EXHIBIT 2.2
AGREEMENT
This Agreement ("Agreement") is made and entered into as of April ___, 2001 (the
"Effective Date") by and between VERTICALNET, INC. ("VerticalNet"), a
Pennsylvania corporation with its principal business address at 000 Xxxxxxx
Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxxxxxx 00000, and MICROSOFT CORPORATION
("Microsoft"), a Washington corporation with its principal business address at
Xxx Xxxxxxxxx Xxx, Xxxxxxx, Xxxxxxxxxx 00000, with reference to the following
facts:
RECITALS
A. VerticalNet and Microsoft have entered into a Co-Marketing
Agreement with an Effective Date of March 29, 2000, as amended (the
"Co-Marketing Agreement") relating to, among other things, VerticalNet's
portfolio of vertical business-to-business trade communities, and Microsoft's
bCentral and MSN sites, which is attached hereto as Exhibit A.
B. The parties desire to terminate the Co-Marketing Agreement and
enter into this Agreement.
AGREEMENT
Accordingly, VerticalNet and Microsoft, intending to be legally bound, hereby
agree as follows:
1. DEFINITIONS. For purposes of this Agreement, the following terms (when
initially capitalized) will have the indicated meanings:
1.1. "bCENTRAL" means that certain Web Site owned and operated by
Microsoft providing business-to-business services and accessed through the
domain (xxxx://xxx.xxxxxxxx.xxx), and any successor Web Site(s).
1.2. "LINK" means an embedded icon, object, graphic or text within
a Web Page that consists of a hypertext pointer to the URL address of a Web
Page.
1.3. "MSN SERVICE" means the aggregation of Web-based properties (as
such properties may change from time to time in Microsoft's sole discretion)
which is currently marketed by Microsoft as "The Microsoft Network" and/or
"MSN", and accessed through the domain (xxxx://xxx.xxx.xxx).
1.4. "TERM" means the period commencing on the Effective Date and
ending on June 30, 2002, subject to earlier termination pursuant to Section 5.1
below.
1.5. "URL" means a uniform resource locator which serves as the
address of a Web Page.
1.6. "VERTICALNET COMMUNITIES" means the VerticalNet portfolio of
wholly-owned Web Sites that consist of vertical business-to-business trade
communities which combine content, community interaction and the ability to
conduct business transactions on line, and
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which feature, among other elements, virtual "storefronts" licensed, developed
and maintained by VerticalNet for third parties.
1.7. "WEB PAGE" means content in the World Wide Web portion of the
Internet accessed via a single URL, and excluding content on other Web Pages
accessed via Links in said content.
1.8. "WEB SITE" means a collection of Web Pages related in some
manner and interconnected via Links within a specific URL domain.
2. TERMINATION AND PAYMENT.
2.1. TERMINATION OF CO-MARKETING AGREEMENT. VerticalNet and
Microsoft hereby agree that the Co-Marketing Agreement is terminated as of March
31, 2001.
2.1.1. Any amounts owed pursuant to the Co-Marketing
Agreement by one party to the other as of March 31, 2001 shall be deemed
terminated and released. Notwithstanding anything in the Co-Marketing Agreement
to the contrary, including but not limited to Section 7.2.3, the following
provisions of the Co-Marketing Agreement shall not survive termination: Sections
2.1.1, 2.1.2(d), 2.1.2(e), 2.1.3, 2.1.4, 2.1.5, 2.2, 2.3, 2.4, 2.5, 3, 4, 5.1.1,
5.1.2, 5.2.1, 5.2.2, 6, 7, 8.1 and 8.2. Notwithstanding anything in the
Co-Marketing Agreement or this Agreement to the contrary, only the following
provisions of the Co-Marketing Agreement shall survive the termination of the
Co-Marketing Agreement: Sections 2.1.2(a), 2.1.2(b), 2.1.2(c), 2.4.2, 2.5.2,
5.1.3, 5.1.4, 5.2.3, 5.2.4, 8.3, and 9 through 24.
2.1.2. The parties acknowledge and agree that, pursuant to
the Co-Marketing Agreement, VerticalNet has already paid Microsoft $8,399,110 in
consideration for goods and services that Microsoft has not yet provided. The
parties acknowledge and agree that such payment shall be allocated as follows:
(a) $4,000,000 shall be recognized by Microsoft in consideration for the License
Agreement for ClearLead executed by the parties concurrently herewith; and (b)
$4,399,110 shall be recognized by Microsoft for VerticalNet banner ads and other
promotional placements made by Microsoft in bCentral and other Microsoft Web
Sites through June 30, 2001.
