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EXHIBIT 10.6
*INFORMATION HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
AND HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
CONFIDENTIAL
FILTERING SERVICE AND LICENSE AGREEMENT
This Service Agreement ("Agreement") is entered into by and between N2H2, Inc. a
Washington corporation, having its principal place of business at 000 0xx Xxxxxx
- Xxxxx 0000, Xxxxxxx, XX, 00000 ("N2H2") and Millennial Star Network, Inc.
("XXXXX.XXX"), a Utah corporation having its principal place of business at 0000
X. Xxxxxxxx Xxx, Xxxx, Xxxx 00000 ("Licensee")
WHEREAS, N2H2 has developed a proprietary system, consisting of computer
hardware, computer software, and related Internet filtering and caching
services, all as described in Schedule A (the "XXXX System"); and
WHEREAS, Licensee provides Internet services to its subscribers
("Authorized Users"); and
WHEREAS, Licensee desires to use the XXXX System in connection with its
Internet services and to make certain N2H2 services available to its
Authorized Users; and
WHEREAS, N2H2 is willing to provide Licensee and its Authorized Users
access to the XXXX System and to provide the services described in this
Agreement all on the terms and conditions set out herein.
THEREFORE, in consideration of the foregoing and the mutual promises set
out in this Agreement, N2H2 and Licensee (together, the "Parties") agree
to the following terms and conditions:
1. TERM. The initial term of this Agreement, as set forth in Schedule A,
shall extend for a period of two (2) years, commencing on November 1,
1999 and continuing through October 31, 2001, and this Agreement shall
automatically renew for additional one-year terms thereafter, unless
either party provides written notice of termination to the other not
less than sixty (60) days prior to the end of the then current term.
2. DELIVERY OF THE XXXX SYSTEM. N2H2 shall deliver and install the XXXX
System at the location specified in Schedule B and Licensee and its
Authorized Users shall have the right to use the XXXX System during the
term of this Agreement, subject to the terms, conditions, and
limitations set out herein.
3. ARTWORK. Licensee shall. choose a trailer, override trailer and a block
page graphics from N2H2's selection of artwork. Said graphics will be
installed on the XXXX System prior to its final configuration and
delivery. Any, customization to N2H2's standard artwork must be approved
in writing by N2H2. All artwork and links from said artwork must adhere
to N2H2's Customization Guidelines, which may be updated from time to
time by N2H2; provided that no such update shall materially adversely
affect Licensee's rights hereunder.
4. CONFIGURATION. Prior to shipping and placement of the XXXX System to the
address specified in Schedule B, N2H2 will configure the XXXX System
based on the information it receives from Licensee using the information
provided by Licensee in Schedule B and via N2H2's web form. Upon
delivery and successful installation, N2H2 will work together with
Licensee's representative to ensure proper completion of the
configuration of the XXXX System. N2H2 shall pay for all shipping and
handling charges associated with the delivery of the XXXX System.
5. HARDWARE/SOFTWARE. The XXXX System's server hardware ("Hardware") shall
remain the sole and exclusive property of N2H2. The XXXX System's
filtering and caching software ("Software") and all documentation shall
remain the sole and exclusive property of N2H2.
6. PROPRIETARY CONTENT. N2H2 shall, through the provision of its filtering
services as part of the XXXX System, provide to Licensee the use of its
proprietary database of records used for filtering and screening
activities and other proprietary data (together, "Proprietary Content").
The Proprietary Content shall be deemed a part of the XXXX System and
shall remain the sole and exclusive property of N2H2.
7. LICENSE. So long as Licensee complies with the terms of this Agreement,
N2H2 grants to Licensee the non-exclusive, nontransferable, limited,
personal night (the "License") to use the Hardware, Software and
Proprietary Content, in conjunction with the XXXX System, as follows:
A. N2H2 grants to Licensee the non-exclusive right to use the
Hardware, Software, and Proprietary Content solely as configured
for Licensee's Authorized Subscribers, as set forth in Schedule
A.
