STRATEGIC RELATIONSHIP AGREEMENT
This STRATEGIC RELATIONSHIP AGREEMENT (this "AGREEMENT") is between
Xxxxxx'x, Inc., a Delaware corporation ("XXXXXX'X"), and Knowledge Net Holdings,
L.L.C., a Delaware limited liability company ("KU").
RECITALS
WHEREAS, Xxxxxx'x and KU are parties to a Stock Purchase Agreement, dated
June 11, 1999 (the "STOCK PURCHASE AGREEMENT"), whereby Xxxxxx'x has agreed to
sell, and KU has agreed to purchase, shares of Xxxxxx'x common stock; and
WHEREAS, in consideration of Xxxxxx'x execution and delivery of the Stock
Purchase Agreement, and as a condition to closing the Stock Purchase Agreement,
Xxxxxx'x and KU agreed to enter into this Agreement.
NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby
agree as follows:
AGREEMENT
1. TERMS AND CONDITIONS. The following terms will govern the development
of the strategic relationship (the "STRATEGIC RELATIONSHIP") between the
parties:
(a) KU will purchase Services (as defined below) from Xxxxxx'x of at least
$2.0 million (Two Million Dollars) beginning on October 1, 1999
through September 30, 2001 (the "SPENDING REQUIREMENT"). At least
$250,000 (Two Hundred Fifty Thousand Dollars) in Services will be
purchased during the period from October 1, 1999 through December 31,
1999 (the "INITIAL QUARTER"). KU shall use reasonable efforts to spend
the remaining amount of the Spending Requirement in equal increments
over the seven consecutive quarterly periods commencing January 1,
2000 and agrees to spend a minimum of $100,000 (One Hundred Thousand
Dollars) in each such quarter. KU and Xxxxxx'x shall meet no later
than March 31, 2000 with the intent of agreeing to the form and timing
of the remaining Spending Requirement, with such remaining Spending
Requirement to in any event be fully paid by September 30, 2001.
(b) "SERVICES" may include, but are not limited to: (i) banner and button
advertising on Xxxxxx'x Online or its affiliated Web sites; (ii)
sponsorship of feature or content areas of Xxxxxx'x Online,
specifically an area of Xxxxxx'x Online dedicated to editorial content
for a Training and Professional Development Resource Center; (iii)
content licensing of Xxxxxx'x proprietary company or industry
information for redistribution on KU operated Web sites; (iv) set-up
fees associated with any Service; (v) editorial services associated
with the creation of a
micro-site within Xxxxxx'x Online featuring KU content, goods, or
services; (vi) enterprise subscriptions for KU and its Affiliates
as defined below; and (vii) any other services that may be required
following good faith negotiations between the Parties.
(c) KU and Xxxxxx'x will execute appropriate contracts to reflect the
Services subject to Xxxxxx'x standard terms and conditions for similar
services as evidenced by standard agreements used by Xxxxxx'x from
time-to-time for similar services to other customers.
(d) All spending by KU or its Affiliates will serve toward fulfilling KU's
Spending Requirement under this Agreement.
(e) KU and Xxxxxx'x will determine the Services to be provided during the
Initial Quarter by August 30, 1999 to allow Xxxxxx'x adequate time to
integrate and provide any Services during the Initial Quarter. KU and
Xxxxxx'x will determine the Services to be provided during the period
from January 1, 2000 through March 31, 2000 prior to November 30, 1999
to allow Xxxxxx'x adequate time to integrate and provide any Services
required during such period.
(f) For purposes of this Agreement, "Affiliate" of KU shall mean any
person or entity directly or indirectly controlling, controlled by, or
under common control with KU.
2. RATES FOR SERVICES. The economic terms of the final components of the
Strategic Relationship will be subject to prevailing market conditions at rates
to be agreed upon by Xxxxxx'x and KU. If the parties cannot mutually agree as
to rates for any or all of the individual Services that could be provided by
Xxxxxx'x to KU during the term of this Agreement, the parties agree to mutually
select an independent third party who is knowledgeable regarding similar
transactions to assist the parties' determination of a market rate.
3. REPRESENTATIONS AND WARRANTIES.
(a) Xxxxxx'x hereby represents and warrants to KU that it has the right,
power and authority to enter into this Agreement and perform its
obligations as set forth herein; (ii) it is under no obligation or
restriction, nor will it assume any such obligation or restriction,
that does or would interfere or conflict with its obligations under
this Agreement; and (iii) the Services provided by Xxxxxx'x hereunder
will be rendered in a commercially reasonable manner.
