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EXHIBIT 10.12
CABLE AFFILIATION AGREEMENT
THIS AGREEMENT is made as of the 15th day of January, 1999, by and between WINK
COMMUNICATIONS, INC., a California corporation ("Wink"), whose address is 0000
Xxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx, XX 00000 and COXCOM, Inc., dba XXX
COMMUNICATIONS PALOS VERDES, a Delaware corporation ("Affiliate"), whose address
is 00 Xxxxxxxxx Xxxxxx, Xxxxxxx Xxxxx Xxxxxxx, XX 00000.
1. GRANT OF LICENSE
1.1 Wink hereby grants to Affiliate the non-exclusive license to use the Wink
ITV Studio, Wink ITV Broadcast Server, and Wink ITV Response Server
versions 1.0 and any and all subsequent versions (hereinafter collectively
referred to as "Wink Software") to deliver Enhanced Broadcasting to
Affiliate cable system over Affiliate's digital and analog platforms.
During the initial eighteen (18) month term of this Agreement, any and all
versions of the Wink Software shall be licensed to Affiliate at no charge.
During the remainder of this Agreement, any and all subsequent versions of
the Wink Software that become available shall be licensed to Affiliate at
a Most Favored Nations (MFN) rate or three thousand ($3,000.00) per month,
whichever is lower. For purposes of this Agreement, the term MFN is based
upon total Wink enabled boxes committed to deploy, and includes all price
and non-price terms of the license or transaction, including but not
limited to price of Software license, support for Software and for the
Enhanced Broadcasting Service, and to the extent applicable, promotional
support and rebates, and duration of license. If MFN language to other
Multiple System Operators (MSOs) is not tied to volume of Wink enabled
boxes committed to deploy, Wink agrees to offer Affiliate such language.
1.2 This License is not transferable outside of the Affiliate systems
Operating Area, nor any rights hereunder, may be transferred, assigned or
sub-licensed in whole or in part without Wink's prior written consent. If,
at any time during the term of this Agreement, other CoxCom, Inc. cable
systems decide to utilize the Wink Software and Enhanced Broadcasting
service, Wink agrees to provide the Software and services to such systems
at an MFN rate.
1.3 For purposes of this Agreement, the "Operating Area" of any system shall
mean, with respect to a cable television system, the geographical area
where Affiliate is authorized to construct, operate, manage or maintain a
cable television system by appropriate governmental authority.
1.4 Affiliate agrees to launch the Wink Software on all advanced analog cable
set top boxes in Operating Area. Affiliate will use commercially
reasonable efforts to enable Wink on a minimum of 10,000 (CFT 2200)
advanced analog cable set top boxes.
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2 TERM
2.1 The term of this Agreement shall commence on February 1, 1999 and
terminate three (3) years thereafter -- January 31, 2002. After the
initial eighteen (18) month period, which will end on August 1, 2000,
Affiliate will have 30 days to terminate this Agreement without cause and
without incurring the first monthly license fee.
2.2 This Agreement will automatically renew for one year periods unless either
party notifies the other at least 60 days prior to the end of the term of
that party's intent not to renew.
3. INTEGRATION
3.1 For purposes of this Agreement, the term "Enhanced Broadcasting" means the
Wink software-enabled supplemental graphics and that is directly related
to and accompanies the primary video and audio stream of the National
Broadcaster (i.e., NBC, CBS, ABC, Fox, UPN, WB and PaxNet) or National
Cable Programming Service (e.g., ESPN, TNT, A&E, et al.)(collectively
referred to as "Programmers") with which it is transmitted. Additionally,
the Enhanced Broadcasting shall be limited to the above-mentioned content
to the extent that it provides additional information about the specific
television programs or commercial advertisements being transmitted by
Programmer to Affiliate pursuant to the applicable cable programming
affiliation agreement or retransmission consent agreement. Otherwise, in
no way does this Agreement expand upon or enlarge the rights of any
Programmer under existing carriage agreements with Affiliate. Enhanced
Broadcasting is originated by and for the sole direct benefit of the
Programmer whose signal is being enhanced by the Wink software.