2.1.3. Notwithstanding anything in the Co-Marketing
Agreement or this Agreement that is, or may be construed to be to the contrary,
in the event VerticalNet no longer sells Storefronts or E-Commerce Centers (as
such terms are defined in the Co-Marketing Agreement), or successor products
that are substantially similar to the Storefronts or E-Commerce Centers, it
shall deliver all data relating to and generated by the Storefronts or
E-Commerce Centers of Microsoft Customers (as defined in the Co-Marketing
Agreement), and Microsoft may freely use such data in connection with its
business.
2.2. PAYMENT. As a prepayment for the deployment of the products
set forth on Schedule A, Microsoft shall pay $40 million to VerticalNet.
VerticalNet shall deploy or upsell products on behalf of Microsoft within 12
months from the date hereof. The parties acknowledge and agree that Microsoft
has already paid VerticalNet $18,544,032 of the aforementioned $40 million.
Microsoft shall pay VerticalNet the balance of $21,455,968 upon the execution of
this Agreement.
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2.3. RELEASE BY VERTICALNET. VerticalNet, for itself and its past
and present affiliates, their respective successors and assigns, and the
directors, officers, employees, shareholders, members, partners and other equity
owners and holders and representatives of each of the foregoing (collectively,
the "VerticalNet Releasors"), does hereby remise, release and forever discharge
Microsoft, the past and present affiliates of Microsoft, their respective
successors and assigns, and the directors, officers, employees, shareholders,
members, partners and other equity owners and holders and representatives of
each of the foregoing (collectively, the "Microsoft Releasees"), of and from any
and all causes of action, actions, suits, damages, losses, liabilities, costs,
expenses, fees, invoices, accounts receivable, interest, indebtedness,
obligations, liens, claims and demands of whatever kind, known or unknown,
foreseeable or unforeseeable, liquidated or unliquidated, in law or in equity,
which the VerticalNet Releasors ever had, now have or hereafter can, shall or
may have against the Microsoft Releasees, for, by reason of, or arising out of,
any performance, breach or alleged breach of the Co-Marketing Agreement to and
including the date of this Agreement; provided, however, that this release does
not, and shall not be construed to, apply to any causes of action, actions,
suits, damages, losses, liabilities, costs, expenses, fees, invoices, accounts
receivable, interest, indebtedness, obligations, liens, claims and demands
arising out of: (i) any breach of, or any other failure to observe or perform
the provisions of this Agreement; or (ii) any breach of, or any other failure to
observe or perform, any of the provisions of the Co-Marketing Agreement which,
pursuant to Section 2.1.1 of this Agreement, survive the termination of the
Co-Marketing Agreement and the execution of this Agreement. VerticalNet, for
itself and the other VerticalNet Releasors, represents and warrants that no
VerticalNet Releasor has assigned or transferred, or purported to assign or
transfer, voluntarily, involuntarily, or by operation of law, any claim herein
released or any part or portion thereof. VerticalNet, for itself and the other
VerticalNet Releasors, covenants and agrees never to commence, prosecute, or
cause, permit, or advise to be commenced or prosecuted on behalf of any of the
VerticalNet Releasors, any action, suit or proceeding based upon any claim or
other matter herein released or any part or portion thereof. VerticalNet, for
itself and the other VerticalNet Releasors, agrees that all rights under Section
1542 of the California Civil Code and any similar statutes, rules or other legal
enactments of any State or territory of the United States, are hereby expressly
waived, it being the intent of the VerticalNet Releasors that the releases
herein shall not be limited in any manner by such statutes, rules or other legal
enactments. Said Section 1542 reads as follows: "A general release does not
extend to claims which the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if known by him must have
materially affected his settlement with the debtor."