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B. Licensee shall provide N2H2 with a monthly port by the 15th of
each month with subscriber count as of the 1st of each month as
described in Schedule that lists the authorized users.
C. The License excludes all rights by Licensee to attempt to
repair, alter, or modify the XXXX System's Hardware, Software,
or Proprietary Content or to access the source code.
D. N2H2 reserves, the right to terminate this License and to seek
any other legal remedies if Licensee violates any provisions
hereof and fails to cure the violation within the time period
allowed in this Agreement.
E. This contract and a Search Agreement of even date, together
replace all existing Agreements between N2H2 and Infobases or
Bookcraft or XXXXxxxx.xxx. All services and hardware provided
under previous contracts will become part of this Agreement, and
any amounts due under previous contracts will be due under this
contract.
8. PAYMENT. Licensee will make payment(s) to N2H2 as calculated and
specified in Schedule A.
9. MAINTENANCE SERVICES. N2H2 shall, at its sole cost and expense, monitor,
maintain and repair the XXXX System and keep the same in good condition
and operating in accordance with all of the specifications set out in
this Agreement or referred to herein. Licensee will maintain the
premises surrounding the XXXX System in a clean and reasonably suitable
condition to permit N2H2 to fulfill its obligations hereunder. Licensee
will be solely responsible for and will reimburse N2H2 for the costs of
all repairs and maintenance necessitated by any act or omission of
Licensee, its employees, agents, or invitees that is inconsistent with
the normal use of the XXXX System as described in documentation provided
to Licensee by N2H2. Licensee shall not attempt to make any updates to
the XXXX System's Hardware, Software, or Proprietary Content without the
written consent of N2H2.
10. UPGRADES; UPDATES. From time-to-time and at its sole discretion, N2H2
will provide Licensee with updates or upgrades for the XXXX System.
Licensee shall be entitled to all updates or upgrades that are provided
to licensees of the XXXX System generally. Licensee shall use the
upgraded or updated XXXX System only in accordance with this Agreement
which supersedes any prior license to any prior versions of the XXXX
System, and any license that may be provided in connection with the
upgrade or update.
11. HELP SERVICES. Upon successful installation of the XXXX System, N2H2
shall train Licensee's network administrator in the proper use of the
XXXX System. N2H2 will make available competent technical consultants by
telephone to provide prompt assistance to Licensee with questions
concerning operation and troubleshooting of the XXXX System. N2H2 will
not be required to travel to Licensee's Premises to provide services
unless Licensee reimburses N2H2 for time and travel costs.
12. LIMITED WARRANTY. N2H2 WARRANTS TO LICENSEE ONLY THAT DURING THE TERM OF
THIS AGREEMENT, (I) N2H2 OWNS ALL OF THE HARDWARE, SOFTWARE, AND
PROPRIETARY CONTENT AND HAS THE RIGHT TO LICENSE THE SAME TO LICENSEE
AND TO PROVIDE LICENSEE AND ITS AUTHORIZED USERS USE OF THE XXXX SYSTEM
AS CONTEMPLATED BY THIS AGREEMENT; AND (II) THE XXXX SYSTEM WILL CONFORM
TO ALL OF THE DOCUMENTATION AND SPECIFICATIONS THAT N2H2 HAS PROVIDED TO
LICENSEE, WHEN USED IN CONFORMANCE WITH SUCH DOCUMENTATION. N2H2 FURTHER
WARRANTS THAT THE XXXX SYSTEM WILL BE FREE FROM DEFECTS IN MATERIALS AND
WORKMANSHIP UNDER NORMAL USE. EXCEPT AS PROVIDED HEREIN, THE XXXX SYSTEM
IS LICENSED "AS IS" AND WITHOUT WARRANTY, EITHER EXPRESSED OR IMPLIED,
AS TO PERFORMANCE, MERCHANTABILITY, OR FITNESS FOR ANY PARTICULAR
PURPOSE. LICENSEE ASSUMES THE ENTIRE RISK AS TO THE RESULTS AND
PERFORMANCE OF THE XXXX SYSTEM, SO LONG AS IT FUNCTIONS IN ACCORDANCE
WITH THIS LIMITED WARRANTY.
