Exhibit 10.24
SERVICE AND PRIVATE LABEL AGREEMENT
This Service and Private Label Agreement (the "AGREEMENT") is made this
20th day of March 2000 (the "EFFECTIVE DATE") by and between xXxxx.xxx Inc., a
Delaware Corporation with its principal place of business at 000 Xxxxx Xxxxx
Xxxx, Xxxxxxxxx, Xxxxxxx 00000 ("ENOTE"), and XxxxXxxxx.xxx, Inc., an Illinois
Corporation with its principal place of business at 000 Xxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000 ("CEM").
RECITALS
WHEREAS, CEM has developed a proprietary software and Internet-based
communication system that provides integrated messaging of e-mail, voicemail,
calendaring, reminders, and other services via a product called CoolEmail ("CEM
SERVICES");
WHEREAS, eNote has developed a proprietary software and Internet-based
communication system and associated appliances which, among other features,
permit users to view, send and receive e-mail and content using television and a
phone line and is engaged in the business of providing messaging and information
via a standard television interface ("TVemail(TM)");
WHEREAS, eNote wishes to obtain from CEM certain CEM Services for
resale and integration with eNote products; and
WHEREAS, CEM is willing to provide such CEM Services privately labeled
as the services of eNote to eNote customers in accordance with the terms and
conditions of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the covenants and agreements contained
herein, the parties agree as follows:
ARTICLE 1. SERVICES
1.1 CEM will provide to eNote and its individual and business
customers, in accordance with the terms and conditions of this
Agreement, a fully supported version of the CEM Services privately
labeled as the services of eNote for integration into eNote
product offerings (the "ENOTE PRIVATE LABEL CEM SERVICE").
1.2 CEM shall be solely responsible for the maintenance of the eNote
Private Label CEM Service. eNote and CEM shall be jointly
responsible for supporting the eNote Private Label CEM Service.
CEM shall bear primary responsibility for ensuring the reliability
of the eNote Private Label CEM Service.
1.3 eNote expects up to 50,000 members to make use of the eNote
Private Label CEM Service during the first 12 months of this
Agreement.
1.4 CEM will provide to eNote its basic Private Label CEM product,
consisting at a minimum of the e-mail backbone service, features
and functions listed in SCHEDULE B hereof. eNote and CEM may from
time to time amend this Agreement to add additional features and
functions to the eNote product offering at such prices and other
terms as the parties may then agree.
1.5 CEM will provide eNote and its users, at eNote's cost as specified
in SCHEDULE A hereof, with a dedicated national toll free number
for use by eNote users, if so requested by eNote.
1.6 CEM will provide eNote with a private label web site (the "ENOTE
WEB SITE")for eNote users. The URL for such web site shall be
chosen, registered/reserved and licensed by eNote. CEM will
provide the eNote users with an e-mail address from one of a set
of multiple domain names specified by eNote. eNote shall provide
CEM with the appropriate Domain Name Server (DNS) numbers.
1.7 At no additional cost to eNote, CEM shall provide support for the
eNote support department and ensure that the eNote Private Label
CEM Service meets the following specifications: Uptime shall
exceed, on average, 99% of scheduled uptime; response-time for
system failure or defects or problems in CEM's equipment or
software (unless caused by facts or circumstances beyond CEM's
control, such as, without limitation, systemic problems with the
Internet, regional power failures, strike, war, riot and the like)
not exceeding, on average, 1 hour; all other support and fix
implementations not exceeding, on average, 4 hours. Any problems
materially affecting the operation of eNote Private Label CEM
Services shall be reported to
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eNote within one hour of detection by CEM. Corrective actions and
progress must be reported as requested by eNote. CEM shall
maintain it's data operations in a data center of CEM's choosing,
that monitors the Private Label CEM Services 24 hours per day, 7
days per week, 365 days per year.
ARTICLE 2. PAYMENT
2.1 WHOLESALE PRICING. eNote shall pay CEM for Private Label CEM Services
at the wholesale pricing rates provided in SCHEDULE A hereof, based
upon the final configuration chosen by eNote.
