Exhibit 10.39(a)
AGREEMENT dated August 26, 1999 by and between WE MEDIA, INC., a
Delaware corporation with principal offices at 000 Xxxxxxx Xx, Xxx Xxxx, XX
00000 ("We Media"), and Educational Video Conferencing Inc. a Delaware
Corporation with principal offices at Grass Sprain Rd, Yonkers, NY 10710
("EVC").
BACKGROUND
EVC has developed a system for delivering high quality distant learning programs
and has formed key relationships with major educational institutions to deliver
fully accredited college courses and degree programs along with continuing
education, from these institutions to students in remote locations. This
delivery mechanism has proven to be a comprehensive system allowing for a
complete educational experience controlled by the instructor during a live class
or delivered asynchronously to students on demand.
We Media has undertaken a mission to provide enabling services to individuals
who have been denied access and choice to the services they need. In this
undertaking, We Media is developing a fourth-generation on-line portal community
that shall exist as the center of interaction for these individuals. This
Internet community will act as a unifying and central location for its members
to interact, learn, grow and meet one another.
Key components of this portal will be the delivery of education, employment and
financial services as well as many more. Utilizing custom technology We Media
will be able to profile and target these services to the members who need them
most. We Media will be able to identify and interact with each and every member
in the pursuit of providing a completely individualized and customized
experience, giving the member access and choice to services they have too long
been denied.
We Media and EVC will enter into a joint marketing agreement to promote their
prospective services to their constituencies.
1. DEFINITIONS.
Terms used in this Agreement which are capitalized shall have the definitions
set forth below or elsewhere in this Agreement. References to Sections or
Exhibits refer to Sections of, or Exhibits to, this Agreement.
1.1. "Advertisement Inventory" means the amount of space in the user
interface of a website of the We Media Properties available for
advertising multiplied by the number of pages actually seen by
End-Users.
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1.2. "Advertisements" means advertising banners, print advertising, media
sponsorships and other advertising displayed on We Media Properties,
subject to the approval of EVC, such approval shall not be
unreasonable denied.
1.3. "Artwork" means the artwork, logos, text, graphics and other
trademarks to be used by We Media for the purposes of promoting EVC
services.
1.4. "End-User" means a registered end-user of the We Media Properties.
1.5. "Enrolled Student" means a person who is currently enrolled and has
paid for one or more courses through EVC.
1.6. "Effective Date" means when the first promotion by We Media begins and
is October 9, 1999 coinciding with a major marketing initiative and
the re-launch of the XxXxxxxxxx.xxx website.
1.7. "EVC Services" means fully accredited college courses and degree
programs along with continuing education, to students in remote
locations.
1.8. "Percentage Shared Revenue" means the percent of EVC's gross revenue
(not including bad debt) taken in from student enrollments distance
learning courses.
1.9. "We Media Properties" means all Website pages, print publications,
radio broadcast and television broadcasts produced by or branded as
the property of We Media.
1.10."User Data" means the demographic information, names and email
addresses of the End-Users.
2. DELIVERABLES: WE MEDIA
2.1. Advertising Dollar commitment. Starting at the Effective Date, We
Media will commit at minimum $1,500,000 dollars in Advertising
Inventory per year throughout the duration of this agreement for the
purpose of promoting EVC services, such Advertising Inventory will
include print and online advertising as described below. The value of
Advertising Inventory is determined by the mean rate paid to We Media
for similar advertising campaigns. The minimum commitment will
increase at a minimum of $1,500,000 per year for every additional
$10,000,000 in gross revenue received by We Media derived from
promotions and initiatives of this Agreement.
2.2. Print advertising. We Media will include reasonably well placed
full-page ad in all issues of We Magazine throughout the duration of
this Agreement. The first
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issue being the 1999 November/December issue, due to hit newsstands on
October 25, 1999.
2.3. Online advertising. The cost of the print advertisement will be
deducted from the minimum commitment leaving an amount that must
committed to Website advertising outlets. This will include, at We
Media's discretion, a combination of one or more of the following:
industry standard banners advertisements, badge advertisements and
direct targeted offers to End-Users.
2.4. Advertising Strategy. We Media will work with EVC to develop a
comprehensive plan for promoting and targeting EVC services to
End-Users through We Media's custom targeting and profiling system.
This plan will be delivered to EVC no later than 20 days prior to the
launch of the first promotion and must be approved by EVC no later
than 10 days prior to launch of the first promotion.
2.5. Promotion. In all reasonably appropriate We Media marketing materials
there will be express mention of EVC being the "Distance Learning
Technology Partner of the We Community." EVC will also be presented by
We Media as an accessibility technology and service provider for the
disabled, their family and friends.
