Exhibit 10.23
Confidential
INTERACTIVE MARKETING AGREEMENT
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This Interactive Marketing Agreement (the "Agreement"), dated as of
September 15, 1999 (the "Effective Date"), is between America Online, Inc.
("AOL"), a Delaware corporation, with offices at 00000 XXX Xxx, Xxxxxx, Xxxxxxxx
00000, and xxxxxxxxxx.xxx, Inc. ("Interactive Content Provider" or "ICP"), a
Delaware corporation with offices at 0000 Xxxxxx Xxx., Xxxxx 000, Xxxxxx, XX
00000. AOL and ICP may be referred to individually as a "Party" and
collectively as the "Parties."
INTRODUCTION
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AOL and ICP desire to enter into an interactive marketing relationship
whereby AOL will promote and distribute an interactive site referred to (and
further defined) herein as the Affiliated ICP Site and services related thereto
through the portions of the AOL Network set forth herein, all as described more
fully on Exhibit A hereto. This relationship is further described below and is
subject to the terms and conditions set forth in this Agreement. Defined terms
used but not defined in the body of the Agreement are defined on Exhibit B
attached hereto.
TERMS
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1. PROMOTION, DISTRIBUTION AND MARKETING.
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1.1. AOL Promotion of ICP Areas. AOL will provide ICP with the Promotions
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described on Exhibit A. Subject to ICP's reasonable approval, AOL will
have the right to fulfill its promotional commitments with respect to
any of the Promotions by providing ICP comparable promotional
placements in appropriate alternative areas of the AOL Network. In
addition, if AOL is unable to deliver any particular Promotion, AOL
will work with ICP to provide ICP, as its sole remedy, a comparable
promotional placement. AOL reserves the right to redesign or modify
the organization, structure, Look and Feel, navigation and other
elements of any part of the AOL Network at any time, including without
limitation, by adding or deleting channels, subchannels and/or screens
and/or making fundamental changes to the Look and Feel, navigation or
other elements of the portions of the AOL Network through which AOL
provides Promotions to ICP. In the event such modifications materially
and adversely affect any specific Promotion, AOL will work with ICP to
provide ICP, as its sole remedy, a comparable promotional placement.
Except to the extent expressly described herein, the exact form,
placement, integration and nature of such Promotions shall be
determined by AOL in its reasonable editorial discretion.
1.2. Impressions Commitment. (a) During the Term, AOL shall deliver the
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Promotions with the targeted number of Impressions described on
Exhibit A (the "Impressions Commitment"). With respect to the
Impressions targets specified on Exhibit A, AOL will not be obligated
to provide in excess of any Impressions target amounts in any year. In
the event AOL provides an excess of any annual Impressions target
amounts in any year, the Impressions target for the subsequent year
will be reduced by the amount of such windfall. Any shortfall in
Impressions at the end of a year will not be deemed a breach of the
Agreement by AOL; instead such shortfall will be added to the
Impressions target for the subsequent year. In the event there is (or
will be in AOL's reasonable judgment)
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a shortfall in Impressions as of the end of the Initial Term (a "Final
Shortfall"), AOL will provide ICP, as its sole remedy, with
advertising placements through "run of service" advertising on the AOL
Network which have a total value, based on comparable rates to those
included in this Agreement, equal to the value of the Final Shortfall
(determined by multiplying the percentage of Impressions that were not
delivered by the guaranteed payment attributable for such promotions
provided for below).
(b) On the second anniversary of the grant of the ICP stock under
Section 4.2 below, AOL shall calculate the then-current value of such
ICP stock as of the date of such second anniversary. In the event the
value of such ICP stock on such second anniversary has fallen below
the value of the ICP stock at the time of the grant (as calculated
under Section 4.2 below), then, notwithstanding anything else in this
Agreement, the Impressions Commitment shall be reduced by a dollar
amount equal to the dollar amount of the decline in value of the ICP
stock held by AOL on the second anniversary of the grant.
1.3. Content of Promotions Within the AOL Network. After launch of the
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Affiliated Site and during the remainder of the Term, promotions for
ICP will link only to the ICP Affiliated Site and will promote only
the Services described on Exhibit D attached hereto (and shall not
promote any third party or third party service, any Interactive
Service or any other service that is not described on Exhibit D). The
specific ICP Content to be contained within the Promotions (including,
without limitation, text within the advertising banners and contextual
promotions residing within the AOL Network (the "Promo Content") will
be determined by ICP, subject to AOL's technical requirements, the
applicable terms of this Agreement (including without limitation
section 2.1) and AOL's then-applicable policies relating to
advertising and promotions. ICP will submit in advance to AOL for its
review a quarterly online marketing plan with respect to the ICP
Areas. The Parties will meet in person or by telephone on a monthly
basis to review operations and performance hereunder, including a
review of the Promo Content to ensure that it is designed to maximize
performance. ICP will consistently update the Promo Content to
maintain its freshness and high quality during the Term of this
Agreement. Except to the extent expressly described herein, the
specific form, placement, duration and nature of the Promotions will
be as determined by AOL in its reasonable editorial discretion
(consistent with the editorial composition of the applicable screens).
1.4. ICP Promotion of ICP Areas and AOL. ICP will provide AOL with
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the online and offline promotions described on Exhibit C attached
hereto. Except as may be specifically provided for herein, the
promotions offered herein shall be offered to AOL on a non-exclusive
basis. ICP will not implement or authorize any promotion substantially
similar in any respect (including, without limitation, in scope,
purpose, amount, prominence or regularity) to the promotions required
or provided pursuant to Exhibit C for any other Interactive Service on
the Affiliated ICP Site.
1.5. Marketing Responsibilities. Without limiting any other requirements
contained herein, ICP will be responsible for the accuracy of all
advertising and sales material relative to Services that are published
or promoted by AOL. The ICP Areas will clearly indicate that the AOL
Member utilizing such site will be a
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customer of ICP and not AOL. In addition, neither AOL nor its
employees (acting as such) will recommend or endorse the
Services.
2. ICP AREAS.
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2.1 Content of ICP Areas. Except as mutually agreed in writing by the
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Parties, the ICP Areas will contain only Content consisting of the
Services, as described more fully on Exhibit D. ICP will ensure that
the ICP Areas do not in any respect, (i) promote, advertise, market or
distribute the products, services or content of any other Interactive
Service, instant messaging feature, email, homesteading, wallet or
check out technology, (ii) promote or make available to any AOL Member,
products or services that are competitive with the products or services
offered by AOL (the "Restricted Services"), or (iii) otherwise provide
promotions, advertisements, products or services which violate AOL's
then-standard advertising or other policies, any third party copyright,
trademark, US patent, or any other third party right, including without
limitation, any music performance or related music right, or any law,
rule or regulation, or (iv) launch any search function, or (v) promote
the freeamp or any other player that could be construed to compete with
Winamp, or any streaming product that could be construed to compete
with Spinner. In addition to the foregoing, ICP shall ensure that the
ICP Areas do not in any respect promote, advertise, market or
distribute any products, services or content of any entity that ICP is
or should be reasonably aware is in competition with any third party
with which AOL has an exclusive or premier relationship. In the event
AOL determines that any product, service or content promoted,
advertised, marketed or distributed on or through any ICP Area is in
competition with a product, service or content of such third party with
whom AOL has an exclusive or premier relationship, then AOL may notify
ICP of such conflict and may immediately suspend all links to the
relevant ICP Area, and ICP shall, within five (5) business days from
the date of any such notice, remove the product, service or content
from the relevant ICP Area. In the event ICP does not remove the
conflicting product, service or content within such 5-day period, then
AOL may continue to suspend all links to the relevant ICP Area and
reduce the Impressions Commitment accordingly by the average daily
number of Impressions for such links at the time of discontinuance
(such average to be calculated over the period from the Effective Date
to the date of discontinuance) multiplied by the number of days
remaining in the display period for such links. Notwithstanding the
foregoing, if ICP later (i.e., after the 5-day cure period above)
removes the conflicting product, service or content from the relevant
ICP Area, AOL shall promptly restore such links but the Impressions
Commitment shall be permanently reduced by the average daily number of
Impressions for such links at the time of discontinuance (calculated as
set forth above) multiplied by the number of days during which the
links were suspended In the event that ICP provides any third party
products, services or other Content in the ICP Areas otherwise
permitted hereunder (collectively, the "Additional Content") such
Additional Content shall be directly related to the digital delivery of
music and must be integral to, and necessary for, the normal operation
of a digital music delivery service. To the extent AOL segments AOL
Users by language, geographic region or other basis, ICP shall use
commercially reasonable efforts to provide the relevant Content in the
applicable languages and/or otherwise appropriately targeted toward
such audience segments created by AOL. In the event that AOL creates a
searchable music database of digital downloads, then ICP shall provide
AOL with access to its Content in a format acceptable to AOL for use in
such searchable database, which will be accessible to
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AOL Users during and after the Term; provided, that the specifics of
such access following the Term shall be determined by the parties at
termination. Any other ICP programming provided by ICP hereunder
(including without limitation any editorial or other integration of ICP
Content into the AOL Network) shall also adhere to the requirements and
restrictions provided for the ICP Areas as outlined above. In the event
ICP intends to promote, advertise, market or distribute the products,
services or content of any other Interactive Service, instant messaging
feature, email, homesteading, wallet or check out technology on any ICP
Interactive Site, ICP shall first give AOL written notice of such
intention and shall in good faith give serious consideration to any
comparable AOL product or technology presented by AOL.
2.2 Production Work. Except as agreed to in writing by the Parties
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pursuant to the "Production Work" section of the Standard Online
Commerce Terms & Conditions attached hereto as Exhibit F, ICP will
be responsible for all production work and maintenance associated
with the ICP Areas, including all related costs and expenses.
2.3 Hosting; Communications. As described more fully in Exhibit E, ICP
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will be responsible for all communications, hosting and connectivity
costs and expenses associated with the ICP Areas. ICP shall create,
implement, host and maintain the Affiliated ICP Site as set forth in
Section 8 of Exhibit D and will bear responsibility for the
implementation, management and cost of such Affiliated ICP Site. ICP
will utilize a dedicated high speed connection to maintain transport
of information that is quick and reliable in accordance with
industry standards to and from the ICP data center and AOL's
designated data center.
2.4 Technology. ICP will conform its promotion and sale of Services
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through the ICP Areas to the then-existing technologies identified
by AOL which are optimized for the AOL Service, including without
limitation AOL's Quick Checkout Technology. In addition, ICP will
use commercially reasonable efforts to conform its promotions and
sales activities on the ICP Interactive Sites to such technologies;
provided that this requirement shall not apply to any ICP
Interactive Site that is cobranded by ICP and a third party who does
not agree to include such technologies on such site after such
promotions are proposed by ICP.
2.5 AOL will be entitled to require reasonable changes to the Content
(including, without limitation, the features or functionality)
within any linked pages of the ICP Areas to the extent such Content
will, in AOL's good faith judgment, adversely affect any operational
aspect of the AOL Network. AOL reserves the right to review and test
the ICP Areas from time to time to determine whether the site is
compatible with AOL's then-available AOL client and host software
and the AOL Network.
2.6 Service Offering. ICP will ensure that the ICP Areas include all of
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the Services and other Content (including, without limitation, any
titles, downloads, features, offers, contests, functionality or
technology) that are then made available by or on behalf of ICP
through any Additional ICP Channel; provided, however, that (i) such
inclusion will not be required where it is commercially or
technically impractical to either Party (i.e., inclusion would cause
either Party to incur substantial incremental costs) or where such
inclusion would otherwise violate the terms of this Agreement; and
(ii) the specific changes in scope, nature and/or
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offerings required by such inclusion will be subject to AOL's review
and reasonable approval and the terms of this Agreement. ICP shall
allow AOL to offer (a) any and all free promotional downloads that
are available on the Affiliated ICP Sites from anywhere within the
AOL Network for free promotional download use, which free downloads
will be used for a service called "Playlist to Go," which is a
weekly compilation of genre based songs available in one download,
and (b) any and all ICP downloads offered for sale on any
Interactive Site, for sale throughout the AOL Network during or
after the Term. In the event that the provision of certain specific
Content or Services from the ICP Areas or the AOL Network reasonably
precludes AOL's ability to enter into an arrangement with a third
party for sale of related content or services, then AOL shall be
entitled to cease offering such specific ICP Content or Services
from within the AOL Network or cause ICP to remove such Content or
Services from the ICP Areas. In the event of any such situation, AOL
shall notify ICP in advance in writing and the parties shall
cooperate in good faith in order to seek to develop a resolution
which does not require the removal of any ICP Content or Services.
