response.
Upon conclusion of the promotion for which access to such data has
been provided, the database in all forms, shall be returned to the
originating party, and the using party shall retain no copies thereof
in any form. Under no circumstances shall any such database, or
information derived therefrom, be made available to competitors of the
originating party, either directly or indirectly and each party agree
that, in the case of a breach hereof, legal remedies such as damages
would be inadequate, and therefore expressly consents to the entry of
injunctive and other equitable relief.
E. Independent Contractors It is mutually understood and agreed that
-----------------------
nothing in this Agreement is intended or may be construed to create or
establish any agency, partnership or joint venture relationship
between the parties hereto, and that the relationship of the parties
hereto shall at all times be that of independent contractors.
F. Non-Waiver The right of either party to require strict performance
----------
and observance of any obligations hereunder will not be affected in
any way by any previous waiver, forbearance or course of dealing.
G. Governing Law This Agreement and any dispute arising under or in
-------------
connection with this Agreement, including any action in tort, will be
governed by the internal laws of the State of Arizona, without regard
to the conflicts of laws principles thereof.
H. Notices All notices to the respective parties hereunder shall be sent
-------
by overnight delivery, or certified or registered U.S. mail, return
receipt requested, to the addresses as set forth on the first page of
this Agreement: America West, Attention: Senior Director, Relationship
Marketing; Netcentives, Attention: Chief Financial Officer, Cc: Vice
7
President, Relationship Marketing. The addresses for the purpose of
notice may be changed at any time by providing notice as set forth
herein.
I. Modification No modification to this Agreement shall be effective
------------
unless it is in writing and signed by the party sought to be charged
with such modification.
J. Captions The captions appearing in this Agreement have been inserted
--------
as a matter of convenience and in no way define, limit or enlarge the
scope of this Agreement or any of its provisions.
K. Entire Agreement This Agreement, including its exhibits, constitutes
----------------
the entire agreement and understanding of the parties on the subject
matter hereof, and, as of the Effective Date, supersedes all prior
agreements, whether written or oral, between the parties hereto
concerning the subject matter hereof. There are no other or further
representations or inducements, whether written or oral, that have
been given or made in connection with this Agreement.
L. Cost In the event of any litigation, arbitration, or other
----
proceedings under this Agreement, the prevailing party shall be
entitled to recover from the other party all costs, reasonable
attorney's fees and other expenses incurred.
M. Consequential Damages In no event will either party be liable for any
----------------------
special, indirect, incidental or consequential damages.
N. Indemnification.
---------------
(i) America West hereby agrees to indemnify, defend and hold
harmless Participant and its respective directors, officers,
agents and employees, from and against any and all claims,
losses, damages, suits, judgments, costs and expenses (including
litigation costs and reasonable attorneys' fees) arising out of
or relating to (i) America West' operation of the FlightFund
Program including without limitation, claims by participants in
the FlightFund Program of America West's breach, violation or
failure to comply with the terms of the FlightFund Program and
(ii) any allegation that Participant's use of the America West
trademarks and logos in strict accordance with this Agreement
infringes a U.S. copyright or trademark existing or issued as of
the date of such use, provided in each case that Participant
promptly notifies America West in writing of any such claim,
gives America West sole control of the defense and all related
settlement negotiations, and cooperates with America West in
defending or settling any such claim.
(ii) Participant hereby agrees to indemnify, defend and hold
harmless America West and its respective directors, officers,
agents and employees, from and against any and all claims,
losses, damages, suits, judgments, costs and expenses (including
litigation costs and reasonable attorneys' fees) arising out of
8
or relating to (i) Participant' operation of the ClickRewards
Program including without limitation, claims by participants in
the ClickRewards Program of Participant' breach, violation or
failure to comply with the terms of the ClickRewards Program and
(ii) any allegation that America West's use of the Participant
trademarks and logos in strict accordance with this Agreement
infringes a U.S. copyright or trademark existing or issued as of
the date of such use, provided in each case that America West
promptly notifies Participant in writing of any such claim, gives
Participant sole control of the defense and all related
settlement negotiations, and cooperates with Participant in
defending or settling any such claim.
IN WITNESS WHEREOF, Participant and America West have executed this
Agreement as of the dates written below.
AMERICA WEST AIRLINES, INC. NETCENTIVES INC.
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxxxx X. Xxxxxxx
------------------------------------ ------------------------------------
By: Xxxxxxx X. Xxxxx By: Xxxxxxxx X. Xxxxxxx
Title: Sr. Vice President,
Marketing & Sales Title: VP, Relationship Marketing
-----------------------------
Date: July 29, 1999 Date: July 23, 1999
---------------------------- ------------------------------
9
Exhibit B
DIRECT COMPETITORS OF NETCENTIVES
ALCONE MARKETING GROUP: NET PERKS AND OTHER PROGRAMS
AOL REWARDS
BIG BANG MEDIA
COOL SAVINGS
CYBERGOLD
EMAGINET
FREE RIDE
INCENTIVE XXXX/INTERNET PERKS
INTELLIOPOST: BONUS MAIL AND OTHER PROGRAMS
JUXTANET: PROLAUNCH AND OTHER PROGRAMS
MOTIVATION NET: MY POINTS AND OTHER PROGRAMS
NETSTAKES
PLANET ALL
PLANET-U
PRODUCT PARTNERS
XXXXXXXXXX.XXX
SPARK ONLINE
TRAUPASS
YOYODYNE
10
