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Exhibit 10.8
****CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES EXCHANGE ACT OF 1933,
AS AMENDED.
SERVICES AGREEMENT
This SERVICES AGREEMENT (this "Agreement") is made this 13th day of
April, 1999, by and between QVC, Inc., a Delaware corporation ("QVC"), and The
Knot, Inc., a Delaware corporation ("Company"), individually a "Party," and
collectively, the "Parties."
WHEREAS, Company is the owner and operator of a site on the world wide
web located at the domain name address of xxx.xxxxxxx.xxx (the "Company Site" or
"Company's Site");
WHEREAS, the purpose of the Company Site is to provide content,
commerce and services related to weddings to users who visit the Company Site;
WHEREAS, it is anticipated that customers of Company (individually a
"Customer" and collectively "Customers") will order goods by means of the
Company Site to be delivered to the Customers or recipients designated by the
Customers (individually a "Recipient" and collectively the "Recipients"); and
WHEREAS, Company and QVC desire that QVC provide certain fulfillment,
customer service and information technology services to the Company on the terms
and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby agree as
follows:
1. Term. This Agreement shall be for a term (the "Term") commencing on the date
hereof and, unless sooner terminated as provided herein, terminating on the
earlier of (i) the date five years after the Commencement Date (defined below),
or (ii) the date that is four years after the date of closing of an underwritten
public offering of the securities of Company with a per share price greater than
[****] and aggregate proceeds in excess of [****]. Upon the expiration or
termination of this Agreement, other than pursuant to Section 12.2, the term of
this Agreement shall be automatically extended for a period of 180 days or such
shorter period as Company shall notify QVC.
2. Transition Period. Commencing on the date hereof and continuing for a period
agreed to by the Parties, but in no event more than one hundred eighty (180)
days hereafter, QVC and Company shall consult regarding the establishment of
procedures for the transactions contemplated by this Agreement (the "Transition
Period"). The last day of such period shall be referred to herein as the
"Commencement Date." The parties shall exercise reasonable commercial efforts to
cause the Commencement Date to occur as soon as possible after the date hereof.
3. Orders.
3.1. A function of the Company Site is to accept orders from Customers
for the purchase of goods from Company. For the purposes of this Agreement, all
of the goods ordered from the Company Site will be classified as (i) goods
purchased by Company from QVC from those
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[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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goods then available for sale to the public by QVC through its televised
shopping programming (individually a "QVC Good" and collectively "QVC Goods"),
(ii) goods purchased by Company from QVC from those goods (other than QVC Goods)
then available for sale to the public through the iQVC internet site
(individually an "iQVC Good" and collectively the "iQVC Goods) which goods are
not usually held at a warehouse facility designated by QVC, (iii) goods other
than QVC Goods or iQVC Goods purchased by Company and held at a QVC warehouse
facility in anticipation of orders from Customers (individually a "Company Good"
and collectively the "Company Goods"), and (iv) goods other than QVC Goods and
iQVC Goods purchased by Company and not held at a QVC warehouse facility
(individually a "Third Party Good" and collectively the "Third Party Goods").
Notwithstanding the foregoing, the QVC Goods and the iQVC Goods shall not
include (i) goods advertised by QVC as being "exclusive" to QVC or iQVC, and
(ii) goods for which the vendor to QVC of such QVC Goods or iQVC Goods (a "QVC
Vendor") has not licensed QVC to sell or re-sell the QVC Goods or the iQVC Goods
to Company. QVC Goods, iQVC Goods, Company Goods and Third Party Goods shall be
referred to herein individually as a "Good" and collectively as the "Goods."
3.2. Commencing on the Commencement Date, at least once each day during
the Term, Company shall transmit electronically to QVC in a file format
established by QVC and acceptable to Company, an order file for each order of
Goods received by Company through the Company Site (an "Electronic Order"). For
each Electronic Order, Company shall pay QVC a fee (the "Electronic Order Fee")
of US [****]. In the event that the Company elects pursuant to Section 8 of this
Agreement to have QVC perform order taking functions for Goods ordered by means
of telephone, facsimile or any means other than an Electronic Order (a
"Telephonic Order"), Company shall pay QVC a fee (the "Telephonic Order Fee") of
US $[****] for each Good ordered by means of a Telephonic Order. Electronic
Orders and Telephonic Orders are referred to herein individually as an "Order"
and collectively as the "Orders." The Electronic Order Fees and the Telephonic
Order Fees are collectively referred to herein as the "Order Fees."
4. Purchase of Goods from QVC.
4.1. Commencing on the Commencement Date, from time to time during the
Term, Company may purchase QVC Goods and iQVC Goods from QVC.