Affiliate's carriage of any Enhanced Broadcasting is wholly subject to
Affiliate's carriage in its Operating Area of the particular Programmer
which is being enhanced by the Wink software. Carriage of any such
Programmer shall remain within the sole discretion of Affiliate.
3.2 Affiliate will distribute Enhanced Broadcasting to advanced analog and, at
its discretion, digital subscribers through its Operating Area headend as
a field trial. Subject to the limitations set forth in section 3.1 above,
the Enhancements provided by the Wink software shall enable viewers to
perform various functions, such as submitting information requests,
viewing information and going to a full screen virtual channel through the
Enhancement. Enhanced Broadcasting shall not include (a) any program guide
functionality or information that subscribers may access through the Wink
software; or (b) content that conflicts with any contractual provisions
contained in any cable affiliation or retransmission consent agreement to
which Affiliate is a party.
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3.3 Wink also agrees to perform all Wink related work necessary to integrate
with advanced analog and digital cable set top boxes at no charge to
Affiliate. Any and all Wink integration to digital cable set top boxes
will be at the sole discretion of Affiliate.
3.4 Both parties will use their commercially reasonable efforts to complete
all installation and integration work per the dates mentioned above.
3.5 Affiliate agrees to allow Wink to install and use Wink Response Servers
located in individual Affiliate Operating Area headends to collect,
aggregate, and route responses for national Enhanced Broadcasting
applications through Wink's Alameda Data Center. Wink agrees to provide
weekly reporting to Affiliate of all response traffic generated by its
Affiliate subscribers.
3.6 During the eighteen (18) month trial period, Wink will provide all
technical phone support and maintenance for all Wink hardware and Wink
Software at no charge to Affiliate. Following the trial period, the
monthly maintenance charge will be $500.
4. RATES AND DEPLOYMENT
4.1 Affiliate agrees to provide Wink Enhanced Broadcasting as part of its
advanced analog and, at its discretion, its digital offering to its
subscribers in Palos Verdes, CA on February 1, 1999 or as soon thereafter
as the Wink Software and any necessary support is available, but in any
event, no later than March 31, 1999. Any and all Wink deployment on the
digital cable set top boxes will be at the sole discretion of Affiliate.
4.2 Effective as of February 1, 1999, Wink agrees to waive the license fee
payment per Operating Area of $3,000 per month for a period of eighteen
(18) months. Following the 18 months, Affiliate shall remit a monthly
license fee payment of $3,000, through the term of this Agreement subject
to the limitations set forth in section 2.1 above.
4.3 Affiliate commits to distribute to its advanced analog subscribers and, at
Affiliate's discretion, its digital subscribers, only Enhanced
Broadcasting delivered from Programmers. Affiliate may delete any material
provided within the bandwidth of a Programmer signal that is not Enhanced
Broadcasting. Affiliate shall not be required to or held responsible for
distributing Enhanced Broadcasting in a manner that would cause it to
violate the terms of an existing Affiliation agreement or retransmission
consent agreement. Any and all Wink integration to digital cable set top
boxes will be at the sole discretion of Affiliate. Affiliate agrees to
keep the appropriate headend and server equipment in good working order
for an uninterrupted carriage of Enhanced Broadcasting. If Affiliate
experiences problems with the Enhanced Broadcasting delivery system,
Affiliate will
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restore Enhanced Broadcasting service as soon as possible. Except as may
be otherwise provided for in this Agreement, Affiliate agrees not to
charge Programmer for delivery of Enhanced Broadcasting for the term of
the Agreement. Wink warrants that it has the permission of all Programmers
for which it provides Enhanced Broadcasting to retransmit and/or enhance
their programming services.
4.4 Wink agrees to a five (5) percent Revenue Share with Affiliate on all Wink
generated advertising Purchase and Request transactions by Affiliates'
Wink Subscribers for the term of this Agreement. (See Schedule A.)
4.5 For purposes of this Agreement, the term "Wink Subscriber" shall mean each
Affiliate residential customer and commercial or business establishment
receiving and paying for cable television service with a digital or
advanced analog box in all Affiliate Operating Areas. Any and all Wink
integration to digital cable set top boxes will be at the sole discretion
of Affiliate.
