JOINT MARKETING AND DISTRIBUTION AGREEMENT
This JOINT MARKETING AND DISTRIBUTION AGREEMENT ("Agreement") is
executed as of June 25, 1999, by and between CONCENTRIC NETWORK CORPORATION
("Concentric"), a Delaware corporation with its principal offices at 0000
Xxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000, and xxxxxxxx.xxx, Inc. ("xxxxxxxx.xxx"), a
Delaware corporation with its principal offices at 000 Xxxxxx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, XX 00000. Concentric and xxxxxxxx.xxx, and their respective
successors and permitted assigns, are sometimes individually referred to herein
as a "Party" or collectively as the "Parties."
RECITALS
WHEREAS, Concentric currently supplies Internet access, web hosting,
e-commerce and domain name registration services to consumers and business
customers;
WHEREAS, xxxxxxxx.xxx currently provides domain name registration,
e-mail and web hosting services to consumers and business customers, and sells
advertising space to companies interested in reaching visitors to web sites
owned and operated by xxxxxxxx.xxx;
WHEREAS, Concentric and xxxxxxxx.xxx desire to enter into an agreement
to offer certain Concentric web hosting and e-commerce services to
xxxxxxxx.xxx's customers, to make xxxxxxxx.xxx's domain registration services
available to Concentric's web hosting customers and OEM partners, and to
cooperate in certain other business opportunities that may further the interests
of both Parties;
WHEREAS, Concentric has agreed to invest (the "Investment") $5 million
in xxxxxxxx.xxx by participating in xxxxxxxx.xxx's current round of venture
capital financing, which is currently expected to close on or about June 25
under the terms set forth in that Letter of Intent, dated June 2, 1999 between
Sandler Capital Partners IV, L.P., Sandler Capital Partners IV FTE, L.P. and
xxxxxxxx.xxx.
NOW, THEREFORE, in consideration of the promises, conditions and mutual
covenants set forth below, the adequacy of which is hereby acknowledged, the
Parties agree as follows:
AGREEMENT
1. DEFINITIONS
1.1. "Web Hosting" shall mean the hosting of Internet web sites for
customers on a web server dedicated to a given customer or on one or
more web servers shared among multiple customers. Web Hosting shall
not mean any e-commerce services except for E-Commerce (as defined in
Section 1.2 below).
1.2. "E-Commerce" shall mean any product catalog, shopping cart and/or
transaction processing server-side technology closely integrated
together and sold solely in connection with Web Hosting services.
1.3. "Private Label" shall mean services that are provided by a Party but
marketed and sold under a name and product brand that is not owned or
controlled by such Party.
1.4. "Domain Registration" shall mean the process through which a unique
Internet domain name is selected and submitted to a designated domain
name registry.
1.5. "DNS" shall mean Domain Name Server, the primary database with which a
given registered domain name is associated.
1.6. "Web Properties" shall mean any and all publicly available Internet
web sites located at the domain "xxxxxxxx.xxx", or any other domain
owned, operated and maintained by xxxxxxxx.xxx, or its successors or
assigns, in each case used for Domain Registration.
1.7. "Concentric Offers" shall mean advertising and promotional materials
that are presented to potential customers that may be interested in
purchasing Web Hosting and/or E-Commerce services.
1.8. "Net New Registrant" shall mean a completed Domain Registration
including payment for the newly registered domain name.
1.9. "Concentric Opportunities" shall mean Net New Registrants made
available to Concentric solely for the benefit of Concentric and
solely for Web Hosting and/or E-Commerce opportunities.
1.10. "Above the Fold" shall mean Internet web site content that is visible
in its entirety above the bottom edge of the browser window when a
standard 800x600 computer display is employed.
1.11. "Net Registration Revenue" shall pertain only to gTLD Names and shall
mean the amount charged customers for Domain Registration less the
amount paid to third party domain registries, less other expenses
directly and solely attributable to functioning as a designated domain
name registrar or reseller, less industry and regulatory fees, and
less any applicable taxes (excluding any income tax paid by
xxxxxxxx.xxx).
1.12. "gTLD Names" shall mean only those domain names registered under the
generic top level domains of .com, .net, and .org.
1.13. "Joint Customer" shall mean a Net New Registrant that purchases Web
Hosting or E-Commerce services from Concentric.
2. MARKETING OF CONCENTRIC SERVICES
2.1. Limited Exclusivity. During the Term (as defined in Section 6.1.5
below), Concentric shall be one (1) of no more than three (3)
Web-Hosting or E-Commerce service providers that are marketed,
advertised, or otherwise promoted on the Web Properties. The
appearance of all Concentric Offers referred to throughout this
Agreement shall have an appearance, size, and placement, taken as
whole, no less favorable in all material respect than any other Web
Hosting or E-commerce service provider present on the Web Properties.
In the event of any conflict between the immediately preceding
sentence and the terms and conditions of Sections 2.2 and 2.3,
Sections 2.2 and 2.3 shall govern.
2.2. Placement. During the Term, Concentric Offers shall receive prominent
placement on the Web Properties. The content of the Concentric Offers
shall be at Concentric's sole cost and expense and shall be subject to
the prior approval of xxxxxxxx.xxx, which approval shall not be
unreasonably withheld. The placement of the Concentric Offers on the
Web Properties shall be subject to the conditions set forth in
Sections 2.2.1 to 2.2.4 below.
2.2.1. Concentric Offers shall be presented Above the Fold for those
customers selecting the "Business Resources" or the "Web
Hosting" buttons on the navigation toolbar used throughout the
Web Properties and reproduced in Exhibit A and on the
"FutureSite" page reproduced in Exhibit B. Xxxxxxxx.xxx will
ensure that end-users receive an aggregate total of no less
than 8,000,000 impressions per month of the "Business
Resources" and "Web Hosting" buttons. In no case will the
Concentric Offers be more than one (1) hyperlink away from any
"Business Resources" or "Web Hosting" button presented on the
Web Properties.