2.6. Online Registration Form. We Media will build, in cooperation with
EVC, an online registration form that will permit interested
individuals to begin the enrollment process for EVC course directly
from We Media Website properties.
2.7. Launch. Both parties shall use commercially reasonable best efforts to
launch the first promotion by Effective Date.
3. DELVIERABLES: EVC
3.1. Promotion.
3.1.1. EVC will promote We Media properties to all current and new
educational and corporate clients and other partners by issuing a
co-branded information memo describing the relationship of this
Agreement and presenting the We Media Properties as embodying the
premier cross-media community providing enabling services to the
disabled, their family and friends.
3.1.2. EVC will make reasonable efforts to encourage its current and new
educational and corporate clients and other partners to present the We
Community to their constituents, members, students or employees.
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3.1.3. Within all reasonably appropriate EVC marketing materials there will
be a We Media logo, URL and text describing We Media as the premier
cross-media community providing enabling services to the disabled,
their family and friends.
EVC will assist We Media in its member acquisition program by making
reasonable efforts to facilitate introductions with current EVC
partners and affiliates.
3.2. Artwork. Any and all Artwork for any advertising must be delivered to
We Media no later than 15 Days prior to the release of promotion.
3.3. Identification of We Media Promotional Enrollments. EVC will make all
reasonable efforts to identify Enrolled Students that have registered
as a result of a We Media promotions.
3.4. Revenue Sharing. Starting at the Effective Date, Percentage Shared
Revenue will initially be valued at [*]% and will be paid to We Media
for Enrolled Students whose enrollment is in response to any We Media
promotion on a quarterly basis, throughout the term of this Agreement.
For every 10,000 Enrolled Students per year, who have registered as a
result of We Media promotions, the Percentage Shared Revenue will
increase by [*]%, with a maximum attainable Percentage Shared Revenue
of [*]%. Likewise if the total number of Enrolled Students per year,
who have registered as a result of We Media promotions, drops by
10,000, the Percentage Shared Revenue will decrease by [*]%. Excluding
year one, if the total number of Enrolled Students per year, who have
registered as a result of We Media promotions, falls below a total of
10,000 the Percentage Shared Revenue will be [*]%.
4. PAYMENT; REPORTS
4.1. Payment; Reports. EVC shall pay We Media, on the tenth day of each
month, the appropriate Percentage Shared Revenue as set forth in
section 3.4 of the Agreement, said payments to commence the month
immediately following the collection of revenue generated by those
students who have registered as a result of We Media promotions.
4.2. Audit of Reports. Each party will maintain complete and accurate books
and records sufficient to prepare accurate reports as required by
Section 4.1. Each shall have the right to cause such books and records
to be audited by an independent certified public accountant selected
by the requesting party. Any such audit shall be performed on seven
(7) days written notice, at the expense of
[*] Confidential Portions
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the requesting party, during normal business hours, no more frequently
than once in a twelve-month period, and in such a manner as to avoid
unreasonable interference with normal business operations, provided,
however, that if any such examination reveals an underpayment to the
requesting party of more than five percent (5%) of the total payment
due for any quarter, then the examined party shall pay the costs of
such examination.
5. OWNERSHIP OF INTELLECTUAL PROPERTY
5.1. Ownership. As between the parties, EVC shall retain all right, title
and interest in and to the distance learning service and its hardware
and software. EVC and We Media will jointly own any data collected as
part of any distance learning program. We Media will own any artwork,
Website and any other content created by We Media.
5.2. Reservation of Rights. As between the parties, any rights to the We
Media Properties and not expressly granted hereunder to EVC are
reserved to We Media, and any rights to hardware, software or
promotional materials belonging to EVC and not expressly granted
hereunder to We Media are reserved to EVC.
6. CONFIDENTIALITY.
Each party shall be entitled to disclose the existence of this
Agreement, but agrees that the financial terms of this Agreement shall
be treated as confidential and shall not be disclosed to any other
party; provided, however, that each party may disclose the financial
terms of this Agreement (a) as required by a court or other
governmental body, or as otherwise required by law, (b) in confidence,
to its legal counsel, accountants, banks, and current and prospective
financing sources and their advisors, or in connection with an actual
or proposed merger or acquisition, or (c) in connection with the
enforcement of its rights under this Agreement.
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7. REPRESENTATIONS AND WARRANTIES.
We Media and EVC each represent and warrant to the other party that:
(a) such party is an entity duly organized, validly existing and in
good standing in the jurisdiction of its formation;
(b) such party has full authority to enter into this Agreement, to
grant the rights granted herein, and to perform the obligations
assumed hereunder; and
(c) this Agreement, when executed by both parties, represents such
party's valid and binding obligation, enforceable against it in
accordance with its terms, subject to certain general legal
enforceability exceptions.