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13. LIMITED LIABILITY. To the maximum extent permitted by law, and except
for the indemnification commitment set out in Paragraph 14, in no event
shall N2H2 or anyone involved in the creation, production, delivery or
licensing of the XXXX System be liable to Licensee or any third party
for incidental, indirect, special or consequential damages (including,
without limitation, damages for loss of business profits, business
interruption, loss of business information, or other pecuniary loss)
arising out of the use or inability to use the XXXX System.
14. N2H2'S INDEMNIFICATION OF LICENSEE. N2H2 will indemnify and defend
Licensee and its directors, officers, employees and agents, at N2H2's
expense, against any and all claims, demands, losses, liabilities,
judgments, awards and costs (including reasonable legal fees and
expenses) arising from or relating to (a) any default or material breach
by N2H2 hereunder; (b) any negligent act or omission or willful
misconduct by N2H2 or its employees, agents, invitees, or licensees; or
(c) any claim that Licensee's use or possession of the XXXX System
infringes or violates the copyright, trade secret, patent, or other
proprietary right of any third party; provided, that N2H2 will not be
required to indemnify Licensee hereunder for (i) liability created
solely by any Licensee modifications or changes to the XXXX System (not
including ordinary customizations or any of the initial configuration)
and (ii) for Licensee's failure to use the XXXX System as described in
this Agreement; provided, however, that N2H2 shall have liability only
for direct damages (and not indirect, special, or consequential damages
or any other costs or expenses) arising out of a material breach of this
Agreement by N2H2 that does not also fall under clause (b) or (c),
above.
15. LICENSEE'S INDEMNIFICATION OF N2H2. Licensee will indemnify and defend
N2H2 and its directors, officers, employees and agents, at Licensee's
expense, against any and all claims, demands, losses, liabilities,
judgments, awards and costs (including reasonable legal fees and
expenses) arising from or relating to (a) any breach of Licensee's
obligations herein; or (b) any negligent act or omission or willful
misconduct by Licensee or its employees, agents, invitees, licensees,
users or subscribers; provided, however, that Licensee shall have
liability only for direct damages (and not indirect, special, or
consequential damages or any other costs or expenses) arising out of a
material breach of this Agreement by Licensee that does not also fall
under clause (b), above.
16. COPYRIGHT. The Software and Proprietary Content and any copies thereof
are owned by N2H2 and are protected by United States copyright laws and
international treaty provisions. Therefore, Licensee must treat the
Software and Proprietary Content like any other copyrighted material.
Licensee agrees not to rent, lease, lend or sell the Software, but it
shall have the right to allow its Authorized Users to use the Software
as part of the XXXX System as contemplated by this Agreement. Licensee's
attempt to reverse engineer, decompose, disassemble or make any attempt
to discover the Proprietary Content, Software or source code to the
Software and/or the details of the Proprietary Content shall result in
the immediate termination of this Agreement.
17. ASSIGNMENT. The rights in this Agreement are personal to each party and
will not be transferred or assigned by operation of law or otherwise
except to a successor organization resulting from an acquisition, merger
sale of assets or similar event which includes a change in control,
without the prior written consent of the other party. Any transfer or
assignment in violation of this paragraph shall be void and will have no
force or effect.
18. FORCE MAJEURE. The Parties will not be in default and liable for breach
of this Agreement due to a business interruption because of strikes,
labor disturbances, lockout, riot, fire, flood, outside electrical
failure, outside telecommunications facilities failure, computer virus,
act of God, or the public enemy, or any other cause, whether like or
unlike the foregoing, if beyond the reasonable efforts of them to
control and which may prevent or delay them from performing their
obligations herein. All performance of both parties shall be excused
during the continuance of such circumstances if the circumstances
materially impair the value of this Agreement to the non-affected party.
