DEVELOPMENT AGREEMENT
ENHANCED TOOLBAR INCLUDING AUDIBILIZATION
This Agreement, dated as of June 8, 2004, is by and between YP Corp., a Nevada
corporation with its principal place of business at 0000 X. Xxxxxxx Xxxxxx,
Xxxxx 000, Xxxx, Xxxxxxx 00000 and SurfNet Media Group, Inc, a Delaware
corporation with its principal place of business at 0000 Xxxxx Xxxx Xxxx, Xxxxx,
Xxxxxxx 00000. YP and SurfNet are sometimes referred to individually as the
"Party" and collectively as the "Parties."
RECITALS:
A. SurtNet develops computer software that, among other things, provides
enhanced communications capabilities via the Internet.
B. YP is in the business of providing Internet-based yellow page advertising
space on or through xxx.xxxxxx-xxxx.xxx, xxx.xx.xxx and xxx.xx.xxx.
C. YP wishes to utilize in its business certain software applications
developed by SurfNet to enhance and improve the functionality and utility of the
products and services YP uses in its business.
D. SurfNet and YP desire to enter into a business relationship pursuant to
which, among other things, (i) SurtNet would deliver certain software
applications via the Internet to YP, and (ii) YP would make certain payments to
SurfNet.
AGREEMENT:
Accordingly, the Parties hereby agree as follows:
1. Certain Definitions. For the purposes of this Agreement, the following terms
will have the indicated meanings:
1.1 "Beneficial Owner" has the meaning set forth in Rule 13d-3 under the
Securities Act of 1993, as amended.
1.2 "Change Of Control" means a change in control of YP of a nature that
would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), whether or not YP is subject to the Exchange Act at
such time, including any of the following events:
1.2.1 Any Person becomes the Beneficial Owner, directly or indirectly, of
securities of YP representing a majority of the combined voting power of
or equity interest in YP in connection with a merger or otherwise. In
applying the preceding sentence, securities acquired directly from YP,
its subsidiaries, or affiliates by or for the Person shall not be taken
into account.
1.2.2 A merger or consolidation of YP is consummated will, any other
corporation or entity or any other form of business combination pursuant
to which the outstanding stock of YP is exchanged for cash, securities
or other property paid, issued or caused to be issued by the surviving
or acquiring corporation or entity unless the stockholders immediately
before the merger or consolidation would continue to own equity
securities that represent (either by remaining outstanding or by being
converted into equity securities of the surviving entity) at least a
controlling interest in YP or such surviving or acquiring entity
corporation immediately after such merger or consolidation.
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1.2.3 A sale, transfer or lease by YP of all, or substantially all, of YP's
assets is consummated.
1.3 "Deliverables" means the software code as set forth in the Specifications
and other materials required to be delivered by SurfNet to YP hereunder, as
more fully described in the Specifications, including, without limitation,
the Toolbar. Unless otherwise set forth in this Agreement (including the
Specifications), or unless otherwise agreed by the Parties, all code to be
delivered to YP will be transmitted by SurfNet to YP electronically in
accordance with such security measures as may be mutually agreed by the
Parties.
1.4 "Error(s)" means defect(s) in the Technology which prevent(s) it from
performing in accordance with the Specifications.
1.5 "Impression(s)" means a single instance of the Toolbar being accessed or
viewed by an end user.
1.6 "Internet" means any systems for distributing digital electronic content
and information to end users via transmission, broadcast, public display,
or other forms of delivery, whether direct or indirect, whether over
telephone lines, cable television systems, optical fiber connections,
cellular telephones, satellites, wireless broadcast, or other mode of
transmission now known or subsequently developed.
1.7 "Launch Date" will mean that date on which the Toolbar is first generally
available for use by YP.
1.8 "Person" has the meaning given in Section 3(a)(9) of the Securities Act
of 1933, amended, as modified and used in Section 13(d) of the Securities
Act of 1933, amended, and will include a "group," as defined in Rule 13d-5
promulgated thereunder. However, a person will not include YP or any of its
affiliates.
1.9 "Schedule" means the schedule(s) for completion of the Services, as set
forth in the Specifications.
1.10 "Services" means the design, development and delivery of the Technology
in accordance with the Specifications, as modified from time to time, and
all other services performed by SurfNet pursuant to this Agreement.