2.2 BILLING AND PAYMENT. CEM will xxxx xXxxx monthly for each eNote user
("ENOTE USER") using the eNote Private Label CEM Service. CEM will
xxxx xXxxx for eNote User usage by the 15th of month following the
month of usage. eNote shall pay CEM 30 days following the date of
invoice. eNote agrees that it will be responsible for billing and
collecting payment from eNote Users.
2.3 USER INVOICING; RETAIL PRICING. CEM will provide eNote with all of
the information necessary for eNote to invoice eNote Users. Retail
pricing to eNote Users of various service levels and fees (if any)
will be at the sole discretion of eNote.
2.4 AUDIT AND INSPECTION. eNote or its agents shall have the right to
audit and inspect the books and records of CEM, and make copies
thereof, as same relate to the usage by eNote users of the eNote
Private Label CEM Service upon reasonable notice, during regular CEM
business hours. Any discrepancy revealed by such inspection shall be
remedied within five (5) days by the party required to tender
payment. In the event the inspection discloses an over-payment by
eNote that is in excess of ten percent (10%), CEM shall bear the
costs of the audit in all cases where the cost of the audit exceeds
the amount of the over-payment disclosed (as reasonably determined by
CEM). CEM shall maintain such books and records in accordance with
generally accepted accounting principles, and retain copies thereof
for the term of this Agreement (and any renewal terms) and for at
least one (1) year following any expiration or termination of this
Agreement. eNote's right of audit and inspection pursuant to this
Section shall
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survive any expiration or termination of this Agreement by a further
period of three (3) months.
ARTICLE 3. PRODUCT INTEGRATION
3.1 ENROLLMENT AND LOGIN. CEM shall host the sign-up procedure as well as
the login to the eNote Private Label CEM Service.
3.2 BASIC FEATURE SET. Aside from any modifications necessary to provide
private labeling in accordance with this Agreement, the features and
function set of the eNote user interface will be consistent with the
then-current private label production version of CoolEmail, which
shall consist, at a minimum, of the standard features and functions
provided in SCHEDULE B hereof for the eNote Basic Service Release.
3.3 CHANGES TO THE BASIC FEATURE SET. eNote may request changes to the
look and feel of the eNote User site. CEM will do its best to
accommodate eNote change requests, but any and all changes must be
reasonably technologically and economically feasible. Changes will be
billed to eNote at $150/hour. CEM staff will work with eNote to
establish an estimated budget before any change work begins. No such
change work will be undertaken by CEM without the prior written
approval by both parties of specifications, costs and scheduling.
ARTICLE 4. PROPRIETARY RIGHTS
4.1 BRANDS. During the term hereof, each Party shall have the right to
display the trade names, trademarks, service marks and logos (the
"BRANDS") of the other Party solely for the purposes and as set forth
in this Agreement.
4.2 LIMITED LICENSE. Subject to the terms and conditions of this
Agreement, CEM hereby grants eNote a non-exclusive, worldwide,
non-transferable, limited license to use, reproduce and display CEM's
Brands in order to display and publish the eNote Private Label CEM
Service and to market and promote the eNote Private Label CEM
Service. Subject to the terms and conditions of this Agreement, eNote
hereby grants CEM a non-exclusive, worldwide, non-transferable,
limited license to use, reproduce and display eNote's Brands in order
to create and maintain the eNote Private Label CEM
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Service and to market and promote the eNote Private Label CEM
Service. All use by either Party of the other's Brands shall inure
solely to the benefit of the Party owning the Brands. Neither Party
shall take any action that would infringe, dilute or conflict with
the other's right and ownership in its Brands. Each Party
acknowledges the other's exclusive ownership of such other Party's
Brands, and except for the license granted in this Section, this
Agreement does not grant either Party any right, title or interest in
or to the other's Brands.