For the avoidance of doubt, it is expressly understood that this
provision relates only to a specific item of Content or Services and
does not allow AOL to require the removal of a material portion of
the ICP Content or Services
2.7 Pricing and Terms. ICP will ensure that the prices, terms and
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conditions for Content and Services offered in the ICP Areas (and
any other area or site from which AOL chooses to offer ICP Services
or Content throughout the AOL Network, or elsewhere) are: (a) no
less favorable in any respect than the prices, terms and conditions
for the Services or substantially similar Services, taken as a
whole, offered by or on behalf of ICP through any Additional ICP
Channel; and (b) generally consistent with the prices, terms and
conditions for substantially similar services and content offered in
the industry by entities who would reasonably be considered
competitors of ICP. AOL acknowledges that, notwithstanding the
foregoing, ICP may from time to time conduct promotional activities
for recordings, services or other merchandise which are offered by
or on behalf of ICP through any Additional ICP Channel, and that
such prices, terms and conditions for such activities may vary from
those for Services in the ICP Areas, provided that ICP will ensure
that prices for Services offered on the Affiliated Site are
generally at least as favorable as those offered on any other ICP
Interactive Site.
2.8 Exclusive Offers/User Benefits. ICP will (a) provide through the ICP
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Areas, without cost to any third party, special promotions that are
generally comparable in number and in nature (e.g., "A" level artist
promotion is comparable to another "A" level artist promotion) to
promotions made available without cost to any third party by or on
behalf of ICP through any Additional ICP Channel (the "Special
Promotions"); and (b) provide through the ICP Areas on a regular and
consistent basis promotions or other unique programming and services
exclusively available to AOL Users. Comparable Special Promotions
will be offered to AOL within 30 days of the promotions made
available through the relevant Additional ICP Channel. In addition
ICP shall give written notice to AOL whenever it intends to make
available through an Additional ICP Channel a promotion for which a
third party is required to pay consideration in order to participate
(e.g., concert, festival event) (each a "Sponsorship Promotion") and
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shall give AOL the first opportunity to participate in such
Sponsorship Promotion; provided, that if such Sponsorship Promotion
is offered by ICP in good faith in conjunction with a third party
who does not agree to AOL participation in such Sponsorship
Promotion after such participation is proposed by ICP, then ICP need
not offer such Sponsorship Promotion to AOL but will offer to AOL a
similar Sponsorship Promotion within a reasonable time after such
third party Sponsorship Promotion. At AOL's discretion, AOL may
offer any Special Promotion and/or Sponsorship Promotion in addition
to the promotions described on Exhibit A, provided that any
impressions derived therefrom shall be included in the Impressions
Commitment. ICP will provide AOL with reasonable prior notice of any
Special Promotions or Sponsorship Promotions so that AOL can market
their availability in the manner AOL deems appropriate in its
editorial discretion.
2.9 Operating Support and Standards. AOL will provide ICP with the
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operational support described on Exhibit E. ICP will ensure that the
ICP Areas comply at all times with the standards and specifications
set forth in Exhibit E. To the extent site standards are not
established in Exhibit E with respect to any aspect or portion of
the ICP Areas (or the Services or other Content contained therein),
ICP will provide such aspect or portion at a level of accuracy,
quality, completeness, and timeliness which meets or exceeds
prevailing standards in the online music industry. In the event ICP
fails to comply with any material terms of this Agreement or any
Exhibit attached hereto, (a) AOL will have the right (in addition to
any other remedies available to AOL hereunder) to decrease or cease
the Promotions it provides to ICP hereunder (and to decrease or
cease any other contractual obligation hereunder) until such time as
ICP corrects its non-compliance (and in such event, AOL will be
relieved of the proportionate amount of any promotional commitment
and/or cease any such integrated placements made to ICP by AOL
hereunder corresponding to such decrease in promotion) and (b) any
threshold(s) set forth in Section 4 will each be adjusted
proportionately to correspond to such decrease in promotion and
other obligations during the period of non-compliance.
2.10 Advertising Sales. AOL shall have the right to sell any links,
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pointers, sponsorships, promotions or similar services or rights
within the ICP Areas ("Advertisements"). All sales of Advertisements
by ICP if any, will be subject to AOL's then-applicable advertising
policies and AOL's prior written approval. The Parties agree and
acknowledge that all Advertisements sold by AOL will be served from
an AOL ad server. AOL shall collect all advertising revenues under
this Section, shall deduct a selling commission in the amount of 15%
of the gross advertising revenues, and shall pay over to ICP 50% of
the net advertising revenues after such deduction. AOL agrees that
it will not sell Advertisements within the ICP Areas to ICP
Competitors. For purposes of this Agreement, "ICP Competitors" shall
mean entities that would reasonably be considered to be competitors
of ICP with respect to the Services, as set forth on a written list
provided to AOL by ICP on the Effective Date (the "Competitors
List"). The Competitors List may be updated by ICP from time to time
upon AOL's approval, not to be unreasonably withheld, to add
additional entities that would reasonably be considered to be
competitors of ICP with respect to the Services or to delete
entities that are no longer ICP Competitors. Only those specific
entities set forth
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on the Competitors List (and not their
affiliates) shall be considered ICP Competitors.
2.11 Traffic Flow. ICP will take commercially reasonable efforts to
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ensure that AOL Network traffic is either kept within the ICP Areas
or channeled back into the AOL Network. The Parties will work
together on implementing mutually acceptable links from the ICP
Areas back to the AOL Network.
3 EXCLUSIVITY. The promotions offered herein are offered to ICP on a non-
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exclusive basis. Without limiting any actions which may be taken by AOL, no
provision of this Agreement will limit AOL's ability (on or off the AOL
Network) to (i) undertake activities or perform duties pursuant to existing
arrangements with third parties (or pursuant to any agreements to which AOL
becomes a party subsequent to the Effective Date as a result of Change of
Control, assignment, merger, acquisition or other similar transaction), (ii)
enter into an arrangement with any third party for the primary purpose of
acquiring AOL Users whereby such party is allowed to promote or market
products or services to AOL Users that are acquired as a result of such
agreement; (iii) create contextual links or editorial commentary relating to
any third party marketer of the Services; (iv) post or allow AOL Users to
post Content, messages contextual links or editorial commentary relating to
any third party marketer of the Services (to the extent created by such AOL
User and not by AOL); (v) enter into an arrangement with any third party for
the purpose of allowing AOL Users the ability to "opt-in" to receive
communications, similar to the Alerts or otherwise, from such third party,
with regard to any products, services or information, including without
limitation the Services; or (vi) promote services in or targeted to countries
or regions for which ICP cannot or does not directly offer such services as
of the Effective Date.
4 PAYMENTS.
4.1 Guaranteed Payments. ICP will pay AOL a non-refundable guaranteed
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payment of Eighteen Million Dollars ($18,000,000.00) (the "Guaranteed
Payment Amount") as follows:
(i) Three Million Dollars (US $3,000,000.00) shall be paid
immediately upon the earlier to occur of: (A) the Live Date;
and (B) expiration of the 30-day period immediately following
the Effective Date; and
(ii) The remaining amount of Fifteen Million Dollars (US
$15,000,000.00) will be guaranteed to AOL in quarterly installments of One
Million Five Hundred Thousand Dollars (US$1,500,000.00), as set forth in
more detail in Section 4.3 below (each a "Guaranteed Quarterly Payment").
4.2 Stock. In addition to the Guaranteed Payment Amount set forth in
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Section 4.1 above, ICP shall execute and deliver to AOL on or before
September 21, 1999 a Subscription Agreement in substantially the form
attached hereto as Exhibit H, pursuant to which ICP shall issue to AOL as
additional consideration under this Agreement such number of shares of ICP
common stock as shall equal Two Million Dollars ($2,000,000.00) divided by
the ICP Stock Price. The "ICP Stock Price" shall mean the average closing
price per share as set forth on NASDAQ for the five trading days immediately
preceding September 16, 1999. Further, AOL shall be entitled to "piggyback"
registration rights, at ICP's expense (except for sales commissions and
discounts attributable to sales of shares by AOL, which shall be borne by
AOL), subject,
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in each case, to the rights of the Registration Rights Holders, as such term
is defined in the Registration Rights Agreement, dated June 8, 1999, between
ICP and the Registration Rights Holders. Subject to the foregoing, AOL shall
have the same rights and obligations as the holders of piggyback registration
rights under ICP's Registration Rights Agreement, except as granted under
Section 2 thereunder. For the avoidance of doubt, the shares held by AOL
hereunder shall be considered "other securities" under Section 3(c)(iii) of
ICP's Registration Rights Agreement.
4.3 Transaction Revenues; Guaranteed Quarterly Payments. During the
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Term of this Agreement, ICP will pay AOL fifty percent (50%) of all Net
Transaction Revenues received during each calendar quarter from the sale of
(i) Content or Services to AOL Users referred from the Promotions provided
pursuant to Exhibit A; and (ii) any ICP Content or Services sold throughout
the AOL Network. Following launch of the Affiliated Site, AOL shall share in
Net Transaction Revenues from the sale of Content or Services to AOL Users
referred from the Promotions to the Affiliated Site; prior to launch of the
Affiliated Site, AOL shall share in Net Transaction Revenues from the sale of
Content or Services to AOL Users referred from the Promotions to any ICP
Interactive Site. On the last day of each calendar quarter during the Term
(starting from the Effective Date) ICP shall pay to AOL the Guaranteed
Quarterly Payment for such quarter. (For purposes of illustration, if the
Effective Date of the Agreement is 9/15/99, then the first Guaranteed
Quarterly Payment due on 12/15/99, the next due on 3/15/00, etc.) At the same
time, ICP shall compute the Net Transaction Revenues received during such
quarter and shall pay over to AOL the amount, if any, by which AOL's share of
such Net Transaction Revenues exceeds the Guaranteed Quarterly Payment for
such quarter within 60 days following the end of such calendar quarter.
Following the Term of this Agreement, ICP will continue to calculate Net
Transaction Revenues on a quarterly basis, and ICP shall pay AOL on the
schedule set forth above twenty-five percent (25%) of all Net Transaction
Revenues received during each quarter from (a) AOL Users who reach an ICP
Interactive Site through any link to such site that AOL may choose to
maintain following the Term; and (b) AOL Users who reach an ICP Interactive
Site through an AOL keyword that AOL continues to grant to ICP following the
Term.
4.4 Late Payments; Wired Payments. All amounts owed hereunder not
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paid when due and payable will bear interest from the date such amounts
are due and payable at the prime rate in effect at such time as
published in the Wall Street Journal. All payments required hereunder
will be paid in immediately available, non-refundable U.S. funds wired
to the "America Online" account, Account Number 323070752 at The Chase
Manhattan Bank, 0 Xxxxx Xxxxxxxxx Xxxxx, Xxx Xxxx, XX 00000 (ABA:
000000000) (with the following notation in the reference field: "For
credit to AOL, Inc").
4.5 Alternative Revenue Streams. In the event ICP (a) receives or desires to
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receive, directly or indirectly, any compensation in connection with the
Affiliated ICP Site other than Transaction Revenues or Advertising
Revenues (an "Alternative Revenue Stream"), ICP will promptly inform AOL
in writing, and the Parties will negotiate in good faith regarding
whether ICP will be allowed to market Products producing such
Alternative Revenue Stream through the Affiliated ICP Site, and if so,
the equitable portion of revenues from such Alternative Revenue Stream
(if applicable) that will be shared with AOL (in no event less than the
percentage of Transaction Revenues to be paid to AOL pursuant to this
Section 4). In the event the Parties cannot in good faith reach
agreement regarding such Alternative
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Revenue Stream within ten (10) days of AOL's request to negotiate, AOL
will have the right, but not the obligation, to have such matter
submitted to dispute resolution pursuant to Section 6.