1.11 "Specifications" means the specifications for the Services and
Technology, attached to this Agreement as Exhibit A, which includes a
Technology design and content summary, as well as a detailed specification
for all required features and functionality, and a complete delivery and
implementation schedule. The Parties contemplate that the Specifications
may be modified by mutual consent from time to time during the Term; if and
when the Specifications are modified, the Parties shall initial the new
Specifications or amendments to the existing Specifications, and
immediately following the last initialing such new Specifications or
amendments shall automatically be deemed to supercede or supplement (as the
case may be) Exhibit A.
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1.12 "Technology" means (i) Metaphor desktop engine computer software
developed by SurfNet driving a YP-designed toolbar created by SurfNet that
will provide an end user with active desktop access to the Toolbar without
imbedding the Technology in the operating system or desktop, as more fully
described in the Specifications, and all future versions thereof and
enhancements, upgrades and modifications thereto developed by SurfNet
("Phase I"); and (ii) an audibilized Metaphor desktop engine computer
software developed by SurfNet, as more fully described in the
Specifications, and all future versions thereof and enhancements, upgrades
and modifications thereto developed by SurfNet driving a YP-designed
toolbar created by SurfNet that will (A) provide an end user with active
desktop access to the Toolbar without imbedding the Technology in the
operating system or desktop, and (B) incorporate streaming audio into the
Metaphor desktop engine for such uses as press releases, management
announcements and other YP generated audible messaging ("Phase II").
1.13 "Toolbar" means the product derived from the Technology.
1.14 "Term" means the period of time commencing on the Effective Date and
continuing thereafter indefinitely until this Agreement is terminated
pursuant to Section 8 below.
1.15 "Territory" means the entire universe.
1.16 "Web" means the so-called World Wide Web, containing, inter alia, pages
written in hypertext markup language (HTML) and/or any similar successor
technology.
2. License. Subject to the terms and conditions contained in this Agreement,
SurfNet hereby grants to YP for a duration of two (2) years commencing on the
date that the technology is delivered and accepted by YP a worldwide,
exclusive license, with respect to the Internet yellow pages market only, to
(i) use the Technology on YP's websites and permit the Technology to be
copied onto the websites of YP's end users, and (ii) promote the Technology
on a co-branded basis. Notwithstanding the foregoing, if the Launch Date does
not occur within six (6) months from the date hereof, YP will forfeit its
exclusivity and the foregoing license automatically will become a nonexclusive
license. SurfNet reserves the right to make copies of, to make derivative works
of and to use the Technology for commercial purposes and to license the
Technology to third parties subject to the terms of this Agreement, subject to
any additional terms relative to the original term sheet executed by the parties
in _______. No rights or licenses are granted or deemed granted hereunder or in
connection herewith, other than those rights or licenses expressly granted in
this Agreement.
3. Compensation. YP shall pay SurfNet for the Services the following:
3.1 A development fee of eighty-five thousand dollars ($85,000), with fifty
thousand dollars ($50,000) payable upon the execution of this Agreement and
thirty-five thousand dollars ($35,000) payable upon delivery of Phase II.
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3.2 A monthly license fee of three thousand seven hundred fifty dollars
($3,750), covering up to one million Impressions per month based on a
streaming rate of 16kbs, payable in arrears on the 15th day of the month
immediately following the Launch Date, and on the 15th day of each month
thereafter during the Term; and
3.3 A monthly license fee of four thousand seven hundred fifty dollars
($4,750) for each additional one million Impressions per month, or any part
thereof, in excess of the aggregate Impressions referenced in Section 3.2,
based on a streaming rate of 16kbs, payable in arrears on the 15th day of
the following month.
3.4 A Change of Control fee of one hundred thousand dollars ($100,000)
payable not later than five (5) business days following a Change of
Control.
4. Technology Development.
4.1 In General. SurfNet shall perform the Services, and deliver to YP the
Technology, in accordance with the Specifications (including the Schedule),
as the same may change from time to time during the Term with the mutual
consent of YP and SurfNet, and all other terms and conditions contained in
this Agreement. SurfNet will use its best efforts to meet each milestone in
the Schedule for delivering the Technology. SurfNet agrees that the
Services shall be performed in a professional manner and shall be of a high
grade, nature and quality. Throughout the Term:
4.1.1 SurfNet will assign human and financial resources to develop the
Technology.