4.2. The price of each QVC Good and iQVC Good purchased by Company
shall be an amount equal to [****] of the cost paid by QVC for such QVC Good or
iQVC Good, including all taxes, tariffs and duties, however, excluding all QVC
xxxx-ups relating to shipping and handling and storage charges.
4.3. The transmission by Company to QVC of an Electronic Order will
constitute an offer by Company to purchase the QVC Goods and iQVC Goods
referenced in the Electronic Order. Each Telephonic Order shall be deemed to be
an offer by Company to purchase the QVC Goods and iQVC Goods referenced in the
Telephonic Order. During the Transition Period, the Parties will establish
procedures for the modification and cancellation of Orders.
4.4. Company shall provide QVC with resale tax certificates when and in
the form reasonably requested by QVC from time to time.
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[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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5. Fulfillment Services.
5.1. After the receipt by QVC of an Order for a QVC Good, QVC shall
segregate such QVC Good from inventory held for sale by QVC and locate such QVC
Good in a portion of a warehouse facility designated by QVC for the storage of
Goods purchased by Company (the "Company Location"). Upon such segregation,
title to the QVC Good shall pass to Company, but, subject to the provisions of
Section 13.3, QVC shall be liable for loss or damages to any QVC Goods resulting
from theft, mishandling, breakage or destruction by QVC while in the possession
of QVC. In addition to the purchase price referred to in Section 4.2. and the
Order Fee, Company shall pay to QVC a warehouse fee of US [****] for each QVC
Good so segregated.
5.2. After the receipt by QVC of an Order for an iQVC Good, QVC shall
order such iQVC Good from QVC's vendor of such iQVC Good (a "QVC Vendor"). As
indicated in the Order, QVC shall instruct the iQVC Vendor either (i) to ship
the iQVC Good to a warehouse facility designated by QVC, in which event [****]
provided however to the extent that the iQVC Goods exceed such weight and
dimension standards, QVC shall pay [****] of the shipping charges and Company
shall pay the balance, or (ii) to ship the iQVC Good directly to the Customer or
the Recipient, in which event Company will pay the shipping charges or reimburse
QVC for the shipping charges paid by QVC. Title to the iQVC Good shall pass to
Company at such time as the iQVC Good is received at the warehouse facility
designated by QVC and is segregated. QVC shall make commercially reasonable
efforts to cause the iQVC Goods being shipped directly to the Customer or the
Recipient to be shipped without any indication to the Customer or Recipient that
the Order for iQVC Goods was processed through QVC.
5.3. When iQVC Goods are received at a warehouse facility from an iQVC
Vendor, QVC shall verify that the Customer, stock keeping unit and quantity of
iQVC Goods received correspond to those subject to the Order. QVC will not
perform product quality inspection. Visible carrier damage on iQVC Goods
received, if any, will be reported to the shipper. QVC will issue a replacement
order on behalf of Company with the iQVC Vendor. QVC agrees that it will assign
to Company any rights that QVC possesses to pursue a claim that Company has
against the iQVC vendor with respect to such damaged iQVC Good. Company assumes
the risk of loss to all iQVC Goods in transit from the QVC Vendor to the
warehouse facility designated by QVC. After the receipt of such iQVC Good, QVC
will place such iQVC Good in the Company Location. In addition to the purchase
price referred to in Section 4.2. and the Order Fee, Company shall pay to QVC a
warehouse fee of US $9.25 for each iQVC Good placed in the Company Location.
Subject to the provisions of Section 13.3, QVC shall be liable for loss or
damages to any iQVC Goods resulting from theft, mishandling, breakage or
destruction by QVC while in the possession of QVC.
5.4. Company may from time to time purchase Company Goods in reasonable
anticipation of Orders. Company may have such Company Goods shipped to a QVC
warehouse facility designated by QVC and Company shall pay the shipping charges
for such shipments. Company shall notify (the "Company Goods Notice") QVC of
each such shipment. When
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[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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Company Goods are received at a warehouse facility designated by QVC, QVC shall
promptly verify that the stock keeping unit and quantity of Company Goods
received correspond to those set forth in the Company Goods Notice and shall
promptly notify Company of any discrepancies with respect to such information
between the Company Goods Notice and the Company Goods received. QVC will not
perform product quality inspection. Visible carrier damage on Company Goods
received, if any will be reported to the shipper and the Company. Company
assumes the risk of loss to all Company goods in transit from the vendor of the
Company Goods to the QVC warehouse facility. After the receipt of such Company
Goods, QVC will place such Company Goods in the Company Location. Company shall
pay to QVC a warehouse fee of US [****] for each Company Good placed in the
Company Location. Title to Company Goods will not pass to QVC. Notwithstanding
the foregoing, in the event that a single package of Company Goods contains
multiple items of the same Company Goods, Company shall pay to QVC a warehouse
fee of US [****] for each such package of Company Goods placed in the Company
Location and [****] for each "pick" of one or more Company Goods contained in
such package in fulfillment of an Order, which [****] charge shall be made at
the time of the picking.