4.3 CEM PROPERTY. eNote acknowledges and agrees that CEM owns all right,
title and interest in and to the CEM web site, the CEM Brands, all
source and object code used in the CEM System whether developed
specifically for the integration of the eNote Private Label CEM
Services or otherwise, together with the instructions and manuals
sold or provided as a unit therewith (together, the "CEM PROPERTY").
Except for the limited license of eNote to the CEM Brands, nothing in
this Agreement confers on eNote any license, right of ownership,
title or interest in CEM Property. To the extent that eNote is deemed
to own any rights in the CEM Property, eNote hereby assigns and
conveys to CEM, its successors and assigns, any and all such rights
and agrees to execute any additional documents reasonably necessary
to effect, evidence and record such assignment. This obligation to
execute such additional documents shall survive any expiration or
termination of this Agreement.
4.4 SERVICE BRANDING. CEM may use the phrase, "powered by CoolEmail" and
related logo in association with the eNote Brands on all static and
dynamic pages served by eNote Users.
4.5 ENOTE PROPERTY. Nothing in this Agreement shall be deemed to confer
any right, title or interest in the eNote Brands, the TVemail(TM)
System and its backbone or any other eNote product or property
whatsoever (the "ENOTE PROPERTY"), which shall remain the sole and
exclusive property of eNote. To the extent that CEM is deemed to own
any rights in the eNote Property, CEM hereby assigns and conveys to
eNote, its successors and assigns, any and all such rights and agrees
to execute any additional documents reasonably necessary to effect,
evidence and record such assignment. This obligation
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to execute such additional documents shall survive any expiration or
termination of this Agreement.
4.6 INDEMNIFICATION. The parties each agree to indemnify and hold
harmless the other party from and against loss or damage, including
reasonable attorneys' fees and costs, sustained by reason of any use
of the other party's Brands in accordance with this Agreement.
4.7 PUBLICITY. eNote and CEM agree to cooperate in developing and issuing
joint press releases from time to time. No press releases may be
issued without advance review and approval of both parties hereto.
4.8 REMEDIES. The parties acknowledge that the rights and obligations of
the parties pursuant to this Article are special and unique, and that
in the event of breach, monetary damages might be insufficient to
compensate the injured party. Therefore, in addition to any other
remedy available at law or equity, the parties agree that the injured
party shall be entitled to specific performance to prevent a breach
or threatened breach of this Section, and to injunctive relief,
without further proof of irreparable harm or the posting of a bond.
ARTICLE 5. TERM AND TERMINATION
5.1 TERM; RENEWAL. Unless other wise terminated pursuant to this Article,
this Agreement shall remain in effect for an initial term of
thirty-six (36) months from the Effective Date hereof (the "TERM").
Thereafter, this Agreement shall renew automatically for successive
six (6) month terms unless terminated by a party upon written notice
no later than forty-five (45) days before the expiration of any term.
5.2 TERMINATION FOR CONVENIENCE. During the first twelve (12) month
period following the Effective Date hereof, either party may
terminate this Agreement without cause upon ninety (90) days' prior
written notice.
5.3 TERMINATION FOR CAUSE. This Agreement may be terminated immediately
by either party, for cause, upon written notice to the other party,
upon the occurrence of any of the following event: (i) if the other
ceases to do business or otherwise terminates its
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business operations for a period of sixty (60) days; (ii) if the
other shall fail to promptly secure or renew any license,
registration permit, authorization or approval necessary for the
conduct of its business in the manner contemplated by this Agreement,
or if any such 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, including, without limitation, any failure to pay
invoices within the time period set forth in Section 2.3 hereof,
twenty (20) days of written notice describing such breach and the
intent to terminate.
5.4 TERMINATION WITHOUT NOTICE. This Agreement may be terminated by
either party without any requirement of notice if the other becomes
insolvent or seeks protection under any bankruptcy, receivership,
trust, deed, creditor arrangement, composition, or comparable
proceeding, or if any such proceeding is instituted against such
party by its creditors and not dismissed within forty-five (45)
days.
5.5 NOT EXCLUSIVE REMEDY. Termination shall not be the sole remedy under
this Agreement and whether or not termination is effected, all other
remedies shall remain available.