4.1.2 SurfNet will monitor the reliability and accessibility of the
Technology, and ensure that it continues to perform in accordance with
the Specifications, excluding any modifications and changes made by YP
without the knowledge or consent of SurfNet.
4.1.3 From time to time, YP may request that SurfNet undertake to develop
certain enhancements to the Technology. Upon such request, SurfNet shall
confer in good faith with YP regarding the feasibility of developing
such enhancements and the time frame for developing, testing and
incorporating such enhancements. Then, SurfNet and YP shall mutually
agree as to whether SurfNet should pursue development of such
enhancements, and, if so, which of SurfNet and/or YP will fund such
development. Upon mutual written agreement, the Specifications shall be
deemed amended to include such enhancements.
4.2 Acceptance. The terms and conditions contained in this Section will apply
to the initial release of the Technology, as well as to each subsequent
release, upgrade, enhancement and version thereof.
4.2.1 SurfNet agrees to thoroughly test the Technology (including without
limitation each and every release, version, and enhancement thereof), as
appropriate under the circumstances, at all appropriate stages of
development, and shall document its testing by written test documents
delivered to YP. Such test documents shall include a detailed
description of the tests as conducted, and test results (including,
without limitation, resulting bug list and outstanding issues list).
Notwithstanding anything contained in this Agreement to the contrary,
SurfNet will not deploy the Technology, and/or any enhancement thereof,
unless and until YP authorizes such deployment in writing.
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4.2.2 If either Party is aware or becomes aware of a delay that will
prevent SurfNet from meeting a scheduled milestone for any component of
the Technology under the Schedule, such Party will promptly inform the
other Party of such delay, and the reason therefore, in writing. If such
delay is caused by YP, the Schedule will automatically be deemed
extended, if and to the extent minimally necessitated by the original
delay. If such delay is caused by SurfNet, SurfNet will be given a
reasonable period (up to thirty (30) business days, depending on the
circumstances) to cure. However, SurfNet acknowledges that timely
meeting the Schedule is of critical importance under this Agreement, and
that time is of the essence in curing a delayed delivery.
4.2.3 YP shall evaluate the beta and final version of the Technology and
shall submit a written acceptance or rejection to SurfNet within ten
(10) business days after YP Net's receipt of the beta versions and
fifteen (15) business days after receipt of the final version of the
Technology. If YP identifies Errors in the Technology prior to
acceptance, then SurfNet shall correct, at its sole expense, such
Errors, and use its best efforts to effect such correction within
fifteen (15) business days. If no written acceptance or rejection is
received by SurfNet, acceptance shall he deemed to have occurred.
4.2.4 If SurfNet fails to deliver the Technology within the dates specified
in the Schedule (after application of the applicable reasonable cure
period) and if any Errors discovered during the acceptance process
cannot be eliminated in the correction period specified in the
Specifications or Exhibit B (whichever is applicable) then YP may, at
its option: (i) extend the correction period; or (ii) suspend its
performance until the problem is corrected to YP's reasonable
satisfaction and/or, if the failure to deliver or uncorrected Error is
material, terminate this Agreement for cause pursuant to Section 8.
4.2.5 Notwithstanding anything contained herein to the contrary, SurfNet
shall at all times hereunder be responsible for ensuring that the
Technology meets all Specifications, and if any Error in the originally
submitted Technology is discovered after acceptance, SurfNet shall
remain obligated to correct such Error in accordance with the applicable
timetable determined by YP and SurfNet as set forth in the
Specifications or Exhibit B, or as otherwise may be mutually agreed
under the circumstances.
5. Representations and Warranties.
5.1 By SurfNet. SurfNet warrants and represents that:
5.1.1 It is a corporation duly organized, validly existing and in good
standing under the laws of Delaware.
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5.1.2 It has the full power to enter into this Agreement and to grant the
rights set forth herein.
5.1.3 This Agreement, when executed and delivered by SurfNet, will be the
legal, valid and binding obligation of SurfNet, enforceable against it
in accordance with its terms.
5.1.4 The execution, delivery and performance of this Agreement by SurfNet
does not conflict with, or constitute a breach or default under, any
provision of any agreement, contract, commitment or instrument to which
it is a party
5.2 By YP. YP warrants and represents that:
5.2.1 It is a corporation duly organized, validly existing and in good
standing under the laws of Nevada.