5.5. After the receipt by QVC of an Order for a Third Party Good, QVC
shall retransmit such Order to Company. As indicated in the Order, Company shall
instruct the vendor of the Third Party Good (a "Third Party Vendor") either (i)
to ship the Third Party Good with documentation specified by QVC to a QVC
warehouse facility designated by QVC, in which event the shipping charges will
be paid by QVC for Third Party Goods weighing up to 15 pounds and not exceeding
the shipper's standard rate cube/volume dimensions, or (ii) to ship the Third
Party Good with documentation specified by QVC directly to the Customer or
Recipient, in which event the shipping charges will be paid by Company or
Company will reimburse QVC for the shipping charges paid by QVC. QVC shall not
be paid a warehouse fee of US [****] for Third Party Goods shipped directly to
the Customer or Recipient. Company shall pay the Third Party Vendor's selling
price for the Third Party Good directly to the Third Party Vendor. Title to
Third Party Goods will not pass to QVC. Company shall notify, or shall cause the
Third Party Vendor to notify, QVC in a manner established by QVC, of the
shipment of each Third Party Good directly to the Customer or the Recipient.
5.6. When Third Party Goods are received from a Third Party Vendor, QVC
shall verify that the Customer, stock keeping unit and quantity of Third Party
Goods received correspond to those subject to the Order. QVC will not perform
product quality inspection. Visible carrier damage on Third Party Goods
received, if any, will be reported to the shipper and QVC will issue a
replacement order on behalf of Company with the Third Party Vendor. Company
assumes the risk of loss to all Third Party Goods in transit from the Third
Party Vendor to the QVC warehouse facility. After the receipt of such Third
Party Good, QVC will place such Third Party Good in the Company Location. In
addition to the Order Fee, Company shall pay to QVC a warehouse fee of US [****]
for each Third Party Good placed in the Company Location and for each
replacement of a Third Party Good placed in the Company Location.
5.7. If the Order for a Good located in the Company Location specifies
that the Good is to be gift wrapped, QVC will gift wrap the Good prior to
shipment to the Recipient in gift wrapping paper provided by Company. Company
will pay to QVC US [****] for each Good gift wrapped. In QVC'S reasonable
discretion, certain oversized Goods may not be eligible for gift wrapping.
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[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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5.8. On or about the date on which Order provides for a Good to be
shipped, QVC will deliver the Good to a shipper designated by QVC. QVC will make
reasonable efforts to ship all Goods to a Customer or a Recipient consistent
with the shipping instructions is the Order. Each package of Goods shipped by
QVC will include (i) a packing slip prepared by QVC based on the information
contained in Order for such Goods and (ii) instructions for the return of the
Goods by the Customer. QVC shall make commercially reasonable efforts to cause
the Goods to be shipped by QVC to be shipped without any indication to the
Customer or Recipient that the Order for the Goods was processed through QVC.
5.9. Company, at its sole expense, shall provide QVC with an adequate
supply of gift wrapping paper, shipping boxes and packaging materials for use by
QVC in the packaging and shipping of Goods. QVC shall be under no obligation to
gift wrap or ship any Goods for which it does not have adequate gift wrapping
paper, shipping boxes and packaging materials. QVC will make commercially
reasonable efforts to regularly notify Company of the inventory of such
materials and the need for additional materials.
5.10. All Goods delivered by QVC to a shipper shall be manifested by
QVC in a form mutually acceptable to the Parties. Company shall pay all
shipper's charges directly to shipper and, if Company elects for its shipments
to be insured, pay all insurance charges.
5.11. The Company Location shall consist of an area for the storage of
Goods designated for specific Customers or Recipients ("Customer Storage Area")
and an area for the storage of other Goods owned by Company ("Company Storage
Area"). The Company Storage Area shall be divided into the "OK Company Storage
Area" and the "Not OK Company Storage Area." In the event that a Customer or a
Recipient alters the Order with respect to Goods which have already been placed
in a Customer Storage Area, QVC shall relocate such Goods from the Customer
Storage Area to the OK Company Storage Area. In the event that Orders are
received for Goods located in the OK Company Storage Area, QVC shall make a
reasonable effort to use such Goods to fill the Orders instead of using the
procedures described in Sections 5.1., 5.2. and 5.4.
