Confidential treatment has been requested for certain portions of this exhibit. Omitted portions have been filed separately with the Commission.
This Exclusive Sponsorship Agreement ('Agreement') is entered into as of _____,_____,_____(M/D/Y) (the 'Effective Date') by and between AAA, Inc., a ______ corporation ('AAA') with offices at ____(address) and BBB, Inc., a ______ corporation, ('BBB') with offices at _________(address). AAA and BBB may be referred to generically as a 'Party', or collectively as 'Parties'.
WHEREAS, BBB operates a site on the World Wide Web and America On Line, which contains channels including but not limited to Parent Soup, Parents Place, Better Health and Armchair Millionaire as well as career, fitness & beauty, food, relationships and work from home channels (collectively the 'Network').
WHEREAS, AAA seeks to drive Network users ('Users') to its World Wide Web site (the 'AAA Web site'), to acquire repeat customers, to increase book purchases focusing on lifestyle categories such as parenting, health, finance and career, and to reinforce the AAA brand as the 'Earth's Biggest Bookstore'.
WHEREAS, BBB and AAA desire to enter into this Agreement where by AAA shall be an exclusive sponsor and retailer throughout the Network (the 'Program') subject to the terms and conditions stated herein.
Section 1. Exclusivity
For the term of this Agreement and any subsequent renewal thereto, BBB agrees that AAA shall be the exclusive book sponsor and retailer, with respect to entities whose primary business is that of a book retailer, throughout the Network and that no advertising, links, promotional information or marketing materials for or relating to any of the entities listed in Exhibit A hereto or any other individual, entity or web site which derives more than ten percent of its annual gross revenue from the sales of books or magazines (whether in printed, audio, electronic or other format) or is primarily functioning or primarily known as a seller of books or magazines, shall be placed or displayed on the Network. In addition, BBB will not sell, or permit any other person or entity to sell, any books or magazines on the Network; or (b) use, or permit any other person or entity to use, all or any part of BBB's customer information database to sell any books or magazines; provided, that such books or magazines are available from AAA. Nothing herein shall (a) prevent an author or subject matter expert from discussing or promoting the sale of a particular book or magazine on the Network, provided that such author or expert does not recommend or promote the purchase of -such book or magazine from a specific party other than AAA; or (b) prevent any other sponsor from selling books or magazines on its own web site, provided that the sale of such books or magazines is not promoted or referenced on the Network. In the event that BBB produces or publishes any private label books, BBB will offer AAA the first right of refusal as to the ability to sell such books before such opportunity is offered to any third party. AAA's sponsorship and exclusivity with regard to products other than books or magazines shall be determined on a case by case basis, whereby AAA shall provide BBB with written notice of any other products it seeks to include within the scope of this Agreement, and BBB shall have sole discretion as to whether such other product(s) shall be included.
Section 2. Term and Termination
2.1 Term
The initial term of this Agreement (the 'Initial Term') shall commence on the Effective Date and shall continue for a period of twelve (12) months from the date that all of the Promotional Placements and Opportunities described in Section 3 below are available on the Network (the 'Implementation Date') unless terminated earlier or extended as provided herein. Promptly after the Implementation Date has occurred, the parties shall in good faith agree upon and document in writing such Implementation Date. Upon mutual agreement of the parties within no less than sixty (60) days prior to the expiration date of the Initial Term, the Agreement may be renewed for an additional twelve (12) month term (the 'Renewal Term'). The Parties agree to discuss, in good faith, prior to the end of the Initial Term, the status of the relationship of the Parties and the terms of the Agreement. Notwithstanding the foregoing, if the parties agree to renew the Agreement, the terms of the Agreement, including without limitation the compensation terms stated in Section 7 below, shall remain in full force and effect without amendment. However, if prior to sixty (60) but no more than ninety (90) days before the expiration of the Initial Term, BBB receives a bona fide offer from a third party to become the exclusive book sponsor and retailer throughout the Network on financial terms more advantageous to BBB than those stated in Section 7 herein and provides AAA with written notice and a copy of such offer, AAA must notify BBB in writing within thirty (30) days of receiving such notice whether it is willing to amend the Agreement to match the financial terms offered by such third party for the Renewal Term. If AAA notifies BBB that it is willing to renew the Agreement upon the amended financial terms, then those terms shall be applied to the Renewal Term, notwithstanding anything in this Agreement to the contrary. If AAA does not notify BBB that it is willing to amend the financial terms of the Agreement for the Renewal Term within thirty (30) days of receiving such notice, then BBB shall have fifteen (15) days thereafter to give AAA written notice to terminate this Agreement at the end of the Initial Term and may then enter into an Agreement with such third party on the amended terms offered to AAA.
2.2 Termination
In the event of a material breach by either party of any term of this Agreement, the non breaching party may terminate this Agreement by written notice to the breaching party if the breaching party fails to cure such material breach within thirty (30) days of receipt of written notice thereof. Either party may terminate this Agreement effective upon written notice stating its intention to terminate in the event the other party (a) ceases to function as a going concern or to conduct operations in the normal course of business, or (b) has a petition filed by or against it under any state or federal bankruptcy or insolvency law which petition has not been dismissed or set aside within sixty (60) days of its filing.
