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*Confidential treatment has been requested with respect to the portions of the
agreement, indicated with an asterisk [*]. A complete copy of this agreement,
including the redacted terms, has been separately filed with the Securities and
Exchange Commission.
Exhibit 10.3
WEB SITE SERVICES AGREEMENT
This Web Site Services Agreement (the "Agreement") is made and entered into
effective as of September 21, 1998, by and between xxxxxxxx.xxx Corporation, a
Delaware corporation, a.k.a. Xxxxxx.xxx, located at 0000 Xxxx Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxx 00000 ("Reseller") and Networks Associates, Inc., a
Delaware corporation, doing business as Network Associates, Inc. located at 0000
Xxxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxxxxx 00000 ("Vendor" or "NAI").
BACKGROUND
(a) Vendor is the owner of all rights to (or has a license to sell) the
Software.
(b) Reseller, as successor of Cybersource Corporation, and Vendor are parties
to an Electronic Software Distribution Agreement, dated September 1, 1997,
regarding the electronic distribution of NAI's Products (the "Reseller
Agreement").
(c) Vendor and Reseller have simultaneously herewith entered into a certain
Co-Hosting Agreement (herein so called) relating to the offering of
software and computer hardware from Vendor's public web sites (other than
the web site maintained by Vendor at www. xxxxxxxxxx.xxx (or such other
name as the site may be given from time to time, including, without
limitation, the "McAfee Store") (the "Managed Site")).
(d) Vendor desires to enter into this Agreement, whereby Reseller would be
responsible for operating and managing certain aspects of the Managed Site
on behalf of Vendor for the purpose of electronically distributing Vendor's
Products to End-User customers in accordance with the terms and conditions
of this Agreement.
NOW THEREFORE, in consideration of the foregoing, and of the mutual covenants
and agreements hereinafter set forth, the parties hereby agree as follows:
1. DEFINITIONS.
Unless otherwise defined herein, the terms used in this Agreement shall have the
following meanings:
(a) CONTENT: means the text, pictures, sound, graphics, video and other data
that appears on the applicable web page or web site.
(b) CUSTOMIZED CONTENT: means the Vendor-specific content that is set up by
Reseller under this Agreement for the Managed Site. Customized Content
shall be subject to the prior approval of Vendor and its continued
placement on the Managed Site thereafter shall be subject to the results of
the quarterly status meetings described on Exhibit "A". The Customized
Content which Vendor initially approves for placement upon on Managed Site
is described on Exhibit "B" attached hereto and made a part hereof.
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(c) VENDOR CONTENT: means the content specifically provided by Vendor to be
included in the Managed Site.
(d) RESELLER CONTENT: means content specifically provided by Reseller to be
included in the Managed Site. Reseller Content shall be subject to the
prior approval of Vendor and its continued placement on the Managed Site
thereafter shall be subject to the results of the quarterly status meetings
described on Exhibit "A".
(e) RESELLER PROPRIETARY HOST SYSTEM: means Reseller's proprietary engine that
is maintained on Reseller's servers and that permits Vendor Clients to
review literature and place orders to obtain Vendor Products via the world
wide web.
(f) RESELLER TRADEMARKS: means the trademarks, service marks, trade names and
logos used by and owned by Reseller.
(g) VENDOR CLIENT: means a customer of Vendor that utilizes the Managed Site.
(h) VENDOR TRADEMARKS: means the trademarks, service marks, trade names and
logos used by and owned by Vendor.
(i) SOFTWARE: means retail desktop software products offered by Vendor under
the "McAfee" brand or other Vendor owned brand, which Vendor makes
available for sale via the Internet. The term "Product" shall have the same
meaning as the term Software.
(j) OTHER TERMS: Other capitalized terms used herein shall have the same
meaning as provided in the Co-Hosting Agreement unless the context requires
otherwise.
2. VENDOR OBLIGATIONS.
(a) Vendor shall establish and maintain the appropriate hypertext links from
its Online Service Page and the NAI Internet Sites to the designated URL or
URLs for the Managed Site under the designation, the McAfee Mall, McAfee
Store or such other designation as may be give to the Managed Site. Such
links shall be of reasonable prominence to give sufficient notice to
viewers of Vendor's Online Service Page.