4.6 Wink agrees to waive the $40,000 in installation and conversion fees for
the Affiliate market upon the execution of the Agreement. During the
period between February 1, 1999 and the later of March 31, 1999 or the
date that Enhanced Broadcasting is available to the first Affiliate Wink
Subscriber, Wink agrees to pay for any shipping or travel costs incurred
by Wink in support of on-site installation, maintenance, phone support, or
phone consulting. Beginning with the later of March 31, 1999 or the
availability of Enhanced Broadcasting to the first Affiliate Wink
Subscriber and August 1, 2000, Wink agrees to provide all travel, shipping
and other out-of-pocket expenses incurred by Wink to remedy a material
technical problem. Following August 1,2000, all travel, shipping and other
out-of-pocket costs incurred by Wink from providing support on site (as
opposed to by phone or e-mail), shall be reimbursed by Affiliate, provided
however that Affiliate's obligation to reimburse Wink for such expenses is
conditioned upon Wink (a) obtaining Affiliate's prior written consent for
such expenditures and (b) Wink provides Affiliate with an itemized and
documented invoice for such expenditures with its monthly invoice.
4.7 Wink agrees to provide Enhanced Broadcasting for local promotional
advertisements to Affiliate at no charge for a period of eighteen (18)
months from the Launch Date. Wink agrees to provide one (1) copy of Wink
Studio (authoring tool) upon Affiliate's request in order to support
Affiliate in experimentation of local application development. Wink shall
develop one (1) Virtual Channel template for Affiliate, with Affiliate
having final approval on all Wink content.
4.8 Affiliate may choose to utilize other Wink Software and services of Wink
from time to time under this Agreement. These services will be extended by
Wink to Affiliate at the then prevailing retail rate.
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5. PAYMENT TERMS
5.1 On or before the thirtieth (30th) day following Affiliate's receipt of the
monthly Wink invoice, throughout the term of this Agreement, Affiliate
shall remit to Wink all fees owed for services rendered in the previous
month.
5.2 Wink's failure, for any reason, to send an invoice for a particular
monthly payment shall not relieve Affiliate of its obligation to make any
payment. Wink agrees that an invoice must be sent to Affiliate prior to
payment by Affiliate. Past due payments shall bear interest at a rate
equal to the lesser of (i) one and one-half percent (1 - 1/2%) per month
or (ii) the maximum legal rate permitted under law, and Affiliate shall be
liable for all reasonable costs and expenses (including, without
limitation, reasonable court costs and attorneys' fees) incurred by Wink
in collecting any past due payments.
6. PROMOTION AND RESEARCH
6.1 Affiliate agrees to promote and market the Wink service to Subscribers
within the Operating Area of each launched system. Advertising,
promotional, marketing and/or sales materials concerning the Wink service
which are provided to Affiliate by Wink may be used at the discretion of
Affiliate.
6.2 Wink may, from time to time, undertake marketing tests and surveys, rating
polls and other research in connection with Affiliate. Wink agrees to
provide a research fund of monies, not to exceed eight thousand dollars
($8000.00) for the purpose of supporting Affiliate in gathering and
aggregating data during the trial period. Affiliate agrees that there must
exist mutual agreement prior to committing such funds. Affiliate shall
provide Wink with reasonable assistance in conducting such research with
respect to Affiliate's subscribers. Both Wink and Affiliate agree that the
other party will have access to any and all research conducted by either
party regarding the deployment, launch, and usage of Wink service by
Affiliate subscribers.
6.3 It is the intent of Wink to issue a press release with respect to this
Agreement within fourteen (14) days of execution of this Agreement.
Neither party shall issue any press release, with respect to this
Agreement, unless the content of such release is mutually approved.
7. NOTICES
7.1 All notices, statements, and other communications given hereunder shall be
in writing and shall be delivered by facsimile transmission, personal
delivery, certified mail, return receipt requested, or by next day express
delivery, addressed, if to WINK COMMUNICATIONS, Attn: VP - Affiliate
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Sales at 0000 Xxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx, XX 00000; and, if to Xxx
Communications Palos Verdes, Attn: Xxxxx Xxxx, 00 Xxxxxxxxxx Xxxxxx,
Xxxxxxx Xxxxx Xxxxxxx, XX, 00000, with a copy to Xxx Communications, Inc.,
Director New Business Development, 0000 Xxxx Xxxxx Xxxxx, Xxxxxxx, XX,
00000. The date of such facsimile transmission, telegraphing or personal
delivery or the next day if by express delivery, or the date three (3)
days after mailing, shall be deemed the date on which such notice is given
and effective.