5.6 NO LIABILITY FOR CERTAIN TERMINATIONS. Each party acknowledges and
agrees that the rights of termination pursuant to Sections 5.1, 5.2
and 5.4 are absolute. Neither party shall incur any liability
whatsoever for any damage, loss or expense of any kind suffered or
incurred by the other (including, without limitation, lost profits)
arising from due to any termination of this Agreement by a party that
has otherwise complied with the terms of this Agreement, whether or
not the terminating party was aware of the possibility of such
damages, loss or expense.
ARTICLE 6. CONDUCT
6.1 SPAM. CEM and eNote will use commercially reasonable efforts to
ensure that the eNote Private Label CEM Service will not be used for
chain letters, junk mail, spamming or any use of distribution lists
to any person who has not given specific permission to be included in
such a process.
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6.2 COOPERATION. The parties agree to co-operate to ensure that the eNote
Private Label CEM Service and the associated eNote Web Site are
restricted to the fullest extent permitted by law in order to
preclude liability of either party from transmission of: (i) obscene,
pornographic or sexually explicit materials; (ii) messages promoting
abusive, threatening, hateful or violent behavior; (iii) messages
advocating prohibited forms of discrimination; or (iv) messages
promoting criminal or illegal activities, provided however, that none
of the foregoing shall be deemed to impose a duty on either party to
monitor communications by or between eNote Users.
6.3 ADVERTISING. All eNote advertisements on the eNote Private Label CEM
Service shall comply with the rules set forth in Sections 6.1 and 6.2
above.
6.4 CERTAIN RIGHTS TO DENY USER ACCESS. eNote Users may be denied
continuing access to the Private Label CEM Service for behavior that
is inconsistent with the policies and principles set forth in this
Article. Such policies and principles may be revised without notice.
ARTICLE 7. CONFIDENTIALITY
7.1 CONFIDENTIAL INFORMATION. The parties acknowledge that as a result of
this Agreement, each may become privy to the confidential business
information and trade secrets of the other, as well as private,
confidential information concerning the customers and users of the
parties' respective Internet and telephony services. Each party
agrees that all such confidential information and trade secrets,
including, but not limited to, software, inventions, algorithms,
know-how, ideas, business and marketing plans, technical information,
financial information and information regarding customers (including
registration data and e-mail content) ("CONFIDENTIAL INFORMATION") it
obtains from or by reason of the services provided to the disclosing
party (the "DISCLOSING PARTY") shall remain the sole property of the
Disclosing Party and/or its customers (as appropriate). Except as
expressly and unambiguously permitted in this Agreement, without the
prior written consent of the Disclosing Party in each instance (which
consent may be withheld at the sole discretion of the Disclosing
Party), the party receiving Confidential Information (the "RECEIVING
PARTY") shall hold in confidence and not use or disclose,
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except in furtherance of this Agreement, any Confidential Information
of the Disclosing Party and/or its customers (as appropriate), and
shall similarly bind its employees, principals and contractors in
writing. [In particular, but without limitation, CEM shall not use or
disclose to any third party either during or after the term of this
Agreement, except under court order, any registration data or other
information or content contained in or provided by any eNote User in
a communication in any media, or any information concerning eNote
User usage data, except in the form of compiled and aggregated data
which does not identify or describe any individual eNote User or the
substance of such eNote user's communications.] [Awaiting resolution
of advertising rights set forth in Section 6.1 hereof]
7.2 PUBLIC DOMAIN INFORMATION. Only such Disclosing Party information
that is in the public domain (other than as a result of a breach of
this Agreement) and information disclosed by the Disclosing Party to
a third party free of restrictions on disclosure shall be excluded
from the definition of Confidential Information.
7.3 RETURN OF CONFIDENTIAL MATERIALS. Upon termination of this Agreement,
unless specifically provided herein, all rights and licenses granted
under this Agreement shall terminate, and each party shall return to
the other all Confidential Information, in any media, then in its
possession or under its control. Each party agrees to certify to such
return if requested by the other party.