2.2.2. Concentric Offers shall be presented via banner advertisements
throughout the Web Properties. Xxxxxxxx.xxx will ensure that
end-users will receive an aggregate total of no less than
250,000 Above the Fold impressions per month of the banner
advertisements. These banner advertisements will hyperlink
directly to a URL owned, operated and maintained by Concentric.
2.2.3. Concentric Offers shall be made prominently visible to the
guaranteed minimum number of Concentric Opportunities as set
forth in Exhibit C. Concentric Offers shall at no time during
the Term be presented to less than one-third (33.3%) of Net New
Registrants. The Concentric Offers relevant to this Section
2.2.3 shall hyperlink directly to a URL owned, operated, and
maintained by Concentric.
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2.2.4. Notwithstanding the forgoing, Concentric shall receive placement
throughout the Web Properties no less favorable than the placement received by
any other Web Hosting or E-commerce service provider.
2.3. Web Site Content. Content of the Concentric Offers shall comply with
the xxxxxxxx.xxx Advertising Guidelines set forth in Exhibit F.
Concentric and xxxxxxxx.xxx acknowledge the goal of converting at
least 5% of Concentric Opportunities into Web Hosting and/or
E-Commerce customers and will use commercially reasonable efforts to
cooperate to improve the Domain Registration process such that this
goal can be achieved. However, at no time will xxxxxxxx.xxx be
required to change the Domain Registration process to the commercial
detriment of its business nor required to obtain or maintain a 5%
conversion rate for the Concentric Opportunities. Notwithstanding the
foregoing, the following efforts shall be undertaken:
2.3.1. After the Launch Date (as defined in Section 6.1.2),
xxxxxxxx.xxx shall present to new domain name registrants on
the Web Properties a survey that has been amended to include an
offer to each prospective customer during the Term to receive
additional information on Web Hosting and E-Commerce services.
2.3.2. During the Term, xxxxxxxx.xxx will place banner advertisements
for Concentric Offers Above the Fold on no less than 75% of
xxxxxxxx.xxx's Domain Registration web pages.
2.3.3. For thirty (30) days following the Launch Date, the last page
of the xxxxxxxx.xxx Domain Registration process shall be in
form and content substantially similar to the layout described
in Exhibit E and shall include a Concentric Offer. A display of
this Concentric Offer to a Net New Registrant will constitute
the creation of a Concentric Opportunity. Following the
expiration of the initial thirty-day period following the
Launch Date, the obligations of Section 2.3.4 below shall
prevail.
2.3.4. Within thirty (30) days of the Launch Date, Concentric and
xxxxxxxx.xxx shall jointly determine if modifications to the
last page of the Domain Registration process will be necessary
in order to help achieve the targeted 5% conversion rate
described in Section 2.3 above. In addition, at least once
during each ninety (90) day period during the Term,
xxxxxxxx.xxx shall consider, in good faith, recommendations by
Concentric to modify the last page of the xxxxxxxx.xxx Domain
Registration process. If during the Term xxxxxxxx.xxx and
Concentric identify mutually agreeable changes to the last page
of the Domain Registration process, then xxxxxxxx.xxx shall
implement such changes within ten (10) business days of their
mutual agreement. If at any time during the Term xxxxxxxx.xxx
and Concentric cannot reach mutual agreement on the form and
content of the last page of the Domain Registration process,
then the version of such page that was most recently mutually
agreeable shall be presented to Net New Registrants and
xxxxxxxx.xxx and Concentric shall continue to negotiate in good
faith until mutual agreement can be reached.
2.3.5. During the Term, xxxxxxxx.xxx shall consider in good faith
recommendations by Concentric with respect to the Domain
Registration process, with the objective of improving the Web
Hosting services purchase rate for Net New Registrants.
2.4. Marketing Rights. Xxxxxxxx.xxx shall provide to Concentric all
relevant collected information on "Concentric Targets." The parties
shall determine a mutually agreeable list of relevant information that
shall be provided to Concentric by xxxxxxxx.xxx. For the purposes of
this Section 2.4, "Concentric Targets" shall mean at least one-third
(33.3%)of end-users that (a) complete the survey described in Section
2.3.1 and (b) either (1) indicate an interest in receiving additional
information on Web Hosting and E-Commerce services or (2) do not
object to their names being provided to third party organizations for
the purposes of marketing. Xxxxxxxx.xxx shall deliver such customer
information on Concentric Targets within a commercially reasonable
period following presentation of a Concentric Offer to the Net New
Registrant at the end of the Domain Registration process. Xxxxxxxx.xxx
acknowledges the goal of providing Concentric with such information on
Concentric Targets in real-time or near real-time. Concentric may, at
its sole discretion, contact Concentric Targets for the purposes of
selling and marketing its services. Concentric will not resell or
distribute the information on Concentric Targets to any third parties
or use such information in violation of any applicable law.
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2.5. Customer Ownership. Upon a Joint Customer's purchase of Web Hosting or
E-commerce services, Concentric may, at it's sole discretion, require
that the domain for that Joint Customer be transferred from
xxxxxxxx.xxx's DNS to Concentric's DNS. The following obligations
regarding Joint Customers shall apply:
2.5.1. At no time shall xxxxxxxx.xxx intentionally contact a Joint
Customer for the purposes of marketing or selling Web Hosting
or E-commerce services, nor shall xxxxxxxx.xxx sell or
otherwise distribute information on a Joint Customer to
companies that xxxxxxxx.xxx knows to be engaged, directly or
indirectly, in marketing or selling Web Hosting or E-Commerce
services.