5.2.2 It has the full power to enter into this Agreement and to grant the
rights set forth herein.
5.2.3 This Agreement, when executed and delivered by YP, will be the legal,
valid and binding obligation of YP, enforceable against it in accordance
with its terms.
5.2.4 The execution, delivery and performance of this Agreement by YP does
not conflict with, or constitute a breach or default under, any
provision of any agreement, contract, commitment or instrument to which
it is a party.
6. Indemnification.
6.1 SurfNet warrants that the use of the Technology by YP pursuant to the
terms hereof shall not constitute an infringement of any existing patent,
copyright or other right. SurfNet hereby agrees to defend or settle any
suit, proceeding or claim brought against YP based on a claim that the use
of the Technology or any part thereof by YP constitutes an infringement of
any existing patent, copyright or other right. SurfNet shall pay all
damages or costs awarded against or expenses, including attorneys' fees,
incurred by YP in such suit, proceeding or claim.
6.2 In the event the Technology or any part thereof shall be in SurfNet's
opinion likely to or shall become the subject of a claim for patent,
copyright, or other infringement, may, at its option and expense, and
without diminishing SurfNet's obligations under Section 7.1, procure for YP
the right to continue using such affected part of the Technology or modify
such affected part to become non-infringing. Should SurfNet elect to remove
or modify such infringing part of the Technology, SurfNet shall forthwith
replace such part with a functionally equivalent non-infringing part and/or
take other appropriate action to ensure that the Technology conforms to the
Specifications to YP Net's satisfaction, without cost to YP.
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6.3 In the event that SurfNet shall refuse or shall be unable to supply or
shall be prevented from supplying the Technology or any part thereof to YP,
or in the event that YP Net's continued use of the Technology shall be
prohibited or enjoined at any time, SurfNet shall promptly replace all
affected parts of the Technology with functionally equivalent
non-infringing parts and/or shall take such other action to ensure that the
Technology conforms to the Specifications to YP's satisfaction, without
cost to YP.
6.4 SurfNet warrants that YP shall suffer no interruption of its normal
business activities or cycles as a result of any claimed infringement, any
litigation referred to in Section 7.1 or any replacement of items
contemplated in Sections 5.2 or 5.3 hereof.
7. Warranties.
7.1 SurfNet represents and warrants to YP that as of the date of delivery:
7.1.1 SurfNet has good and merchantable title to and the right to sell
and/or license the Technology as the case may be as provided for in this
Agreement, free and clear of all security interests, liens and
encumbrances.
7.1.2 The Technology is designed in accordance with this Agreement.
7.1.3 The Technology is comprised of all of the features and functions
agreed to herein.
7.1.4 YP shall receive any licenses or warranties extended by any third
party used by SurfNet in connection with the Technology.
7.2 SurfNet further warrants and covenants that for a period of one year
following the Technology Acceptance Date:
7.2.1 The Technology will be free from defects in workmanship and material.
7.2.2 The Technology will have all of the qualities and features, and be
capable of performing all of the functions described in the
Specifications.
7.2.3 The Technology will be of merchantable quality, will be fit for the
ordinary purposes for which such goods are used, and will pass without
objection in the trade.
7.3 During the one year following the Technology Acceptance Date, SurfNet
will immediately and in no event later than thirty (30) business days after
notice, provide, at no charge to YP, corrections, modifications or
additions to the Technology where YP notifies SurfNet in writing, of any
errors, omissions, deficiencies or inconsistencies in the Technology,
except for any changes made by YP. YP shall assist SurfNet in identifying
these circumstances on which such errors, omissions, deficiencies or
inconsistencies are discovered, and, if requested by SurfNet, shall
document their existence.
7.4 EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT, THERE ARE NO EXPRESS
WARRANTIES WHICH EXTEND BEYOND THE DESCRIPTION SET FORTH IN THIS AGREEMENT.
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8. Termination and Other Remedies.
8.1 In addition to any other rights and/or remedies that YP may have under
the circumstances, all of which are expressly reserved, YP may suspend
performance and/or terminate this Agreement immediately upon written notice
at any time if:
8.1.1 SurfNet is in material breach of this Agreement, and fails to cure
that breach within sixty (60) business days after written notice
thereof, in which case YP Net will have the right to withhold payment of
amounts otherwise owed by YP Net to SurfNet pursuant to this Agreement;
or
8.1.2 In the case of a failure to provide the technology or deliverables as
promised by the delivery dates as mutually agreed by the parties herein
or as extended than YP will be entitled to the return of all the
development money tendered herein.