5.12 Notwithstanding anything to the contrary contained herein, QVC
shall not be obligated to receive, warehouse or ship any goods which do not
comply with QVC policies; provided that QVC has provided Company in a timely
manner with all changes to QVC policies relating to receiving, warehousing or
shipping. By way of example, and not of limitation, QVC shall not be obligated
to receive warehouse or ship any hazardous materials, foods, pornographic
materials, goods containing alcohol, firearms and ammunition or goods that
exceed QVC's size, weight or value limitations.
5.13 QVC shall use commercially reasonable care for the safekeeping and
safe handling of all Goods in its possession.
5.14. Company shall have access to QVC's warehouse facilities at
reasonable times for the purpose of performing inspections of the Goods and
examining warehouse procedures.
5.15. From time to time, Company and QVC shall consult regarding the
advisability of including certain goods sold by QVC through its televised
shopping program and through iQVC
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but which are likely to be subject to "stock-outs" among the goods that may be
ordered by Customers from the Company Site.
5.16. The fulfillment services complimenting by this Agreement shall be
available to Company, Customer and Recipient five days per week fifty-two weeks
per year excluding federal holidays.
6. Returns.
6.1. Pursuant to the returns policy of Company, Customers and
Recipients may return Goods to Company under conditions established by Company.
QVC shall designate a QVC warehouse facility as the site to which returns of QVC
Goods, iQVC Goods and Company Goods shall be made. QVC agrees to notify Company
in a timely manner of any returns received on behalf of Company.
6.2. QVC shall inspect any returns received to determine whether the
return packaging is empty, contains a QVC Good, an iQVC Good or a Company Good,
or contains another good. If the return packaging is empty, QVC will notify
Company of such receipt. If the return packaging contains a Good, QVC will
determine whether the packaging of the Good was opened after shipment; if it was
opened or if there is visible damage to the packaging, QVC will locate the Good
in the Not OK Company Storage Area; if it was not opened and there is not
visible damage to the packaging, QVC will locate the Good in the OK Company
Storage Area. If the return packaging contains anything other than a Good, QVC
will locate the package in the Not OK Company Storage Area.
6.3. Company shall pay to QVC a returns processing fee of US [****] for
each empty package, each returned Good, and for each other good received at a
QVC warehouse facility. Company shall not pay a returns processing fee of US
[****] for each returned Good if the reason for the return was that the
incorrect Good was shipped by QVC to the Customer or Recipient.
6.4. From time to time, Company and QVC shall review the contents of
the Company Storage Area. Company shall notify QVC of the disposition of the
such contents which shall be shipped, at Company's expense, to locations
designated by Company.
7. Order Management System.
7.1. A record of each Order will be maintained on Company's and on
QVC's order management system by Company and QVC, respectively.
7.2. Each Electronic Order will include attributes established by QVC
and Company including the Customer's name, account number, Goods ordered
(including the QVC SKU number for each Good), gift wrap selection, Recipient's
name and address, gift message, payment method, requested ship date and whether
the Goods will be shipped from a QVC warehouse facility. The same information
will be recorded by QVC with respect to each Telephonic Order.
7.3. QVC's order management system, sourcing and manifesting system and
returns system (the "Systems") will handle the forward flow of each Order
through its life cycle. Among
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[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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other functions, the Systems will add and/or update the Customer's records,
insert each Order for QVC Goods into the QVC system, transmit by means of QVC
electronic document interchange ordering and shipping instructions to iQVC
Vendors and Company for iQVC Goods and Third Party Goods, respectively, cause a
"fraud check" to be conducted with respect to the method of payment, cause
picking orders and packing slips to be produced for Goods stored at Company
Locations, identify on a daily basis the QVC Goods and iQVC Goods which are then
out of stock, communicate to Company on at least a daily basis the status of
each pending Order (e.g. canceled, picked, backordered, shipped, billed),
transmit billing information to Company's credit card clearing house for
shipped-confirmed Orders (but not transfers of funds or credits between the
credit card clearing house and Company), accept return of Goods from Customers
and Recipients, and post credits for returned Goods to Company's credit card
clearing house (but not transfers of funds or credits between the credit card
clearing house and Company) with respect to returned Goods.
7.4. QVC will establish and maintain methods of reporting to Company
such reports and in such formats as shall be mutually agreed, including reports
of perpetual inventory located at a Company Location, projected Goods shipped,
actual sales, order history of each Customer and Recipient, credit card
transactions between Company and Company's credit card clearing house.
7.5. Except for the customer services to be provided pursuant to
Section 8 of this Agreement, all communications with Customers and Recipients
shall be conducted by Company.