2.5.2. Notwithstanding the restrictions created in Section 2.5.1,
xxxxxxxx.xxx may distribute information on a Joint Customer to
either of the two (2) other Web Hosting and E-commerce service
providers allowable under this Agreement if and only if the
Joint Customer is not presented a Concentric Offer after the
completion of another Domain Registration process.
2.5.3. If and when xxxxxxxx.xxx has developed and deployed the
technology, systems and processes to suppress the presentation
of competing Web Hosting or E-commerce offers to Joint
Customers, the rights granted to xxxxxxxx.xxx under Section
2.5.2 shall be terminated.
2.5.4. Should xxxxxxxx.xxx discover that it has unintentionally
contacted a Joint Customer or unknowingly distributed
information on a Joint Customer in violation of Section 2.5.1,
xxxxxxxx.xxx shall inform Concentric within ten (10) days of
such contact or distribution.
2.5.5. Concentric and xxxxxxxx.xxx shall meet no less than quarterly
during the Term to determine and implement a mutually agreeable
plan for marketing to Joint Customers services that do not fall
under the definitions of Domain Registration, Web Hosting, or
E-commerce provided in this Agreement.
2.6. Market Development Funds. During the Initial Term (as defined in
Section 6.1.3 below), xxxxxxxx.xxx shall pay to Concentric a market
development fund in the amount of $41,666.67 per month to be spent by
Concentric for co-branded marketing programs designed and implemented
by Concentric and approved by xxxxxxxx.xxx, which approval shall not
be unreasonably withheld or delayed, to increase the size of the
market for Domain Registration, Web Hosting and E-Commerce services.
To the extent that either Concentric or xxxxxxxx.xxx are able to
track, in a mutually agreeable manner, the leads created by the
co-branded marketing programs, such leads shall be counted toward the
guaranteed minimum Concentric Opportunities as per Section 2.8.
Concentric and xxxxxxxx.xxx will use reasonable efforts to track such
leads. Such amount shall be paid to Concentric by xxxxxxxx.xxx on the
fifteenth day of every month during the Initial Term following
Concentric's delivery of an invoice. If such payment is not made
timely, xxxxxxxx.xxx will pay a late fee equal to 1.5% for each month
or portion thereof until all past-due obligations are paid. Within
fifteen (15) days of the Effective Date(as defined in Section 6.1.1
below), Concentric and xxxxxxxx.xxx shall agree in writing as to the
form of the co-branded marketing programs that shall benefit both
Parties in an equitable manner. As requested in writing by
xxxxxxxx.xxx no more than once per month during the Term, Concentric
shall provide to xxxxxxxx.xxx evidence that demonstrates that the
market development fund is being spent by Concentric in accordance
with the co-branded marketing programs described in the previous
sentence.
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2.7. Integration Requirements. By the Launch Date, Concentric and
xxxxxxxx.xxx shall have completed the integration of the xxxxxxxx.xxx
Web Properties and Domain Registration process with the Concentric Web
Hosting and E-commerce services such that all obligations of this
Section 2 can be fulfilled. This integration shall include, but shall
not be limited to, (a) methods to transfer domains from xxxxxxxx.xxx's
DNS to Concentric's DNS in a timely and mechanized manner should
Concentric decide, in its sole discretion, to require such a transfer
and (b) methods to ensure the timely transfer of customer information
as required by Section 2.4.
2.8. Performance. During the first month of the Initial Term, xxxxxxxx.xxx
will ensure that at least 16,667 Concentric Opportunities are created.
The sole evidence of xxxxxxxx.xxx's fulfillment of the obligations of
this Section 2.8 is the presentation of the Concentric Offers
described in Sections 2.2.3 and 2.3.3. In each subsequent monthly
period of the Initial Term, the number of Concentric Opportunities
will increase by 10%, such that the number of Concentric
Opportunities meets or exceeds the monthly minimums established in
Exhibit C.
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2.9. Reporting. During the Term, xxxxxxxx.xxx shall provide to Concentric
monthly reports on the number of impressions of all Concentric Offers.
During the Term, xxxxxxxx.xxx shall provide to Concentric weekly
reports on the relative click through rates for each unique Concentric
banner advertisement. During the Term, Concentric shall provide to
xxxxxxxx.xxx monthly reports for all hosting subscriptions that
Concentric can attribute to the creation of a Concentric Opportunity.
so that xxxxxxxx.xxx will have the necessary information to see which
subscribers have paid and which have discontinued the Concentric
hosting service. In addition, Concentric shall use commercially
reasonable efforts to provide to xxxxxxxx.xxx information on the
number hosting subscriptions generated by Concentric's marketing
presence on the Web Properties.
2.10. Without limiting the foregoing, xxxxxxxx.xxx reserves the right at any
time and from time to time to amend, supplement or otherwise modify
the design, "look and feel," layout, content, architecture and
navigational flow of the Web Properties.
3. DISTRIBUTION OF XXXXXXXX.XXX SERVICES
3.1. Concentric-Branded Hosting Services. Following the Launch Date,
Concentric shall use xxxxxxxx.xxx as the exclusive third-party gTLD
Name Domain Registration service for its Concentric-branded
Web-Hosting and E-Commerce services. The xxxxxxxx.xxx logo will be
prominently displayed on the domain registration page of Concentric's
Web-Hosting and E-commerce products and on all pages relating directly
to gTLD Name Domain Registration. A "domain registration" button will
be present on the "xxx.xxxxxxx.xxx" web page, or its equivalent. The
button shall hyperlink directly to Concentric's domain registration
page, which co-branded page shall be designed by Concentric with
consultation from xxxxxxxx.xxx. Concentric shall consider in good
faith recommendations by xxxxxxxx.xxx to modify such co-branded page.
