EXHIBIT 10.19
News America Incorporated
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
November 4, 1999
Xx. Xxxxxxx Xxxxxxx
Executive Vice President and Managing Director
Yupi Internet Inc.
000 Xxxxxxx Xxxx
Xxxxx 000
Xxxxx Xxxxx, XX 00000
Dear Xxxxxxx:
This letter agreement ("Letter Agreement") between Yupi Internet Inc.,
a Florida corporation (the "Company"), and News America Incorporated, a Delaware
corporation ("NAI"), sets forth the terms pursuant to which certain advertising
services shall be purchased by the Company and provided by the News Group
Companies (as defined herein). The parties hereto agree to the terms set forth
below:
1. CONSIDERATION; TERM OF AGREEMENT.
The Company hereby agrees to purchase from NAI and other News
Group Companies for $12,500,000 in cash (payable as provided herein), and NAI
agrees to provide to the Company, and to cause other News Group Companies to
provide to the Company, advertising and promotional inventory (the "Advertising
Inventory") and related services (together with the Advertising Inventory, the
"Advertising Services") on and in respect of media of all types available
through the News Group Companies worldwide, including without limitation,
on-line, television, radio and print media, which such Advertising Services
shall be (i) equal in value to $12,500,000 (exclusive of any agency fees payable
in connection with the Company's purchase of Advertising Inventory and other
Advertising Services hereunder, which such agency fees shall be excluded from
the $12,500,000 purchase price paid by the Company for Advertising Services
hereunder (the "Advertising Budget") and shall be separately paid for by the
Company), which
such value shall be determined in the manner provided herein, (ii) paid for and
rendered in full within the thirty (30) month period commencing on January 1,
2000 (the "Term"), (iii) used for the purpose of advertising and promoting the
world wide web sites owned and/or controlled by Yupi, including but not limited
to those having the URL xxxx://xxx.xxxx.xxx and/or the URL of any other site
included in the Yupi network of majority owned sites (the "Sites"); and (iv) may
be used for the purpose of co-advertising and co-promoting the Sites with third
parties subject to the provisions of Section 3(a) hereof. All such Advertising
Services shall be paid for by the Company and rendered by the News Group
Companies, respectively, in the manner set forth herein. In the event that upon
expiration of the Term (i) the News Group Companies then include, at a minimum,
Fox Sports Latin America, Fox Kids Latin America, Inc. and the Fox Latin America
Channel, Inc., and/or other entities that, in the aggregate, then generate
ratings in Latin American markets equivalent or better than the aggregate
ratings generated by those entities on the date hereof and present similar
programming content to that shown by those entities on the date hereof, and (ii)
Yupi has not paid to NAI in full amount equivalent to the Advertising Budget,
Yupi shall pay to NAI an amount equivalent to the then-remaining unpaid balance
of the Advertising Budget within thirty (30) days after the date of expiration
of the Term.
As used herein, "News Group Companies" shall include (i) any
corporation or other entity Controlled (as defined herein) by The New
Corporation Limited ("News Corporation"), including but not limited to Fox
Sports Latin America and the Fox Latin America Channel, Inc. and (ii) Fox Kids
Latin America, Inc. As used herein, a corporation or other entity shall be
deemed "Controlled" by another party if more than fifty percent (50%) of the
outstanding voting securities or other equity interests of such corporation or
other entity is owned, directly or indirectly, by such other party.
2. MARKETING PLAN; COORDINATION OF ADVERTISING SERVICES.
NAI shall assist the Company in structuring a comprehensive
integrated marketing plan (the "Marketing Plan") which shall set forth the
Advertising Services that the parties contemplate will be provided to the
Company by NAI and other News Group Companies pursuant hereto. NAI and the
Company shall confer regularly in respect of the Company's implementation of the
Marketing Plan and the Company's periodic purchases of Advertising Services. The
Company shall make final selections of all Advertising Inventory, and shall
coordinate implementation of all Advertising Services generally, directly
through News Group Company providing such Advertising Services. NAI shall use
commercially reasonable efforts to satisfy, and to cause all other News Group
Companies to satisfy, requests made by the Company in connection with the
selection of such Advertising Inventory and implementation of such Advertising
Services generally. Each party shall designate a representative responsible for
coordinating the relationship between the parties as contemplated by this
Section 2.