8. TRADEMARKS
8.1 All right, title and interest in and to the service or other rights, of
whatever nature, related thereto shall remain the property of Wink.
Further, Affiliate acknowledges and agrees that all names, logos, marks,
copyright notices or designations utilized by Wink in connection with the
service are the sole and exclusive property of Wink, and no rights or
ownership are intended to be or shall be transferred to Affiliate. Wink
acknowledges that the name, COX, as well as any logos, trademarks, service
marks and copyrighted material owned or controlled by Affiliate, and that
all use of the name, COX, shall remain the sole and exclusive property of
Affiliate, and cannot be used by Wink without express permission by
Affiliate, and no right or ownership are intended to be or shall be
transferred to Wink.
9. REPRESENTATION AND INDEMNIFICATION
9.1 Wink represents and warrants to Affiliate that (i) it is a corporation
duly organized and validly existing under the laws of the State of
California; (ii) Wink has the corporate power and authority to enter into
this Agreement and to fully perform its obligations hereunder (iii) Wink
is under no contractual or other legal obligation which in any way
interferes with its ability to fully, promptly and completely perform
hereunder.
9.2 Affiliate represents and warrants to Wink that (i) Affiliate is a
corporation duly organized and validly existing under the laws of the
State of Delaware; (ii) Affiliate has the requisite power and authority to
enter in this Agreement and to fully perform its obligations hereunder;
(iii) Affiliate's Operating Areas are operating, with respect to any cable
television system, pursuant to valid franchise agreements, or licenses or
other permits duly authorized by proper local authorities; (iv) Affiliate
is under no contractual or other legal obligation which in any way
interferes with its ability to fully, promptly and completely perform
hereunder.
9.3 Wink shall indemnify, defend and hold harmless any COX company, Affiliate,
its parents, subsidiaries, and their respective affiliates, officers,
directors, employees and agents from and against any and all losses,
settlements, claims, actions, suits, proceedings, investigation,
judgments, awards, damages, liabilities, costs and expenses including,
without
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limitation, reasonable attorneys' fees (collectively "Losses" and,
individually, a "Loss") which arise out of or as a result of (i) any
claim, demand, action, suit or proceeding in which it is alleged that the
Wink Software or Enhanced Broadcasting or any part thereof violates or
infringes any patent or copyright or other proprietary right of any third
party or constitutes a misappropriation of any third party's trade secrets
or (ii) arising out of or as a result of any Wink equipment or Affiliate's
carriage of the Wink Enhanced Broadcasting.
10. CONFIDENTIALITY
10.1 In the event that Wink is required to produce any Cox confidential
information in order to comply with a court order, subpoena or other
compulsory legal process, it will promptly inform Cox of this requirement
and will give Cox the opportunity to object to such disclosure prior to
the designated date of production. The parties agree to keep the terms of
this Agreement confidential, but acknowledge that VBI pass through
disclosures will be made to Programmers and that certain other disclosures
may be required by law.
10.2 Wink commits to Affiliate that Wink will implement high levels of security
on the network for the collection, storage, and routing of subscriber
information. Wink further agrees to only release individual subscriber
information to entities that a subscriber decides should have that
information and only in connection with the specific transaction or
request made by the subscriber. Choice is granted by the subscriber
through his or her deliberate interaction with a Wink Enhanced
Broadcasting application. For purposes of this Agreement, Subscriber Data
is defined as that information which currently resides in Affiliate's
billing system, e.g. subscriber name, address, phone number, service
level, monthly billing amount, ordering activity tied to pay-per-view and
other ancillary services and Wink Software.