4.6 Auditing Rights. ICP will maintain complete, clear and accurate records
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of all expenses, revenues and fees in connection with the performance of
this Agreement. For the sole purpose of ensuring compliance with this
Agreement, AOL (or its representative) will have the right to conduct a
reasonable and necessary inspection of portions of the books and records
of ICP which are relevant to ICP's performance pursuant to this
Agreement. Any such audit may be conducted after twenty (20) business
days prior written notice to ICP. AOL shall bear the expense of any
audit conducted pursuant to this Section 4.3 unless such audit shows an
error in AOL's favor amounting to a deficiency to AOL in excess of ten
percent (10%) of the actual amounts paid and/or payable to AOL
hereunder, in which event ICP shall bear the reasonable expenses of the
audit. ICP shall pay AOL the amount of any deficiency discovered by AOL
within thirty (30) days after receipt of notice thereof and a copy of
the audit from AOL. If any audit shows an overpayment by ICP, ICP shall
be given a credit in the amount of the overpayment to be applied toward
future payments of Net Transaction Revenues and/or Guaranteed Quarterly
Payments.
4.7 Taxes. ICP will collect and pay and indemnify and hold AOL harmless
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from, any sales, use, excise, import or export value added or similar
tax or duty related to transactions covered by this Agreement and not
based on AOL's net income, including any penalties and interest, as well
as any costs associated with the collection or withholding thereof,
including attorneys' fees.
4.8 Reports.
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4.8.1 Sales Reports. ICP will provide AOL with quarterly reporting
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of such transactional activity, including the total number of
sales of Services from the Affiliated ICP Site, the total
number of downloads by AOL Users from the Affiliated ICP Site,
including identification of the AOL property from which such
download originated (e.g., Spinner, Winamp, ICQ, etc.),
screennames of such users and demographic information about
such customers accessing the ICP Areas. In addition, ICP will
provide AOL with quarterly reports indicating the gross number
of ICP user accounts opened by AOL Users from the ICP
Affiliated Site during the prior quarter, quarter-to-date and
agreement-to-date. ICP shall also provide AOL with demographic
and other information about ICP's non-AOL customers and will
allow AOL to implement selective targeted marketing towards
such customers; provided that the foregoing will not require
ICP to violate any existing confidentiality, privacy or other
agreement to which it is a party as of the Effective Date.
Upon AOL's request, ICP will use commercially reasonable
efforts to provide such reports on a more frequent basis in
order to facilitate the efficient programming by AOL of
Promotions hereunder.
4.8.2 Usage Reports. AOL shall provide ICP with standard monthly
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usage information related to the Promotions (e.g., a schedule
of the Impressions delivered by AOL at such time) which are
similar in substance and form
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to the reports provided by AOL to other interactive marketing
partners similar to ICP.
4.8.3 Fraudulent Transactions. To the extent permitted by applicable
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laws, and subject to ICP's published privacy policy with its
customers, ICP will provide AOL with a prompt report of any
fraudulent order effected through the ICP Areas, including the
date, screenname or email address and amount associated with
such order, promptly following ICP obtaining knowledge that
the order is, in fact, fraudulent.
5 TERM; RENEWAL; TERMINATION.
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5.1 Term. Unless earlier terminated as set forth herein, the initial term
of this Agreement will be three (3) years from the Effective Date (the "Initial
Term").
5.2 Early Termination. AOL, at its option, may elect to terminate this
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agreement after eighteen (18) months from the Effective Date, by providing ICP
with notice of its intention to terminate as of December 31, 2000.
5.3 Renewal. Upon conclusion of the Initial Term, AOL will have the
right to renew the Agreement for successive one-year renewal terms on the same
terms set forth herein. (each a "Renewal Term" and together with the Initial
Term, the "Term").
5.4 Termination for Breach. Except as expressly provided elsewhere in
this Agreement, either Party may terminate this Agreement at any time in the
event of a material breach of the Agreement by the other Party which remains
uncured after thirty (30) days written notice thereof to the other Party (or
such shorter period as may be specified elsewhere in this Agreement); provided
that AOL will not be required to provide notice to ICP in connection with ICP's
failure to make any payment to AOL required hereunder, and the cure period with
respect to any scheduled payment will be fifteen (15) days from the date for
such payment provided for herein. Notwithstanding the foregoing, in the event
of a material breach of a provision that expressly requires action to be
completed within an express period shorter than 30 days, either Party may
terminate this Agreement if the breach remains uncured after written notice
thereof to the other Party.
5.5 Termination for Bankruptcy/Insolvency. Either Party may terminate this
Agreement immediately following written notice to the other Party if the other
Party (i) ceases to do business in the normal course, (ii) is declared insolvent
or bankrupt, (iii) is the subject of any proceeding related to its liquidation
or insolvency (whether voluntary or involuntary) which is not dismissed within
ninety (90) calendar days or (iv) makes an assignment for the benefit of
creditors.
5.6 Termination on Change of Control. In the event of (i) a Change of
Control of ICP or (ii) a Change of Control of AOL, AOL may terminate this
Agreement by providing thirty (30) days prior written notice of such intent to
terminate. In addition, in the event of a Change of Control of AOL such that
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AOL is controlled by an ICP Competitor, ICP may terminate this Agreement by
--------------------------------------------------------------
providing thirty (30) days prior written notice of such intent to
terminate.
6 MANAGEMENT COMMITTEE/ARBITRATION.
- ---------------------------------
6.1 Management Committee. The Parties will act in good faith and use
--------------------
commercially reasonable efforts to promptly resolve any claim,
dispute, claim, controversy or
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disagreement (each a "Dispute") between the Parties or any of their
respective subsidiaries, affiliates, successors and assigns under or
related to this Agreement or any document executed pursuant to this
Agreement or any of the transactions contemplated hereby. If the
Parties cannot resolve the Dispute within such time frame, the Dispute
will be submitted to the Management Committee for resolution. For ten
(10) days following submission of the Dispute to the Management
Committee, the Management Committee will have the exclusive right to
resolve such Dispute; provided further that the Management Committee
will have the final and exclusive right to resolve Disputes arising
from any provision of the Agreement which expressly or implicitly
provides for the Parties to reach mutual agreement as to certain
terms. If the Management Committee is unable to amicably resolve the
Dispute during the ten-day period, then the Management Committee will
consider in good faith the possibility of retaining a third party
mediator to facilitate resolution of the Dispute. In the event the
Management Committee elects not to retain a mediator, the dispute will
be subject to the resolution mechanisms described below. "Management
Committee" will mean a committee made up of a senior executive from
each of the Parties for the purpose of resolving Disputes under this
Section 6 and generally overseeing the relationship between the
Parties contemplated by this Agreement. Neither Party will seek, nor
will be entitled to seek, binding outside resolution of the Dispute
unless and until the Parties have been unable amicably to resolve the
Dispute as set forth in this Section 6 and then, only in compliance
with the procedures set forth in this Section 6.
6.2 Arbitration. Except for Disputes relating to issues of (i) proprietary
----------------
rights, including but not limited to intellectual property and
confidentiality, and (ii) any provision of the Agreement which
expressly or implicitly provides for the Parties to reach mutual
agreement as to certain terms (which will be resolved by the Parties
solely and exclusively through amicable resolution as set forth in
Section 6.1), any Dispute not resolved by amicable resolution as set
forth in Section 6.1 will be governed exclusively and finally by
arbitration. Such arbitration will be conducted by the American
Arbitration Association ("AAA") in Washington, D.C. and will be
initiated and conducted in accordance with the Commercial Arbitration
Rules ("Commercial Rules") of the AAA, including the AAA Supplementary
Procedures for Large Complex Commercial Disputes ("Complex
Procedures"), as such rules will be in effect on the date of delivery
of a demand for arbitration ("Demand"), except to the extent that such
rules are inconsistent with the provisions set forth herein.
Notwithstanding the foregoing, the Parties may agree in good faith
that the Complex Procedures will not apply in order to promote the
efficient arbitration of Disputes where the nature of the Dispute,
including without limitation the amount in controversy, does not
justify the application of such procedures.
6.3 Selection of Arbitrators. The arbitration panel will consist of three
-----------------------------
arbitrators. Each Party will name an arbitrator within ten (10) days after
the delivery of the Demand. The two arbitrators named by the Parties may
have prior relationships with the naming Party, which in a judicial setting
would be considered a conflict of interest. The third arbitrator, selected
by the first two, should be a neutral participant, with no prior working
relationship with either Party. If the two arbitrators are unable to select
a third arbitrator within ten (10) days, a third neutral arbitrator will be
appointed by the AAA from the panel of commercial arbitrators of any of the
AAA Large and Complex Resolution Programs. If a vacancy in the arbitration
panel occurs after the hearings have
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commenced, the remaining arbitrator or arbitrators may not continue with
the hearing and determination of the controversy, unless the Parties agree
otherwise.
6.4 Governing Law. The Federal Arbitration Act, 9 U.S.C. Secs. 1-16, and
-----------------
not state law, will govern the arbitrability of all Disputes. The
arbitrators will allow such discovery as is appropriate to the purposes of
arbitration in accomplishing a fair, speedy and cost-effective resolution
of the Disputes. The arbitrators will reference the Federal Rules of Civil
Procedure then in effect in setting the scope and timing of discovery. The
Federal Rules of Evidence will apply in toto. The arbitrators may enter a
default decision against any Party who fails to participate in the
arbitration proceedings.
6.5 Arbitration Awards. The arbitrators will have the authority to award
-----------------------
compensatory damages only. Any award by the arbitrators will be accompanied
by a written opinion setting forth the findings of fact and conclusions of
law relied upon in reaching the decision. The award rendered by the
arbitrators will be final, binding and non-appealable, and judgment upon
such award may be entered by any court of competent jurisdiction. The
Parties agree that the existence, conduct and content of any arbitration
will be kept confidential and no Party will disclose to any person any
information about such arbitration, except as may be required by law or by
any governmental authority or for financial reporting purposes in each
Party's financial statements.
6.6 Fees. Each Party will pay the fees of its own attorneys, expenses of
---------
witnesses and all other expenses and costs in connection with the
presentation of such Party's case (collectively, "Attorneys' Fees"). The
remaining costs of the arbitration, including without limitation, fees of
the arbitrators, costs of records or transcripts and administrative fees
(collectively, "Arbitration Costs") will be born equally by the Parties.
Notwithstanding the foregoing, the arbitrators may modify the allocation of
Arbitration Costs and award Attorneys' Fees in those cases where fairness
dictates a different allocation of Arbitration Costs between the Parties
and an award of Attorneys' Fees to the prevailing Party as determined by
the arbitrators.
6.7 Non Arbitrable Disputes. Any Dispute that is not subject to final
----------------------------
resolution by the Management Committee or to arbitration under this Section
6 or by law (collectively, "Non-Arbitration Claims") will be brought in a
court of competent jurisdiction in the Commonwealth of Virginia. Each Party
irrevocably consents to the exclusive jurisdiction of the courts of the
Commonwealth of Virginia and the federal courts situated in the
Commonwealth of Virginia, over any and all Non-Arbitration Claims and any
and all actions to enforce such claims or to recover damages or other
relief in connection with such claims.
7 COMPLIANCE WITH LAWS. Nothing herein shall be deemed to require either party
-----------------------
to violate any rule, law or regulation, including, without limitation, the
Securities Act of 1933 or the Securities Exchange Act of 1934. In the event
that a Party can demonstrate to the reasonable satisfaction of the other
Party that a provision herein would require it to violate any such rule, law
or regulation, then the Parties shall restate such provision so as to comply
with the applicable laws and regulations at issue, while maintaining, to the
maximum extent possible, the original effect of such provision (consistent
with the applicable legal and regulatory requirements).
8 PRESS RELEASES. Each Party will submit to the other Party, for its prior
-----------------
written approval, which will not be unreasonably withheld or delayed, any
press release or any other public
statement regarding the transactions contemplated hereunder ("Press
Release"). Notwithstanding the foregoing, either Party may issue Press
Releases and other disclosures as required by law without the consent of the
other Party and in such event, the disclosing Party will provide at least
five (5) business days prior written notice of such disclosure. The failure
by one Party to obtain the prior written approval of the other Party prior to
issuing a Press Release (except as required by law) shall be deemed a
material breach of this Agreement for which there is no adequate cure. In
such event, the non-breaching Party may terminate this Agreement upon written
notice to the other Party.