8.1.3 SurfNet becomes insolvent or makes any assignment for the benefit of
creditors or similar transfer evidencing insolvency; or suffers or
permits the commencement of any form of insolvency or receivership
proceeding; or has any petition under any bankruptcy law filed against
it, which petition is not dismissed within sixty (60) business days of
such filing; or has a trustee or receiver appointed for its business or
assets or any part thereof.
8.2 In addition to any other rights and/or remedies that SurfNet may have
under the circumstances, all of which are expressly reserved, SurfNet may
suspend performance and/or terminate this Agreement immediately upon
written notice at any time if:
8.2.1 YP is in material breach of Section 3 of this Agreement, and fails to
cure that breach within thirty (30) business days after written notice
thereof; or
8.2.2 YP becomes insolvent or makes any assignment for the benefit of
creditors or similar transfer evidencing insolvency; or suffers or
permits the commencement of any form of insolvency or receivership
proceeding; or has any petition under any bankruptcy law filed against
it, which petition is not dismissed within sixty (60) business days of
such filing; or has a trustee or receiver appointed for its business or
assets or any part thereof.
8.3 In the event of termination or expiration of this Agreement for any
reason, any provision required to interpret the rights and obligations of
the Parties arising prior to termination of this Agreement shall survive
termination.
9. Confidentiality.
9.1 Nondisclosure.
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9.1.1 SurfNet shall maintain in confidence and shall not disclose to any
third Party the Confidential Information received pursuant to this
Agreement, without the prior written consent of YP. The foregoing
obligation shall not apply to: (i) information that is known to SurfNet
or independently developed by SurfNet prior to the time of disclosure;
(ii) information disclosed to SurfNet by a third party that has a right
to make such disclosure; (iii) information that becomes patented,
published or otherwise part of the public domain as a result of acts by
YP or by a third person who has the right to make such disclosure; or
(iv) information that is required to be disclosed by order of any
governmental authority or a court of competent jurisdiction; provided
that SurfNet shall notify YP if it believes such disclosure is required
and shall use its best efforts to obtain confidential treatment of such
information by the agency or court.
9.1.2 YP shall maintain in confidence and shall not disclose to any third
Party the Confidential Information received pursuant to this Agreement,
without the prior written consent of SurfNet. The foregoing obligation
shall not apply to: (i) information that is known to YP or independently
developed by YP prior to the time of disclosure; (ii) information
disclosed to YP by a third party that has a right to make such
disclosure; (iii) information that becomes patented, published or
otherwise part of the public domain as a result of acts by SurfNet or by
a third person who has the right to make such disclosure; or (iv)
information that is required to be disclosed by order of any
governmental authority or a court of competent jurisdiction; provided
that YP shall notify SurfNet if it believes such disclosure is required
and shall use its best efforts to obtain confidential treatment of such
information by the agency or court.
9.1.3 The receiving Party's obligations of confidentiality with respect to
Confidential Information that constitute trade secrets under the Uniform
Trade Secrets Act as adopted in the State of Georgia (or other similar
applicable law) shall run for as long as such information remains a
trade secret. The receiving Party's obligations of confidentiality with
respect to Confidential Information that is not covered under the
Uniform Trade Secrets Act as adopted in the State of Arizona (or other
similar applicable law), shall run for three (3) years from the date of
termination of this Agreement.
9.2 Use of Confidential Information.
9.2.1 SurfNet shall ensure that all of its employees, agents and
contractors having access to the Confidential Information of YP are
obligated in writing to abide by SurfNet's obligations hereunder.
SurfNet shall use the Confidential Information only for the purposes
contemplated under this Agreement.
9.2.2 YP shall ensure that all of its employees, agents and contractors
having access to the Confidential Information of SurfNet are obligated
in writing to abide by YP Net's obligations hereunder. YP shall use the
Confidential Information only for the purposes contemplated under this
Agreement.
9.3 Disparagement. Without having first sought and obtained YP Net's written
approval (which YP may withhold in its sole and absolute discretion),
SurfNet shall not, directly or indirectly, (i) trade upon this transaction
or any aspect of SurfNet's relationship with YP, or (ii) otherwise
deprecate YP technology.