(b) Other than technical support related to Vendor Clients' purchases and
downloading of the Vendor Products, Vendor shall provide all other support
to Vendor Clients, including without limitation, the support being provided
in accordance with its current technical support policies.
(c) Vendor shall cooperate and work with Reseller in accordance with the terms
of the Miscellaneous section of Exhibit "A" of this Agreement.
(d) Except for those Products listed in Exhibit "A" of this Agreement, Vendor
shall not sell Vendor's or other third party software (including the
Products) from its public web sites except through the Managed Site or the
Destination (as defined in the Co-Hosting Agreement). Vendor agrees that
any software and computer hardware offered for sale on
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the Managed Site must be fulfilled, at Vendor's election, through the
Managed Site, the Destination or must link to the Co-Host Site (as defined
in the Co-Hosting Agreement). Vendor will not advertise on the Managed Site
(whether with banners, buttons or other forms of online advertising) or
link directly to web sites which are involved in the resale of software
from such page on the web sites.
(e) Vendor will display on each page of the Managed Site a statement to the
effect that the Managed Site is operated by Vendor in partnership of with
Reseller. The parties will agree in good faith on the prominence and exact
format of such statement on each such page with increasing prominence to be
given to such statement on the online order pages of the Managed Site.
(f) Vendor will reasonably promote and operate the Managed Site.
3. RESELLER OBLIGATIONS.
(a) Reseller will build, maintain and manage the online order pages of the
Managed Site (the "Order Pages") to process orders for Vendor Products both
for electronic software download ("ESD") and for physical delivery. The
structure of the Order Pages shall be based on Reseller's standard
templates, but the graphical content, including the Customized Content will
be subject to the approval of Vendor. All buttons, links and labels for the
Managed Site shall be labeled McAfee Mall, McAfee Store or other
designation approved by Vendor.
(b) Reseller will be responsible for supporting Vendor Clients in the purchase
and download process from the Managed Site, but will not otherwise provide
product or technical support. Reseller will exercise all commercially
reasonable efforts to distribute the most current version of Vendor's
Products and other products which Vendor makes or desires to make available
from the Managed Site.
(c) Reseller will provide for financial and tax reporting for all activity on
the Managed Site in accordance with Exhibit "A".
(d) Reseller shall undertake export and licensing restriction management in
accordance with the requirements set forth in the Co-Hosting Agreement and
the Reseller Agreement, which export and licensing restriction requirements
are incorporated herein by reference. Reseller shall comply with all
applicable laws in connection with the operation of the Managed Site,
including without limitation, laws relating to the use of information
concerning Vendor Clients. Subject to the Reseller's rights set forth in
Section 5(c) of this Agreement, Reseller shall also comply with Vendor's
on-line privacy policies to the extent commercially reasonable upon written
notice of such policies.
(e) Vendor shall be responsible for all credit card fraud activity committed on
the Managed Site. The initial risk procedures for the Managed Site are set
forth on Exhibit "C" attached hereto. The risk procedures shall be a
subject in the quarterly meetings between the parties described in Exhibit
"A".
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(f) Reseller shall cooperate and work with Vendor in accordance with the terms
of the Miscellaneous section of Exhibit "A".
4. LICENSE.
(a) CUSTOMIZED CONTENT. Vendor grants Reseller a non-exclusive, royalty-free
license and right during the term of this Agreement, to use, reproduce,
electronically distribute, publicly display, and publicly perform the
Customized Content delivered to Reseller by Vendor only in connection with
the Managed Site. Vendor shall indemnify and hold harmless Reseller for any
liabilities, losses, damages, costs and expenses (including attorneys' fees
and costs) based on any third party claim that Customized Content infringes
another's U. S. patent, copyright, trademark, service xxxx, or trade secret
or that said Customized Content is defamatory or violates another's right
to publicity or privacy; provided that Reseller promptly notifies Vendor in
writing of the claim and allows Vendor to control, and fully cooperates
with Vendor in, the defense and all related settlement negotiations. Vendor
shall have no liability for any settlement or compromise made without its
consent. Upon notice of an alleged infringement, or if in the Vendor's
opinion such a claim is likely, Vendor shall have the right, at its option,
to obtain the right for Reseller to continue to exercise the rights granted
under this Agreement, substitute other software with similar operating
capabilities, or modify the Software so that it is no longer infringing.