2.4. RELEASE BY MICROSOFT. Microsoft, for itself and its past and
present affiliates, their respective successors and assigns, and the directors,
officers, employees, shareholders, members, partners and other equity owners and
holders and representatives of each of the foregoing (collectively, the
"Microsoft Releasors"), does hereby remise, release and forever discharge
VerticalNet, the past and present affiliates of VerticalNet, their respective
successors and assigns, and the directors, officers, employees, shareholders,
members, partners and other equity owners and holders and representatives of
each of the foregoing (collectively, the "VerticalNet Releasees"), of and from
any and all causes of action, actions, suits, damages, losses, liabilities,
costs, expenses, fees, invoices, accounts receivable, interest, indebtedness,
obligations, liens, claims and demands of whatever kind, known or unknown,
foreseeable or unforeseeable, liquidated or unliquidated, in law or in equity,
which the Microsoft Releasors ever had, now have or hereafter can, shall or may
have against the VerticalNet Releasees, for, by
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reason of, or arising out of, any performance, breach or alleged breach of the
Co-Marketing Agreement to and including the date of this Agreement; provided,
however, that this release does not, and shall not be construed to, apply to any
causes of action, actions, suits, damages, losses, liabilities, costs, expenses,
fees, invoices, accounts receivable, interest, indebtedness, obligations, liens,
claims and demands arising out of: (i) any breach of, or any other failure to
observe or perform the provisions of this Agreement; or (ii) any breach of, or
any other failure to observe or perform, any of the provisions of the
Co-Marketing Agreement which, pursuant to Section 2.1.1 of this Agreement
survive the termination of the Co-Marketing Agreement and the execution of this
Agreement. Microsoft, for itself and the other Microsoft Releasors, represents
and warrants that no Microsoft Releasor has assigned or transferred, or
purported to assign or transfer, voluntarily, involuntarily, or by operation of
law, any claim herein released or any part or portion thereof. Microsoft, for
itself and the other Microsoft Releasors, covenants and agrees never to
commence, prosecute, or cause, permit, or advise to be commenced or prosecuted
on behalf of any of the Microsoft Releasors, any action, suit or proceeding
based upon any claim or other matter herein released or any part or portion
thereof. Microsoft, for itself and the other Microsoft Releasors, agrees that
all rights under Section 1542 of the California Civil Code and any similar
statutes, rules or other legal enactments of any State or territory of the
United States, are hereby expressly waived, it being the intent of the Microsoft
Releasors that the releases herein shall not be limited in any manner by such
statutes, rules or other legal enactments. Said Section 1542 reads as follows:
"A general release does not extend to claims which the creditor does not know or
suspect to exist in his favor at the time of executing the release, which if
known by him must have materially affected his settlement with the debtor."
2.5. NO DISPARAGEMENT. Each party agrees, for itself, its
affiliates, and its and their respective successors and assigns, and the
directors, officers, employees, shareholders, members, partners and other equity
owners and holders and representatives of each of the foregoing, not to make any
statements or comments of a disparaging nature to third parties (including any
of their customers) regarding the other party, any affiliate of the other party,
any of their respective successors or assigns, any director, officer or employee
of any of the foregoing, any current or planned product or service of any of the
foregoing, or any prospects, condition or conduct of any of the foregoing.
2.6. EQUITY INVESTMENT INSTRUMENTS NOT AFFECTED. Neither the
termination of the Co-Marketing Agreement, nor any provision of this Agreement
shall affect in any manner the Series A Convertible Preferred Stock Purchase
Agreement dated as of April 7, 2000 (the "Stock Purchase Agreement") between
VerticalNet and Microsoft, any of the agreements, documents or instruments
executed and/or delivered in connection with the Stock Purchase Agreement (the
"Ancillary Documents"), or any of the transactions contemplated by the Stock
Purchase Agreement or any of the Ancillary Documents. The Stock Purchase
Agreement and each of the Ancillary Documents is hereby ratified and confirmed
to be in full force and effect.
3. MARKET DEVELOPMENT PLAN.
3.1. IMPLEMENTATION. During the Term of this Agreement, each party
shall pay $10,000,000 to the other party towards such other party's products
and/or services in furtherance of a Market Development Plan ("MDP") for various
activities such as, and without limitation: marketing placement on certain Web
Sites; use of key words and high-yield words in search
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engine capabilities on certain Web Sites; and/or the development of new products
and technology. Such activities shall be in accordance with the MDP. The parties
will use good faith efforts to finalize the MDP by May 31, 2001. Expenditures
under the MDP shall begin as of July 1, 2001. The MDP will include a cash flow
schedule, and will include an explanation of the costs associated with each
activity. The parties shall contribute to the MDP on a 1:1 ratio (i.e.,
$10,000,000 each), and such funds will be spent in accordance with the MDP. The
parties acknowledge and agree that Microsoft's participation in the MDP is
contingent upon VerticalNet's compliance with the provisions of Section 4.1.
3.2. MICROSOFT MARKS. Microsoft hereby grants to VerticalNet during
the Term a non-exclusive, non-transferable (except in connection with a
permitted transfer of this Agreement as a whole), personal, worldwide license to
use the Microsoft trademarks, service marks and logos depicted in Exhibit B, as
may be amended from time to time (the "Microsoft Marks"), solely in connection
with its activities pursuant to the MDP. Such usage must be in accordance with
the trademark and logo usage guidelines set forth in Exhibit C.