7.6. In the event Company desires QVC to provide additional information
technology services, the Parties will enter into good faith negotiations to
determine the scope of such services. For such services, Company shall pay QVC a
fee of [****] per hour per person providing such services.
8. Customer Services.
8.1. Upon notice from Company to QVC that QVC is to commence processing
Telephonic Orders, QVC shall exercise commercially reasonable efforts to
commence processing Telephonic Orders as soon as possible, but in no event shall
QVC commence processing Telephonic Orders later 180 days after the receipt of
such notice.
8.2. In the event that Company desires QVC to provide additional
customer services, the Parties will enter into good faith negotiations to
determine the scope of such services. For such services, Company shall pay QVC a
fee of [****] per hour per person providing such services.
9. Payments.
9.1. On a monthly basis, QVC will provide Company with a detailed and
itemized invoice for the amount of charges due to QVC under the terms of this
Agreement. Company shall make payment of such charges which are not the subject
of a good faith dispute to QVC, within 30 days after the delivery of such
invoice.
9.2. At its election, QVC may implement a cost tracking system to
determine its costs of providing the services set forth in this Agreement. In
the event that the cost tracking system determines that the fees to be paid by
Company to QVC are not sufficient to allow QVC to
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[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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receive an amount equal to [****] of its costs for such services, at any
time after the third anniversary of the Commencement Date hereof, upon notice
from QVC to Company, the parties shall enter into good faith negotiations to
reestablish the fees to be paid by Company to QVC for the services to be
provided under the terms of this Agreement, so that QVC shall be paid an amount
equal to [****] of its costs to provide such services.
10. Insurance. Company shall maintain policies of property and casualty
insurance with policy limits in amounts greater than the aggregate replacement
value of the Goods, gift wrapping paper, shipping boxes, and packaging materials
to which title has passed to Company and located at a QVC warehouse facility.
Company and QVC shall each maintain policies of public or general liability
insurance and policies of product liability insurance with policy limits of not
less than [****] per occurrence. Each Party shall cause the other Party to
be listed as an additional insured on such policies and such policies shall
provide that they may not be canceled on less than 30 days written notice to the
other Party.
11. Representations and Warranties. Each Party represents and warrants to the
other as follows:
11.1. It has all requisite power and authority to enter into this
Agreement, and has duly authorized by all necessary corporate action the
execution and delivery hereof by the officer whose name is signed on its behalf
below.
11.2. Its execution and delivery of this Agreement and the performance
of its obligations hereunder, do not and will not conflict with or result in a
breach of or a default under its organizational instruments or any other
agreement, instrument, order, law or regulation applicable to it or by which it
may be bound.
11.3. This Agreement has been duly and validly executed and delivered
by it and constitutes its valid and legally binding obligation, enforceable in
accordance with its terms, except as enforcement may be limited by bankruptcy,
insolvency or other laws of general application relating to or affecting the
enforcement of creditors' rights and except as enforcement is subject to general
equitable principles.
11.4. It is not in default under any contract that is material to the
undertaking of its obligations under this Agreement.
12. Termination.
12.1. In the event (i) Company fails to pay any amount when due
hereunder and such failure is not cured within ten (10) days after written
notice thereof from QVC to Company (excluding any amounts which are the subject
of a good faith dispute), (ii) either Party fails to perform any material
provision of this Agreement and such failure is not cured within thirty (30)
days after written notice thereof is given, (iii) with respect to either Party,
a Bankruptcy Event (as defined below) occurs, (iv) either Party assigns or
attempts to assign this Agreement, or any of the obligations hereunder, in
violation of Section 17 hereof, or (v) a breach by Company of any material
covenant made to QVC pursuant to (a) Series B Stock Purchase Agreement, (b)
Common Stock Warrant Certificate, (c) Voting Agreement, (d) Second Amended and
Restated Investors' Rights Agreement or (e) Amended and Restated Right of First
Refusal and Co-Sale Agreement, all dated of even date herewith which is not
cured within 90 days after written notice
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[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
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to Company, then, in each such case the other nondefaulting Party may terminate
this Agreement by written notice to the defaulting Party without prejudice to
any other rights and remedies it may have. A "Bankruptcy Event" shall mean with
respect to either Party, as applicable, (i) the making by such Party of any
assignment for the benefit of creditors of all or substantially all of its
assets or the admission by such Party in writing of inability to pay all or
substantially all of its debts as they become due; (ii) the adjudication of such
Party as bankrupt or insolvent or the filing by such Party of a petition or
application to any tribunal for the appointment of a trustee or receiver for
such Party or any substantial part of the assets of such Party; or (iii) the
commencement of any voluntary or involuntary bankruptcy proceedings,
reorganization proceedings or similar proceeding with respect to such Party or
the entry of an order appointing a trustee or receiver or approving a petition
in any such proceeding.