Concentric's obligations under this Section 3.1 shall be relieved if
Concentric chooses to use xxxxxxxx.xxx's Private Label Domain
Registration services as described in Section 3.3 below.
3.2. Private Label Hosting Services. To the extent Concentric is able to
use a third party Domain Registration service for its Private Label
Web Hosting and E-commerce services, Concentric shall use xxxxxxxx.xxx
as the exclusive third-party gTLD Name Domain Registration service for
Private Label services sold under contracts entered into by Concentric
after the Launch Date of this Agreement. Concentric shall use
commercially reasonable efforts to secure xxxxxxxx.xxx as the
exclusive gTLD Name Domain Registration service used by Concentric's
existing Private Label customers. If Concentric cannot secure
exclusive arrangements for future or existing Private Label customers,
it shall use commercially reasonable efforts to secure a non-exclusive
arrangement for xxxxxxxx.xxx.
3.3. Private Label Registration Services. If following the Effective Date,
Concentric elects to use a Private Label Domain Registration service,
Concentric will use xxxxxxxx.xxx's Private Label gTLD Name Domain
Registration services. Xxxxxxxx.xxx shall receive co-branding on the
primary Domain Registration web page used by Concentric for such
Private Label gTLD Name Domain Registration services. Xxxxxxxx.xxx
shall provide Private Label Domain Registration services that are at
competitive prices, terms and conditions. If such competitive prices,
terms and conditions are not made available by xxxxxxxx.xxx to
Concentric in any instance, Concentric shall provide xxxxxxxx.xxx with
a right of "last refusal".
3.4. Performance Metrics. If during the Term any customer purchasing
Concentric's Web Hosting service is unable to complete the Domain
Registration process for gTLD Names within seventy-two (72) hours of
the customer's first attempt to do so, Concentric may provide written
notification to xxxxxxxx.xxx that describes the performance problem.
Xxxxxxxx.xxx shall have thirty (30) days following such notification
to remedy the Domain Registration process. The Domain Registration
process shall be considered remedied when any customer purchasing
Concentric's Web Hosting service is able to complete the Domain
Registration process within a period of time that is within 20% of the
"Industry Standard Registration Time" as calculated using the methods
described in Exhibit H. If xxxxxxxx.xxx does not remedy the Domain
Registration process within thirty (30) days of Concentric's initial
notification, then Concentric's obligations under this Section 3 to
use xxxxxxxx.xxx as the exclusive third party gTLD Name Domain
Registration service shall be terminated. If during the Initial Term
or during the Renewal Term Concentric provides, under the rights
created by this Section 3.4, three (3) written notifications to
xxxxxxxx.xxx, then Concentric's obligations under this Section 3 to
use xxxxxxxx.xxx as the exclusive third party gTLD Name Domain
Registration service shall be terminated.
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4. COMPENSATION AND FEES
4.1. Minimum Payment. Concentric will pay to xxxxxxxx.xxx a fee of $100,000
per month for the Initial Term (as defined in Section 6.1.3 below).
This fee will be paid by Concentric to xxxxxxxx.xxx within fifteen
(15) days of the beginning of each monthly period during the Initial
Term. If such payment is not made timely, Concentric will pay a late
fee equal to 1.5% for each month or portion thereof until all past-due
obligations are paid.
4.2. Incentive Payment. Concentric will pay to xxxxxxxx.xxx $75 for each
Concentric Opportunity that becomes a "Qualified Concentric Customer".
For the purposes of this Section 4.2, a Qualified Concentric Customer
shall mean a Web Hosting or E-Commerce customer that meets all of the
following conditions: (a) is identified as a Concentric Opportunity
responding to a Concentric Offer; (b) purchases a fee-bearing account
of the type that incurs a monthly charge; (c) successfully completes
two (2) billing cycles with Concentric, and; (d) is not among the
first 5% of all Concentric Opportunities that purchase Web Hosting
or E-Commerce services from Concentric in a given month. Concentric
will make this incentive payment to xxxxxxxx.xxx on the fifteenth day
of each month following the conversion of the customer to a Qualified
Concentric Customer. If such payment is not made timely, Concentric
will pay a late fee equal to 1.5% for each month or portion thereof
until all past-due obligations are paid.
4.3. Registration Commissions. Xxxxxxxx.xxx will pay to Concentric a
one-time commission for all Net New Registrants originated by
Concentric, fulfilled by xxxxxxxx.xxx, and that register gTLD Names.
The commission paid by xxxxxxxx.xxx to Concentric shall be 15% of the
Net Registration Revenue or shall adhere to the commission schedule in
Exhibit G, whichever amount is greater for a given volume of
registered domains. Xxxxxxxx.xxx shall make this commission payment on
the fifteenth day of each month following the month during which the
Domain Registration process is completed by the Net New Registrant. If
such payment is not made timely, xxxxxxxx.xxx will pay a late fee
equal to 1.5% for each month or portion thereof until all past-due
obligations are paid. For the duration of the Term, the commission
schedule presented in Exhibit G may be substituted, at Concentric's
sole discretion, for the commission schedule typically offered by
xxxxxxxx.xxx to other companies.
4.4. Audit. (a) Upon fifteen (15) business days prior notice to one Party,
the other Party may have access to the other Party's relevant
databases and records to conduct an audit for the sole purpose of
verifying the commissions and incentive payments due hereunder, as the
case may be. Each Party shall grant the other such access for a
maximum of two (2) requests during each of the Initial Term and, if
applicable, the Renewal Term (as defined in Section 6.1.4 below).