The foregoing indemnification shall not apply to claims of infringement to
the extent they arise by reason of the combination of the software or
documentation with any other product if such claim would have been avoided
but for such combination.
(b) RESELLER LINK. Reseller grants to Vendor a non-exclusive, non-transferable,
revocable, royalty-free license and right during the term of this
Agreement, to use, reproduce, electronically distribute, publicly display,
and publicly perform Reseller's hypertext link, including certain of
Reseller's graphic icon buttons and other proprietary content used in
conjunction therewith as authorized in writing by Reseller, to link
Vendor's web site to the Managed Site, provided that Vendor complies with
section 9b, below. Reseller reserves the right to terminate the foregoing
right if in its sole discretion, Vendor's usage of Reseller's hypertext
link, graphic icon buttons and other proprietary content, xxxxx the
business, image and goodwill of Reseller.
5. PROPRIETARY RIGHTS.
(a) Vendor acknowledges that as between the parties, Reseller owns all right,
title and interest in and to all components of the Order Pages and the
Co-Host Site. Reseller acknowledges that as between the parties, Vendor
owns all right, title and interest in and to the Managed Site and its
associated URLs. Vendor acknowledges that the Reseller Trademarks are
trademarks owned solely and exclusively by Reseller, and agrees to use the
Reseller Trademarks only in the form and manner and with appropriate
legends as prescribed by Reseller. Vendor agrees not to use any other
trademark or service xxxx in connection with any of the Reseller Trademarks
without prior written approval of
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Reseller. All use of Reseller Trademarks shall inure to the benefit of
Reseller. Reseller acknowledges that the Vendor Trademarks are trademarks
owned solely and exclusively by Vendor, and agrees to use the Vendor
Trademarks only in the form and manner and with appropriate legends as
prescribed by Vendor. Reseller agrees not to use any other trademark or
service xxxx in connection with any of the Vendor Trademarks without prior
written approval of Vendor. All use of Vendor Trademarks shall inure to the
benefit of Vendor.
(b) Nothing in this Agreement shall give Vendor any right or license to use,
reproduce, display or distribute (electronically or otherwise) any
technology or intellectual property rights in the Order Pages and the
Co-Host Site.
(c) Except as required by law, Reseller shall be entitled to use any
information that it collects regarding the visitors to and purchasers from
the Managed Site, including e-mail names, such information shall be
considered co-owned by NAI and Reseller, with the restriction that Reseller
may not sell, license or disclose such information to any competitor of
NAI.
6. TERM AND TERMINATION.
(a) TERM. The term of this Agreement will commence on September 18, 1998, and
continue in effect until June 30, 2000, unless earlier terminated as herein
provided ("Initial Term"). This Agreement will automatically be renewed for
an additional one (1) year term ("Renewal Term") unless either party gives
the other written notice of termination at least ninety (90) days prior to
the expiration of the Initial Term or any Renewal Term.
(b) TERMINATION FOR CAUSE. This Agreement may be terminated by a party for
cause immediately by written notice upon the occurrence of any of the
following events:
(i) If the other ceases to do business, or otherwise terminates its
business operations (or in the case of Vendor, sells or otherwise
disposes of the Managed Site or any division of its business which
includes the Managed Site); or
(ii) If the other shall fail to promptly secure or renew any material
license registration, permit, authorization or approval for the
conduct of its business in the manner contemplated by this Agreement
or if any such material license, registration, permit, authorization
or approval is revoked or suspended and not reinstated within thirty
(30) days; or
(iii) If the other breaches any material provision of this Agreement and
fails to fully cure such breach within thirty (30) days (ten (10) days
in the case of failure to pay) of written notice describing the
breach; or
(iv) By Reseller if the Vendor Uptime Requirement is not met in any one (1)
month; or
(v) Deleted; or
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(vi) By Vendor if the Reseller Uptime Requirement is not met in any one (1)
month; or
(vii) If the other seeks protection under any bankruptcy receivership trust
deed, creditor's arrangement composition or comparable proceeding, or
if any such proceeding is instituted against the other and not
dismissed within thirty (30) days.