If the circumstances persist for more than thirty (30) days, the
non-affected party shall have the night to immediately terminate this
Agreement by sending notice of termination to the affected party.
19. USAGE. Each party will take such action as is necessary to protect and
shall not misrepresent the other party's copyrights, tradenames,
trademarks, goodwill, trade secrets, proprietary information, products
and/or services.
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Licensee may attach to or modify N2H2 marketing materials to the extent
necessary to provide contact information about Licensee, but may not
otherwise modify N2H2 materials or distribute Licensee's own version of
marketing materials without the written approval of N2H2. Licensee
agrees to not create or use a private label for N2H2's products or
services without the written approval of N2H2.
20. NON-COMPETITION. Licensee will not offer, operate or attempt to develop any
other Internet content filtering system in competition with the XXXX System
during the term of this Agreement. Licensee agrees that during term of this
Agreement and for a period of one year after its termination, if terminated by
Licensee's breach, Licensee agrees to not develop any competing Internet content
filtering system for its own use, or a third party's use, without N2H2's written
approval.
21. REMEDIES. Licensee acknowledges and agrees that the use or release of
Proprietary Content in violation of this Agreement will cause irreparable harm
for which N2H2 may not be fully or adequately compensated by recovery of
monetary damages. Accordingly, in the event of any such violation or threatened
violation, N2H2 will be entitled to injunctive relief from a court of competent
jurisdiction in addition to monetary damages and any other remedy available at
law or in equity. If any action at law or in equity is brought to enforce or
interpret the terms of this Agreement, the prevailing party will be entitled to
recover, at trial and on appeal, reasonable attorneys' fees, costs and
disbursements in addition to any other relief that may be granted. Except as
provided in Paragraph 14, Licensee's exclusive remedy against N2H2 will be a
return of fees paid for the XXXX System for the months in which a breach by N2H2
occurs. An action for any breach of this Agreement must be commenced within two
(2) years from the date when a party had knowledge of the alleged breach.
22. TERMINATION. Except as set forth in paragraph 15, in the event that any
breach or default of this Agreement by either party remains uncured for more
than ten (10) days after written notice from the other party, the non-breaching
party may terminate this Agreement and all rights hereunder by giving the
breaching party written notice of termination. Upon termination by either party,
N2H2 will have the right immediately to disconnect Licensee from the XXXX System
and Licensee will promptly return the XXXX System to N2H2 in good working
condition. N2H2 shall pay for all shipping and handling charges associated with
the return of the XXXX System.
23. NOTICES. Any notice required by this Agreement or given in connection with
it, will be in writing and will be given to the appropriate party by personal
delivery or by certified mail, or recognized overnight delivery services.
Facsimile notice or email may be used only if a means of obtaining an immediate
written confirmation of receipt is available and such proof is presented in the
event of a dispute.
24. MISCELLANEOUS. The terms of this Agreement are binding on the Parties, their
subsidiaries, affiliates and any party controlling, controlled by or under
common control with the Parties, and their successors, licensees, agents and
employees. The invalidity or unenforceability of any provision hereof will in no
way affect the validity or enforceability of any other provision. The Parties
agree that this Agreement will be governed by the internal laws of the State of
Washington, without regard to Washington conflict of law' principles. Suits
relating to this Agreement must be brought in the appropriate state or federal
court in the state of Washington and the Parties submit to the jurisdiction of
such Washington courts.
25. CONFIDENTIALITY. The Parties agree to maintain the confidential nature of
all proprietary information disclosed or received during this relationship.
Proprietary information shall include lists of customers and prospects, product
or service development plans, all technical system information not on published
marketing materials, financial information, customer usage and billing reports,
software, and any other information identified as confidential or proprietary.
This responsibility will continue for five (5) years after termination of this
Agreement as long as the disclosing Party does not make such proprietary
information public.
26. ENTIRETY. This Agreement constitutes the complete agreement between N2H2 and
Licensee, and may not be modified except by written agreement of both Parties.
