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EXHIBIT 10.5
FORM OF WEB SERVICES AGREEMENT
This WEB SERVICES AGREEMENT (this "Agreement") dated as of ____ __,
1999 between American Greetings Corporation, an Ohio corporation ( "Client"),
and xxxxxxxxxxxxxxxxx.xxx, inc., a Delaware corporation ( "Provider").
W I T N E S S E T H:
WHEREAS, Client has caused Provider and its subsidiaries to be created
to carry on the online interactive and electronic businesses of Client and its
subsidiaries; and
WHEREAS, Client wishes to enter into arrangements with Provider to
provide various online services to Client on a cost-plus basis, and Provider
wishes to provide these services to Client (to support Client and Client's
initiatives with its Customers);
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein and in the other agreements between the parties being entered into at the
same time, and for other good and valuable consideration had and received, the
receipt and sufficiency of which are hereby acknowledged, the undersigned hereby
agree as follows:
ARTICLE I. DEFINITIONS
When used in this Agreement with initial capital letters, the following
terms shall have the following meanings, unless the context otherwise clearly
requires:
"AG BUSINESS" has the meaning assigned to the term "AG Business" in the
Cross License Agreement.
"CLIENT SITE" means a Web site on the World Wide Web portion of the
internet established or maintained by Client or any Customer of Client.
"CONFIDENTIAL INFORMATION" has the meaning assigned to it in the Cross
License Agreement.
"CONTENT" means all text, pictures, sound, graphics, video and other
data supplied by Client or its Customers to Provider pursuant to this Agreement,
as such materials may be modified from time to time.
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"COST" has the meaning assigned to that term in the Administrative
Services Agreement of even date herewith between Client and Provider.
"CROSS-LICENSE AGREEMENT" means the Cross-License Agreement dated
________, 1999 between the parties hereto.
"CUSTOMER" means any customer or prospective customer of Client.
"DOMAIN NAME" means any domain name used for a Client Site.
"FORMATION AGREEMENT" means the Formation Agreement dated ________,
1999 between the parties hereto.
"INTELLECTUAL PROPERTY RIGHTS" has the meaning assigned to it in the
Cross License Agreement.
"SUPPLEMENTARY AGREEMENT" means any agreement entered into between
Client and Provider with respect to particular Web Services for the purpose of
setting forth the specifications for that project, the timetable for delivery
and acceptance of Web Services for that project and similar matters.
"USER CONTENT" means all text, pictures, sound, graphics, video and
other data provided by users of any Client Site.
"WEB SERVICES" means electronic and internet content delivery related
technology development and implementation services, including, without
limitation, web site development and maintenance. The term Web Services shall
not include actual web hosting, but shall include services related to arranging
for web hosting with third parties.
"WORK PRODUCT" means tangible and intangible work product, ideas,
concepts, know-how and information and the writings in which any of the same are
fixed (including, without limitation, all reports, computer software systems,
routines, data models, technical data, processes, designs, code and
documentation and systems, concepts and business information) and all
proprietary rights (including, without limitation, rights under patent,
copyright, trade secret and other similar laws) therein. "Work Product" shall
specifically include, without limitation, all HTML files, Java files, graphics
files, animation files, data files, technology, scripts and programs, both in
object code and source code form, all documentation and any other deliverable
prepared for Client by Provider in accordance with the terms of this Agreement
or any Supplementary Agreement.
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ARTICLE II. SERVICES TO BE PROVIDED
SECTION 2.1 REQUESTS FOR SERVICES. Whenever Client requires Web Services in the
course of Client's business, Client shall have the right, but not the
obligation, to call upon Provider to provide those Services in accordance with
the terms of this Agreement. Client shall from time to time give Provider notice
a reasonable time in advance of the volume of Web Services it expects to
require. Client's notices will specify in reasonable detail the types of Web
Services Client expects to require and the level of each type of Web Service.
Provider shall be obligated to provide those Web Services of which it has such
notice at the volume level specified, subject only to Provider's reasonable
determination that such Services are within its competency.
SECTION 2.2 USE OF SERVICES. Provider shall only be obligated to provide Web
Services for the purpose of supporting Client's business, including, without
limitation, supporting, through services to Client, initiatives by Customers.
Provider shall have no obligation to provide Web Services to assist Client in
establishing a service bureau, engaging in outsourcing activities or otherwise
offering Provider's Web Services to third parties (other than services
incidentally provided to Customers of Client in the course of supporting
Client's activities with that Customer). After Provider notifies Client under
Section 3.1.3 of the Cross-License Agreement that it is terminating its licenses
of "Finished XX.XXX Properties" (as defined in the Cross-License Agreement),
Provider may decline to provide services hereunder that relate solely to such
Finished XX.XXX Properties as are no longer licensed; provided, that, Provider
shall continue to provide services hereunder which relate to its Intellectual
Property which continues to be licensed under the Cross-License Agreement.