Audits shall be conducted during regular business hours and shall not
unreasonably interfere with normal business. Such audit shall be
solely at the auditing Party's expense. However, if the audited Party
has either overcharged or underpaid the auditing Party by more than
five percent (5%) for the time period subject to audit, then the
audited Party shall pay the reasonable expenses of such audit. The
findings of any audit conducted under this Section 4.4 shall be
subject to the confidentiality requirements of Section 8.
5. OTHER SERVICE AGREEMENTS
5.1. Domain Parking. During the Term, Xxxxxxxx.xxx will provide a domain
parking service for all Net New Registrants whereby any domain not
explicitly moved elsewhere will be associated with the DNS of
xxxxxxxx.xxx. During the Term, Xxxxxxxx.xxx will not offer domain
parking to any other company.
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5.2. SiteAmerica Divestiture If during the Term, xxxxxxxx.xxx decides to
divest the Web Hosting customer accounts served by the SiteAmerica
shared hosting platform, which platform currently owned and operated
by xxxxxxxx.xxx, it shall provide to Concentric written notice of such
decision. Concentric shall have the right to be the first party to
negoitate with xxxxxxxx.xxx for the proposed purchase of the
SiteAmerica customer accounts. If the Parties do not reach agreement
on the price, terms and conditions of such purchase within twenty (20)
business days of xxxxxxxx.xxx's written notice to Concentric, then
xxxxxxxx.xxx shall have the right to divest the Site America customer
accounts third party. However, if the price to be paid for the
accounts by third party is equivalent to or less than the Concentric's
last written offer to purchase the accounts, Concentric shall have the
right and the obligation to purchase the accounts at the price
described in the last written offer to xxxxxxxx.xxx. Any such customer
account purchase agreement will be subject to a definitive written
agreement containing reasonably customary terms and conditions for
agreements of that type and that is executed and delivered by both
Parties.
5.3. Server Co-Location. If at any time during the Term, xxxxxxxx.xxx
decides to open another server hosting facility in the United States
or another country served by Concentric, xxxxxxxx.xxx will use
Concentric's server co-location facilities. Concentric shall provide
such server co-location services that are at competitive prices, terms
and conditions. If such competitive prices, terms and conditions are
not made available by Concentric to xxxxxxxx.xxx, xxxxxxxx.xxx's
obligations under this Section 5.4 to use Concentric's co-location
services are relieved.
5.4. Reselling of Private Label Web Hosting Services. Xxxxxxxx.xxx shall
have the right to resell under a Private Label Concentric's Web
Hosting and E-commerce services integrated with xxxxxxxx.xxx's Domain
Registration service. Xxxxxxxx.xxx will be subject to all prices,
terms and conditions of Concentric's master-reseller agreement for Web
Hosting and E-commerce services, attached hereto in Exhibit D.
6. TERM AND TERMINATION
6.1. Term Definitions. The following definitions shall be used in this
Section 6 and throughout the Agreement to govern the term of this
Agreement and any termination thereof.
6.1.1. "Effective Date" shall mean the date that the Investment is
consummated.
6.1.2. "Launch Date" shall mean the first day of the month following
the month during which Concentric and xxxxxxxx.xxx complete the
integration of the xxxxxxxx.xxx Web Properties and Domain
Registration process with Concentric Web Hosting and E-Commerce
services such that all obligations of Section 2 of this
Agreement can be fulfilled, or such other date as mutually
agreed to by the Parties.
6.1.3. "Initial Term" shall mean the period commencing on the Launch
Date and continuing for a period of twelve (12) months.
6.1.4. "Renewal Term" shall mean the period commencing on the
termination of the Initial Term and continuing for a period of
twelve months.
6.1.5. "Term" shall mean the period encompassing both periods of the
Initial Term and the Renewal Term.
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6.2. Term. This Agreement shall be effective on the Effective Date and
shall continue until the expiration of the Initial Term, unless sooner
terminated in accordance with Section 6.3 or extended in accordance
with Section 6.5. If the Investment is not consummated on or before
June 30, 1999, this Agreement shall be null and void as though never
executed and delivered by the Parties.
6.3. Termination for Cause. In addition to any other rights and/or remedies
that either Party may have under the circumstances, all of which are
expressly reserved, either Party may terminate this Agreement if:
6.3.1. The other Party is in material breach of any warranty,
representation, term, condition or covenant of this Agreement
and, if such breach is curable, fails to cure that breach
within thirty (30) days after written notice thereof (except
that all payment defaults shall be cured within five (5) days
without the need for written notice), or;
6.3.2. The other Party makes any assignment for the benefit of
creditors or similar transfer; or suffers or permits the
commencement of any form of insolvency or bankruptcy
proceeding; or has any petition under any bankruptcy law filed
against it, which petition is not dismissed within (60) days of
such filing; or has a trustee or receiver appointed for its
business assets or any part thereof.
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6.3.3. Xxxxxxxx.xxx fails to achieve the minimum commitments for
Concentric Opportunities established in Section 2.8 and Exhibit
C for two (2) consecutive monthly periods.
6.4. Effect of Termination. The termination or expiration of this Agreement
shall have no effect upon any other then-current written agreements
between the Parties unless such other agreements expressly provide
otherwise. Following the expiration or termination of this Agreement,
Sections 1,2.5 (except for Section 2.5.5), 4.4, 8, 9, 10, 11, and 12
shall survive, except that the provisions of Section 2.5 shall not
survive beyond one year after the termination of this Agreement. In
addition, the financial obligations created under Sections 4.1, 4.2,
and 4.3 and accrued through the date of termination shall survive
until all amounts due either Party at the time of termination of the
Agreement are paid in full.
6.5. Extension. No earlier than 60 days and no later than 30 days prior to
the end of the Initial Term, Concentric shall have the right to renew
the agreement for the Renewal Term at revised prices, terms and
conditions, taken as a whole which shall be no less favorable, in all
material respects, than prices, terms and conditions agreed to with
any Web Hosting or E-Commerce service provider.
