CONFIDENTIAL
SHOPPING CHANNEL PROMOTIONAL AGREEMENT
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This Agreement, (the "Agreement") dated as of Gourmet Market 05/06 1999
(the "Effective Date"), is made and entered into by and between America Online,
Inc. ("AOL"), a Delaware corporation, with its principal offices at 00000 XXX
Xxx, Xxxxxx, Xxxxxxxx 00000 and Gourmet Market ("MERCHANT"), a California
corporation, with its principal offices at 000 Xxxxxx Xxxxxx, Xxxxx 000, Xxx
Xxxxxxxxx, XX 00000 (each a "Party" and collectively the "Parties").
INTRODUCTION
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AOL owns, operates and distributes the AOL Service, XXX.xxx, the CompuServe
Service and the Netscape Netcenter. MERCHANT wishes to secure a promotional
placement within the shopping channel of the AOL Service, XXX.xxx, the
CompuServe Service and the Netscape Netcenter (as specified in Exhibit A) (each
channel, a "Shopping Channel") which, when activated, will provide access to
MERCHANT's site on the World Wide Web or its area on the AOL Service or
CompuServe Service (as the case may be) (the "Merchant Site") where MERCHANT
offers content, products and/or services for sale. Terms not defined herein
shall be defined on the attached Exhibit B.
TERMS
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1. MERCHANT PROGRAMMING. MERCHANT will make available through the Merchant
Site the certain products, content and/or services specified in Exhibit
A (the "Products") in accordance with the Standard Shopping Channel
Terms and Conditions set forth on Exhibit C.
2. PROMOTIONAL OBLIGATIONS.
2.1 AOL Promotion of MERCHANT. Commencing on a date set forth on
Exhibit A hereto, AOL will provide the promotion(s) set forth in
Exhibit A (the "Promotion"). Except to the extent expressly
described in Exhibit A, the specific form, placement,
positioning, duration and nature of the Promotion(s) will be as
determined by AOL in its reasonable discretion (consistent with
the editorial composition of the applicable screens) and the
nature of the Promotion being purchased by MERCHANT, as reflected
in Exhibit A. The specific content to be contained within the
Promotions (including, without limitation, within any advertising
banners or contextual promotions) will be determined by MERCHANT,
subject to AOL's technical limitations, the terms of this
Agreement and AOL's then-applicable policies relating to
advertising and promotions. Each Promotion will link only to the
Merchant Site and will promote only Products listed on Exhibit A.
MERCHANT acknowledges that the sole obligation of AOL is to
display the Promotion(s) in the Shopping Channel(s) in accordance
with the terms and conditions hereto.
2.2 MERCHANT Cross-Promotion.
A. Within each Merchant Site, MERCHANT shall include a
prominent promotional banner ("AOL Promo") appearing
"above the fold" on the first screen of the Merchant
Site, to promote such AOL products or services as AOL
may reasonably designate (for example, the America
Online(R) brand service, the CompuServe(R) brand
service, the XXX.xxx(R) site, the Netscape Netcenter(TM)
site, ICQ, the Digital City(R) services or the AOL
Instant Messenger(TM) service); AOL will provide the
creative content to be used in the AOL Promo (including
designation of links from such content to other content
pages). MERCHANT shall post (or update, as the case may
be) the creative content supplied by AOL (within the
spaces for the AOL Promo) within a commercially
reasonable period of time from its receipt of such
content from AOL. Without limiting any other reporting
obligations of the Parties contained herein, MERCHANT
shall provide AOL with monthly written reports
specifying the number of Impressions to the pages
containing the AOL Promo during the prior month.
B. In MERCHANT's television, radio, print and "out of home"
(e.g., buses and billboards) advertisements and in any
publications, programs, features or other forms of media
over which MERCHANT exercises at least partial editorial
control, MERCHANT will include specific references or
mentions (orally where possible) of the availability of
the Merchant's Site through the America Online(R) brand
service, which are at least as prominent as any
references that MERCHANT makes to any other MERCHANT
online or Internet site (by way of site name, related
company name, URL or otherwise). Without limiting the
generality of the foregoing, MERCHANT's listing of the
"URL" for any Merchant online site will be accompanied
by an equally prominent listing of the "keyword" term on
the AOL Service for Merchant's Site.
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PAYMENTS; REPORTS.
3.1 Placement Fees. MERCHANT will pay AOL $104,405 for displaying
the Promotion within the Shopping Channel on the AOL Service,
XXX.xxx, the CompuServe Service and the Netscape Netcenter. The
total amount of $104,405 will be payable in three equal
installments, with the first such payment to be made upon the
Effective Date, the second such payment to be made ninety (90)
days from the earliest launch date of the AOL Shopping Commerce
Center(s) specified on Exhibit A attached hereto and the last
payment to be made ninety (90) days from the second installment.
MERCHANT will be provided a credit against any amounts already
paid to AOL by MERCHANT for promotional carriage under
MERCHANT's existing agreement with AOL which overlap promotional
carriage provided for hereunder, if any, as established by the
launch date of the applicable AOL Shopping Commerce Center(s)
specified on Exhibit A attached hereto. MERCHANT agrees that,
except as specified herein, once the Promotion is installed,
there will be no refunds or proration of rates if MERCHANT
elects to discontinue display of the Promotion prior to
expiration of the Term. Should AOL fail to display the Promotion
in accordance with the terms of this Agreement due to MERCHANT's
failure to comply with any requirement of this Agreement,
MERCHANT will remain liable for the full amount indicated above.