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9.4 Press Release. Neither Party will issue any press release or make any
public announcement(s) relating in any way whatsoever to this Agreement or
the relationship established by this Agreement without the express prior
written consent of the other Party. However, the Parties acknowledge that
this Agreement, or portions thereof, may be required under applicable law
to be disclosed, as part of or an exhibit to a Party's required public
disclosure documents. If either Party is advised by its legal counsel that
such disclosure is required, it will notify the other in writing and the
Parties will jointly seek confidential treatment of this Agreement to the
maximum extent reasonably possible, in documents approved by both Parties
and filed with the applicable governmental or regulatory authorities.
Notwithstanding the foregoing, YP and SurfNet will cooperate to create a
mutually approved joint press release regarding the non-confidential
aspects of this Agreement, which press release shall be issued by each
Party on the Launch Date; provided, however, that the precise timing of
such press release shall be subject to the approval of YP (in its sole and
absolute discretion).
9.5 Injunctive Relief. Because damages at law will be an inadequate remedy
for breach of any of the covenants, promises and agreements contained in
this Article 9 hereof, the aggrieved Party shall be entitled to injunctive
relief in any state or federal court located within the City of Phoenix,
Arizona, including specific performance or an order enjoining the breaching
Party from any threatened or actual breach of such covenants, promises or
agreements. The rights set forth in this Section shall be in addition to
any other rights which the aggrieved Party may have at law or in equity.
10. Miscellaneous
10.1 Neither Party shall represent itself as the agent nor legal
representative of the other for any purpose whatsoever, and neither Party
shall have the right to create or assume for the other any obligation of
any kind. This Agreement shall not create or be deemed to create an agency,
partnership, franchise, employment relationship or joint venture between
the Parties. Each Party's employees who perform services related to this
Agreement shall remain under the exclusive direction and control of their
respective employer and shall receive such salaries, compensation and
benefits as their respective employer may from time to time determines.
Each Party shall have full and sole responsibility for its employees who
perform any service related to this Agreement with regard to compliance
with all applicable laws, rules and regulations governing such Party
relating to employment, labor, wages, benefits, taxes and other matters
affecting its employees,
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10.2 Any notice required or permitted to be given under this Agreement shall
be made in writing and shall be deemed to have been given or made if it is
in writing and is: (i) delivered in person, (ii) sent by same day or
overnight courier, (iii) mailed by certified or registered mail, return
receipt requested, postage prepaid, addressed to the Party at its address
set forth below or at such other address as such Party may subsequently
furnish to the other Party by notice hereunder, or (iv) delivered by
facsimile, the transmittal of which shall be confirmed by a telephone call
to the other Party and by dispatch of a confirming copy of the transmittal
by registered or certified mail, postage prepaid. Notices will be deemed
effective on the date of delivery in the case of personal delivery, or
three (3) business days after mailing, or on the date of dispatch in the
case of notification by facsimile (assuming confirmation of transmission).
The Parties' addresses for purposes of notice shall be as set forth above.
10.3 This Agreement shall be construed, enforced, performed and in all
respects governed by and in accordance with the laws in the State of
Arizona. In any action or suit to enforce any right or remedy under this
Agreement the prevailing Party shall be entitled to recover its reasonable
attorneys' fees and costs.
10.4 In the event any provision of this Agreement is rendered null, void or
otherwise ineffective in any given country or any political subdivision in
a given country, then (i) the Parties agree to negotiate in good faith an
acceptable alternative provision which reflects as closely as possible the
intent of the unenforceable provision and which shall apply only with
respect to that portion of the Territory in which the original provision is
rendered null, void or otherwise ineffective and (ii) notwithstanding, and
regardless of whether the Parties reach agreement after the good faith
negotiations described in clause (i) immediately above, the validity,
legality and enforceability of the remaining provisions of this Agreement
with respect to such portion of the Territory (and of all of the provisions
of this Agreement with respect to the balance of the Territory) shall not
in any way be affected or impaired thereby and shall remain in full force
and effect. Section and all other headings used herein are provided for
convenience only and are not to be given any legal effect or considered in
interpreting any provision of this Agreement. No provision of this
Agreement shall be interpreted against any Party because such Party or its
legal representative drafted such provision.