(b1) TERMINATION BY RESELLER. Reseller may terminate the agreement without
cause if the Minimum Revenue Targets are not met in any year of the Term other
than as a result of a breach of this Agreement by Reseller. As used in the
preceding sentence, Minimum Revenue Targets shall mean: (i) in the first (1st)
year of the Term, Aggregate Revenues of not less than Nine Million Dollars
($9,000,000) and (ii) in the second (2nd) year of the Term, Aggregate Revenues
of not less than Twelve Million Dollars ($12,000,000). "Aggregate Revenue" shall
have the same meaning as set forth in the the Co-Hosting Agreement.
(c) EFFECT OF TERMINATION. Reseller shall remit all fees due under this
Agreement to Vendor within thirty (30) days of such termination.
(d) EFFECT ON END USERS. Termination of this Agreement by either party will not
affect the rights of any End User under the terms of the End-User License
Agreement and shall not affect terms of any other agreement between the
parties except to the extent specifically provided for in such agreement.
7. COMPENSATION.
Reseller and Vendor shall be compensated in accordance with the terms of
the Revenue Sharing portion of Exhibit "A".
8. DISCLAIMER; UPTIME REQUIREMENT.
(a) Vendor acknowledges and agrees that Reseller shall not be responsible for
Order Pages unavailability due to (i) outages caused by the failure of
public network or communications components or (ii) errors in the HTML
coding in, or any other aspect of, the electronic files provided by Vendor.
Notwithstanding the foregoing, the Order Pages, the Co-Host Site and all
sales and order entry operations with respect to products offered from
either of same shall be operational and accessible by Vendor's Clients at
least 99 percent of the time except for (i) site maintenance downtime,
which is mutually agreed upon in writing and in advance by Vendor and
Reseller at least two weeks prior to proposed site maintenance downtime;
(ii) the failure of some other portion of the Managed Site; or (iii) a
failure of the Internet generally due to reasons beyond the control of
Reseller (the "Reseller Uptime Requirement"). Compliance with the Uptime
Requirement shall be determined with respect to each one month period
during the Term.
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Failure to meet the Reseller Uptime Requirement shall be grounds for
termination of this Agreement without notice or opportunity to cure.
(b) Reseller acknowledges and agrees that Vendor shall not be responsible for
Managed Site unavailability due to (i) outages caused by the failure of
public network or communications components or (ii) errors in the HTML
coding in, or any other aspect of, the electronic files provided by
Reseller. Notwithstanding the foregoing, the Managed Site (other than the
Order Pages) shall be operational and accessible by Vendor's Clients at
least 99 percent of the time except for (i) site maintenance downtime,
which is mutually agreed upon in writing and in advance by Vendor and
Reseller at least two weeks prior to proposed site maintenance downtime; or
(ii) a failure of the Internet generally due to reasons beyond the control
of Vendor (the "Vendor Uptime Requirement"). Compliance with the Uptime
Requirement shall be determined with respect to each one (1) month period
during the Term. Failure to meet the Vendor Uptime Requirement shall be
grounds for termination of this Agreement without notice or opportunity to
cure.
9. TRADEMARK USE.
(a) Reseller acknowledges that the Vendor Trademarks are trademarks owned
solely and exclusively by Vendor, and agrees to use the Vendor Trademarks
only in the form and manner and with appropriate legends as prescribed by
Vendor. Reseller agrees not to use any other trademark or service xxxx in
connection with any of the Vendor Trademarks without prior written approval
of Vendor. All use of Vendor Trademarks shall inure to the benefit of
Vendor.
(b) Vendor acknowledges that the Reseller Trademarks are trademarks owned
solely and exclusively by Reseller, and agrees to use the Reseller
Trademarks only in the form and manner and with appropriate legends as
prescribed by Reseller. Vendor agrees not to use any other trademark or
service xxxx in connection with any of the Reseller Trademarks without
prior written approval of Reseller. All use of Reseller Trademarks shall
inure to the benefit of Reseller.
(c) Reseller shall indemnify and hold Vendor harmless from and against any and
all liabilities, losses, damages, costs and expenses (including legal fees
and expenses) associated with any claim or action brought against Vendor
that may arise from Reseller's improper or unauthorized replication,
packaging, marketing, distribution, or installation of the Software,
including claims based on representations, warranties, or
misrepresentations made by Reseller.