27. ADDITIONAL FEES. Payments to N2H2, as set forth in Schedule A, are exclusive
of applicable taxes on the
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license, transfer or use of the XXXX System. In the event N2H2 is charged such
taxes on the services provided in this Agreement, N2H2 may add an equal amount
to the total fees owed by Licensee hereunder. Any other services purchased by
Licensee from N2H2 will be payable through a separate invoice of N2H2.
ACCEPTED AND AGREED FOR N2H2, INC.: ACCEPTED AND AGREED FOR LICENSEE:
Signature: [/s/ Xxxxx Xxxxxxxx] Signature: [/s/ Xxxx X. Xxxxxx]
------------------------------ ---------------------------
Printed: [Xxxxx Xxxxxxxx] Printed: [Xxxx X. Xxxxxx]
-------------------------------- -----------------------------
Title: [Contract Manager] Title: [Executive V.P.]
---------------------------------- -------------------------------
Date: [1/5/00] Date: [12/30/99]
----------------------------------- --------------------------------
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SCHEDULE B
LICENSEE'S NETWORK REPRESENTATIVE INFORMATION
CONTACT NAME: [XXX XXXXXX]
----------------------------------
EMAIL ADDRESS: [XXXXXXX@XXXXX.XXX]
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OFFICE PHONE NUMBER: [000-000-00000]
----------------------------------
FAX PHONE NUMBER: [000-000-0000]
----------------------------------
PAGER PHONE NUMBER: [-----]
----------------------------------
LOCATION OF SERVER(S)
CONTACT NAME: [XXXXX XXXXX]
----------------------------------
ORGANIZATION: [SISNA]
----------------------------------
XXXXXX XXXXXXX #0: [265 E 100 S]
----------------------------------
XXXXXX XXXXXXX #0: [SUITE 310]
----------------------------------
CITY/STATE/COUNTRY: [SALT LAKE CITY, UT]
----------------------------------
ZIP/POSTAL CODE: [84111]
----------------------------------
COMPLETED BY
NAME: [XXX XXXXXX]
----------------------------------
TITLE: [DEV. MANAGER]
----------------------------------
DATE: [12-30-99]
----------------------------------
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FUTURE PROJECTS. Parties shall meet in Seattle on or before March 30, 2000 to
discuss the following potential future projects:
1. Client software featuring N2H2's server-level filtering,
customized for use by Licensee's users which are unable to
connect locally to a Licensee-leased POP.
2. Real language search technology that allows visitors to
Licensee's Web site search for key words/terms within Licensee's
Web site.
ACCEPTED AND AGREED FOR N2H2, INC.: ACCEPTED AND AGREED FOR LICENSEE:
Signature: [/s/ Xxxxx Xxxxxxxx] Signature: [/s/ Xxxx X. Xxxxxx]
------------------------------ ---------------------------
Printed: [Xxxxx Xxxxxxxx] Printed: [Xxxx X. Xxxxxx]
-------------------------------- -----------------------------
Title: [Contract Manager] Title: [E.V.P.]
---------------------------------- -------------------------------
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SCHEDULE A
N2H2 shall provide XXXX Internet Filtering Service to XXXXX.XXX for an initial
period of 24 months:
SERVICE START DATE: 11/1/-99
SERVICE END DATE: 10-31-01
The XXXX System is a Proxy Server Internet Filtering and Caching System.
N2H2 proprietary hardware is an [*], Server includes; [*]. *
PROXY SERVER SET-UP & INSTALLATION
RACKMOUNT HARDWARE PRICING *
NUMBER OF SERVERS [*] [*]
Servers 1-3 [*] [*]
Servers 4-6 [*] [*]
Servers 7-9 [*] [*]
Servers 10-12 [*] [*]
Servers 13+ [*] [*]
MONTHLY SERVICE FEE SCHEDULE
SUBSCRIBERS MONTHLY SERVICE FEE
Up to 50,000 subscribers [*] per subscriber*
50,001 - 100,000 subscribers [*] per subscriber*
100,001 - 150,000 subscribers [*] per subscriber
150,000+ subscribers [*] per subscriber but not less than [*] per month
----------
* N2H2 will provide filtering for [*] per subscriber through September 30,
2000. After September 30, 2000 pricing reverts to schedule defined above.
Subscriber counts will be submitted via Monthly Traffic Report. Monthly Traffic
Report is to be submitted on the 15th of each month with monthly fees due on the
1st of the following month.