12.2. Upon the consummation of a sale of 50% or more of the voting
power of Company to a party other any QVC or its affiliates, either party shall
have the right to terminate this Agreement upon 120 days prior written notice.
12.3. Company shall have the right, in its full discretion to terminate
this Agreement at any time provided that Company provides QVC with 90 days prior
written notice.
13. Limitation of Liability.
13.1. QVC MAKES NO WARRANTY, WHETHER EXPRESS OR IMPLIED, INCLUDING
WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE, RELATED TO ANY GOODS OR SERVICES, AND SUCH WARRANTIES ARE HEREBY
DISCLAIMED.
13.2. QVC shall not be responsible to Company for any damages arising
out of, resulting from, by reason of or in connection with the Goods pursuant to
this Agreement by QVC or its affiliates, agents or independent contractors,
except to the extent that such liability arises from the gross negligence or
willful or wanton misconduct of QVC or its affiliates, agents or independent
contractors.
13.3. Company's sole and exclusive remedy against QVC for any matter or
claim arising under or relating to this Agreement and any transaction involving
or relating to the Goods or the services to be provided by QVC pursuant to this
Agreement (the "Support Services"), whether in contract, tort (including
negligence) or otherwise, shall be (i) general money damages not in excess of
the lesser of the actual direct damage to Company or the purchase price for the
Goods or the Support Service Fee to which the claim relates, or (ii) an
equitable order for specific performance of the Support Services. EXCEPT FOR
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT BY QVC, IN NO EVENT WILL QVC BE LIABLE TO
COMPANY FOR INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES OF ANY KIND, EVEN IF
QVC WAS ADVISED OR AWARE OF THE POSSIBILITY OF SUCH DAMAGES, EXCEPT TO THE
EXTENT MANDATED BY APPLICABLE LAW.
13.4. Company shall indemnify and hold QVC, its affiliates, agents and
independent contractors and each of their officers, directors and employees
harmless from and against any and all liabilities, losses, damages, expenses,
fines and penalties of any kind, including
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reasonable attorneys fees, incurred by any such party as a result of any claim
made against such party arising out of, resulting from, by reason of, or in
connection with the provision of the Goods or the Support Services, except where
such liability, loss, damage, expense, fine or penalty results solely from such
party's gross negligence or willful or wanton misconduct in providing the Goods
or the Support Services hereunder.
13.5. Subject to the provisions of Sections 13.1, 13.2 and 13.3, QVC
shall indemnify and hold Company, its affiliates, agents and independent
contractors and each of their officers, directors and employees harmless from
and against any and all liabilities, losses, damages, expenses, fines and
penalties of any kind, including reasonable attorneys fees, incurred by any such
party as a result of any claim made against such party arising out of, resulting
from, by reason of, or in connection with the breach of this Agreement by QVC
14. Taxes, Duties Royalties and Other Charges. All taxes (including sales, use
and value added taxes) duties (including customs and import duties) royalties or
other charges imposed in connection with the performance of this Agreement shall
be paid by Company; provided however, that Company shall have no obligation
under this Section 14 for federal, state or local income taxes or payments in
the nature of taxes payable to any taxing authority by QVC. If QVC pays any
taxes, duties or royalties on behalf of Company, Company shall reimburse QVC the
total amounts paid within thirty (30) days of receipt of an invoice from QVC for
the same.
15. Trademark and Trade Names. Neither Party shall use any trademarks, service
marks, trade names, corporate names or intellectual property rights of the other
Party without the prior written consent of such Party.
16. Relationship of the Parties. The relationship between QVC and Company under
this Agreement is that of seller and buyer of goods and services. In providing
the Goods and the Support Services hereunder, QVC and its affiliates, agents and
independent contractors shall act as independent contractors for Company and not
as agents of Company. Unless otherwise expressly authorized in writing by the
Parties, neither Party shall have the right or authority to make any
representation or warranty on behalf of the other Party, to assume or create any
responsibility, express or implied, on behalf of or in the name of the other
party, to act for or bind the other party in any manner whatsoever, or to accept
payment from any person on behalf of the other Party.
17. Assignment. Neither this Agreement nor any right or obligation hereunder is
assignable or transferable by either Party in whole or in part without the prior
written consent of the other Party, and any such purported assignment without
such consent shall be void. Notwithstanding the foregoing QVC shall have the
right to assign this Agreement and its rights and obligations hereunder, without
obtaining prior written consent of Company, to any entity with which QVC merges,
any entity to which QVC transfers a substantial part of the assets or businesses
to which this Agreement relates, or to any Affiliate of QVC or entity which
controls QVC, so long as such assignee accepts such assignment of QVC's rights
and obligations hereunder. Nothing in this Section 16 shall limit QVC's ability
to subcontract to a third party any of QVC's obligations under the terms of this
Agreement, provided that QVC obtains the consent of Company which shall not be
unreasonably withheld.