9 STANDARD TERMS. The Standard Online Commerce Terms & Conditions set forth on
-----------------
Exhibit F attached hereto and Standard Legal Terms & Conditions set forth on
Exhibit G attached hereto are each hereby made a part of this Agreement.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
Effective Date.
AMERICA ONLINE, INC. XXXXXXXXXX.XXX, INC.
By: ______________________ By: _______________________________
Name Name: Xxxxxx X. Xxxxxxxx
Title: Title: Chairman and Co-Chief Executive Officer
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Exhibit A
Promotions and Impressions Commitment
AOL Service XXX.xxx Spinner & Winamp Netscape Netcenter ICQ1
------------------------------------------------------------------------------------------------------------------------------------
Imps %tier imps Imps %tier imps Imps %tier imps Imps %tier imps Imps %tier imps
------------------------------------------------------------------------------------------------------------------------------------
Level 1 * * * * * * * * * *
------------------------------------------------------------------------------------------------------------------------------------
Level 2 * * * * * * * * * *
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Brand imps as * * * * *
% of total
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Total Impressions % Total Impressions
------------------------------------------------------------------------------------------------------------------------------------
Level 1 * *
------------------------------------------------------------------------------------------------------------------------------------
Level 2 * *
------------------------------------------------------------------------------------------------------------------------------------
Total Impressions Commitment * *
------------------------------------------------------------------------------------------------------------------------------------
Notes:
1 The above ICQ impressions represent a value of approximately $ * and
will be delivered during the first two years of the Initial Term of this
Agreement. In addition, ICP will receive ICQ client integration during the
first two years of the Initial Term of this Agreement (e.g., EICQ
Registration Center and ICQ Message Plug-In) also valued at approximately
$ * .
2 AOL agrees to make good faith efforts to allow Advertiser to switch
placements within areas of the AOL Network, subject to AOL receiving
reasonable and specific written notice as to Advertiser's desire to switch
placement, AOL approval (not to be unreasonably withheld), the availability
of Impressions, and AOL's then current Impression swapping policies. The
Parties agree and acknowledge that material changes to the carriage plan may
not be made more frequently than once a month. In addition, AOL will make
commercially reasonable efforts to target certain special promotions offered
by ICP for the AOL Service where AOL believes such targeting would be
appropriate.
* Confidential portions have been omitted and filed separately.
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EXHIBIT B
Definitions
-----------
The following definitions will apply to this Agreement:
Active Audio
------------
15-30 second audio message that is played concurrently with a related 468 x
60 banner on the Spinner Service.
Additional ICP Channel. Any other distribution channel (e.g., an Interactive
----------------------
Service other than AOL) through which ICP makes available one or more offerings
comparable in nature to the Services.
Affiliated ICP Site. The specific mirrored and unique area or web site to be
-------------------
promoted and distributed by AOL hereunder through which ICP can market and
complete transactions regarding the Services, available only to AOL Users.
Alerts. Any communication from ICP directed at an AOL User (whether by e-mail,
------
instant message, or otherwise) as a result of such AOL User's expressly
requested opt-in to receive such communication, requested via an AOL controlled
registration process, which such registration process (i) clearly and
prominently notifies all registrants of the nature and frequency of the
communications that will or may be received as a result thereof, and (ii)
requires such registrant to expressly reconfirm such election to receive such
communications, and which such communications each offer a clear and prominent
opportunity for such AOL User to subsequently opt-out at any time.
XXX.xxx. AOL's primary Internet-based Interactive Site marketed under the
-------
"XXX.XXX(TM)" brand, specifically excluding (a) the AOL Service, (b) any
international versions of such site, (c) "ICQ," "AOL NetFind(TM)," "AOL Instant
Messenger(TM)," "NetMail(TM)" or any similar independent product or service
offered by or through such site or any other AOL Interactive Site, (d) any
programming or Content area offered by or through such site over which AOL does
not exercise complete operational control (including, without limitation,
Content areas controlled by other parties and member-created Content areas), (e)
any programming or Content area offered by or through the U.S. version of the
America Online brand service which was operated, maintained or controlled by the
former AOL Studios division (e.g., Electra), (f) any yellow pages, white pages,
classifieds or other search, directory or review services or Content offered by
or through such site or any other AOL Interactive Site, (g) any property,
feature, product or service which AOL or its affiliates may acquire subsequent
to the Effective Date and (h) any other version of an America Online Interactive
Site which is materially different from AOL's primary Internet-based Interactive
Site marketed under the "XXX.XXX(TM)" brand, by virtue of its branding,
distribution, functionality, Content and services, including, without
limitation, any co-branded versions and any version distributed through any
broadband distribution platform or through any platform or device other than a
desktop personal computer.
AOL Interactive Site. Any Interactive Site which is managed, maintained, owned
--------------------
or controlled by AOL or its agents.
AOL Look and Feel. The elements of graphics, design, organization,
------------------
presentation, layout, user interface, navigation and stylistic convention
(including the digital implementations thereof) which are generally associated
with Interactive Sites within the AOL Service, the ICQ Service, the Spinner
Service, the Winamp Service, the Netscape Netcenter Service or XXX.xxx.
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AOL Members. Any authorized user of the AOL Service, including any sub-accounts
-----------
using the AOL Service under an authorized master account.
AOL Network. (i) The AOL Service, (ii) the ICQ Service, (iii) the Spinner
-----------
Service, (iv) the Winamp Service, (v) XXX.xxx, (vi) Netscape Netcenter and (vii)
any other product or service owned by AOL or its affiliates. It is understood
and agreed that the rights of ICP hereunder relate only to the ICQ Service, the
Spinner Service, the Winamp Service, Netscape Netcenter, the AOL Service and
XXX.xxx, and not generally to the AOL Network, except as otherwise set forth
herein.
AOL Registration Center. The specific registration screen within the AOL
-----------------------
Service available to existing AOL Members where such AOL Members may, at their
option, register to receive additional or incremental services and features,
including without limitation Alerts (but specifically excluding any registration
screen or area for registrations to obtain the AOL client software and become an
AOL Member).
AOL Service. The narrow-band U.S. version of the America Online brand service,
-----------
specifically excluding (a) XXX.xxx and any other AOL Interactive Site, (b) the
international versions of an America Online service (e.g., AOL Japan), (c)
"ICQ," "AOL NetFind(TM)," "AOL Instant Messenger(TM)," "Digital City(TM),"
"NetMail(TM)," "Electra", "Thrive", "Real Fans", "Love@AOL", "Entertainment
Asylum" or any similar independent product, service or property which may be
offered by, through or with the U.S. version of the America Online brand
service, (d) any programming or Content area offered by or through the U.S.
version of the America Online brand service over which AOL does not exercise
complete operational control (including, without limitation, Content areas
controlled by other parties and member-created Content areas), (e) any yellow
pages, white pages, classifieds or other search, directory or review services or
Content offered by or through the U.S. version of the America Online brand
service, (f) any property, feature, product or service which AOL or its
affiliates may acquire subsequent to the Effective Date and (g) any other
version of an America Online service which is materially different from the
narrow-band U.S. version of the America Online brand service, by virtue of its
branding, distribution, functionality, Content or services, including, without
limitation, any co-branded version of the service and any version distributed
through any broadband distribution platform or through any platform or device
other than a desktop personal computer.
AOL User. Any user of the AOL Service, the ICQ Service, the Spinner Service, or
--------
the Winamp Service, XXX.xxx or the AOL Network.
Change of Control. (a) The consummation of a reorganization, merger or
-----------------
consolidation or sale or other disposition of substantially all of the assets of
a party or (b) the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1933,
as amended) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under such Act) of more than 50% of either (i) the then outstanding
shares of common stock of such party; or (ii) the combined voting power of the
then outstanding voting securities of such party entitled to vote generally in
the election of directors.
Confidential Information. Any information relating to or disclosed in the
------------------------
course of the Agreement, which is or should be reasonably understood to be
confidential or proprietary to the disclosing Party, including, but not limited
to, the material terms of this Agreement, information about AOL Members
(including without limitation their AOL number or other unique identifying
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data), AOL Users, AOL purchasers and ICP customers, technical processes and
formulas, source codes, product designs, sales, cost and other unpublished
financial information, product and business plans, projections, and marketing
data. "Confidential Information" will not include information (a) already
lawfully and non-confidentially known to or independently developed without use
or access to such information by the receiving Party, (b) disclosed in published
materials, (c) generally known to the public, or (d) lawfully and non-
confidentially obtained from any third party.
Content. Text, images, video, audio (including, without limitation, music used
-------
in synchronism or timed relation with visual displays) and other data, services,
advertisements, promotions, links, pointers and software, including any
modifications, upgrades, updates, enhancements and related documentation.
ICP Areas. The Affiliated ICP Site and any portions of the Promo Content which
---------
are managed, maintained, owned or controlled predominately by ICP or its agents
(rather than by AOL).
ICP Interactive Site. Any Interactive Site (other than the ICP Areas) which is
--------------------
managed, maintained, owned or controlled by ICP or its agents, including for
example any site called XxxxxXxxxx.xxx, or MusicMaker.[country code].
ICQ Service. The standard narrow-band English language version of the ICQ brand
-----------
communications and messaging service available in the U.S. (e.g., to U.S. based
ICQ Members), specifically excluding (a) XXX.xxx or any other ICQ Interactive
Site, (b) any non-English language versions of an ICQ service or any version of
the ICQ service aimed specifically at any particular international audience
segment, (c) "ICQ It!" or any other independent product, service or property
which may be offered by, through or with the English language version of the ICQ
brand service, (d) any programming or Content area offered by or through the
English language version of the ICQ brand service over which ICQ does not
exercise complete operational control (including, without limitation, Content
areas controlled by other parties, whether or not co-branded with ICQ, and ICQ
user-created Content areas), (e) any yellow pages, white pages, classifieds or
other search, directory or review services or Content offered by or through the
English language version of the ICQ brand service, (f) any property, feature,
product or service which ICQ or its affiliates may acquire subsequent to the
effective date hereof and (g) any other version of an ICQ service which is
materially different from the standard narrow-band English language version of
the ICQ brand service, by virtue of its branding, distribution, functionality,
Content or services, including, without limitation, any co-branded version of
the service or any version distributed through any broadband distribution
platform or through any platform or device other than a desktop personal
computer.
Impression. User exposure to the applicable Promotion, as such exposure may be
----------
reasonably determined and measured by ABC Interactive or another similar third
party used in the industry for such purposes.
Interactive Service. An entity offering one or more of the following: (i)
-------------------
online or Internet connectivity services (e.g., an Internet service provider);
(ii) an interactive site or service featuring a broad selection of aggregated
third party interactive content (or navigation thereto) (e.g., an online service
or search and directory service) and/or marketing a broad selection of products
and/or services across numerous interactive commerce categories (e.g., an online
mall or other leading online commerce site); (iii) a persistent desktop client;
or (iv) communications software capable of serving as the principal means
through which a user creates, sends and receives
Confidential
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electronic mail or real time or "instant" online messages (whether by telephone,
computer or other means), including without limitation greeting cards.
Interactive Site. Any interactive site or area, including, by way of example and
----------------
without limitation, (i) an ICP site on the World Wide Web portion of the
Internet or (ii) a channel or area delivered through a "push" product such as
the Pointcast Network or interactive environment such as Microsoft's Active
Desktop or interactive television service such as WebTV.
Licensed Content. All Content offered through the ICP Areas pursuant to this
----------------
Agreement or otherwise provided by ICP or its agents in connection herewith
(e.g., offline or online promotional Content, Promotions, "slideshows", etc.),
including in each case, any modifications, upgrades, updates, enhancements, and
related documentation.
Live Date. The mutually agreed upon date for launch of the promotions. The
---------
parties agree to use their reasonable commercial efforts to achieve the Live
Date on or before expiration of the 30-day period immediately following the
Effective Date of this Agreement.