3.2.1. Except as provided in this Section 3.2, this
Agreement does not grant VerticalNet any right, title, interest, or license in
or to any of Microsoft's names, logos, trade dress, designs, or other trademarks
and all uses of the Microsoft Marks will inure solely to the benefit of
Microsoft.
3.2.2. VerticalNet acknowledges Microsoft's sole ownership
of the Microsoft Marks worldwide and all associated goodwill. Nothing in this
Agreement or in the performance thereof, or that might otherwise be implied by
law, shall operate to grant VerticalNet any right, title, or interest in or to
the Microsoft Marks other than as specified in the limited license grant herein.
VerticalNet hereby assigns to Microsoft all rights it may acquire by operation
of law or otherwise in the Microsoft Marks, including all applications or
registrations therefore, along with the goodwill associated therewith.
3.2.3. Microsoft has the sole right to and in its sole
discretion may commence, prosecute or defend, and control any action concerning
any Microsoft Xxxx. VerticalNet agrees not to contest the validity of, by act or
omission jeopardize, or take any action inconsistent with, Microsoft's rights or
goodwill in any Microsoft Xxxx in any country, including attempted registration
of any Microsoft Xxxx, or use or attempted registration of any confusingly
similar xxxx.
3.2.4. VerticalNet agrees to maintain the quality and
performance of its products and services at a level that meets all terms of this
Agreement and meets or exceeds standards of quality and performance generally
accepted in the industry. VerticalNet shall fully correct and remedy any
deficiencies in its use of the Microsoft Marks, upon reasonable notice from
Microsoft.
3.3. VERTICALNET MARKS. VerticalNet hereby grants to Microsoft
during the Term a non-exclusive, non-transferable (except in connection with a
permitted transfer of this Agreement as a whole), personal, worldwide license to
use the VerticalNet trademarks, service marks and logos depicted in Exhibit B,
as may be amended from time to time (the "VerticalNet
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Marks"), solely in connection with its activities pursuant to the MDP. Such
usage must be in accordance with the trademark and logo usage guidelines set
forth in Exhibit C.
3.3.1. Except as provided in this Section 3.3, this
Agreement does not grant Microsoft any right, title, interest, or license in or
to any of VerticalNet's names, logos, trade dress, designs, or other trademarks
and all uses of the VerticalNet Marks will inure solely to the benefit of
VerticalNet.
3.3.2. Microsoft acknowledges VerticalNet's sole ownership
of the VerticalNet Marks worldwide and all associated goodwill. Nothing in this
Agreement or in the performance thereof, or that might otherwise be implied by
law, shall operate to grant Microsoft any right, title, or interest in or to the
VerticalNet Marks other than as specified in the limited license grant herein.
Microsoft hereby assigns to VerticalNet all rights it may acquire by operation
of law or otherwise in the VerticalNet Marks, including all applications or
registrations therefore, along with the goodwill associated therewith.
3.3.3. VerticalNet has the sole right to and in its sole
discretion may commence, prosecute or defend, and control any action concerning
any VerticalNet Xxxx. Microsoft agrees not to contest the validity of, by act or
omission jeopardize, or take any action inconsistent with, VerticalNet's rights
or goodwill in any VerticalNet Xxxx in any country, including attempted
registration of any VerticalNet Xxxx, or use or attempted registration of any
confusingly similar xxxx.
3.3.4. Microsoft agrees to maintain the quality and
performance of its services offered on or through the MSN Service, bCentral and
Microsoft-owned Web Sites at a level that meets all terms of this Agreement and
meets or exceeds standards of quality and performance generally accepted in the
industry. Microsoft shall fully correct and remedy any deficiencies in its use
of the VerticalNet Marks, upon reasonable notice from VerticalNet.
4. VERTICALNET USES OF MICROSOFT TECHNOLOGY.
4.1. ADOPTION AND USE. During the Term, VerticalNet agrees (on a
non-exclusive basis) to use commercially reasonably efforts to adopt and use the
Microsoft products listed in Exhibit D (and successor versions made available to
VerticalNet during the Term), to operate VerticalNet's business when appropriate
and feasible (i.e., when the applicable Microsoft product has the requisite
functionality and performance to meet the needs of VerticalNet). The parties
recognize that VerticalNet's adoption and use of the Microsoft products may be
subject to technical feasibility or third-party contractual limitations. During
the Term, if any third party contract prohibits or restricts VerticalNet's
adoption and use of Microsoft products, VerticalNet agrees to use good faith
efforts to adopt and use the corresponding Microsoft products when the
contractual prohibition or restriction expires or is terminated, provided that
the corresponding Microsoft products have the requisite functionality and
performance to meet the needs of VerticalNet. In addition, during the Term
VerticalNet agrees to use good faith efforts to encourage its subsidiaries,
affiliates and other contractual business partners to use Microsoft products and
services.