SECTION 2.3 THIRD PARTY PROVIDERS. Client shall remain free at all times to
source Web Services internally or from third parties. Provider shall be free to
provide Web Services to Client through any of its subsidiaries, subcontractors
or other third parties selected or managed by Provider, subject to Client's
right to approve or disapprove any such third party (other than a wholly-owned
subsidiary) in the exercise of Client's reasonable discretion; provided that to
the extent Client disapproves a reasonable third party selection by Provider,
Provider shall, solely to such extent, be relieved of its obligation to provide
Web Services.
ARTICLE III. TERMS OF SERVICE
Client and Provider may from time to time enter into Supplementary
Agreements to specify the terms and conditions applicable to particular Web
Services. Except as may be otherwise agreed between Client and Provider from
time to time in any Supplementary Agreement, all Web Services provided under
this Agreement, whether or not the subject of a Supplementary Agreement, shall
be governed by the Cross License Agreement and shall be subject to the terms and
conditions hereof, including the following terms and conditions:
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SECTION 3.1 OWNERSHIP.
(a) OWNERSHIP OF PROPERTY CREATED BY PROVIDER UNDER THIS AGREEMENT. As
between Client and Provider, Provider shall retain (and to the extent of any
interest therein, Client hereby assigns to Provider) ownership of all right,
title and interest in and to all Work Product produced by Provider pursuant to
Client's requests for services hereunder, including, without limitation, all
applicable Intellectual Property Rights thereto. Provider hereby grants to
Client an irrevocable, perpetual, worldwide, fully paid license, with right to
sublicense through multiple tiers, to all such Work Product and Intellectual
Property Rights. Such license shall be governed by the Cross-License Agreement
and shall be exclusive in the AG Business and non-exclusive otherwise.
(b) OWNERSHIP OF OTHER PROPERTY. For the avoidance of doubt, the
retention and assignment provided for in Section 3.1(b) shall not be deemed to
effect any assignment of any other Work Product (i.e., Work Product not
developed hereunder, including any pre-existing Work Product). Client and its
Customers shall retain their respective ownership interests in all Client Sites
that receive Web Services. Without limiting the generality of the foregoing,
Client and its Customers shall retain their respective rights in any Client or
Customer owned Content (including Domain Names) or User Content given to
Provider for purposes of enabling Provider to provide Web Services. Subject to
Section 3.1(a) above, as between Client and Provider, Client shall own all
rights in User Content and usage information arising from any Client Site.
(c) EMPLOYEE AND SUBCONTRACTOR CONTRACTS. Provider shall, consistent
with customary industry practices, cause each individual or company employed by
Provider in the performance of Web Services to execute a contract regarding
confidentiality and ownership of rights prior to each such individual or
company's commencement of services thereunder or otherwise bind itself to
reasonable confidentiality and ownership requirements. Such contracts shall be
deemed to meet the foregoing requirement if they: (a) include a full assignment
of all rights to Provider, as appropriate, (b) include a waiver of any moral or
similar rights, and (c) contain restrictions on use and disclosure. Further,
with respect to any subcontractors which it employs: (x) Provider shall be
responsible for the direction and coordination of the services of such
subcontractors, and (y) Client shall have no obligation to pay such
subcontractor(s).
(d) FURTHER ASSURANCES. Provider shall cooperate with Client and its
Customer, both during and after the term of this Agreement, in the procurement
and maintenance of their respective rights to intellectual property created
hereunder and to execute, when requested, any other documents deemed necessary
or appropriate by Client to carry out the purpose of this Agreement.
SECTION 3.2 PRICING AND PAYMENT.
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Except as may be otherwise agreed, Client shall pay Provider for Web
Services at rates equal to Cost plus 10 percent. Payment terms shall be net 30
days unless otherwise agreed.
SECTION 3.3 STANDARDS OF SERVICE.
(a) MOST FAVORED NATION STATUS. The services rendered by Provider under
this Agreement shall meet or exceed the standards of quality and technological
currency that Provider meets in its own business or offers to any other customer
of Provider.
(b) LIMITED REMEDY. In the event any Web Services result in Work
Product that does not meet the standards set forth in Section 3.3(a) or is
otherwise defective, Provider shall, at Client's request and as Client's sole
and exclusive remedy hereunder, remedy any such defect, provided that Provider
shall be entitled to compensation for any additional Web Services required to
effect such remedy on the terms set forth herein, including, without limitation,
in Section 3.2.