Net Transaction Revenues. ICP's gross revenues received from sale of Services
------------------------
(including without limitation delivery expenses charged to the customer), less
only the following amounts: (a) ICP's actual expenses incurred directly and
paid to non-employee third parties in consideration of (i) the manufacture of
the custom CDs including packaging and package inserts, and (ii) order
processing activities, including billing, collection, tracking, transaction
security and customer service functions, all incurred directly as a result of
the processing of orders for custom CDs and digital downloads, and (iii)
delivery expenses charged to the customer; and (b) royalties and other payments
for licenses required in connection with such custom CDs and digital downloads,
including authorizations from and payments to owners of copyright in the sound
recordings and musical compositions.
Netscape Netcenter. The U.S. version of the Netscape Netcenter internet based
------------------
interactive site marketed under the "Netcenter" brand, specifically excluding
without limitation (a) any other Netscape or Netscape Affiliate owned or
operated internet based interactive sites, (b) the international versions of
Netcenter or any similar Netscape or Netscape Affiliate service or interactive
site; (c) "Netscape AOL Instant Messenger(TM)," "Netscape Custom Netcenter,"
Netscape WebMail, or any similar independent product, service or property which
may be offered by, through or by Netscape; (d) any programming or content area
offered by or through the U.S. version of the Netcenter brand service over
which Netscape does not exercise complete operational control (including without
limitation Content areas controlled by other parties), (e) any yellow pages,
white pages, classifieds or other search, directory or review services or
Content offered by or through the U.S. version of the Netcenter brand service,
(f) any property, feature, product or service that Netscape or its Affiliates
may acquire subsequent to the Effective Date and (h) any other version of a
Netscape service that differs materially from Netcenter by virtue of its
branding, distribution, functionality, Content or services, including, without
limitation, any co-branded version of the service or any version distributed
through any other distribution platform or through any platform or device other
than a desktop personal computer.
Promotions. Any of the promotions described herein, including without
----------
limitation (a) the standard Impressions described in Section 1.2; (b) any Alerts
or other permitted communications as set forth herein; and (c) any comparable
promotions provided herein.
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Run of Service Inventory. A collection of inventory made up of all areas of the
------------------------
AOL Service, and not running on any particular screen or group of screens.
Service. Any product, good or service which ICP (or others acting on its behalf
-------
or as distributors) offers, sells, provides, distributes or licenses to AOL
Members directly or indirectly through (i) the ICP Areas (including through any
Interactive Site linked thereto), (ii) any other electronic means directed at
AOL Members (e.g., e-mail offers), or (iii) an "offline" means (e.g., toll-free
number) for receiving orders related to specific offers within the ICP Areas
requiring purchasers to reference a specific promotional identifier or tracking
code, as described more fully on Exhibit D hereto.
Spinner Service. Spinner's primary Internet-based English language Interactive
----------------
Site marketed under the Xxxxxxx.xxx brand. The multi-channel music broadcast
service available over the Internet via a Web-based music player and a stand-
alone Internet application Spinner Plus, capable of displaying song information
as music is played, and providing dynamic links that enable online purchasing,
real-timelistener feedback, and other music-related activity. Xxxxxxx.xxx the
Internet-based English language Interactive Site marketed under the Xxxxxxx.xxx
brand, specifically excluding (a) any international / non-English language
versions of such site, (b) any independent product or service offered by or
through such site, (c) any programming or Content area offered by or through
such site over which AOL does not exercise complete operational control
(including, without limitation, Content areas controlled by other parties,
whether or not co-branded with Spinner, and Spinner user-created Content areas),
(d) any property, feature, product or service which AOL or its affiliates may
acquire subsequent to the Effective Date and (e) any other version of an
Interactive Site which is materially different from Spinner's primary Internet-
based English language Interactive Site marketed under the "Xxxxxxx.xxx" brand,
by virtue of its branding, distribution, functionality, Content and services,
including, without limitation, any co-branded versions and any version
distributed through any broadband distribution platform or through any platform
or device other than a desktop personal computer.
Winamp Service. Winamp's primary Internet-based English language Interactive
---------------
Site marketed under the Xxxxxx.xxx brand. The site features a high-fidelity
music player for Windows 95/98/NT, which supports MP3, CD, Audiosoft, Audio
Explosion, MOD, WAV and other audio formats, as well as custom appearances
called skins and audio visualization and audio effect plug-ins.
Confidential
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EXHIBIT C
ICP Cross-Promotion
-------------------
A. "Try AOL" Button. Within each Affiliated ICP Site and on each ICP
----------------
Interactive Site, ICP shall include (i) a promotional banner for AOL (or, at
AOL's option, ICQ, Netscape, Spinner, or Winamp), appearing above the fold
on the first screen, (ii) a prominent "Try AOL" feature (or at AOL's option,
a "Try ICQ," "Try Netscape," "Try Spinner" or "Try Winamp" feature)(at least
90 x 30 pixels or 70 x 70 pixels in size) (the "AOL Promo") through which
users can obtain promotional information about AOL products or services
designated by AOL and, at AOL's option, download or order the then-current
version of client software for such products or services and (iii) links to
the relevant music topic areas on XXX.xxx, Netscape Netcenter, the ICQ
Service, the Spinner Service, and the Winamp Service; provided, that this
requirement shall not apply to any ICP Interactive Site that is cobranded by
ICP and a third party who does not agree to include such promotions on such
site after such promotions are proposed by ICP. The Banners will be rotated
through ICP's normal rotation. AOL will provide the creative content to be
used in the AOL Promo (including designation of links from such content to
other content pages). ICP shall post (or update, as the case may be) the
creative content supplied by AOL within the spaces for the AOL Promo within
five days of its receipt of such content from AOL. Without limiting any
other reporting obligations of the Parties contained herein, ICP shall
provide AOL with quarterly written reports specifying the number of
impressions to the pages containing the AOL Promo during the prior month. In
the event that AOL elects to serve the AOL Promo to the ICP Interactive Site
from an ad server controlled by AOL or its agent, ICP shall take all
reasonable operational steps necessary to facilitate such ad serving
arrangement including, without limitation, inserting HTML code designated by
AOL on the pages of the ICP Interactive Site on which the AOL Promo will
appear.
B. ICQ as Default Communications Tool. Within each Affiliated ICP Site and on
----------------------------------
each ICP Interactive Site (including without limitation during any ICP
customer registration process) and in any online communications by ICP to
its customers (except as otherwise expressly set forth herein), ICP shall
use commercially reasonable efforts to integrate ICQ into each such site as
the default communications tool (including without limitation for Alerts,
customer service and other customer communications, research, chat, and
community areas); provided, that this requirement shall not apply to any ICP
Interactive Site that is cobranded by ICP and a third party who does not
agree to include such promotions on such site after such promotions are
proposed by ICP.
C. Winamp as Default Player. Winamp shall be integrated into each Affiliated
------------------------
ICP Site as the default digital audio playback and encoding software.
D. Spinner as Primary Internet Multichannel Broadcaster; and Shoutcast as
----------------------------------------------------------------------
Secondary Internet Broadcaster. At AOL's option, within each Affiliated ICP
------------------------------
Site, the Spinner Service shall be integrated into each such site as the
primary internet multichannel broadcaster; and Shoutcast shall be integrated
as the secondary internet broadcaster.
E. Communications Promos. In any online promotions by ICP on each Affiliated
---------------------
ICP Site and on each ICP Interactive Site, when promoting the community or
communications aspects of ICP, or of ICP's products or services (each, a
"Communications Promo"), ICP will include specific references or mentions
(verbally where possible) of the AOL Service (or at AOL's option, the ICQ
Service, Netscape Netcenter, the Spinner Service, or the Winamp Service)
(e.g., a reference to the availability of such AOL Service through the ICP
Areas or vice
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versa), which are at least as prominent as such Communications Promo;
provided, that this requirement shall not apply to any ICP Interactive Site
that is cobranded by ICP and a third party who does not agree to include
such promotions on such site after such promotions are proposed by ICP.
F. In a substantial portion of ICP's television, radio, print and "out of home"
(e.g., buses and billboards) advertisements and in a substantial portion of
ICP's publications, programs, features or other forms of media over which
ICP exercises editorial control, ICP will include specific references or
mentions (verbally where possible) to or of the availability of the
Affiliated ICP Site through the AOL Service, XXX.xxx, the Spinner Service,
the Winamp Service, Netscape Netcenter and/or ICQ. Without limiting the
generality of the foregoing, ICP's listing of the URL for any ICP Web Site
as required above will be accompanied by a prominent listing of the keyword
term on AOL for the Affiliated ICP Site. In advertisements that are
cobranded by ICP and a third party, ICP shall also include such references
or mentions unless such third party does not agree to include such
references or mentions after they are proposed by ICP.
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EXHIBIT D
Description of Services
------------------------
The Affiliated ICP Site shall contain Content and Services that:
1. Provide ICP's content available for free and surcharged downloading from its
complete range of musical artists. ICP to provide free promotional content
at an amount at least as great as on its own site and/or comparable to other
sites.
2. Provide ICP's content as streaming or real-time audio, provided that at
least one of the streaming technology and/or service used is supported by at
least one of the AOL properties, ICQ, Netscape Netcenter, Spinner and
Winamp.
3. Promote any text or visual content that supports or provides additional
detail on ICP's musical artists. As an example, such content could include
news articles or photos.
4. Distribute and sell CDs customized by end users.
5. Sell products related to ICP's brand and/or its musical artists.
6. Sell advertising to partners within ICP's agreed-upon inventory to
companies, only upon approval of AOL, which approval will not be
unreasonably withheld, and subject to AOL's standard advertising guidelines
and terms and conditions.
7. Promote and support AOL's music store (when such store is created).
8. Navigation Bar for each of the respective ICQ, Netscape Netcenter, Spinner
and Winamp Services, at the top of all pages within the Affiliated ICP Site.
9. ICP, at its sole expense, will implement and host the Affiliated ICP Site
starting on the Live Date and during the remainder of the term of this
Agreement, and will provide all computer equipment and personnel necessary
to operate and maintain the Affiliated ICP Site. The Affiliated ICP Site
shall: (i) display each party's relevant trademarks and/or service marks on
substantially all the pages, (ii) provide all of the features and
functionality of, and perform in a manner substantially equivalent to, other
ICP Interactive Sites as such sites may be replaced, updated and/or enhanced
by ICP from time to time, (iii) have URLs in the ICP domain; and (iv)
display relevant AOL network navigation bar at the top of substantially all
of the Co-Branded Site pages (the "Navigation Bar") in a manner that is
mutually agreed to by both parties, and (v) the linking of each ICP Internet
Site to an URL which contains the location code for the appropriate AOL
brand (e.g. xxx.xxxxxxxxxx.xxx.xxx) or such other URL as determined by AOL
in its sole discretion.
10. The Affiliated ICP Site with respect to ICQ will follow the following ICQ
Cobranding requirements:
HEADER
Area for navigational and search bars measuring 600 pixels wide and 65 pixels
deep. ICQ retains the right to change the look and feel of all elements in the
header. ICQ also requires the ability to submit revised elements on the ICP
Affiliated Site at least twice a month in order to reflect changes in the
XXX.xxx site.
ICQ-branded navigational bar measuring 600 pixels wide and 30 pixels deep
containing ICQ branding and 6 links.
ICQ Search bar 5 pixels below the navigation bar measuring 600 pixels wide and
30 pixels deep including a search term input window and choices for WWW search
and ICQ site search.
FOOTER
Area for navigational and search bars measuring 600 pixels wide and 112 pixels
deep. ICQ retains the right to change the look and feel of all elements in the
footer. ICQ also requires the ability to submit
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revised elements on the co-branded site as often as necessary in order to
reflect programming and navigational changes in the XXX.xxx site.
ICQ-branded People Search bar measuring 600 pixels wide and 57 pixels deep
containing ICQ branding and input fields.
ICQ navigation links below the People Search bar measuring 600 pixels wide and
55 pixels deep including 12 links for ICQ Networks and a Download ICQ button.
ICQ RELATED LINKS
An area measuring 200 pixels wide and 60 pixels deep (depending on the number
of links - ICP can choose up to 7 links) for ICQ text promos of related content
on the ICQ site. Only required on the first page of the Affiliated Site. ICQ
must have the ability to update these promos at once per week.