7.4 SURVIVAL OF OBLIGATIONS. The obligations of confidentiality contained
in this Agreement shall survive expiration or termination of this
Agreement for three (3) years, provided however, that the obligations
concerning customer Confidential Information shall survive in
perpetuity.
7.5 REMEDIES. The parties acknowledge that the rights and obligations of
the parties pursuant to this Article are special and unique, and that
in the event of breach, monetary damages might be insufficient to
compensate the injured party. Therefore, in addition to any other
remedy available at law or equity, the parties agree that the injured
party shall be entitled to specific performance to prevent a breach
or threatened breach of this
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Article, and to injunctive relief, without further proof of
irreparable harm or the posting of a bond.
ARTICLE 8. WARRANTIES
8.1 AUTHORITY FOR AGREEMENT.
(a) Each of the Parties represents and warrants to the other that:
(i) it has full power and legal right to execute and deliver this
Agreement and to perform its obligations under this Agreement; (ii)
the execution, delivery, and performance of this Agreement have been
authorized by all required action, corporate or otherwise, and do not
violate or conflict with any provisions of its charter or bylaws or
any of its contractual obligations or requirements of law binding on
it; (iii) this Agreement constitutes its legal, valid, and binding
obligation, enforceable against it in accordance with its terms; and
(v) it has and will maintain in full force and effect throughout the
term of this Agreement all governmental permits, licenses, and
authorizations required on its part to perform its obligations under
this Agreement.
(b) EXCEPT AS OTHERWISE SET FORTH IN THIS SECTION, NEITHER CEM NOR
ENOTE MAKES ANY EXPRESS OR IMPLIED WARRANTIES WHATSOEVER WITH RESPECT
TO THE SERVICES LICENSED UNDER THIS AGREEMENT AND EXPRESSLY DISCLAIMS
ANY EXPRESS OR IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPORSE, OR OF NON-INFRINGEMENT.
8.2 PERFORMANCE. CEM warrants and represents that the eNote Private Label
CEM Service will operate substantially in conformity with the
specifications as provide in SCHEDULE B hereto and the operating
guidelines in this Agreement and any instructions provided by CEM to
eNote or eNote Users, and that any fixes, patches, work-arounds or
modifications necessary to the operation of the eNote Private Label
CEM Service will be performed by CEM in a timely manner at no
additional cost to eNote or eNote Users.
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ARTICLE 9. MISCELLANEOUS
9.1 ENTIRE AGREEMENT. Upon execution by both parties, this Agreement
shall constitute the entire agreement between the parties with
respect to the subject matter hereof and shall supersede all prior
and contemporaneous communications whether oral or written.
9.2 GEOGRAPHIC LIMITATION. The terms and conditions of this agreement are
limited to eNote Private Label CEM Service pertaining to, and
originating from the United States.
9.3 AMENDMENT AND WAIVER. Any provision of this Agreement may be amended
and the observance of any provision of this Agreement may be waived
(either generally or in any particular instance and either
retroactively or prospectively) only with the written consent of all
parties hereto.
9.4 CONTROLLING LAW. This Agreement is made in, and shall be governed by
and construed under the laws of, the State of Illinois and the United
States without regard to conflicts of laws provisions thereof. The
sole jurisdiction and venue for actions related to the subject matter
hereof shall be the Illinois and United States federal courts having
within their jurisdiction the location of CEM's principal place of
business. Both parties consent to the exclusive jurisdiction of such
courts and agree that process may be served in the manner provided
herein for giving of notices or otherwise as allowed by Illinois or
federal law. The parties hereby also waive their right to trial by
jury on causes of action that are based on this Agreement.
9.5 ATTORNEYS' FEES. If either the eNote or CEM employs attorneys to
enforce any rights arising out of or relating to this Agreement, the
prevailing party shall be entitled to recover its reasonable
attorneys' fees, costs, and other expenses.