7. MOST FAVORED NATION PROVISION
If during the Term, xxxxxxxx.xxx enters into an agreement that provides any
pricing, terms or conditions to another one of the three third-party Web
Hosting or E-Commerce providers allowable under this agreement that, when
taken as a whole, are materially more favorable than those offered to
Concentric in this Agreement, then xxxxxxxx.xxx shall amend this Agreement in
writing within five (5) days to provide Concentric with prices, terms and
conditions that, when taken as a whole, are equivalent or more favorable than
those offered to the other provider.
8. CONFIDENTIALITY AND PUBLICITY
8.1. Confidentiality. The Parties acknowledge and agree that the terms and
conditions of the Non-Disclosure Agreement dated March 22, 1999 (the
"NDA"), entered into by and between the Parties are incorporated into
this Agreement and that all the terms of this Agreement and all
discussions and negotiations related thereto and all information
exchanged pursuant hereto are considered Confidential Information as
defined in the NDA. In the event that any of the incorporated terms of
the NDA are inconsistent with or conflict with this Agreement, then
the terms of this Agreement shall prevail. The customer information
provided to Concentric under Section 2.4 will not be subject to the
terms of the NDA, but instead will be governed by Section 2.4.
8.2. Press Releases. Concentric and xxxxxxxx.xxx will issue a joint press
release announcing their commercial and financial relationship at
least fourteen (14) days prior to any similar press release by
xxxxxxxx.xxx in conjunction with another Web Hosting or E-Commerce
provider. At no time will either Party issue any press release or make
any public announcement(s) relating in anyway whatsoever to this
Agreement or the relationship established by this Agreement without
the express prior written consent of the other Party, except as
required by law.
9. REPRESENTATIONS AND WARRANTIES
9.1. General. Each Party represents and warrants that: (a) it has the right
and authority to enter into this and to fully perform its obligations
hereunder; (b) the services and goods it provides do not infringe upon
the intellectual property rights of any third party; and (c) by
entering into this Agreement, it will not violate, conflict with or
result in a material default under any other contract, agreement,
indenture, decree, judgment, undertaking, conveyance, lien or
encumbrance to which it is a party or by which it or any of its
property is or may become subject or bound.
9.2. Legal Authorization. Each Party represents and warrants to the other
Party that it will, at its own expense, make, obtain, and maintain in
force at all times during the term, all applicable filings,
registrations, reports, licenses, permits and authorizations in order
for it to operate to perform its obligations under this Agreement.
10
9.3. Legal Compliance. Both Parties represent and warrant that they will,
at their own expense comply with all laws, regulations and other legal
requirements that apply to them and this Agreement, including
copyright, privacy and communications decency laws. Both Parties
represent and warrant that no consent, approval or authorization of or
designation, declaration or filing with any governmental authority is
required in connection with the valid execution, delivery and
performance of this Agreement.
9.4. Y2K Compliance. Xxxxxxxx.xxx hereby represents and warrants to
Concentric that the hardware and software that comprise xxxxxxxx.xxx
Domain Registration services and all related products provided
pursuant to this Agreement are, and will at all times remain "Year
2000 Compliant" defined herein as the ability to: (a) correctly handle
date information needed for the December 31, 1999 to January 1, 2000
date change; (b) function properly without changes in operation
resulting from the advent of the new century assuming correct
configuration; (c) where appropriate, respond to two digit date input
in a way that resolves the ambiguity as to century in a disclosed,
defined and predetermined manner; (d) if the date elements in
interfaces and data storage specify the century, store and provide
output of date information in ways that are unambiguous as to century;
and (e) recognize year 2000 as a leap year.
9.5. EXCEPT FOR THE WARRANTIES SET FORTH IN THIS SECTION 9 NEITHER PARTY
MAKES ANY WARRANTIES OR REPRESENTATIONS, EXPRESS OR IMPLIED,
INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF
MERCHANTABILITY, TITLE, AND FITNESS FOR A PARTICULAR PURPOSE.
CONCENTRIC EXPRESSLY DISCLAIMS ANY WARRANTY THAT ACCESS TO OR USE OF
THE CONCENTRIC WEB HOSTING OR E-COMMERCE SERVICES WILL BE
UNINTERRUPTED OR ERROR-FREE. XXXXXXXX.XXX EXPRESSLY DISCLAIMS ANY
WARRANTY THAT ACCESS TO OR USE OF XXXXXXXX.XXX'S DOMAIN REGISTRATION
SERVICES WILL BE UNINTERRUPTED OR ERROR-FREE.
10. INDEMNIFICATION
A party ("Indemnifying Party") shall, at its expense and the request of the
other party ("Indemnified Party"), defend any third-party claim or action
brought against the Indemnified Party, to the extent it is based upon a
breach of any representation or warranty of the Indemnifying Party in
Section 9 (collectively, "Indemnified Claims"). The Indemnified Party shall
promptly notify the Indemnifying Party in writing, specifying the nature of
the action and the total monetary amount sought or other such relief as is
sought therein. The Indemnified Party shall cooperate with the Indemnifying
Party at the Indemnifying Party's expense in all reasonable respects in
connection with the defense of any such action. The Indemnifying Party may
upon written notice to the Indemnified Party undertake to control and
conduct all proceedings or negotiations in connection therewith, assume and
control the defense thereof, and if it so undertakes, it shall also
undertake all other required steps or proceedings to settle or defend any
such action, including the employment of counsel which shall be reasonably
satisfactory to the Indemnified Party, and payment of all reasonably
incurred expenses. The Indemnified Party shall have the right to employ
separate counsel to provide input into the defense, at Indemnified Party's
own cost. The Indemnifying Party shall reimburse the Indemnified Party upon
demand for any payments made or loss suffered by it at any time after the
date of tender, based upon the judgment of any court of competent
jurisdiction or pursuant to a bona fide compromise or settlement of claims,
demands, or actions, in respect to any damages to which the foregoing
relates. The Indemnifying Party shall not settle any claim or action under
this Section 10 on the Indemnified Party's behalf without first obtaining
the Indemnified Party's written permission, which permission shall not be
unreasonably withheld or delayed, and the Indemnifying Party shall indemnify
and hold the Indemnified Party harmless from and against any costs, damages
and fees reasonably incurred by Indemnified Party, including but not limited
to fees of attorneys and other professionals, that are attributable to such
Indemnified Claims. The Indemnified Party shall provide the Indemnifying
Party reasonably prompt notice in writing of any such Indemnified Claims and
provide the Indemnifying Party with reasonable information and assistance,
at the Indemnifying Party's expense, to help the Indemnifying Party to
defend such Indemnified Claims.