11. ICP must obtain AOL's prior written consent prior to including any other
Content or Services on the Affiliated ICP Site.
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EXHIBIT E
OPERATING STANDARDS
-------------------
1. ICP Internet Site(s) Infrastructure. Except as provided in Section
-----------------------------------
1.2.7 of the Agreement, ICP will be responsible for all communications,
hosting and connectivity costs and expenses associated with the ICP Internet
Site(s). ICP will provide all hardware, software, telecommunications lines
and other infrastructure necessary to meet traffic demands on the ICP
Internet Site(s) from the AOL Network. ICP will design and implement its
connectivity to the Internet such that (i) no single component failure will
have a materially adverse impact on AOL Users seeking to reach the ICP
Internet Site(s) from the AOL Network and (ii) no single line will run at
more than 70% average utilization for a 5-minute peak in a daily period.
2. Optimization; Speed. ICP will use commercially reasonable efforts to ensure
-------------------
that: (a) the functionality and features within the ICP Internet Site(s) are
optimized for the client software then in use by AOL Users; and (b) the ICP
Internet Site(s) is designed and populated in a manner that minimizes delays
when AOL Users attempt to access such site. At a minimum, ICP will ensure
that the ICP Internet Site(s)'s data transfers initiate within fewer than
fifteen (15) seconds on average; except where such inability is due to
problems with the AOL Network. ICP will permit AOL to conduct performance
and load testing of the ICP Internet Site(s) (in person or through remote
communications).
3. Technical Problems. ICP agrees to use commercially reasonable efforts to
------------------
address material technical problems (over which ICP exercises control)
affecting use by AOL Users of the ICP Internet Site(s) (an "ICP Technical
Problem") promptly following notice thereof.
4. Monitoring. ICP will ensure that the performance and availability of the
----------
ICP Internet Site(s) is monitored on a Continuous basis. ICP will provide
AOL with contact information (including e-mail, phone, pager and fax
information, as applicable, for both during and after business hours) for
ICP's principal business and technical representatives, for use in cases
when issues or problems arise with respect to the ICP Internet Site(s).
5. Security. ICP will utilize Internet standard encryption technologies (e.g.,
--------
Secure Socket Layer - SSL) to provide a secure environment for conducting
transactions and/or transferring private member information (e.g. credit
card numbers, banking/financial information, and member address information)
to and from the ICP Internet Site(s). ICP will facilitate periodic reviews
of the ICP Internet Site(s) by AOL in order to evaluate the security risks
of such site. ICP will promptly remedy any security risks or breaches of
security as may be identified by AOL's Operations Security team.
6. Technical Performance.
---------------------
i. ICP will design the ICP Internet Site(s) to support the most recent two
(2) Windows versions of the Microsoft Internet Explorer browser as well as
any browser that represents more than two percent (2%) of aggregate ICP
Internet Sites traffic. In addition, AOL and ICP shall work together with
the goal of preventing any caching by AOL's proxy servers (where applicable,
including preventing caching of any banner advertisements served by ICP). To
the extent the ICP Internet Site(s) do not
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support older AOL browsers, ICP shall have the option of (A) using ICP's ad
serving technology and the information contained in
"http:''xxxxxxxxx.xxxx.xxx.xxx", to restrict an AOL User's access to
incompatible features on the Internet Site(s) and serve a mutually agreed
upon promotional message to such users, or (B) add alternative features
which may be chosen by a user depending on the type of operating system
and/or browser a user employs.
ii. To the extent ICP creates customized pages on the ICP Internet Site(s)
for AOL Users or restricts access to advertising by AOL Users, ICP will
configure the server from which it serves the site to examine the HTTP User-
Agent field in order to identify the "AOL Member-Agents" listed at:
"xxxx://xxxxxxxxx. Xxxx.xxx.xxx."
iii. ICP will periodically review the technical information made available
by AOL at xxxx://xxxxxxxxx.xxxx.xxx.xxx.
------------------------------
iv. ICP will design its site to support HTTP 1.0 or later protocol as
defined in RFC 1945 (available at
"xxxx://xx.xxxxxxxx.xxx/xxx/xxx0000.xxxx").
v. Prior to releasing material, new functionality or features through the
ICP Internet Site(s) ("New Functionality"), ICP will use commercially
reasonable efforts to test the New Functionality to confirm its
compatibility with AOL Service client software. With respect to any major
implementation of significant new technology, ICP will provide AOL with
written notice of the new technology so that AOL can perform tests of the
new technology to confirm its compatibility with the AOL Service client
software.
vi. AOL may notify ICP of any problems with respect to New Functionality or
new technology on the ICP Internet Site(s), and ICP will work in good faith
to resolve such problems. AOL will be entitled to require reasonable changes
to the Content (including, without limitation, the features or
functionality) within any pages of the ICP Internet Site(s) linked to from
the AOL Network to the extent such Content will materially and adversely
affect any operational aspect of the AOL Network. If ICP is unable to
adequately resolve such problems, ICP shall have the option of (A) using
ICP's ad serving technology to restrict an AOL User's access to such Content
and serve a mutually agreed upon promotional message to such users, or (B)
add alternative features which may be chosen by a user depending on the type
of operating system a user employs. If ICP does not restrict access to such
Content or add applicable alternative features, AOL shall have the right to
terminate the link to such Content from the AOL Network, subject to the
remedies set forth in Section 5.1 of the Agreement.
7. AOL Internet Services Partner Support. AOL will provide ICP with access to
-------------------------------------
the highest level of online resources, standards and guidelines
documentation, technical phone support, monitoring and after-hours
assistance that AOL makes generally available to AOL's web-based partners.
AOL support will not, in any case, be involved with Content creation on
behalf of ICP or support for any technologies, databases, software or other
applications which are not supported by AOL or are related to any ICP area
other than the ICP Internet Site(s). Support to be provided by AOL is
contingent on ICP providing to AOL demo account information (where
applicable), a detailed description of the ICP Internet Site(s)'s software,
hardware and network architecture and access to the ICP Internet Site(s) for
purposes of such performance and load testing as AOL elects to conduct.
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EXHIBIT F
Standard Online Commerce Terms & Conditions
-------------------------------------------
1. AOL Network Distribution. ICP will not authorize or permit any third party
------------------------
to distribute or promote the Services or any ICP Interactive Site through the
AOL Network absent AOL's prior written approval. The Promotions and any other
promotions or advertisements purchased from or provided by AOL will link only to
the ICP Areas, will be used by ICP solely for its own benefit and will not be
resold, traded, exchanged, bartered, brokered or otherwise offered to any third
party.
2. Provision of Other Content. In the event that AOL notifies ICP that (i) as
--------------------------
reasonably determined by AOL, any Content within the ICP Areas violates AOL's
then-standard Terms of Service (including without limitation, the terms of the
AOL End User License Agreement, and the AOL Privacy Policy) (the "Terms of
Service"), the terms of this Agreement or any other standard, written AOL policy
or (ii) AOL reasonably objects to the inclusion of any Content within the ICP
Areas (other than any specific items of Content which may be expressly
identified in this Agreement), then ICP will take commercially reasonable steps
to block access by AOL Users to such Content using ICP's then-available
technology. In the event that ICP cannot, through its commercially reasonable
efforts, block access by AOL Users to the Content in question, then ICP will
provide AOL prompt written notice of such fact. AOL may then, at its option,
restrict access from the AOL Network to the Content in question using technology
available to AOL. ICP will cooperate with AOL's reasonable requests to the
extent AOL elects to implement any such access restrictions.
3. Contests. ICP will take all steps necessary to ensure that any contest,
--------
sweepstakes or similar promotion conducted or promoted through the ICP Areas
(a "Contest") complies with all applicable federal, state and local laws and
regulations.
4. Navigation. Subject to the prior consent of ICP, which consent will not be
----------
unreasonably withheld, AOL will be entitled to establish navigational icons,
links and pointers connecting the ICP Areas (or portions thereof) with other
content areas on or outside of the AOL Network. Additionally, in cases where an
AOL User performs a search for ICP through any search or navigational tool or
mechanism that is accessible or available through the AOL Network (e.g.,
Promotions, search terms, or any other promotions or navigational tools), AOL
shall have the right to direct such AOL User to the ICP Areas, or any other ICP
Interactive Site determined by AOL in its reasonable discretion.
5. Disclaimers. Upon AOL's request, ICP agrees to include within the ICP Areas
-----------
a product disclaimer (the specific form and substance to be mutually agreed
upon by the Parties) indicating that transactions are solely between ICP and
AOL Users purchasing Services from ICP.
6. AOL Look and Feel. ICP acknowledges and agrees that AOL will own all right,
-----------------
title and interest in and to the elements of graphics, design, organization,
presentation, layout, user interface, navigation and stylistic convention
(including the digital implementations thereof) which are generally associated
with online areas contained within the AOL Network, subject to ICP's ownership
rights in any ICP trademarks or copyrighted material within the ICP Areas.
7. Management of the ICP Areas. ICP will manage, review, delete, edit, create,
---------------------------
update and otherwise manage all Content available on or through the ICP Areas,
in a timely and professional manner and in accordance with the terms of this
Agreement. ICP will ensure that the ICP Areas is current, accurate and well-
organized at all times. ICP warrants that the Services and any Licensed Content
: (i) will not infringe on or violate any copyright, trademark, U.S. patent or
any other third party right, including without limitation, any music-related
rights, except that the parties will mutually agree on the licensing of any
music performance rights that may be required in connection with this agreement;
(ii) will not violate AOL's then-applicable Terms of Service or any other
standard, written AOL policy or license; and (iii) will not violate any
applicable law or regulation of the United State or any other country or
jurisdiction,
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including those relating to contests, sweepstakes or similar promotions.
Additionally, ICP represents and warrants that it owns or has a valid license to
all rights to any Licensed Content used in AOL "slideshow" or other formats
embodying elements such as graphics, animation and sound, free and clear of all
encumbrances and without violating the rights of any other person or entity. ICP
also warrants that a reasonable basis exists for all Service performance or
comparison claims appearing through the ICP Areas. ICP shall not in any manner,
including, without limitation in any Promotion, the Licensed Content or the
Materials state or imply that AOL recommends or endorses ICP or ICP's Services
(e.g., no statements that ICP is an "official" or "preferred" provider of
products or services for AOL). AOL will have no obligations with respect to the
Services available on or through the ICP Areas, including, but not limited to,
any duty to review or monitor any such Services.
8. Duty to Inform. ICP will promptly inform AOL of any information related to
--------------
the ICP Areas which could reasonably lead to a claim, demand, or liability
of or against AOL and/or its affiliates by any third party.
9. Customer Service. It is the sole responsibility of ICP to provide customer
----------------
service to persons or entities purchasing Services through the AOL Network
("Customers"). ICP will bear full responsibility for all customer service,
including without limitation, order processing, billing, fulfillment, shipment,
collection and other customer service associated with any Services offered, sold
or licensed through the ICP Areas, and AOL will have no obligations whatsoever
with respect thereto. ICP will receive all emails from Customers via a computer
available to ICP's customer service staff and generally respond to such emails
within one business day of receipt. ICP will receive all orders electronically
and generally process all orders within one business day of receipt, provided
Services ordered are not advance order items. ICP will ensure that all orders of
Services are received, processed, fulfilled and delivered on a timely and
professional basis. ICP will offer AOL Users who have purchased Services through
such ICP Areas a money back satisfaction guarantee. ICP will bear all
responsibility for compliance with federal, state and local laws in the event
that Services are out of stock or are no longer available at the time an order
is received. ICP will also comply with the requirements of any federal, state or
local consumer protection or disclosure law. Payment for Services will be
collected by ICP directly from customers. ICP's order fulfillment operation will
be subject to AOL's reasonable review.
10. Production Work. In the event that ICP requests AOL's production assistance
---------------
in connection with (i) ongoing programming and maintenance related to the ICP
Areas, (ii) a redesign of or addition to the ICP Areas (e.g., a change to an
existing screen format or construction of a new custom form), (iii) production
to modify work performed by a third party provider or (iv) any other type of
production work, ICP will work with AOL to develop a detailed production plan
for the requested production assistance (the "Production Plan"). Following
receipt of the final Production Plan, AOL will notify ICP of (i) AOL's
availability to perform the requested production work, (ii) the proposed fee or
fee structure for the requested production and maintenance work and (iii) the
estimated development schedule for such work. To the extent the Parties reach
agreement regarding implementation of the agreed-upon Production Plan, such
agreement will be reflected in a separate work order signed by the Parties. To
the extent ICP elects to retain a third party provider to perform any such
production work, work produced by such third party provider must generally
conform to AOL's standards & practices (and any standard AOL "styleguide"). The
specific production resources which AOL allocates to any production work to be
performed on behalf of ICP will be as determined by AOL in its sole discretion.