11 TERMINATION
11.1 Notwithstanding any other provision herein, Wink will have the right to
terminate this Agreement or all or any licenses granted herein if
Affiliate fails to comply with any of its material obligations under this
Agreement. Should Wink elect to exercise this right to terminate for
nonperformance, it must be done in writing specifically setting forth
those items of nonperformance. Affiliate will then have fifteen (15) days
from receipt of notification to remedy the items of nonperformance. Should
Affiliate fail to correct these items of nonperformance, then Wink shall
have the right to collect all fees owed under this Agreement for the
entire term of the Agreement, and enter upon Affiliate's premises to
repossess and remove any Wink-owned or licensed Wink Software. In
addition, Wink's termination of this Agreement or such taking of
possession shall be
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without prejudice to any other remedies Wink may have, including, without
limitation, all remedies with respect to the unperformed balance of this
Agreement; provided, however, that if Affiliate has not made payment of
the fees or charges due hereunder and such nonpayment continues after
thirty (30) days prior written notice by Wink, then Wink may terminate
this Agreement or any license granted herein.
11.2 Notwithstanding any other provision herein, Affiliate will have the right
to terminate this Agreement or all or any licenses granted herein during
the term of this Agreement if Wink fails to comply with any of its
material obligations under this Agreement or if Wink encounters or creates
a material technical problem with its Software or its Enhanced
Broadcasting in the course of its performance of the Agreement. Should
Affiliate elect to exercise this right to terminate for nonperformance, it
must be done in writing specifically setting forth those items of
nonperformance. Wink will then have fifteen (15) days from receipt of
notification to remedy the items of nonperformance and sixty (60) days
from receipt of notification to remedy any technical problems. In
addition, Affiliate's termination of this Agreement shall be without
prejudice to any other remedies Wink may have, including, without
limitation, all remedies with respect to the unperformed balance of this
Agreement.
11.3 Upon expiration of the term (including any extensions thereof) of this
Agreement or upon the termination of this Agreement or of any license
granted hereunder for any reason, all rights of Affiliate to use the Wink
Software will cease and Affiliate will immediately (i) grant to Wink
access to its business premises and the Wink Software and allow Wink to
remove the Wink Software, (ii) purge all copies of all Wink Software from
all computer processors or storage media on which Affiliate has installed
or permitted others to install such Wink Software, and (iii) when
requested by Wink, certify to Wink in writing, signed by an officer of
Affiliate, that all copies of the Wink Software have been returned to Wink
or destroyed and that no copy of any Product remains in Affiliate's
possession or under its control.
11.4 Except as otherwise provided herein, neither Affiliate nor Wink may
terminate this Agreement except upon thirty (30) days prior written notice
and then only if the other has made a misrepresentation herein or breaches
any of its material obligations hereunder and such misrepresentation or
breach (which shall be specified in such notice) is not or cannot be cured
within thirty (30) days of such notice.
12. GENERAL
The parties agree that in the event it is necessary to employ attorneys to
enforce the terms of this Agreement, the prevailing party in any lawsuit shall
be entitled to an award of reasonable attorneys' fees and court costs.
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a) This Agreement may not be assigned without prior written mutual consent of
Affiliate and Wink.
b) This Agreement may be amended only by an instrument in writing, executed
by Affiliate and Wink.
c) This Agreement will be governed in all respects by the laws of the State
of California.
d) This Agreement represents the entire agreement between the parties and
supersedes and replaces all prior oral and written proposals,
communications and agreements with regard to the subject matter hereof
between Affiliate and Wink.
e) This Agreement may be signed in counterpart.
IN WITNESS WHEREOF, the parties by their duly authorized representatives have
entered into this Agreement as of the Effective Date.
WINK COMMUNICATIONS, INC XXX COMMUNICATIONS PALOS VERDES
Name : Name:
Title: Title:
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WINK/AFFILIATE REVENUE SHARE
-SCHEDULE A-
WINK RESPONSE SERVICE TRANSACTION FEE
5 PERCENT OF GROSS TRANSACTION FEE
Purchase Transaction is defined as transaction(s) initiated by Wink enabled
subscribers which result in the purchase of services or products advertised
through a Wink Enhanced Broadcast application.
Request Transaction is defined as transaction(s) initiated by Wink enabled
subscribers which result in the subscriber requesting information that must be
sent to subscriber about services or products advertised through a Wink Enhanced
Broadcast application.