11
11. LIMITATION OF LIABILITIES
NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR (A) ANY AMOUNT IN EXCESS OF
THE AMOUNTS PAYABLE UNDER SECTION 4; OR (B) ANY INDIRECT, INCIDENTAL,
CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES, ARISING OUT OF OR RELATED TO
THIS AGREEMENT INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF BUSINESS
PROFITS, BUSINESS INTERRUPTION, LOSS OF BUSINESS INFORMATION, AND THE LIKE,
EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS
SECTION SHALL NOT APPLY TO EITHER PARTY'S (X) CONFIDENTIALITY OBLIGATIONS
UNDER SECTION 8; (Y) BREACH OF ITS REPRESENTATIONS, WARRANTIES AND COVENANTS
UNDER SECTION 12.3; AND (Z) INDEMNIFICATION OBLIGATIONS UNDER SECTION 10.
12. GENERAL PROVISIONS
12.1. Assignment. Neither Party may assign this Agreement or any rights
and/or obligations hereunder without the other Party's prior written
approval, which shall not be unreasonably withheld or delayed;
however, either party may, without the other Party's approval, assign
all its rights and obligations to an entity that either is an
affiliate or an unaffiliated party that agrees in writing to be bound
in connection with a merger, acquisition, or sale of all or
substantially all of such Party's assets. Any attempted assignment,
sub-license, transfer, encumbrance, or other disposal without such
consent shall be void and shall constitute a material default and
breach of this Agreement
12.2. Proprietary Rights. The Parties agree that Concentric and/or its
suppliers shall retain all right, title, and interest in Concentric's
Web Hosting and E-Commerce services and any and all content,
technology, and materials delivered by Concentric to xxxxxxxx.xxx
pursuant to this Agreement. The Parties further agree that
xxxxxxxx.xxx and/or its suppliers shall retain all right, title and
interest in xxxxxxxx.xxx's Domain Registration services and any and
all content, technology, and materials delivered by xxxxxxxx.xxx to
Concentric pursuant to this Agreement. Neither party shall have any
rights to any materials, content or technology provided by the other
party hereunder except as specifically provided in this Agreement and
shall not alter, modify, copy, edit, format, translate, create
derivative works of or otherwise use any materials, content or
technology provided by the other party except as explicitly provided
herein or approved in advance in writing by the other Party.
12.3. Each Party shall remain the owner of all right, title and interest in
and to its trademarks, service marks, logos and tradenames, content
and web sites, and no right, title in or to such is conveyed to the
other Party by this Agreement. Each Party will comply with all
reasonable guidelines and directions of the other Party with respect
to the use of the other Party's trademarks, service marks, logos and
tradenames. All goodwill arising out of a Party's use of the other
Party's trademarks, service marks, logos and tradenames will inure
solely to the benefit of the other Party. Each Party reserves the
right to update, alter, modify and delete the content of its
respective web sites and it respective trademarks, service marks,
logos and tradenames at will, from time to time, and without notice to
or permission of the other Party.
12.3.1. Xxxxxxxx.xxx may use the Concentric logo solely for the
purposes of fulfilling the obligations of Section 2 of this
Agreement. Xxxxxxxx.xxx shall fully correct and remedy any
deficiencies in its use of the Concentric logo, upon
reasonable notice from Concentric. Concentric shall have the
sole right to and at its sole discretion may commence,
prosecute or defend, and control any action concerning the
Concentric logo.
12.3.2. Concentric may use the xxxxxxxx.xxx logo solely for the
purposes of fulfilling the obligations of Section 3 of this
Agreement. Concentric shall fully correct and remedy any
deficiencies in its use of the xxxxxxxx.xxx logo, upon
reasonable notice from xxxxxxxx.xxx. Xxxxxxxx.xxx shall have
the sole right to and at its sole discretion may commence,
prosecute or defend, and control any action concerning the
xxxxxxxx.xxx logo.
12
12.4. Independent Contractors. The Parties are independent contractors with
respect to each other, and nothing in this Agreement shall be
construed as creating an employer-employee relationship, a
partnership, agency relationship or a joint venture between the
Parties
12.5. Third Party Beneficiaries. Except as specifically provided herein,
this Agreement does not provide and shall not be construed to provide
third parties, including any customer, with any remedy, claim, and
cause of action or privilege. The Parties specifically acknowledge and
agree that Concentric's operating subsidiaries are intended third
party beneficiaries of the rights under this Agreement; provided
however, that such third party beneficiaries shall agree in writing to
be bound by the terms of this Agreement.
12.6. Expenses. Each Party shall pay all costs and expenses that it incurs
with respect to the negotiation, execution, delivery and performance
of this Agreement.