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18. Force Majeure.
18.1. Any delays in or failure by either Party hereto in the
performance of any obligations hereunder shall be excused if and to the extent
caused by occurrences beyond such party's reasonable control, including, but not
limited to, acts of God, strikes or other labor disturbances, war, whether
declared or not, sabotage, and any other cause or causes, whether similar or
dissimilar, to those herein specified which cannot reasonably be controlled by
such party, expect that this provision shall not apply to any breach of the
payment obligations of Company. Additionally, in the event that further lawful
performance hereof or any part hereof by either Party hereto shall be rendered
impossible by or as a consequence of any law, or any act of any government or
political subdivision thereof having jurisdiction over such Party or directly or
indirectly over a parent company of such Party, such Party shall not be
considered in default hereunder by reason of any failure to perform occasioned
thereby, except that this provision shall not apply to any breach of the payment
obligations of Company. In the event of non-performance, the applicable
obligation hereunder will be extended for a period equal to the period of delay
caused by the forces majeure described above. Each Party agrees to notify the
other Party in writing of the cause of any delay of performance under this
Section 18.1.
18.2 Notwithstanding the foregoing, any Party whose performance is
delayed or rendered impossible as described in Section 18.1 above shall use its
best efforts, without obligation to expend substantial amounts of money not
otherwise required under the Agreement, to circumvent or overcome the cause of
the delay. In the event that the delay should exceed 180 days, either party may,
at its option, terminate this Agreement effective immediately, by giving notice
to the other Party.
19. Notice. Any notice, demand, election or communication required, permitted or
desired to be given between the parties hereunder shall be in writing and shall
be sent by prepaid registered or certified mail, return receipt requested, or by
commercial courier service, or electronic facsimile (but in the latter instance,
also by mail or by commercial courier service). Notices, demands, elections or
communications shall be deemed received on the first to occur of the following:
(i) when personally delivered; (ii) when actually received; or (iii) when sent
by commercial courier service, five (5) days following the deposit thereof with
such service. Notices, demands, elections or communications shall be addressed
as follows (or to any other address which either party may designate to the
other by written notice):
If to QVC: QVC, Inc.
Studio Xxxx
Xxxx Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: President
FAX: 000-000-0000
With a copy to: QVC, Inc.
Xxxxxx Xxxx
Xxxx Xxxxxxx, Xxxxxxxxxxxx 00000
Attn: General Counsel
FAX: 000-000-0000
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If to Company: The Knot, Inc.
000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxx
FAX: 000-000-0000
With a copy to: Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxxx, Esq.
FAX: 000-000-0000
20. Entire Agreement. This Agreement constitutes the entire Agreement between
the Parties with respect to the subject matter hereof, and it supersedes all
prior agreements between them with respect to such matters. This Agreement
cannot be amended or modified in any manner except by a writing signed by the
parties hereto. Notwithstanding the provisions of the Pennsylvania Uniform
Commercial Code, if the Parties correspond with each other after the date hereof
with purchase orders, invoices or other similar documentation, the terms and
conditions of such documentation shall not modify this Agreement unless the
Parties expressly agree in writing that they intend to modify this Agreement
thereby.
21. Severability. Should any part or provisions of this Agreement be held
unenforceable or in conflict with the applicable laws or regulations of any
jurisdiction, the invalid or unenforceable part or provision shall be replaced
with a revision which accomplishes, to the extent possible, the original
business purpose of such part or provision in a valid and enforceable manner,
and the balance of this Agreement shall remain in full force and effect and be
binding upon the Parties hereto.
22. Waiver. No waiver of a breach or default hereunder shall be considered valid
unless in writing and signed by the Party giving such waiver, and no such waiver
shall be deemed a waiver of any subsequent breach or default of the same or
similar nature.
23. Governing Law. This Agreement shall be governed by the laws of the
Commonwealth of Pennsylvania, without regard to principles of conflicts of laws
applicable therein. Each of the Parties hereto consents to the jurisdiction of
the Court of Common Pleas of Xxxxxxx County, Pennsylvania or the United States
District Court for the Eastern District of Pennsylvania, which shall apply
Pennsylvania law.
24. Proprietary Information. The Parties hereto agree that certain information
of the other Party hereto used or made available in connection with this
Agreement is proprietary and confidential ("Proprietary Information").