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4.2. BIZTALK FRAMEWORK. During the Term, VerticalNet agrees to
adhere to the Microsoft BizTalk Framework.
4.3. CERTIFIED SOLUTION PROVIDER. During the Term, VerticalNet will
participate as a "Partner" in the Microsoft Certified Solution Provider program
and maintain certifications for the Microsoft products used by VerticalNet.
4.4. END USER AGREEMENTS. All uses of Microsoft products are
subject to Microsoft's standard end user license agreements applicable to the
respective Microsoft products.
4.5. POST-TERM PRODUCTS AND SUPPORT SERVICES. Following expiration
of the Term, Microsoft agrees to continue to offer to VerticalNet the products
and support services offered to VerticalNet during the Term. Microsoft shall
offer said products and support services to which the products and support
services are offered to VerticalNet during the Term; provided, however, that
pricing for said products and support services shall be Microsoft's
then-standard volume discount pricing for similarly situated customers entitled
to "preferred pricing" discounts.
5. TERM AND TERMINATION.
5.1. TERM. The Term of this Agreement shall commence as of the
Effective Date and shall continue through June 30, 2002 unless terminated
earlier as provided in this Section 5. Prior to March 31, 2002, the parties
shall meet to discuss a renewal of this Agreement and the terms that would
govern any such renewal.
5.2. TERMINATION. Either party may terminate this Agreement
immediately upon written notice at any time if:
5.2.1. The other party is in material breach of any material
warranty, term, condition or covenant of this Agreement, and fails to cure that
breach within 45 days after written notice from the non-breaching party (five
days for a material breach of Section 9 or the NDA (defined in Section 9
below)); or
5.2.2. The other party 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 proceeding or petition is not dismissed within sixty (60) days
of such filing; or has a trustee or receiver appointed for its business or
assets or any part thereof.
5.2.3. In the event of termination or expiration of this
Agreement for any reason, the following provisions of this Agreement will
survive termination or expiration: Sections 1, 2, 4.5, 3.2.2, 3.3.2, 5.2.3, and
6 through 20; any payment obligations of the parties hereunder accruing prior to
the date of termination or expiration; and any other provision herein expressly
surviving termination or expiration or necessary to interpret the rights and
obligations of the parties in connection with the termination or expiration of
the Term of this Agreement. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR
DAMAGES OF ANY SORT RESULTING SOLELY FROM EXERCISING ITS RIGHT TO TERMINATE OR
NOT RENEW THIS AGREEMENT IN ACCORDANCE WITH THIS SECTION 5.
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6. AUDITS.
During the Term, and for a period of 12 months following the expiration or
termination of the Term, each party agrees to keep all usual and proper records
related to amounts payable to the other party pursuant to this Agreement. During
the Term and for a period of 12 months following the expiration or termination
of the Term, each party shall have the right to cause an audit and/or inspection
to be made of such records of the other party. Any such audit or inspection will
be conducted by an independent certified public accountant (other than on a
contingent fee basis, which auditor must be approved by the audited party such
approval not to be unreasonably withheld or delayed) with at least 5 business
days' prior written notice by the auditing party to the party being audited and
will be conducted during normal business hours in such a manner as to not
unreasonably interfere with the normal business operations of the party audited.
If a party has audited the other party under this Section 6, the party that
conducted the audit may not audit the other party within 12 months after the
completion of the prior audit. Any audit will be paid for by the auditing party
unless material discrepancies are disclosed. "Material" will mean a discrepancy
of 5% or higher between amounts payable and the amounts received by the party to
whom payment is owed. If discrepancies are disclosed the audited party will
promptly pay any underpayment detected in the audit plus interest thereon at the
rate of the prime lending rate plus 2%. For any material discrepancy, the
audited party must also reimburse the auditing party for the reasonable costs
associated with the audit. Any overpayment discovered in an audit will be
promptly refunded to the party from whom the overpayment was received.
7. REPRESENTATIONS AND WARRANTIES.
Each party represents and warrants to the other that:
(a) it has the requisite corporate right, power and authority to
enter into and perform this Agreement;
(b) it is not a party to any agreement or understanding and knows
of no law or regulation that would prohibit it from entering into and performing
this Agreement or that would conflict with this Agreement; and
(c) this Agreement has been executed by its duly authorized
representative.