MONTHLY MINIMUM FEE SCHEDULE*
MONTHS MINIMUMS * SUBSCRIBERS * PAYMENT DUE
Nov 1999 - Jan 2000 [*] [*] 1st of each month
Feb 2000 - Mar 2000 [*] [*] 1st of each Month
Apr 2000 - May 2000 [*] [*] 1st of each Month
Jun 2000 - Jul 2000 [*] [*] 1st of each Month
Aug 2000 - Sep 2000 [*] [*] 1st of each Month
Oct 2000 - Oct 2001 [*] [*] 1st of each Month
ACCEPTED AND AGREED FOR N2H2, INC.: ACCEPTED AND AGREED FOR LICENSEE:
Signature: [/s/ Xxxxx Xxxxxxxx] Signature: [/s/ Xxxx X. Xxxxxx]
--------------------------- -----------------------------
Printed: [Xxxxx Xxxxxxxx] Printed: [Xxxx X. Xxxxxx]
----------------------------- -------------------------------
Title: [Contract Manager] Title: [E.V.P.]
------------------------------- ---------------------------------
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ADDENDUM A
This Addendum A ("Addendum") is entered into by and between N2H2, Inc. a
Washington corporation, having its principal place of business at 000 0xx Xxxxxx
- Xxxxx 0000, Xxxxxxx, XX, 00000 ("N2H2") and Millenial Star Network, Inc.
("XXXXX.XXX"), a Utah corporation having its principal place of business at 0000
X. Xxxxxxxx Xxx, Xxxx, Xxxx 00000 ("Licensee")
This Addendum amends and supplements a Filtering Service and License Agreement
(the Agreement) of even date between N2H2 and Licensee (together, the
"Parties"), and all of the terms and conditions of the Agreement are hereby
incorporated into this Addendum. The Parties agree to the following additional
terms and conditions:
DEMO SERVER. Within thirty days of request, N2H2 shall deliver a demonstration
server "that shall be used solely by Licensee's potential customers. This
demonstration server shall feature rotating proxy ports, each lasting for no
more than two (2) weeks and shall conform to the description and specifications
set out in Schedule A. N2H2 shall provide daily updates to this demonstration
server, including the supplemental database, as described in paragraph C6
(below). The demonstration server and all associated computer hardware, computer
software, and database content shall be considered part of the XXXX System, as
that term is defined in the Agreement, and all terms, conditions,
representations, and warranties set out in the Agreement relating to the XXXX
System shall apply to all of the foregoing items. Licensee shall pay N2H2 a
one-time setup fee of [*] per server and an ongoing monthly rotation/update fee
of [*] per month.
BRANDING. N2H2 and Licensee shall co-create a set of trailers and block page
that shall be used in conjunction with the filtering services being provided by
N2H2 to Licensee under this Addendum. The trailer and block page graphics shall
include an N2H2-approved reference to N2H2, such as "Powered by N2H2". The
reference shall be hyperlinked to N2H2's web site.
REVIEW PROCESS. Within the time frame set out in Schedule A, N2H2 shall
customize its Web site review process for Licensee in the following manner:
1. [*]
2. [*]
3. [*]
4. [*]
5. [*]
6. [*]
TERM OF ADDENDUM. This Addendum shall be co-terminous with the Base Agreement
and shall terminate automatically upon any termination of the Base Agreement for
any reason; provided however, that either party may terminate this Addendum
without terminating the Base Agreement in the event of any material breach of
the terms of this Addendum that is not cured within the applicable cure period
set out in the Agreement.