Proprietary Information shall include information of, entrusted to, or in the
possession of the disclosing Party or any of its affiliates, employees, agents
or representatives and disclosed to the receiving Party by or on behalf of the
disclosing party or any of its affiliates, in writing, marked as confidential,
and which is not generally made available to the public at large, including but
not limited to financial data, costs, margins, software, computer
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programming, mailing or other marketing lists, customer lists, sources of
supply, salaries and other information concerning employees, any advertising,
promotion, product or program concepts, plans or proposals, or any other
information of a proprietary or non-public nature. Each Party will not permit
the duplication or disclosure of the other Party's Proprietary Information by or
to any person (other than employees, agents or representatives who must have
such information in connection with the provision of the services contemplated
hereby), unless the duplication or disclosure is specifically authorized in
writing by the other Party. The Parties shall use reasonable measures and take
reasonable action with respect to its employees, agents or representatives to
ensure that its obligation of non-use and nondisclosure hereunder is satisfied.
The obligations of a receiving Party shall not apply to Proprietary Information
of the disclosing Party to the extent it is:
a. information that is available or becomes available to the general
public without restriction through no wrongful act or omission of the
receiving Party;
b. information received from a third party having the right to transfer
said information;
c. information that is independently developed by the receiving Party
reference to Proprietary Information;
d. information which is ascertainable from a visual inspection of the
disclosing Party's products, services, news releases, advertising,
promotional literature/material disseminated by the disclosing Party
without restriction or public premises; or
e. required to be disclosed pursuant to a subpoena or order of a court,
agency or Government authority of competent jurisdiction that is
binding on the receiving Party, provided that the receiving Party shall
promptly notify disclosing Party thereof and permit disclosing Party to
contest the same.
Upon the termination of this Agreement, the receiving Party of the Proprietary
Information will promptly, and in any event upon request by the disclosing Party
of the Proprietary Information deliver to the disclosing Party all Proprietary
Information, including all written and electronically stored copies, then in the
receiving Party's possession. Neither disclosing Party nor its affiliates,
employees, agents or representatives will retain any copies, extracts or other
reproductions, in whole or in part, of such Proprietary Information. At the
disclosing Party's requests, all documents, memoranda, notes and other writings
prepared by the receiving Party or its nor its affiliates, employees, agents or
representatives based directly on the information in the Proprietary
Information, or which quote from or summarize and Proprietary Information, will
be destroyed as soon as reasonably practicable, and such destruction will be
certified in writing to the disclosing Party by an authorized officer of the
receiving Party supervising such destruction. The Parties hereto acknowledge
that a breach of the covenant of confidentiality contained in this Agreement
will result in irreparable and continuing damage to the disclosing Party for
which there will be no adequate remedy at law. In the event of any breach of
this Agreement, the receiving Party agrees that the disclosing Party will be
entitled to seek an obtain specific performance of this Agreement by the
receiving Party, including, upon making the requisite showing that it is
entitled thereto, provisional injunctive relief restraining the receiving Party
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from committing such breach, in addition to such other and further relief,
including monetary damages, as provided by law.
25. Covenant of QVC. During the term of this Agreement, QVC will not, directly
or indirectly, own or operate or make any type of investment (other than a less
than 5% ownership interest in a publicly traded entity) in any other
corporation, limited partnership, limited liability company, joint venture or
any similar organization or association that engages primarily in provision of
wedding-related services.
26. Limited Warranties and Remedies.
26.1. QVC warrants to Company that the Support Services provided shall
be performed in a workmanlike manner with the same standard of care used in
connection with QVC's iQVC and television shopping network transactions. QVC
further warrants that the Support shall be free from material defects in
workmanship. This warranty (the "Warranty") shall survive inspection, acceptance
and payment for a period of one (1) year.
26.2 If during the term of this Agreement Company believes that there
is a breach of the Warranty, the Company shall notify QVC, setting forth in
writing the nature of such claimed breach. QVC shall promptly investigate such
breach and advise Company of QVC's planned corrective action. If such breach of
the Warranty has not been corrected within a reasonable time, Company may, in
addition to all other rights and remedies provided by law or this Agreement, but
subject to the provisions of Section 13 of this Agreement, be refunded the US
[****] warehouse fee associated with respect to the Goods subject to the Order
affected by such breach.
---------------
[****] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED AND FILED
SEPARATELY WITH THE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
[THIS SPACE IS LEFT BLANK INTENIONALLY
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IN WITNESS WHEREOF, the Parties have executed this Services Agreement on the day
first above written.
QVC, Inc. The Knot, Inc.
By: /s/ Xxxx X. Xxxx By: /s/ Xxxxx Xxx
Title: Executive VP Title: President and Chief Executive
Officer
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