8. INDEMNIFICATION.
8.1. INDEMNIFICATION BY VERTICALNET. VerticalNet will at its
expense and Microsoft's request, defend and/or settle any third-party claim or
action brought against Microsoft, and Microsoft's affiliates, directors,
officers, employees, licensees, agents and independent contractors to the
extent: (i) relating in any way to the VerticalNet family of Web Sites, and any
services provided by VerticalNet in connection with the VerticalNet family of
Web Sites including, without limitation, any third party claim or action
alleging that the VerticalNet family of Web Sites, or any portion thereof, or
any service provided by VerticalNet violates any applicable federal, state,
provincial or local laws, regulations or ordinances, or infringes the
copyrights, trademarks, service marks or other proprietary rights of any third
party; or (ii) arising from any breach, or alleged breach that if true would
constitute a breach, of a VerticalNet
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warranty or representation or covenant set forth in this Agreement
(collectively, "VerticalNet Claims"). VerticalNet will indemnify and hold
Microsoft harmless from and against any costs, damages and fees reasonably
incurred by Microsoft in the defense and/or settlement of the VerticalNet
Claims, including but not limited to reasonable fees of attorneys and other
professionals, to the extent attributable to such VerticalNet Claims, subject to
Section 8.3. Microsoft will provide VerticalNet reasonably prompt notice in
writing of any such VerticalNet Claims and provide VerticalNet with reasonable
information and assistance, at VerticalNet's expense, to help VerticalNet to
defend such VerticalNet Claims.
8.2. INDEMNIFICATION BY MICROSOFT. Microsoft will, at its expense
and VerticalNet's request, defend and/or settle any third-party claim or action
brought against VerticalNet, and VerticalNet's affiliates, directors, officers,
employees, licensees, agents and independent contractors to the extent: (i)
relating in any way to the MSN Service, bCentral, Xxxxxxxxx.xxx or any other Web
Site within the Microsoft family of Web Sites, and any services provided by
Microsoft in connection with the MSN Service, bCentral, Xxxxxxxxx.xxx or any
other Web Site within the Microsoft family of Web Sites, including, without
limitation, any third party claim or action alleging that the MSN Service,
bCentral, Xxxxxxxxx.xxx or any other Web Site within the Microsoft family of Web
Sites, and any services provided by Microsoft in connection with the MSN
Service, bCentral, Xxxxxxxxx.xxx or any other Web Site within the Microsoft
family of Web Sites, violates any applicable federal, state, provincial or local
laws, regulations or ordinances, or infringes the copyrights, trademarks,
service marks or other proprietary rights of any third party; or (ii) arising
from any breach, or alleged breach that if true would constitute a breach, of a
Microsoft warranty or representation or covenant set forth in this Agreement
(collectively, "Microsoft Claims"). Microsoft will indemnify and hold
VerticalNet harmless from and against any costs, damages and fees reasonably
incurred by VerticalNet in the defense and/or settlement of the Microsoft
Claims, including but not limited to reasonable fees of attorneys and other
professionals, to the extent attributable to such Microsoft Claims, subject to
Section 8.3. VerticalNet will provide Microsoft reasonably prompt notice in
writing of any such Microsoft Claims and provide Microsoft with reasonable
information and assistance, at Microsoft's expense, to help Microsoft to defend
such Microsoft Claims.
8.3. INDEMNIFICATION PROCESS. If any action shall be brought
against a party (the "Claimant") in respect to which indemnity may be sought
from the another party (the "Indemnifying Party") pursuant to the provisions of
this Section 8, the Claimant shall promptly notify the Indemnifying Party in
writing, specifying the nature of the action and the total monetary amount
sought or other such relief as is sought therein. The Claimant shall cooperate
with the Indemnifying Party at the Indemnifying Party's expense in all
reasonable respects in connection with the defense and/or settlement of any such
action. The Indemnifying Party shall, upon written request by the Claimant,
undertake to control and conduct all proceedings or negotiations in connection
therewith, assume and control the defense thereof, and if it so undertakes, it
shall also undertake all other required steps or proceedings to settle or defend
any such action, including the employment of counsel which shall be reasonably
satisfactory to Claimant, and payment of all reasonably incurred expenses.