9.6 NOTICES. Unless otherwise provided, any notice required or permitted
under this Agreement shall be given to the party to be notified in
writing and shall be deemed effectively given upon date of personal
delivery, upon date of delivery by confirmed facsimile or electronic
transmission (with duplicate original sent by United States mail) or
three business days after deposit with the United States Post Office
by registered or certified mail, postage prepaid, and addressed to
the party to be notified at the address
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indicated for such party on the signature page hereof, or at such
other address as such party may designate with like notice.
9.7 SEVERABILITY. If any provision of this Agreement shall be held by a
court of competent jurisdiction to be illegal, invalid or
unenforceable, such provision shall be limited or eliminated to the
minimum extent necessary so as to ensure that the rest of this
Agreement remains in full force and effect and remains enforceable.
9.8 TRANSITION. In the event this Agreement is terminated, CEM will work
with eNote to transition eNote Users to a new service provider.
9.9 TAXES. eNote shall pay any and all taxes associated with the use of
the eNote private label CEM System apart from taxes imposed on CEM's
income therefrom.
9.10 INDEPENDENT CONTRACTOR. CEM, in its performance under this Agreement,
is acting solely as an independent provider of services to eNote. No
joint venture or partnership shall be deemed created by this
Agreement or the performance of the parties.
9.11 ASSIGNMENT. This Agreement shall be binding on the successors and
assigns of the parties.
{SIGNATURE PAGE FOLLOWS}
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed on
their behalf on the date and year first above written.
Accepted by: /s/ Xxxx X. Xxxxxxxx Accepted by: /s/ Xxxxxxx X'Xxxxx
------------------------- ---------------------
Xxxx X. Xxxxxxxx Xxxxxxx X'Xxxxx
President and CEO President
xXxxx.xxx Inc XxxxXxxxx.xxx, Inc.
000 Xxxxx Xxxxx Xxxx 000 Xxxx Xxxxxx
Xxxxxxxxx, XX 00000 Xxxxxxx, XX 00000
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SCHEDULE A
Schedule of Private Label Pricing
YEAR 1
1. No charge for basic email backbone
2. $0.10/month for first phone activated account on a eNote (TVemail(TM)) unit
and $0.25/month for all additional phone activated accounts on a eNote
(TVemail(TM)) unit.
3. $0.065/minute for phone accessed accounts on CEM lines
4. Pass through of payphone access charges. Currently $0.285/payphone call
5. Should eNote elect to run their own lines then:
5.1. There is a $25,000 set up fee per inbound telephony pod. Each inbound
telephony pod can accommodate 2,500 - 5,000 calls per day. Each pod
can handle 24 simultaneous calls.
5.2. Phone access cost would drop to $0.015/minute
6. $150.00/hour for custom development time
7. Approximately $20,000.00 (at CEM's actual cost) for the attachment server.
Final price to be included in a separate agreement that covers attachments.
8. CEM and eNote shall share net advertising revenue derived from the eNote
Web Site and telephone access to the CEM hosted eNote email service
equally.
YEAR 2
1. Same as in Year 1 except:
1.1 $995.00/month for every 250,000 email address in the eNote CEM service
2. $0.25/month for first phone activated account on an eNote (TVemail(TM))
unit and $0.25/month for all additional phone activated accounts on an
eNote (TVemail(TM)) unit.
YEAR 3
1. Same as in Year 2 except:
1.2 0 - 100,000 mailboxes $0.10/month per mailbox
100,001 - 250,000 mailboxes $0.09/month per mailbox
250,001 - 500,000 mailboxes $0.08/month per mailbox
500,000 + mailboxes $0.07/month per mailbox
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SCHEDULE B
Standard Features Available in the eNote Basic Service Release
- Basic email service:
- Read
- Reply
- Forward
- Delete
- 6 Megs of storage
- POP3 access
- CEM service via private toll-free number
- Consolidation of external email accounts generally supported by CEM
service
Enhanced Features Available in the eNote Basic Service Release
These features are subject to additional development time. A separate budget and
contract will be developed to address these features:
- Attachment translation
- Address book with synchronization between the CEM address book and the
eNote address book
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