(b) KU hereby represents and warrants to Xxxxxx'x that it has the right,
power and authority to enter into this Agreement and perform its
obligations as set forth herein; (ii) it is under no obligation or
restriction, nor will it assume any such obligation or restriction,
that does or would interfere or conflict with its obligations under
this Agreement; (iii) it is either the owner of or it has the right
to use, publish, reproduce and display any content it provides to
Xxxxxx'x for inclusion in any Services that Xxxxxx'x will provide
under this Agreement.
(c) EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED IN THIS AGREEMENT, NEITHER
PARTY MAKES ANY OTHER WARRANTIES, EITHER EXPRESS, IMPLIED OR
STATUTORY, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF
TITLE, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
4. TERM. This Agreement shall commence on the date last written above
and shall continue through September 30, 2001.
5. TERMINATION FOR CAUSE. In the event that either party materially
defaults in the performance of any of its duties or obligations
hereunder, which default shall not be substantially cured within
thirty (30) days after written notice is given to the other party
specifying the default, then such party may, by giving written notice
thereof to the other party, terminate this Agreement as of a date
specified in such notice of termination. In the event that Xxxxxx'x
terminates this Agreement under this paragraph 5 or paragraph 6 below,
then KU agrees that Xxxxxx'x shall have the right to repurchase the
shares of Common Stock purchased by KU pursuant to the Stock Purchase
Agreement at a price per share equal to that paid by KU under the
terms of the Stock Purchase Agreement (the "REPURCHASE RIGHT"). Such
Repurchase Right shall be exercisable by Xxxxxx'x at any time during
the thirty day period subsequent to Xxxxxx'x termination of this
Agreement under this paragraph 5 or paragraph 6 by delivering written
notice to KU.
6. OTHER TERMINATION. Either KU or Xxxxxx'x may terminate this Agreement
immediately upon the occurrence of any of the following events with
respect to the other party: (a) a receiver is appointed for such
party or its material assets; (b) such party becomes insolvent,
generally unable to pay its debts as they become due, makes an
assignment for the benefit of its creditors or seeks relief under any
bankruptcy, insolvency or debtor's relief law; (c) if proceedings are
commenced against the other party under any bankruptcy, insolvency or
debtor's relief law, and such proceedings have not been vacated or set
aside within sixty (60) days from the date of commencement thereof; or
(d) if such party is liquidated or dissolved or otherwise ceases to do
business provided written notice is provided to the other party.
7. EFFECTS OF TERMINATION. In the event of any termination of this
Agreement, KU and Xxxxxx'x shall, within thirty (30) days after the
effective date of such termination, remove, take down, or cease to
provide Services (including under any individual agreement for
Services between the parties), and return to the other party any
intellectual or other property licensed or otherwise obtained from the
other party for the purpose of providing such Service.
8. BINDING NATURE AND ASSIGNMENT. This Agreement shall be binding on the
Parties hereto and their respective successors and assigns, but
neither party may, or shall have the power to, assign this Agreement
without the prior written consent of the other, which consent shall
not be unreasonably withheld.
9. COMPLIANCE WITH LAW. Each party shall comply with all applicable
laws, codes, ordinances, rules and regulations of the federal, state
and local governments, and of any and all political subdivisions and
regulatory authorities thereof. Each party shall obtain all necessary
permits and licenses required in connection with the performance of it
obligations hereunder.
10. NOTICES. Wherever under this Agreement one party is required or
permitted to give notice to the other, such notice shall be deemed
given when delivered in hand or when mailed by registered or certified
United States mail, return receipt requested, postage prepaid, and
sent to the following address:
If to KU: Knowledge Net Holdings, L.L.C.
000 Xxxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxx
with a copy to: Maron & Sandler
000 Xxxxxx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxx
If to Xxxxxx'x: Xxxxxx'x, Inc.
0000 Xx Xxxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxxx 00000
Attention: Chief Financial Officer
with a copy to: Xxxxxxx, Xxxxxxx & Xxxxxxxx LLP
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxx X. Xxxxxx
11. HEADINGS. The article and section headings used herein are for
reference and convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
12. RELATIONSHIP OF PARTIES. This Agreement does not constitute a party
as the agent or legal representative of the other and does not create
a partnership or joint venture between the parties.