12.7. Governing Law. This Agreement is to be construed in accordance with
and governed by the internal laws of the State of New York without
giving effect to choice of law. Any dispute or claim arising out of or
in connection with this Agreement or the performance, breach or
termination thereof, shall be finally settled by binding arbitration
in New York City, New York under the Rules of Arbitration of the
American Arbitration Association by an arbitrator appointed in
accordance with those rules. Judgment on the award rendered by the
arbitrators may be entered in any court having jurisdiction thereof.
Notwithstanding the foregoing, either party may apply to any court of
competent jurisdiction for injunctive relief without breach of this
arbitration provision. If any legal action or other legal proceeding
(including arbitration) relating to the transactions under this
Agreement or the enforcement of any provision of this Agreement is
brought against any Party hereto, the prevailing Party shall be
entitled to recover reasonable attorneys' fees, costs and
disbursements
12.8. Force Majeure. Neither Party shall be responsible for any failure to
perform any obligation or provide service hereunder because of any (i)
act of God, (ii) war, riot or civil commotion, (iii) governmental acts
or directives, (iv) strikes, work stoppage, or equipment or facilities
shortages not in the reasonable control of either Party, or (v) other
similar force beyond such Party's reasonable control.
12.9. Severability. If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, each party agrees that such
provision shall be enforced to the maximum extent permissible so as to
effect the intent of the parties, and the validity, legality and
enforceability of the remaining provisions of this Agreement shall not
in any way be affected or impaired thereby. If necessary to effect the
intent of the parties, the parties shall negotiate in good faith to
amend this Agreement to replace the unenforceable language with
enforceable language that reflects such intent as closely as possible.
12.10. Notices. All notices and requests in connection with this Agreement
shall be given in writing and shall be deemed given as of the day
they are received if received by noon on a business day in the city
of receipt (otherwise on the next business day) either by messenger,
delivery service, or in the United States of America mail, postage
prepaid, certified or registered, return receipt requested, and
addressed as follows:
TO CONCENTRIC TO XXXXXXXX.XXX
Concentric Network Corporation Xxxxxxxx.xxx, Inc.
0000 Xxxxxxxx Xxxxxx 000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx Xxxx, XX 00000
Phone: 000.000.0000 Phone: 000.000.0000
Fax: 000.000.0000 Fax: 000.000.0000
Attention: Xxxxx Xxxxxx Attention: Xxxx Xxxxxxxx
or to such other address a Party may designate pursuant to this
notice provision.
12.11. Entire Agreement. This Agreement, which includes the Exhibits and
other agreements expressly referenced herein, including the NDA,
constitutes the entire agreement between the parties concerning the
subject matter hereof and with the exception of the NDA, supersedes
any prior agreements, representations, statements, negotiations,
understandings, proposals or undertakings, oral or written, with
respect to the subject matter expressly set forth herein. The
headings contained in this Agreement are for convenience of reference
only, shall not be deemed to be a part of this Agreement and shall
not be referred to in connection with the construction or
interpretation of this Agreement. Any amendment or supplement to this
Agreement shall be in writing and duly executed by both parties.
13
IN WITNESS WHEREOF, the parties have entered into this Agreement as of the date
written above in the first sentence of this Agreement.
CONCENTRIC NETWORK CORPORATION XXXXXX INTERACTIVE CORP.
/s/ Xxxx Xxxxxx /s/ Xxxxxxx X. Xxxxxx
-------------------------------------------------- -------------------------------------------------
By (Sign) By (Sign)
Xxxx Xxxxxx Xxxxxxx X. Xxxxxx
-------------------------------------------------- -------------------------------------------------
Name (Print) Name (Print)
E.V.P. President and C.E.O.
-------------------------------------------------- -------------------------------------------------
Title Title
06/25/1999 06/25/1999
-------------------------------------------------- -------------------------------------------------
Date Date
EXHIBIT A
[GRAPHIC: Screen shot of xxxxxxxx.xxx homepage.]
EXHIBIT B
[GRAPHIC: Screen shot of xxxxxxxx.xxx web page for websites under construction,
including statement: "Coming Soon! You have reached my future website. We
recently registered our domain name at. . . xxxxxxxx.xxx the first step on the
web."]
EXHIBIT C
Guaranteed Monthly Minimums for the Duration of this Agreement:
Minimum
Concentric
Month Opportunities
----- -------------
1 16,667
2 18,333
3 20,167
4 22,183
5 24,402
6 26,842
7 29,526
8 32,479
9 35,726
10 39,299
11 43,229
12 47,552
EXHIBIT D
[Standard Concentric Reseller Agreement Attached Hereto, for reference only]
EXHIBIT E
Sample Proposed Concentric Offer for last page of Domain Registration Process:
[GRAPHIC: Screen shot of xxxxxxxx.xxx Business Resources page.]
EXHIBIT F
[Standard xxxxxxxx.xxx Advertising Terms and Conditions
Attached Hereto, for reference only]
EXHIBIT G
Commission Schedule for Origination of Net New Registrants
regs./mo. Comm. %
0-500 10%
501-1000 12.50%
1001-2500 15%
2501+ 20%
This commission schedule is subject to change by xxxxxxxx.xxx with written
notification to Concentric.
EXHIBIT H
Calculation of "Industry Standard Registration Time"
Industry Standard Registration Time shall be calculated, by a third-party
mutually agreeable to both Parties, as follows:
1) The top five (5) companies registering gTLD Names are identified by the
number of domains registered in the month during which Concentric provided
xxxxxxxx.xxx with written notification of xxxxxxxx.xxx's performance
problem as described in Section 3.4.
2) The time required to complete the Domain Registration process is gathered
for a typical customer of each of the top five companies identified in Step
1 above.
3) The Industry Standard Registration Time shall be the median of the five (5)
registration times gathered in Step 2 above.