With respect to any routine production, maintenance or related services which
AOL reasonably determines are necessary for AOL to perform in order to support
the proper functioning and integration of the ICP Areas ("Routine Services"),
ICP will pay the then-standard fees charged by AOL for such Routine Services.
11. Overhead Accounts. To the extent AOL has granted ICP any overhead accounts
-----------------
on the AOL Service, ICP will be responsible for the actions taken under or
through its overhead accounts, which actions are subject to AOL's applicable
Terms of Service and for any surcharges,
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including, without limitation, all premium charges, transaction charges, and any
applicable communication surcharges incurred by any overhead Account issued to
ICP, but ICP will not be liable for charges incurred by any overhead account
relating to AOL's standard monthly usage fees and standard hourly charges, which
charges AOL will bear. Upon the termination of this Agreement, all overhead
accounts, related screen names and any associated usage credits or similar
rights, will automatically terminate. AOL will have no liability for loss of any
data or content related to the proper termination of any overhead account.
12. Bookmarking. To the extent AOL allows AOL Users to "bookmark" the URL or
-----------
other locator for the ICP Areas, such bookmarks will be subject to AOL's
control at all times. Upon the termination of this Agreement, ICP's rights
to any Keyword Search Terms and bookmarking will terminate.
13. Merchant Certification Program. ICP will participate in any generally
------------------------------
applicable "Certified Merchant" program operated by AOL or its authorized agents
or contractors. Such program may require merchant participants on an ongoing
basis to meet certain reasonable, generally applicable standards relating to
provision of electronic commerce through the AOL Network (including, as a
minimum, use of 40-bit SSL encryption and if requested by AOL, 128-bit
encryption) and may also require the payment of certain reasonable certification
fees to the applicable entity operating the program. Each Certified Merchant in
good standing will be entitled to place on its affiliated Interactive Site an
AOL designed and approved button promoting the merchant's status as an AOL
Certified Merchant.
14. Classifieds. ICP shall not implement or promote any classifieds listing
-----------
features through ICP Programming without AOL's prior written approval. Such
approval may be conditioned upon, among other things, ICP's conformance with any
then-applicable service-wide technical or other standards related to online
classifieds.
15. Message Boards; Chat Rooms and Comparable Vehicles. Any Content submitted
--------------------------------------------------
by ICP or its agents within message boards, chat rooms or any comparable
vehicles will be subject to the license grant relating to submissions to "public
areas" set forth in the AOL Terms of Service. ICP acknowledges that it has no
rights or interest in AOL Member submissions to message boards within the AOL
Network. CP will refrain from editing, deleting or altering, without AOL's prior
approval, any opinion expressed or submission made by an AOL Member within ICP
Programming except in cases where ICP has a good faith belief that the Content
in question violates an applicable law, regulation, third party right or the
applicable AOL Terms of Service.
16. AOL Rewards Program. On the ICP Areas, ICP shall not offer, provide,
-------------------
implement or otherwise make available any promotional programs or plans that are
intended to provide customers with rewards or benefits in exchange for, or on
account of, their past or continued loyalty to, or patronage or purchase of, the
products or services of ICP or any third party (e.g., a promotional program
similar to a "frequent flier" program), unless such promotional program or plan
is provided exclusively through AOL's or its affiliates' "Rewards" program.
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EXHIBIT G
Standard Legal Terms & Conditions
---------------------------------
1. Promotional Materials. Each Party will submit to the other Party, for
---------------------
its prior written approval, which will not be unreasonably withheld or delayed,
any marketing, advertising, or other promotional materials, excluding Press
Releases, related to the ICP Areas and/or referencing the other Party and/or its
trade names, trademarks, and service marks (the "Promotional Materials");
provided, however, that either Party's use of screen shots of the ICP Areas for
promotional purposes will not require the approval of the other Party so long as
America Online(R) is clearly identified as the source of such screen shots; and
provided further, however, that, following the initial public announcement of
the business relationship between the Parties in accordance with the approval
and other requirements contained herein, either Party's subsequent factual
reference to the existence of a business relationship between the Parties in
Promotional Materials, will not require the approval of the other Party. Each
Party will solicit and reasonably consider the views of the other Party in
designing and implementing such Promotional Materials. Once approved, the
Promotional Materials may be used by a Party and its affiliates for the purpose
of promoting the ICP Areas and the content contained therein and reused for such
purpose until such approval is withdrawn with reasonable prior notice. In the
event such approval is withdrawn, existing inventories of Promotional Materials
may be depleted. Notwithstanding the foregoing, either Party may issue press
releases and other disclosures as required by law or as reasonably determined by
legal counsel without the consent of the other Party and, in such event, prompt
notice thereof shall be provided to the other Party.
2. License. ICP hereby grants AOL a non-exclusive worldwide license to market,
-------
license, distribute, reproduce, display, perform, translate, transmit, and
promote the Licensed Content (or any portion thereof) through such areas or
features of the AOL Network as AOL deems appropriate. ICP acknowledges and
agrees that the foregoing license permits AOL to distribute portions of the
Licensed Content in synchronism or timed relation with visual displays prepared
by ICP or AOL (e.g., as part of an AOL "slideshow"). In addition, AOL Users
will have the right to access and use the ICP Areas. The provisions of this
paragraph apply only to the extent that ICP has the rights to grant such
licenses.
3. Trademark License. In designing and implementing the Materials and subject
-----------------
to the other provisions contained herein, ICP will be entitled to use the
following trade names, trademarks, and service marks of AOL: "American
Online(R)", AOL(R), the AOL triangle logo, WinAMP(TM), Spinner(TM), ICQ(R),
Netscape Netcenter and associated logos ; and AOL and its affiliates will be
entitled to use the trade names, trademarks, and service marks of ICP for which
ICP holds all rights necessary for use in connection with this Agreement
(collectively, together with the AOL marks listed above, the "Marks"); provided
that each Party: (i) does not create a unitary composite xxxx involving a Xxxx
of the other Party without the prior written approval of such other Party; and
(ii) displays symbols and notices clearly and sufficiently indicating the
trademark status and ownership of the other Party's Marks
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in accordance with applicable trademark law and practice.
4. Ownership of Trademarks. Each Party acknowledges the ownership right of the
-----------------------
other Party in the Marks of the other Party and agrees that all use of the other
Party's Marks will inure to the benefit, and be on behalf, of the other Party.
Each Party acknowledges that its utilization of the other Party's Marks will not
create in it, nor will it represent it has, any right, title, or interest in or
to such Marks other than the licenses expressly granted herein. Each Party
agrees not to do anything contesting or impairing the trademark rights of the
other Party.
5. Quality Standards. Each Party agrees that the nature and quality of its
-----------------
conform to quality standards set by the other Party. Each Party agrees to
supply the other Party, upon request, with a reasonable number of samples of any
Materials publicly disseminated by such Party which utilize the other Party's
Marks. Each Party will comply with all applicable laws, regulations, and
customs and obtain any required government approvals pertaining to use of the
other Party's marks.
6. Infringement Proceedings. Each Party agrees to promptly notify the other
------------------------
Party of any unauthorized use of the other Party's Marks of which it has actual
knowledge. Each Party will have the sole right and discretion to bring
proceedings alleging infringement of its Marks or unfair competition related
thereto; provided, however, that each Party agrees to provide the other Party
with its reasonable cooperation and assistance with respect to any such
infringement proceedings.
7. Representations and Warranties. Each Party represents and warrants to the
------------------------------
other Party that: (i) such Party has the full corporate right, power and
authority to enter into this Agreement and to perform the acts required of it
hereunder; (ii) the execution of this Agreement by such Party, and the
performance by such Party of its obligations and duties hereunder, do not and
will not violate any agreement to which such Party is a party or by which it is
otherwise bound; (iii) when executed and delivered by such Party, this Agreement
will constitute the legal, valid and binding obligation of such Party,
enforceable against such Party in accordance with its terms; and (iv) such Party
acknowledges that the other Party makes no representations, warranties or
agreements related to the subject matter hereof that are not expressly provided
for in this Agreement. ICP hereby represents and warrants that (i) it possesses
all authorizations, approvals, consents, licenses, permits, certificates or
other rights and permissions necessary to sell the Services, including all
requisite music performance and other music related rights, (ii) products sold
and all content included in the ICP Areas, as well as all ICP Promotional
Materials will neither infringe on any copyright, US patent, music performance
or other music related right.
8. Confidentiality. Each Party acknowledges that Confidential Information may
---------------
be disclosed to the other Party during the course of this Agreement. Each Party
agrees that it will take reasonable steps, at least substantially equivalent to
the steps it takes to protect its own proprietary information, during the term
of this Agreement, and for a period of three years following expiration or
termination of this Agreement, to prevent the duplication or disclosure of
Confidential Information of the other Party, other than by or to its employees
or agents who must have
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access to such Confidential Information to perform such Party's obligations
hereunder, who will each agree to comply with this section. Notwithstanding the
foregoing, either Party may issue a press release or other disclosure containing
Confidential Information without the consent of the other Party, to the extent
such disclosure is required by law, rule, regulation or government or court
order. In such event, the disclosing Party will provide at least five
(5) business days prior written notice of such proposed disclosure to the other
Party. Further, in the event such disclosure is required of either Party under
the laws, rules or regulations of the Securities and Exchange Commission or any
other applicable governing body, such Party will (i) redact mutually agreed-upon
portions of this Agreement to the fullest extent permitted under applicable
laws, rules and regulations and (ii) submit a request to such governing body
that such portions and other provisions of this Agreement receive confidential
treatment under the laws, rules and regulations of the Securities and Exchange
Commission or otherwise be held in the strictest confidence to the fullest
extent permitted under the laws, rules or regulations of any other applicable
governing body.
9. Limitation of Liability; Disclaimer; Indemnification.
----------------------------------------------------
9.1 Liability. UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE
--- ---------
OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY
DAMAGES (EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES), ARISING FROM BREACH OF THE AGREEMENT, THE SALE OF PRODUCTS, THE USE OR
INABILITY TO USE THE AOL NETWORK, THE AOL SERVICE, XXX.XXX OR THE ICP AREAS, OR
ARISING FROM ANY OTHER PROVISION OF THIS AGREEMENT, SUCH AS, BUT NOT LIMITED TO,
LOSS OF REVENUE OR ANTICICPATED PROFITS OR LOST BUSINESS (COLLECTIVELY,
"DISCLAIMED DAMAGES"); PROVIDED THAT EACH PARTY WILL REMAIN LIABLE TO THE OTHER
PARTY TO THE EXTENT ANY DISCLAIMED DAMAGES ARE CLAIMED BY A THIRD PARTY AND ARE
SUBJECT TO INDEMNIFICATION PURSUANT TO SECTION 9.3. EXCEPT AS PROVIDED IN
SECTION 9.3, (I) LIABILITY ARISING UNDER THIS AGREEMENT WILL BE LIMITED TO
DIRECT, OBJECTIVELY MEASURABLE DAMAGES, AND (II) THE MAXIMUM LIABILITY OF ONE
PARTY TO THE OTHER PARTY FOR ANY CLAIMS ARISING IN CONNECTION WITH THIS
AGREEMENT WILL NOT EXCEED THE AGGREGATE AMOUNT OF PAYMENT OBLIGATIONS OWED TO
THE OTHER PARTY HEREUNDER IN THE YEAR IN WHICH THE EVENT GIVING RISE TO
LIABILITY OCCURS; PROVIDED THAT EACH PARTY WILL REMAIN LIABLE FOR THE AGGREGATE
AMOUNT OF ANY PAYMENT OBLIGATIONS OWED TO THE OTHER PARTY PURSUANT TO THE
AGREEMENT.