3. RATES FOR ADVERTISING SERVICES.
(a) All Advertising Inventory and other Advertising Services
provided to the Company by the News Group Companies hereunder shall be (i)
subject to availability and to the technical and other requirements specific to
the News Group Companies and media involved, (ii) agreed upon jointly and in
good faith by the Company, NAI and any other News Group Company providing
Advertising Inventory or other Advertising Services to the Company, (iii) valued
at the then-current rates charged by the News Group Company providing such
Advertising Inventory or other Advertising Services to non-affiliated buyers of
similar amounts of comparable inventory and services; provided, however, that
all purchases by the Company of Advertising Inventory from those News Group
Companies listed on SCHEDULE A hereto (the "Fox Latin America Group") shall be
valued at the lower of (x) the rates set forth on said schedule and
(y) the lowest rates then being charged by the Fox Latin America Group to
non-affiliated buyers of comparable inventory and services on the Fox Latin
America Group properties, unless such other buyers commit to spend in excess of
$12.5 million in cash over a 30-month period or less; and (iv) paid for by the
Company as provided in Subsection 3(b) hereof. Except as expressly provided
herein, the Advertising Services purchased by the Company hereunder shall not be
transferable. The Advertising Services may be utilized by the Company's
affiliates, any successor in interest to all or substantially all of the
Company's business or assets, and by the Company to advertise or promote the
Sites in conjunction with other goods and/or services offered by the Company
and/or any third party; provided, however, that the Company, its affiliates and
its successors shall not utilize the Advertising Services to advertise or
promote any business or service that is directly competitive with any business
or service owned or Controlled by any of the News Group Companies without NAI's
prior written consent thereto. This Letter Agreement may be assigned by the
Company to any successor in interest to all or substantially all of the
Company's business or assets, subject to the limitations set forth herein.
(b) Neither party shall have any rights or obligations in
respect of particular Advertising Services until the purchase thereof has been
confirmed in accordance with the customary procedures applied by the News Group
Company providing such Advertising Services to the Company. Additionally, each
purchase of Advertising Services by the Company shall be subject to the
customary terms and conditions, including but not limited to those relating to
the production and delivery of materials and the payment for, and/or
cancellation of, reserved Advertising Inventory and other agreed-upon
Advertising Services, generally applied by the News Group Company providing such
Advertising Services to the Company.
(c) The News Group Companies shall not provide to the Company,
or charge the Company for, any Advertising Services that the Company has not
requested.
4. MISCELLANEOUS.
(a) Each party represents to the other that this Letter
Agreement has been duly authorized, executed and delivered by such party and
constitutes the legal, valid and binding obligation of such party, and is
enforceable against such party in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and similar laws affecting the rights of creditors generally and by
general principles of equity.
(b) This Letter Agreement may be executed in counterparts,
each of which shall be deemed an original and each of which shall constitute one
and the same instrument. This Letter Agreement will be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to its conflicts of law rules.
(c) This Letter Agreement may be amended except by a written
instrument executed by both parties. This Agreement shall be binding upon and
inure of the benefit of the parties and their respective successors and
assigns.
Please indicate your agreement to the foregoing by signing below.
Very truly yours,
NEWS AMERICA INCORPORATED
By: /s/ Xxxxx Nova
-----------------------
Name: Xxxxx Nova
Title: Vice President
Agreed:
YUPI INTERNET INC.
By: /s/ Xxxxxxx Xxxxxxx
-----------------------
Name: Xxxxxxx Xxxxxxx
Title: EVP Managing Director
SCHEDULE A
FOX LATIN AMERICA GROUP RATE CARD
Fox Latin America
[CONFIDENTIAL TREATMENT REQUESTED]/*/
/*/[CONFIDENTIAL TREATMENT REQUESTED] INDICATES MATERIAL THAT HAS BEEN OMITTED
AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED
MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
RULE 406 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