Claimant shall have the right to employ separate counsel to provide input into
the defense, at Claimant's own cost. The Indemnifying Party shall pay directly
or, if requested, reimburse Claimant upon demand for any payments made or
damages suffered by Claimant, based upon the judgment of any court of competent
jurisdiction or pursuant to a bona fide compromise or settlement of claims,
demands,
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or actions for which Claimant is entitled to indemnification hereunder. The
Indemnifying Party shall not settle any claim or action under this Section 8 on
Claimant's behalf without first obtaining Claimant's written permission, which
permission shall not be unreasonably withheld or delayed, however if Claimant
withholds or unreasonably delays approval of Indemnifying Party's settlement
offer, Claimant shall defend that claim or action and Claimant hereby waives any
right to indemnity hereunder from the Indemnifying Party in excess of the
settlement offer amount. A Claimant may settle any claim or action hereunder,
but the Indemnifying party will not be responsible for any such settlement
unless it shall have approved the settlement, in writing and in advance, which
approval will not be unreasonably withheld or delayed. Each party agrees not to
publicize any settlement without first obtaining the other party's written
permission, which permission will not be unreasonably withheld.
8.4. LIMITATION ON DAMAGES. TO THE MAXIMUM EXTENT PERMITTED BY LAW,
EXCEPT AS SET FORTH IN THE NEXT SENTENCE, NEITHER PARTY WILL BE LIABLE TO THE
OTHER FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL, OR PUNITIVE DAMAGES OF ANY
NATURE ARISING OUT OF OR RELATED TO THIS AGREEMENT, INCLUDING WITHOUT LIMITATION
LOSS OF PROFITS, EVEN IF ADVISED OF THE POSSIBILITY THEREOF. THIS SECTION SHALL
NOT APPLY TO ANY PARTY'S (A) BREACH OF ITS OBLIGATIONS UNDER SECTION 9 OR THE
NDA AND ANY LIABILITIES ASSOCIATED THEREWITH, AND (B) INDEMNIFICATION
OBLIGATIONS AND ASSOCIATED LIABILITIES UNDER SECTION 8.
9. CONFIDENTIALITY.
9.1. EXISTING NON-DISCLOSURE AGREEMENT. Microsoft and VerticalNet
acknowledge and agree that the terms and conditions of the Microsoft Corporation
Non-Disclosure Agreement, that was attached as Exhibit I to the Co-Marketing
Agreement ("NDA"), are incorporated by reference into this Agreement. If any of
the incorporated terms of the NDA are inconsistent with or conflict with this
Agreement, then the terms of this Agreement shall control.
9.2. PERMITTED DISCLOSURES. Each Party may disclose the terms and
conditions of this Agreement to its employees, affiliates and its immediate
legal and financial consultants on a need to know basis as required in the
ordinary course of that party's business, provided that such employees,
affiliates and consultants agree in advance of disclosure to be bound by this
Section 9, or, in the case of its attorneys, are bound by obligations of
confidentiality under applicable state law or otherwise. Further, the parties
acknowledge that this Agreement, or portions thereof, may be required under
applicable laws, rules or regulations to be disclosed, as part of or as an
exhibit to a party's required public disclosure documents. If any 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 filed
with the applicable governmental or regulatory authorities.
9.3. EQUITABLE RELIEF. Each Party acknowledges that monetary
damages may not be a sufficient remedy for unauthorized disclosure of the terms
and conditions of this Agreement and that each Party may seek, without waiving
any other rights or remedies and without posting any bond or other security,
such injunctive or equitable relief as may be deemed proper by a court of
competent jurisdiction.
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10. PUBLICITY.
Except as may be required by applicable laws, rules or regulations (including
those arising under any securities laws), neither party will originate any
publicity, news release or other public announcement, written or oral, whether
to the public press or otherwise, concerning the relationship between the
parties or the transactions described in this Agreement without the prior
written consent of the other party, which consent shall not be unreasonably
withheld or delayed. In the event disclosure is required by applicable law,
rules or regulations, then the party required to so disclose such information
shall, to the extent possible, provide to the other party for its approval (such
approval not to be unreasonably withheld) a written copy of such public
announcement as soon as practicable prior to disclosure. As stated in Section
9.2, the parties acknowledge that this Agreement, or portions thereof, may be
required under applicable laws, rules or regulations to be disclosed, as part of
or as an exhibit to a party's required public disclosure documents. If any 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 filed
with the applicable governmental or regulatory authorities.
11. NO WAIVER.
No delay or omission to exercise any right, power or remedy accruing to
VerticalNet or Microsoft, upon any breach or default under this Agreement, will
impair any such right, power or remedy, nor will it be construed to be a waiver
of any such breach or default, or any acquiescence therein, or of any similar
breach or default thereafter occurring; nor will any waiver of any single breach
or default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character by VerticalNet or Microsoft of any breach or default under this
Agreement, or any waiver by VerticalNet or Microsoft of any provisions or
conditions of this Agreement, must be in writing and will be effective only to
the extent specifically set forth in writing, and all remedies, either under
this Agreement, or by law or otherwise afforded to VerticalNet or Microsoft,
will be cumulative and not alternative.