(c) TIMELINES. Provider shall meet or beat the timetable established in
any Supplementary Agreement, and failure to do so to any material extent shall
be considered a material breach of this Agreement.
(d) DISCLAIMER OF WARRANTIES. EXCEPT AS SET FORTH HEREIN AND IN THE
CROSS-LICENSE AGREEMENT, EACH PARTY EXPRESSLY DISCLAIMS ALL WARRANTIES OR
CONDITIONS OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE
IMPLIED WARRANTIES OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE
SECTION 3.4 INDEMNITY. Provider shall indemnify Client against any claims by
third parties asserting damages resulting from services rendered by Provider
under this Agreement.
SECTION 3.5 CONFIDENTIAL INFORMATION. Each party shall hold the other party's
Confidential Information in confidence in accordance with the Cross License
Agreement
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SECTION 3.6 ADVERTISING. Client and its Customers shall have the right, in their
sole discretion, to sell advertising, directly and via their licensees and other
promotional partners, to appear on Client Sites, without consulting with
Provider. Client shall have the right to retain all revenues and fees arising
from or in connection with such advertising sold by Client, its licensees and
promotional partners. Provider shall not approach any potential advertisers for
client sites without the prior written consent of Client, which consent shall
not be unreasonably withheld. All final decisions concerning potential
advertisers shall remain within the sole discretion of Client and its Customers.
SECTION 3.7 ANCILLARY RIGHTS. Provider shall have no right to any royalties,
revenues, fees or other payments in connection with, or as a result of, the Web
Services or any Client Site, or with respect to products or services promoted or
sold on or by any Client Site, except as expressly provided in this Agreement.
Nor shall Provider have any rights of attribution in connection with any Client
Site, which shall contain appropriate proprietary rights notices, as directed by
Client. Notwithstanding the immediately preceding sentence, Provider shall have
the right to place a Client-approved logo on a credits page for each Client
Site, which logo may reference Provider's creation and operation of the Client
Site. With the express written consent of Client or its Customer, as the case
may be, this logo may include a link to Provider's own Web site.
SECTION 3.8 HOSTING.
If requested by Client with respect to a particular Client Site, the Web
Services to be provided under this Agreement shall include assistance to Client
and its Customers in arranging for hosting of such Client Site and assisting
Client and its Customers with management of the hosting arrangements.
ARTICLE IV. TERM AND TERMINATION
SECTION 4.1 TERM OF AGREEMENT. This Agreement shall be effective as of the date
first above written and shall remain in force for a period of 99 years, unless
otherwise terminated as provided herein.
SECTION 4.2 TERMINATION OF WORK. Client may, at its sole discretion, terminate
any or all work outstanding on any Client Site, or any portion thereof,
immediately upon written notice. Upon receipt of notice of such termination,
Provider shall inform Client of the extent to which performance has been
completed through such date, and collect and deliver to Client whatever Work
Product then exist in a manner prescribed by Client. Provider shall be paid for
all work performed through the date of receipt of notice of termination as
specified in paragraph 3.2 above. Provider may not terminate any work under this
Agreement without the prior written consent of Client.
SECTION 4.3 TERMINATION OF AGREEMENT. This Agreement shall terminate on the
earliest of (a) the date of termination of the Cross-License Agreement and (b)
the date when all work has been terminated pursuant to Section 4.2, but only if
Client files further written notice to Promoter stating its intention that this
Agreement shall then terminate.
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SECTION 4.4 SURVIVAL. In the event of any termination of this Agreement,
paragraphs 3.1, 3.2, 3.4 and 3.5 hereof shall survive and continue in effect and
shall inure to the benefit of and be binding upon the parties and their legal
representatives, heirs, successors, and assigns. The termination of any
provision of this Agreement shall not excuse a prior breach of that provision.
ARTICLE V. MISCELLANEOUS
SECTION 5.1 FORCE MAJEURE. Either party shall be excused from delays in
performing or from its failure to perform hereunder to the extent that such
delays or failures result from causes beyond the reasonable control of such
party; provided, however, that, in order to be excused from delay or failure to
perform, such party must act diligently to remedy the cause of such delay or
failure.
SECTION 5.2 NO AGENCY OR JOINT VENTURE. Provider, in rendering performance under
this Agreement, is acting and shall act solely as an independent contractor.
Client does not undertake by this Agreement or otherwise to perform any
obligation of Provider, whether by regulation or contract. In no way is Provider
to be construed as the agent or to be acting as the agent of Client in any
respect, or as a joint venturer, any other provisions of this Agreement
notwithstanding.