3.2 Reports. AOL will provide MERCHANT with monthly usage
information related to the Promotion in substance and form
reasonably determined by AOL. MERCHANT may not distribute or
disclose usage information to any third party without AOL's
prior written consent. MERCHANT will provide AOL with monthly
reports, in a form reasonably satisfactory to AOL, which detail
the number of daily items, orders and gross sales through the
Merchant Site on the AOL Service, XXX.xxx, the CompuServe
Service and the Netscape Netcenter (as applicable).
4. TERM. Unless otherwise rightfully terminated pursuant to the terms and
conditions in the Exhibits attached hereto, this Agreement will
terminate ten (10) months from the latest launch date of the AOL
Shopping Channel Commerce Center(s) specified on Exhibit A attached
hereto (the "Term").
5. EXISTING AGREEMENTS. To the extent that MERCHANT has any existing
shopping channel agreement(s) with AOL in effect as of the Effective
Date such agreements shall terminate on the date that the last
promotion described in the existing agreement is replaced with
Promotion(s) described in this Agreement.
6. PRESS RELEASES. Each Party will submit to the other Party, for its
prior written approval, which will not be unreasonably withheld or
delayed, any press release or any other public statement ("Press
Release") regarding the transaction contemplated hereunder.
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, the disclosing Party will provide at least five (5) business
days prior written notice of such disclosure. The failure to obtain
the prior written approval of the other Party will be deemed a
material breach of this Agreement. Because it would be difficult to
precisely ascertain the extent of the injury caused to the
non-breaching Party, in the event of such material breach, the
non-breaching party may elect to either (i) terminate this Agreement
immediately upon notice to the other Party, and the cure provision of
Section 12 on Exhibit D of this Agreement shall not apply, or (ii) as
liquidated damages, elect to modify the Impression commitment
hereunder by fifteen percent (15%) (either an increase in Impressions
if AOL has materially breached the Agreement or a decrease in
Impressions if MERCHANT has materially breached the Agreement).
7. GENERAL TERMS. The general legal terms and conditions set forth on
Exhibit D attached hereto are hereby made a part of this Agreement.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as
of the Effective Date.
AMERICA ONLINE, INC. Gourmet Market
By: By:
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Print Name: Print Name:
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Title: Title:
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Date: Date:
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Tax ID/EIN#:
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GOLD TENANT PROMOTION
To commence on the launch date of the AOL commerce center specified below on the
AOL Service (the "AOL Commerce Center Launch Date") and terminate ten (10)
months from the AOL Commerce Center Launch Date, MERCHANT will become a "Gold
Tenant" in the Gourmet Gift department(s) of the Food and Gourmet commerce
center of the Shopping Channel on the AOL Service. Commencing on the launch date
of the corresponding commerce center (described above) of the Shopping Channel
on each of XXX.xxx, the CompuServe Service and the Netscape Netcenter, MERCHANT
will become a Gold Tenant as specified herein and such promotion shall terminate
ten (10) months from the AOL Commerce Center Launch Date. As a Gold Tenant in a
department, MERCHANT will be entitled to the following:
Principal Exposure on the AOL Service, XXX.xxx, the CompuServe Service, and the
Netscape Netcenter:
One continuous (24/7) 143 x 30 pixels button with corporate brand or logo
on the department front screen.
Additional Promotion on the AOL Service:
Rotation with other Gold Tenants in the department on a promotional banner
with text and branded art promotion on the department front screen. These
banner rotations are reserved for the Gold Tenant Merchant's on the
department screen and will be divided proportionately among them.
Product listing availability through the AOL Product Search, subject to
Merchant's participation and the terms and conditions set forth on Exhibit
C Section 3.
Banner rotation on the AOL Product Search screen of the AOL Service. These
banner rotations will be divided proportionately among all shopping channel
merchants.
Up to three (3) AOL Keywords(TM) for use from the AOL Service, for
registered MERCHANT trade name or trademark (subject to the other
provisions contained herein).
Fifteen percent (15%) discount from the then-current rate card on purchases
of additional advertising banners or buttons on the AOL Service, XXX.xxx,
the CompuServe Service, and the Netscape Netcenter, subject to availability
for the period requested (with such purchases to be made in accordance with
the then-applicable Standard Advertising Insertion Order for the property
in question). Sponsorships are not entitled to the aforementioned discount.
Eligibility to participate in the following AOL Shopping promotional
programs (the "Program Areas") subject to the terms and conditions set
forth on Exhibit C Section 3:
o Quick Gifts
o Standard Seasonal Catalogs or Special Event Merchandising areas
(e.g., Christmas Shop), subject to MERCHANT's participation in
AOL's Quick Checkout and AOL's Search Product as described on
Exhibit C Section 3.
o Premier-level Seasonal Catalogs or Special Event Merchandising
areas (e.g., Golf Outings), subject to MERCHANT's participation
in AOL's Quick Checkout and AOL's Search Product as described on
Exhibit C Section 3.
o Gift Reminder
o Newsletters
xxx additional Promotions on the AOL Service, XXX.xxx, the CompuServe Service,
the Netscape Netcenter or the AOL network not specified herein will be
determined at AOL's reasonable discretion; provided that the additional,
standard promotions to be provided to the MERCHANT within the Shopping areas on
the AOL Service, XXX.xxx, the CompuServe Service and the Netscape Netcenter will
be comparable in nature to the additional, standard Promotions provided to other
similarly situated MERCHANTs in the same category (i.e. Anchor Tenant, Gold
Tenant or Silver Tenant).