(d) BOTH PARTIES LIABILITY SHALL BE LIMITED TO DIRECT DAMAGES. IN NO EVENT WILL
EITHER PARTY BE LIABLE FOR INCIDENTAL, SPECIAL, OR CONSEQUENTIAL DAMAGES
(INCLUDING LOST PROFITS) SUFFERED BY THE OTHER PARTY, EVEN IF IT HAS
PREVIOUSLY BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. RESELLER STATES
AND VENDOR ACKNOWLEDGES THAT THE BENEFITS OF THIS AGREEMENT ARE A
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MATERIAL INDUCEMENT TO RESELLER TO ENTER INTO THE CO-HOSTING AGREEMENT AND,
IN THE EVENT OF A TERMINATION OF THIS AGREEMENT BY VENDOR FOR AN ALLEGED
MATERIAL RESELLER BREACH WHICH IS HELD NOT TO BE A MATERIAL BREACH IN FACT,
THE COURT SHALL CONSIDER IN ASSESSING DAMAGES HEREUNDER THE CO-HOSTING FEES
AND ANY AMOUNTS PAID BY ANY SUCCESSOR THIRD PARTY SITE MANAGER FOR THE
RIGHT TO PERFORM SIMILAR WEB SITE SERVICES FOR VENDOR WITHIN ONE YEAR OF
THE TERMINATION.
10. GENERAL PROVISIONS.
(a) ASSIGNMENT. This Agreement may not be assigned by either party (except by
operation of law or in connection with the sale of substantially all of the
assets of such party's business or the acquisition of such party by a third
party) to any other person, persons, firms, or corporations without the
express written approval of the other party.
(b) NOTICES. All notices and demands hereunder shall be in writing and will be
deemed given upon the earlier of actual receipt or two (2) days after being
sent by overnight Federal Express or Express Mail, return receipt
requested, to the appropriate address set forth above, as such contracts
and addresses may be changed by written notice to the other party.
(c) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the substantive laws of the State of California. Each party
hereto expressly consents to the personal jurisdiction of the state and
federal courts located in Santa Xxxxx County, California, and expressly
waives any defense to any action based on inconvenient forum, choice of
venue, lack of personal jurisdiction, sufficiency of service of process or
the like.
(d) RELATIONSHIP OF THE PARTIES. Each party is acting as an independent
contractor and not as an agent, partner, or joint venture with the other
party for any purpose. Except as provided in this Agreement, neither party
shall have the right, power, or authority to act or to create any
obligation, express or implied, on behalf of the other.
(e) SURVIVAL OF CERTAIN PROVISIONS. The indemnification and confidentiality
obligations set forth in the Agreement shall survive the termination of the
Agreement by either party for any reason.
(f) HEADINGS. The titles and headings of the various sections and paragraphs in
this Agreement are intended solely for convenience of reference and are not
intended for any other purpose whatsoever, or to explain, modify or place
any construction upon or on any of the provisions of this Agreements.
(g) ALL AMENDMENTS IN WRITING. No provisions in either party's purchase orders,
or in any other business forms employed by either party will supersede the
terms and conditions of this Agreement, and no supplement, modification, or
amendment of this Agreement shall
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be binding, unless executed in writing by a duly authorized representative
of each party to this Agreement.
(h) ENTIRE AGREEMENT. The parties have read this Agreement and agree to be
bound by its terms, and further agree that it, the Co-Hosting Agreement and
the Reseller Agreement, constitutes the complete and entire agreement of
the parties and supersedes all previous communications, oral or written,
and all other communications between them relating to the license and to
the subject hereof. No representations or statements of any kind made by
either party, which are not expressly stated herein, shall be binding on
such party.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set
forth above.
XXXXXXXX.XXX CORPORATION NETWORKS ASSOCIATES, INC.
(a.k.a. Xxxxxx.xxx) doing business as Network Associates, Inc.