8. LIMITATION OF LIABILITY.
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY SPECIAL,
CONSEQUENTIAL, INCIDENTAL, OR INDIRECT DAMAGES, HOWEVER CAUSED AND ON
ANY THEORY OF LIABILITY, ARISING OUT OF THIS AGREEMENT, WHETHER OR NOT
SUCH PARTY IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND
NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED
REMEDY.
9. TERM.
The term of this Agreement shall commence on the Date of the Agreement
and shall continue until the fifth anniversary of the Effective Date.
The parties agree that commencing June 30 2000, and every June 30th
there after, this Agreement shall automatically be extended for an
additional period of one year, subject to the conditions herein after
contained.
9.1. In the event that either party should desire not to automatically
extend this Agreement, then and in that event, such party shall so
notify the other in writing, by Certified Mail, Return Receipt
Requested, no later than June 1st of any given year, after which the
agreement will not be extended for an additional one year, but will
only have the four years of the existing term remaining.
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10. GENERAL PROVISIONS.
10.1.Governing Law. This Agreement shall be governed by and construed under
the laws of the State of New York and the United States (excluding the
U.N. Convention on Contracts for the International Sale of Goods)
without regard to conflict of laws principles. In any action or
proceeding to enforce rights under this Agreement, the prevailing
party shall be entitled to recover costs and attorneys' fees.
10.2.Arbitration. The parties agree that any disputes or disagreements
rising hereunder or in connection herewith shall be settled by binding
arbitration before the American Arbitration Association at their
offices located in White Plains, NY, and that any judgement awarded
thereunder may be entered in any court of appropriate jurisdiction,
and will have full force and effect therein.
10.3.Assignment. Except as otherwise expressly provided in this Agreement,
neither party may transfer or assign its rights or delegate its
obligations hereunder (whether voluntarily or by operation of law)
without the prior written consent of the other party, which consent
shall not be withheld or delayed unreasonably, provided that each
party shall have the right to transfer this Agreement, and assign all
of its rights and delegate all of its obligations hereunder, to any
affiliate, and to any successor by way of merger or consolidation or
in connection with the sale or transfer of substantially all of its
business and assets relating to this Agreement.
10.4.Notices. All notices under this Agreement shall be in writing and
delivered personally or by facsimile, commercial overnight courier, or
certified or registered mail, return receipt requested, to a party at
its respective address set forth herein.
10.5.Entire Agreement. This Agreement sets forth the entire agreement and
understanding of the parties relating to the subject matter herein and
merges and supersedes all prior discussions between them. No
modification of or amendment to this Agreement, nor any waiver of any
rights under this Agreement, shall be effective unless in writing
signed by the party against whom it is to be enforced. Nothing express
or implied in this Agreement is intended to confer, nor shall anything
herein confer, upon any person other than the parties and the
respective successors or permitted assigns of the parties, any rights,
remedies, obligations or liabilities whatsoever.
10.6.Severability. If the application of any provision or provisions of
this Agreement to any particular facts or circumstances shall be held
to be invalid or unenforceable by any court of competent jurisdiction,
then: (i) the validity and enforceability of such provision or
provisions as applied to any other particular facts or circumstances
and the validity of other provisions of this Agreement shall not in
any way be affected or impaired thereby; and (ii) such provision or
provisions shall be reformed without further action by the parties
hereto and only to the extent necessary to make such
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provision or provisions valid and enforceable when applied to such
particular facts and circumstances.
10.7.Independent Contractors. The parties are independent contractors, and
nothing in this Agreement shall be construed to create a joint venture
or partnership.
10.8.Force Majeure. A party will not be deemed to have materially breached
this Agreement to the extent that performance of its obligations or
attempts to cure any breach are delayed or prevented by reason of an
act of God, fire, natural disaster, accident, act of government,
shortage of equipment, materials or supplies beyond the reasonable
control of such party, or any other cause beyond the reasonable
control of that party (a "force majeure event"); provided that the
party whose performance is delayed or prevented promptly notifies the
other party of the nature and duration of the force majeure event.
10.9.Compliance with Laws. Each party shall comply with all laws and
regulations applicable to it.
In witness whereof, both parties have caused this Agreement to be executed as of
the date written above.
We Media, Inc.
/s/ Jordan X. Xxxxxx
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Xxxxxx Xxxxxx, CEO
/s/ Xxxxxxxxx Xxxxxxxx
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Xxxxxxxxx Xxxxxxxx, Executive Vice President
AND
Educational Video Conferencing, Inc.
/s/ Xx. Xxxx X. XxXxxxx
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Dr. Xxxx XxXxxxx, President
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