10.5 Neither Party may transfer, assign or sublicense this Agreement, or any
rights or obligations hereunder, whether by contract or by operation of
law, except with the express written consent of the other Party, and any
attempted transfer, assignment or sublicense by a Party in violation of
this Section shall be void. For purposes of this Agreement, an "transfer"
under this Section shall be deemed to include, without limitation, the
following: (a) a merger or any other combination of an entity with another
party, whether or not the entity is the surviving entity; (b) any
transaction or series of transactions whereby a third party acquires direct
or indirect power to control the management and policies of an entity,
whether through the acquisition of voting securities, by contract, or
otherwise; (c) the transfer of any rights or obligations in the course of a
liquidation or other similar reorganization of an entity; or (d) the
transfer to a subsidiary. Neither Party will unreasonably withhold or delay
its consent to a requested transfer, assignment or sublicense. Subject to
the provisions of this Section, this Agreement shall be binding upon and
inure to the benefit of each Party and their respective successors and
assigns.
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10.6 All rights and obligations of the Parties hereunder arc personal to
them. Except as otherwise specifically stated herein, this Agreement is not
intended to benefit, nor shall it be deemed to give rise to, any rights in
any third party.
10.7 Each Party shall be responsible for compliance with all applicable laws,
rules and regulations, if any, related to the performance or its
obligations under this Agreement.
10.8 No waiver of any breach of any provision of this Agreement shall
constitute a waiver of any prior, concurrent or subsequent breach of the
same or any other provisions hereof or thereof, and no waiver shall be
effective unless made in writing and signed by an authorized representative
of the waiving Party.
10.9 Neither Party shall be liable hereunder by reason of any failure or
delay in the performance of its obligations hereunder during any event of
force majeure.
10.10 This Agreement contains the entire agreement of the Parties with
respect to the premises, and may not be modified or amended except by a
written instrument executed by the Party sought to be charged or bound
thereby.
10.11 The Parties acknowledge that there may be instances during the Term
when, notwithstanding the Non-Disclosure Agreement referred to in Section
10.1 above, either party will not wish to disclose or have the other party
become aware (through inspection or otherwise) of certain confidential and
proprietary information of the other party relating to its business and/or
technology. In those instances, the Parties agree to work together in a
spirit of cooperation to work around such disclosure so that each party is
able to perform the Services under this agreement to the other party's
reasonable satisfaction and otherwise discharge their obligations under
this Agreement without making such disclosure.
11.Source Code Escrow. SurfNet agrees to deposit a full and complete electronic
copy of the source code to the Technology, and all updates and enhancements
thereto (the "Source Materials"), into escrow with a mutually agreed upon
escrow services company. The parties will enter into a mutually agreeable
escrow agreement. YP shall pay all fees for such escrow and SurfNet shall
bear its own costs in preparing the Source Materials for deposit. The escrow
agreement shall provide for the release of such Source Materials in the event
SurfNet ceases to do business in the normal course (except in the cases of
corporate restructuring, acquisition or reorganization under Chapter 11 of
the U.S. Bankruptcy Code). Subject to the terms and conditions of this
Agreement, upon release from escrow, YP shall have a nonexclusive, license to
use and modify the Source Materials and distribute the same. Title in all
Source Materials shall remain in SurfNet, and YP will take all reasonable
precautions to maintain the secrecy of the Source Materials unless Surfnet
becomes insolvent as defined herein.
Executed as of the date set forth above.
SURFNET MEDIA GROUP, INC. YP CORP.
By:_________________________ By:_____________________
Xxxxxx Xxxxx Xxxxx Xxxxxxxx
Chairman Chief Executive Office
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EXHIBIT A
SPECIFICATIONS, DELIVERY AND IMPLEMENTATION SCHEDULE
The toolbar shall contain the following:
1. Search controls consistent with the YP main website 2. Stock ticker
information 3. Rotating banners consisting of a YP banner and banners for
YP's
national customer base including audio commercials. 4. This will be based
on Surfnet's MetaphorTM patented technology.
The toolbar shall be similar to that shown in xxx.xxxxxxx.xxx on the Surfnet
proofing station.
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EXHIBIT B
CORRECTION PERIODS
Corrections shall be made as needed on an ongoing basis, Should such corrections
result in designing a new toolbar or one with new functionalities, revised
pricing will be instituted based on negotiations to be conducted at the time.
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