By: [SIG] By: [SIG]
-------------------------------- --------------------------------------
Name: [ILLEGIBLE] Name: [ILLEGIBLE]
Title: Vice President, Business Title: CFO
Operations
Date: September 21, 1998 Date: 21 SEP 1998
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EXHIBIT "A"
REVENUE SHARING
(a) Reseller shall collect all moneys due for sales conducted on the Managed
Site and shall report and remit same to Vendor as herein provided. [*] will
pay [*] of [*] and [*] of [*] from the [*] and [*]. Net sales shall mean
total moneys actually received by Reseller from Product sales less returns
and [*] or sales tax charges. [*] shall mean [*] for [*] and [*] from [*]
or any other [*] providing such services, [*] and [*] of [*] and [*].
(b) Reseller will pay Vendor in accordance with the [*], provided, however,
that no fee shall be due for copies of Products returned to Reseller for
refund in accordance with the End-User License Agreement and accompanied by
an executed Letter of Destruction from the End-User.
(c) TAXES. Reseller will collect and remit to the appropriate authorities all
federal, state and local taxes designated, levied, or based upon the sale
of Products by Reseller as required by applicable law.
(d) PAYMENT AND REPORTS. Within [*] Reseller will remit to Vendor the sales fee
due on the cost of Products actually billed to and those paid by Vendor
Clients during the immediately preceding [*], and provide Vendor with a
written report (the "Report"), specifying the number of copies of Products
that Reseller has shipped during the immediately prior month and the
calculation of the amounts due to Vendor and [*] in connection therewith.
(e) VENDOR CLIENT INFORMATION. Reseller will provide to Vendor within ten (10)
days after the end of each month, a report for the immediately prior month
showing (i) the name and address of each Vendor Client that purchased the
Product from Reseller, and (ii) the name and quantity of the Product
purchased by the Vendor Client through the Managed Site.
(f) BOOK AND RECORDS. Reseller agrees to maintain adequate books and records
relating to the distribution of Products to Vendor Client. Such books and
records shall be available at their place of keeping for inspection by
Vendor or its representative, for the purpose of determining whether the
correct fees have been paid to Vendor in accordance with the terms of this
Agreement, and whether Reseller has otherwise complied with the terms of
this Agreement. Vendor shall have the right to conduct such an audit upon
ten (10) days advance notice twice each year. In the event that such an
audit discloses an underpayment of more than five percent (5%), then
Reseller shall pay the costs of such audit.
*Confidential treatment requested. Certain confidential information has been
omitted and filed separately with the Securities and Exchange Commission.
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(g) FAILURE TO PAY. Any sales fee payment or part of a payment that is not paid
when due shall bear interest at the rate of 1.5% per month from its due
date until paid. Failure of Reseller to pay any fees or other charges when
due shall constitute sufficient cause for Vendor to immediately suspend its
performance hereunder and/or to terminate this Agreement upon due notice
given.
EXCLUDED PRODUCTS
Any NAI products which are not included in the definition of Software, none of
which which will be required to flow through the Managed Site.
MISCELLANEOUS
(a) Reseller will provide Vendor with daily reporting on sales numbers.
(b) Both Vendor and Reseller will use all commercially reasonable efforts to
maximize product sales through this relationship. The parties shall meet
quarterly within the second two weeks of the first month of each quarter to
(i) determine Managed Site's financial performance against performance
goals; (ii) discuss NAI's implementation of Xxxxxx.xxx technologies, (iii)
discuss NAI purchasing of desktop software from Xxxxxx.xxx and (iv)
discounts on pricing to Reseller for ESD Products. The parties shall
consult in good faith concerning financial performance goals for the
Managed Site, the location on the Vendor public sites of links to the
Managed Site, risk levels, the Content on the Managed Site and all other
matters pertaining to the operation of the Managed Site.
(c) Reseller and Vendor will develop programs and offers targeted to these
customers as they flow through the site.
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EXHIBIT "B"
DELETED.
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EXHIBIT "C"
INITIAL RISK LEVEL
PICK ONE AND DELETE THE OTHER.
If initialed level guidelines are not attached to this Agreement, then such
level shall be agreed to by the parties; provided, that failing agreement, the
Initial Risk Level shall be that specified by Network Associates, Inc.
OR
The initial risk level shall be a score of 46, as such risk level is
defined by Cybersource Corporation in connection with its IVS fraud service as
in existence on the date hereof.