13. CONFIDENTIALITY. This Agreement and all other information or know-how
that relates to that party's operations, future business plans, or
other proprietary information which is marked or identified as
"Confidential" and/or "Proprietary", or is otherwise reasonably
identified as confidential is confidential ("Confidential
Information"). Each party may use Confidential Information received
from the other party hereunder only in connection with the business
purposes for which such Confidential Information was or shall be
provided. Each party agrees to use the same means it uses to protect
its own Confidential Information, but in any event not less than
reasonable means, to prevent the disclosure and to protect the
confidential and proprietary nature of the other party's Confidential
Information. Confidential Information shall not include anything which
is (i) already known by the recipient party without an obligation of
confidentiality, (ii) publicly known or becomes publicly known through
no unauthorized act of the recipient party, (iii) rightfully received
from a third party under no obligation of confidentiality, (iv)
independently developed by the recipient party without use of the
other party's Confidential Information, (v) disclosed without similar
restrictions to a third party by the party owning the Confidential
Information, (vi) approved by the other party for disclosure, or (vii)
required to be disclosed pursuant to requirement of a governmental
agency or law so long as the disclosing party provides the other party
with notice of such requirement prior to any such disclosure.
Notwithstanding anything to the contrary contained herein, each party
may provide access to and the use of the Confidential Information to
third parties providing services to such party who have a business
need to access such Confidential Information in connection with a bona
fide service being provided to such party so long as such party takes
reasonable steps to ensure that such third parties maintain the
confidentiality of such Confidential Information as provided for
hereunder.
14. SEVERABILITY. If any provision of this Agreement is declared or found
to be illegal, unenforceable or void, then both parties shall be
relieved of all obligations arising under such provision, but only to
the extent that such provision is illegal, unenforceable or void, it
being the intent and agreement of the parties that this Agreement
shall be deemed amended by modifying such provision to the extent
necessary to make it legal and enforceable while preserving its intent
or, if that is not possible, by substituting therefor another
provision that is legal and enforceable and achieves the same
objective. If the remainder of this Agreement shall not be affected
by such declaration or finding and is capable of substantial
performance, then, each provision not so affected shall be enforced to
the extent permitted by law.
15. PRESS RELEASES. Except to the extent required by applicable law or as
otherwise specified herein, any use by one party of the other party's
name, trademarks or service marks in any press releases, customer
lists, marketing materials or other announcements concerning the
matters covered by this Agreement, or for
promotional, advertising or other purposes, shall require the other
party's prior written approval. Notwithstanding the foregoing, once
either party refers to the existence of its relationship with the
other party in printed customer lists that may only be provided to
prospective new customers of such party and such use has been
approved by the other party, similar uses may be made without
submitting such uses for approval.
16. WAIVER. No delay or omission by either party hereto to exercise any
right or power hereunder shall impair such right or power or be
construed to be a waiver thereof. A waiver by either of the parties
hereto of any of the covenants to be performed by the other or any
breach thereof shall not be construed to be a waiver of any succeeding
breach thereof or of any other covenant herein contained. 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.
17. FORCE MAJEURE. If the performance of this Agreement or any obligation
hereunder is prevented, restricted or interfered with by reason of
fire or other casualty or accident, acts of God, severe weather
conditions, war or other violence, any law, order, proclamation,
regulation, ordinance, demand or requirement of any governmental
agency, or any other act or condition whatsoever beyond the reasonable
control of the parties hereto, the party whose performance is so
affected shall be excused from such performance; PROVIDED, HOWEVER,
that in such event, the other party shall be relieved of any payment
obligations during such force majeure event; and PROVIDED, FURTHER,
that if either party invokes this Section for any consecutive period
of thirty (30) business days or longer, then the other party may
terminate this Agreement without penalty, upon written notice to such
invoking party.
18. SURVIVAL OF TERMS. Termination or expiration of this Agreement for
any reason shall not terminate any rights, liabilities or obligations
that have either accrued prior to the effective date of termination of
this Agreement or which the parties have expressly agreed shall
survive any such termination or expiration.
19. ENTIRE AGREEMENT. This Agreement and each Exhibit attached hereto,
each of which is incorporated herein for all purposes, constitutes the
entire agreement between the parties hereto with respect to the
subject matter hereof, and there are no written or oral
representations, understandings or agreements relative hereto which
are not fully expressed herein. This Agreement and such Exhibits are
intended to be the sole and exclusive statement of the agreement
between the parties hereto with respect to the subject matter hereof
and any other terms or conditions included in any forms utilized or
exchanged by the parties hereto shall be of no force or effect and
shall not be incorporated herein or be binding unless expressly agreed
to in writing by both parties hereto. No change, amendment, waiver or
discharge hereof shall be valid unless in writing and signed by an
authorized representative
of the party against which such change, amendment, waiver or discharge
is sought to be enforced.
20. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas, without reference to
such state's principles of conflicts of laws.
SIGNATURE PAGE TO STRATEGIC RELATIONSHIP AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
XXXXXX'X, INC.
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------
Xxxx X. Xxxxxxxx
Executive Vice President and
Chief Operating Officer
KNOWLEDGE NET HOLDINGS, L.L.C.
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Xxxxxx X. Xxxx
President