SECTION 5.3 MULTIPLE COUNTERPARTS. This Agreement may be executed in several
counterparts, all of which taken together shall constitute one single Agreement
between the parties.
SECTION 5.4 AUTHORITY TO ENTER INTO AGREEMENT. The parties and their
representatives signing this Agreement hereby acknowledge and represent that the
representatives signing this Agreement are duly authorized agents of the parties
hereto and are authorized and have full authority to enter into this Agreement
on behalf of the parties for whom they are signing.
SECTION 5.5 SECTION HEADINGS; EXHIBITS. The section and subsection headings used
herein are for reference and convenience only, and shall not enter into the
interpretation hereof.
SECTION 5.6 NO WAIVER. No delay or omission by either party hereto to exercise
any right or power occurring upon any noncompliance or default by the other
party with respect to any of the terms of this Agreement shall impair any such
right or power or be construed to be a waiver thereof. The terms and conditions
of this Agreement may be waived or amended only in writing and only by the party
that is entitled to the benefits of the term(s) or condition(s) being waived or
amended. A waiver by either of the parties hereto of any of the covenants,
conditions, or agreements to be performed by the other shall not be construed to
be a waiver of any succeeding breach thereof or of any covenant, condition, or
agreement herein contained (whether or not the provision is similar). Unless
stated otherwise, all remedies provided for in this Agreement shall be
cumulative and in addition to and not in lieu of any other remedies available to
either party at law, in equity, or otherwise.
SECTION 5.7 GOVERNING LAW/CONSENT TO JURISDICTION AND VENUE. This Agreement
shall be governed by and construed in accordance with the laws of the State of
Ohio, without reference to the choice of law provisions thereof. All aspects of
all actions brought relating to the subject matter of this Agreement shall be
governed by Ohio law, without reference to the choice of law
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provisions thereof. Disputes between the parties shall be submitted to
resolution under Section 8.09 of the Formation Agreement.
SECTION 5.8 ENTIRE AGREEMENT. Each party to this Agreement acknowledges that
this Agreement and the other agreements between the parties referred to herein
constitute the entire agreement of the parties with regard to the subject
matters addressed in this Agreement, that this Agreement supersedes all prior or
contemporaneous agreements, discussions, or representations, whether oral or
written, with respect to the subject matter of this Agreement, and that this
Agreement cannot be varied, amended, changed, waived, or discharged except by a
writing signed by all parties hereto. Each party to this Agreement further
acknowledges that no promises, representations, inducements, agreements, or
warranties, other than those set forth herein, have been made to induce the
execution of this Agreement by said party, and each party acknowledges that it
has not executed this Agreement in reliance on any promise, representation,
inducement, or warranty not contained herein.
SECTION 5.9 NEUTRAL CONSTRUCTION. The parties to this Agreement agree that this
Agreement was negotiated fairly between them at arm's length and that the final
terms of this Agreement are the product of the parties' negotiations. Each party
warrants and represents that it has sought and received legal counsel of its own
choosing with regard to the contents of this Agreement and the rights and
obligations affected hereby. The parties agree that this Agreement shall be
deemed to have been jointly and equally drafted by them, and that the provisions
of this Agreement therefore should not be construed against a party or parties
on the grounds that the party or parties drafted or was more responsible for
drafting the provision(s).
SECTION 5.10 UNENFORCEABILITY. If any provision of this Agreement or any word,
phrase, clause, sentence, or other portion thereof should be held to be
unenforceable or invalid for any reason, then provided that the essential
consideration for entering into this Agreement on the part of any party is not
unreasonably impaired, such provision or portion thereof shall be modified or
deleted in such manner as to render this Agreement as modified legal and
enforceable to the maximum extent permitted under applicable laws.
SECTION 5.11 NOTICES. Under this Agreement if one party is required or permitted
to give notice to the other, such notice shall be deemed given either (a) when
transmitted by facsimile or (b) two business days after being deposited in the
U.S. mail, first-class postage prepaid, to the attention of the other party's
chief executive officer at the registrant's principal executive office.
SECTION 5.12 NO ASSIGNMENT. Provider may not, without the prior written consent
of Client, assign, transfer, subcontract, or sublicense this Agreement or any
obligation hereunder. Any attempt to do so in contravention of this section
shall be void and of no force and effect.
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IN WITNESS WHEREOF, Client and Provider have caused this Agreement to
be signed and delivered by their duly authorized agents, all as of the date
first above written.
AMERICAN GREETINGS CORPORATION
By:_________________________________
Name:_______________________________
Title:______________________________
XXXXXXXXXXXXXXXXX.XXX, INC.
By:_________________________________
Name:_______________________________
Title:______________________________
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