12. SEVERABILITY.
If any provision of this Agreement is held by a tribunal of competent
jurisdiction to be illegal, invalid, or otherwise unenforceable in any
jurisdiction, then to the fullest extent permitted by law (i) the same shall not
effect the other terms or provisions of this Agreement, (ii) such term or
provision shall be deemed modified to the extent necessary in the tribunal's
opinion to render such term or provision enforceable, and the rights and
obligations of the parties shall be construed and enforced accordingly,
preserving to the fullest extent the intent and agreements of the parties set
forth herein and (iii) such finding of invalidity, illegality or
unenforceability shall not affect the validity, legality or enforceability of
such term or provision in any other jurisdiction.
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13. ASSIGNMENT.
VerticalNet may not assign this Agreement, or any rights or obligations
hereunder, whether by operation of contract, law or otherwise, except with the
express written consent of Microsoft, and any attempted assignment by
VerticalNet in violation of this Section shall be void. For purposes of this
Agreement, an "assignment" by VerticalNet under this Section shall be deemed to
include, without limitation, each of the following: (a) a change in beneficial
ownership of VerticalNet of greater than thirty-five percent (35%) (whether in a
single transaction or series of related transactions) if VerticalNet is a
partnership, trust, limited liability company or other like entity; (b) a merger
of VerticalNet with another party, whether or not VerticalNet is the surviving
entity; (c) the acquisition of more than thirty-five percent (35%) of any class
of VerticalNet's voting stock (or any class of non-voting security convertible
into voting stock) by another party (whether in a single transaction or series
of related transactions); and (d) the sale of more than fifty percent (50%) of
VerticalNet's assets (whether in a single transaction or series of related
transactions). In the event of such assignment or attempted assignment by
VerticalNet, Microsoft shall have the right to immediately terminate this
Agreement.
14. NOTICES.
All notices and other communications required or permitted hereunder will be in
writing and will be: (i) delivered personally, (ii) delivered by facsimile
transmission with transmittal confirmation and with concurrent delivery via
another method specified in this sentence, (iii) delivered by a nationally
recognized overnight courier with written verification of receipt, or (iv)
delivered by certified or registered mail, return receipt requested, in each
case with all delivery or postal charges pre-paid. Notices will be effective
when received, and will be addressed: (i) if to the Microsoft, at Microsoft's
address as set forth in the initial paragraph of this Agreement, Attention:
General Manager, bCentral Business Development (Fax (000) 000-0000), with a copy
to Law and Corporate Affairs Department - Product Development and Marketing, at
Microsoft's address as set forth in the initial paragraph of this Agreement, or
(ii) if to VerticalNet, at VerticalNet's address set forth in the initial
paragraph of this Agreement, Attention: General Counsel (Fax (000) 000-0000, or
at such other address as one party may have furnished to the other in writing.
15. ENTIRE AGREEMENT.
This Agreement constitutes the entire understanding and agreement among the
parties with regard to the subject matter hereof, and supersede any and all
prior and contemporaneous agreements and understandings among the parties,
including without limitation, the Co-Marketing Agreement.
16. GOVERNING LAW & ATTORNEYS' FEES.
This Agreement will be governed by and construed and enforced in accordance with
the laws of the State of Delaware as they apply to contracts entered into and
wholly to be performed within such state, and without reference to its
principles of conflicts of law or choice of law. In the event of any litigation
in a court of competent jurisdiction arising in connection with this
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Agreement, the prevailing party in judgment will be entitled to recover
reasonable legal fees and costs in connection with such action including any
appeals.
17. EXPENSES.
VerticalNet and Microsoft will each bear all expenses that such respective party
has incurred or incurs in connection with this Agreement and the transactions
contemplated hereby, and any amendments or waivers.
18. TITLES.
The titles of the Sections and subsections of this Agreement are for convenience
of reference only and are not to be considered in construing this Agreement.
19. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which will
be an original and all of which together will constitute one instrument. This
Agreement shall become binding when any one or more counterparts hereof,
individually or taken together, bear the signatures of both parties hereto. For
the purposes hereof, a facsimile copy of this Agreement, including the signature
pages hereto, shall be deemed an original.
20. RELATIONSHIP OF THE PARTIES.
This Agreement is not intended to create any joint venture, partnership, agency
or employee-employer relationship.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed
and delivered by their proper and duly authorized officers as of the day and
year first written above.
VERTICALNET, INC.
a Pennsylvania corporation
By:
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Name:
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Title:
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MICROSOFT CORPORATION
a Washington corporation
By:
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Name:
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Title:
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