9.2 No Additional Warranties. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
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NEITHER PARTY MAKES ANY, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS ANY
REPRESENTATIONS OR
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WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE AOL NETWORK, THE AOL SERVICE,
XXX.XXX OR THE ICP AREAS, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE AND IMPLIED WARRANTIES ARISING FROM COURSE OF
DEALING OR COURSE OF PERFORMANCE. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, AOL SPECIFICALLY DISCLAIMS ANY WARRANTY REGARDING THE PROFITABILITY
OF THE ICP AREAS.
9.3 Indemnity. Either Party will defend, indemnify, save and hold harmless the
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other Party and the officers, directors, agents, affiliates, distributors,
franchisees and employees of the other Party from any and all third party
claims, demands, liabilities, costs or expenses, including reasonable attorneys'
fees ("Liabilities"), resulting from the indemnifying Party's material breach of
any duty, representation, or warranty of this Agreement.
9.4 Claims. If a Party entitled to indemnification hereunder (the "Indemnified
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Party") becomes aware of any matter it believes is indemnifiable hereunder
involving any claim, action, suit, investigation, arbitration or other
proceeding against the Indemnified Party by any third party (each an "Action"),
the Indemnified Party will give the other Party (the "Indemnifying Party")
prompt written notice of such Action. Such notice will (i) provide the basis on
which indemnification is being asserted and (ii) be accompanied by copies of all
relevant pleadings, demands, and other papers related to the Action and in the
possession of the Indemnified Party. The Indemnifying Party will have a period
of ten (10) days after delivery of such notice to respond. If the Indemnifying
Party elects to defend the Action or does not respond within the requisite ten
(10) day period, the Indemnifying Party will be obligated to defend the Action,
at its own expense, and by counsel reasonably satisfactory to the Indemnified
Party. The Indemnified Party will cooperate, at the expense of the Indemnifying
Party, with the Indemnifying Party and its counsel in the defense and the
Indemnified Party will have the right to participate fully, at its own expense,
in the defense of such Action. If the Indemnifying Party responds within the
required ten (10) day period and elects not to defend such Action, the
Indemnified Party will be free, without prejudice to any of the Indemnified
Party's rights hereunder, to compromise or defend (and control the defense of)
such Action. In such case, the Indemnifying Party will cooperate, at its own
expense, with the Indemnified Party and its counsel in the defense against such
Action and the Indemnifying Party will have the right to participate fully, at
its own expense, in the defense of such Action. Any compromise or settlement of
an Action will require the prior written consent of both Parties hereunder, such
consent not to be unreasonably withheld or delayed.
9.5 Acknowledgment. AOL and ICP each acknowledges that the provisions of this
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Agreement were negotiated to reflect an informed, voluntary allocation between
them of all risks (both known and unknown) associated with the
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transactions contemplated hereunder. The limitations and disclaimers related to
warranties and liability contained in this Agreement are intended to limit the
circumstances and extent of liability. The provisions of this Section 9 will be
enforceable independent of and severable from any other enforceable or
unenforceable provision of this Agreement.
10. Solicitation of AOL Users. During the term of the Agreement and for a two
--- -------------------------
year period thereafter, ICP will not use the AOL Network (including, without
limitation, the e-mail network contained therein) to solicit AOL Users on behalf
of another Interactive Service. More generally, ICP will not send unsolicited,
commercial e-mail (i.e., "spam") or other online communications through or into
AOL's products or services, absent a Prior Business Relationship. For purposes
of this Agreement, a "Prior Business Relationship" will mean that the AOL User
to whom commercial e-mail or other online communication is being sent has
voluntarily either (i) engaged in a transaction with ICP or (ii) provided
information to ICP through a contest, registration, or other communication,
which included clear notice to the AOL User that the information provided could
result in commercial e-mail or other online communication being sent to that AOL
User by ICP or its agents. Any commercial e-mail communications to AOL Users
which are otherwise permitted hereunder, will (a) include a prominent and easy
means to "opt-out" of receiving any future commercial e-mail or other online
communications from ICP, and (b) shall also be subject to AOL's then-standard
restrictions on distribution of bulk e-mail (e.g., related to the time and
manner in which such e-mail can be distributed through or into the AOL product
or service in question).
11. AOL User Communications. To the extent that ICP is permitted to
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communicate with AOL Users under Section 10 of this Exhibit G, in any such
communications to AOL Users on or off the ICP Areas (including, without
limitation, e-mail solicitations), ICP will not encourage AOL Users to take any
action inconsistent with the scope and purpose of this Agreement, including
without limitation, the following actions: (i) using an Interactive Site other
than the ICP Areas for the purchase of Services, (ii) using Content other than
the Licensed Content; (iii) bookmarking of Interactive Sites; or (iv) changing
the default home page on the AOL browser. Additionally, with respect to such
AOL User communications, in the event that ICP encourages an AOL User to
purchase products through such communications, ICP shall ensure that (a) the AOL
Network is promoted as the primary means through which the AOL User can access
the ICP Areas and (b) any link to the ICP Areas will link to a page which
indicates to the AOL User that such user is in a site which is affiliated with
the AOL Network.
12. Collection and Use of User Information. ICP shall ensure that its
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collection, use and disclosure of information obtained from AOL Users under this
Agreement ("User Information") complies with (i) all applicable laws and
regulations and (ii) AOL's standard privacy policies, available on the
Interactive Site XXX.xxx (or, in the case of the ICP Areas, ICP's standard
privacy policies so long as such policies are prominently published on the site
and provide adequate notice, disclosure and choice to users regarding ICP's
collection, use and disclosure of user information). ICP will not disclose
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User Information collected hereunder to any third party in a manner that
identifies AOL Users as end users of an AOL product or service or use Member
Information collected under this Agreement to market another Interactive
Service.
13. Statements through AOL Network. Neither party shall make, publish, or
--- ------------------------------
otherwise communicate through the AOL Network any deleterious remarks concerning
the other Party or its affiliates, directors, officers, employees, or agents
(including, without limitation, the other Party's business projects, business
capabilities, performance of duties and services, or financial position) which
remarks are based on the relationship established by this Agreement or
information exchanged hereunder.
14. Excuse. Neither Party will be liable for, or be considered in breach of or
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default under this Agreement on account of, any delay or failure to perform as
required by this Agreement as a result of any causes or conditions which are
beyond such Party's reasonable control and which such Party is unable to
overcome by the exercise of reasonable diligence.
15. Independent Contractors. The Parties to this Agreement are independent
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contractors. Neither Party is an agent, representative or employee of the other
Party. Neither Party will have any right, power or authority to enter into any
agreement for or on behalf of, or incur any obligation or liability of, or to
otherwise bind, the other Party. This Agreement will not be interpreted or
construed to create an association, agency, joint venture or partnership between
the Parties or to impose any liability attributable to such a relationship upon
either Party.
16. Notice. Any notice, approval, request, authorization, direction or other
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communication under this Agreement will be given in writing and will be deemed
to have been delivered and given for all purposes (i) on the delivery date if
delivered by electronic mail on the AOL Network (to the e-mail address
"XXXXxxxxx@xxx.xxx" in the case of AOL) or by confirmed facsimile; (ii) on the
delivery date if delivered personally to the Party to whom the same is directed;
(iii) one business day after deposit with a commercial overnight carrier, with
written verification of receipt; or (iv) five business days after the mailing
date, whether or not actually received, if sent by U.S. mail, return receipt
requested, postage and charges prepaid, or any other means of rapid mail
delivery for which a receipt is available. In the case of AOL, such notice will
be provided to both the Senior Vice President for Business Affairs (fax no. 703-
000-0000) and the Deputy General Counsel (fax no. 000-000-0000), each at the
address of AOL set forth in the first paragraph of this Agreement. In the case
of ICP, except as otherwise specified herein, the notice address will be the
address for ICP set forth in the first paragraph of this Agreement, with the
other relevant notice information, including the recipient for notice and, as
applicable, such recipient's fax number or AOL e-mail address, to be as
reasonably identified by AOL.
17. Launch Dates. In the event that any terms contained herein relate to or
--- ------------
depend on the commercial launch date of the ICP Areas contemplated by this
Agreement (the "Launch Date"), then it is the intention of the Parties to record
such Launch Date in a written instrument signed by both Parties promptly
following such Launch Date; provided that, in the absence of such a written
instrument, the Launch Date will be as reasonably determined by
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AOL based on the information available to AOL.
18. No Waiver. The failure of either Party to insist upon or enforce strict
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performance by the other Party of any provision of this Agreement or to exercise
any right under this Agreement will not be construed as a waiver or
relinquishment to any extent of such Party's right to assert or rely upon any
such provision or right in that or any other instance; rather, the same will be
and remain in full force and effect.
19. Return of Information. Upon the expiration or termination of this
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Agreement, each Party will, upon the written request of the other Party, return
or destroy (at the option of the Party receiving the request) all confidential
information, documents, manuals and other materials specified the other Party.
20. Survival. Sections ____ of the body of the Agreement, and Sections 8
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through 30 of this Exhibit, will survive the completion, expiration, termination
or cancellation of this Agreement.
21. Entire Agreement. This Agreement sets forth the entire agreement and
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supersedes any and all prior agreements of the Parties with respect to the
transactions set forth herein. Neither Party will be bound by, and each Party
specifically objects to, any term, condition or other provision which is
different from or in addition to the provisions of this Agreement (whether or
not it would materially alter this Agreement) and which is proffered by the
other Party in any correspondence or other document, unless the Party to be
bound thereby specifically agrees to such provision in writing.
22. Amendment. No change, amendment or modification of any provision of this
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Agreement will be valid unless set forth in a written instrument signed by the
Party subject to enforcement of such amendment, and in the case of AOL, by an
executive of at least the same standing to the executive who signed the
Agreement.
23. Further Assurances. Each Party will take such action (including, but not
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limited to, the execution, acknowledgment and delivery of documents) as may
reasonably be requested by any other Party for the implementation or continuing
performance of this Agreement.
24. Assignment. ICP will not assign this Agreement or any right, interest or
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benefit under this Agreement without the prior written consent of AOL, provided,
however, subject to AOL's rights under Section 5.6 of the Interactive Marketing
Agreement to which these terms are attached, the assumption of the Agreement by
any successor to ICP (including, without limitation, by way of merger or
consolidation, or by purchase of all or substantially all of the assets of ICP)
will be not subject to AOL's prior written approval. Subject to the foregoing,
this Agreement will be fully binding upon, inure to the benefit of and be
enforceable by the Parties hereto and their respective successors and assigns.
25. Construction; Severability. In the event that any provision of this
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Agreement conflicts with the law under which this Agreement is to be construed
or if any such provision is held invalid by a court with jurisdiction over the
Parties to this Agreement, (i) such provision will be deemed to be restated to
reflect as nearly as possible the original intentions of the Parties in
accordance with applicable law, and (ii) the remaining terms, provisions,
covenants and restrictions of this Agreement will remain in full force and
effect.
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26. Remedies. Except where otherwise specified, the rights and remedies
--- --------
granted to a Party under this Agreement are cumulative and in addition to, and
not in lieu of, any other rights or remedies which the Party may possess at law
or in equity; provided that, in connection with any dispute hereunder, ICP will
be not entitled to offset any amounts that it claims to be due and payable from
AOL against amounts otherwise payable by ICP to AOL.
27. Applicable Law. Except as otherwise expressly provided herein, this
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Agreement will be interpreted, construed and enforced in all respects in
accordance with the laws of the jurisdiction in which the applicable legal
action between the Parties is being adjudicated in accordance with the terms
hereof ,except for its conflicts of laws principles.
28. Export Controls. Both Parties will adhere to all applicable laws,
--- ---------------
regulations and rules relating to the export of technical data and will not
export or re-export any technical data, any products received from the other
Party or the direct product of such technical data to any proscribed country
listed in such applicable laws, regulations and rules unless properly
authorized.
29. Headings. The captions and headings used in this Agreement are inserted
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for convenience only and will not affect the meaning or interpretation of this
Agreement.
30. Counterparts. This Agreement may be executed in counterparts, each of
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which will be deemed an original and all of which together will constitute one
and the same document.
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EXHIBIT H
STOCK PURCHASE AGREEMENT
[To be supplied]
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