2.3 Survival
Sections 9, 11, 12, 13, 15 and 16 hereof shall survive any termination of this Agreement.
Section 3. Promotion
Throughout the term of this Agreement, and any extensions or renewals thereof, BBB will provide links, advertisements and other promotional placements and opportunities to promote AAA and its sponsorship of the Network (collectively the 'Promotional Placements and Opportunities') in a manner to be agreed upon by the parties. The Promotional Placements and Opportunities provided by BBB will at a minimum be no less prominent or frequent than those provided to any other Network sponsor or advertiser. The parties will cooperate in good faith to develop and implement such Promotional Placements and Opportunities and to maximize the effectiveness of all such Promotional Placements and Opportunities. The Promotional Placements and Opportunities as described herein shall be available on the Network no later than May 31 and shall include, without limitation, the following promotions:
3.1 Book Club Sponsorship
3.1.1 BBB shall create and make available a Network-wide Book Club ('Book Club') which shall be sponsored exclusively by AAA and accessible from the BBB.com home page located at the URL: //www.BBB.com. Members of the Network will be invited to become Book Club Members ('Book Club Members') and those who join the Book Club will be eligible for special promotional benefits including but not limited to book-related gifts and discounts from BBB and AAA. Book Club Members will also have the opportunity to submit questions to featured book authors. AAA will cooperate with BBB in the implementation of these and other special promotional premiums in connection with the Book Club, but will have no financial obligation to BBB for such promotions. Subject to availability and budget, the Parties agree to work together to produce and promote co-branded premiums.
3.1.2 BBB, its editors and producers, shall select book titles from the Ainazon.com library which shall be prominently featured in the Book Club throughout the Network ('Selected Titles') and shall provide a direct link to the AAA Web Site for the purchase of such Selected Titles. Selected Titles may be works of fiction or non-fiction and it is anticipated that selection of Selected Titles may also be made by Book Club Members. BBB shall select and feature those titles which concern subjects and/or issues that appeal to the Users and/or which have been published within 3 months of the date the title is featured and/or would appear on the Network for the first time anywhere online.
3.1.3 In connection with Selected Titles, BBB shall post excerpts from featured authors and shall host message boards and chats to be moderated by a Book Club leader and to be accessed by Book Club Members.
3.1.4 BBB shall also include a 'Click here to buy from AAA' icon to be placed throughout the Book Club areas of the Network which shall link Users to the AAA Web site.
3.2 Channel Book Lists
Throughout the channels of the Network, BBB shall promote reading lists ('Reading Lists'), on a rotating basis, of topic-specific titles which are appropriate for those given sub channels of the Network channel on which the Reading Lists are featured. The 'Click here to buy from AAA' icon will also appear in connection with the Reading Lists.
3.3 Search Engine Integration
BBB shall fully integrate the AAA database of available titles into an BBB search database, resulting in identical queries being carried to both the BBB search database and that of AAA. When a User accesses the BBB search engine, a 'Click here to find Related Books' icon will appear as part of the search results, allowing a User to view a list of related titles for purchase. In addition, BBB will reserve the key words listed in Exhibit B exclusively for AAA and will display an AAA banner (in addition to the AAA 'Click here to find Related Books' icon) whenever one of these key words is used in a search query of the BBB site.
3.4 Shopping
BBB shall prominently feature AAA, its products and services, in its Shopping Channel. During the term of this Agreement, AAA shall be listed in the Shopping Channel with a branded button which shall link Users directly to the AAA Web site.
3.5 Newsletter
AAA will have the opportunity to include a promotional message of its choosing, subject to BBB's reasonable approval, in at least one email newsletter per month (twelve (12) total newsletters per year) that BBB will send to its email subscribers.
3.6 Banner Advertising
During the term of this Agreement, BBB agrees to provide advertising banners that will run across the tops of the home pages of various channels within the Network. The advertising banners will permit recipients to navigate directly to a page on the AAA Web Site selected by AAA.
3.7 Right of First Presentation and Promotion
BBB will present to AAA an equal opportunity (prior to presenting the opportunity to any other sponsor or other third party) to participate in any new advertising, promotional or merchandising placement or activity on any Network service or other service that is wholly or partially owned by BBB and/or any of its corporate parents or wholly or partially owned subsidiaries. Any such AAA placements will come at no additional fixed costs to AAA, but instead will earn referral fees in accordance with the schedule specified in Section 7 of this Agreement.
BBB will make a good faith effort to include AAA whenever reasonably possible in its marketing campaigns (including without limitation any TV, radio, print, and online ads) and will work with AAA to determine the method and content to be used in such marketing campaigns. BBB will feature AAA at least as prominently as any other sponsor in such marketing campaigns. Possible methods include selection and use of AAA screenshots and/or logo where the BBB book club and AAA logo are visible, voice-over mentions of BBB book club in association with Amazon-com, voice-over mentions of BBB channel book lists in association with AAA, or voice-over mentions of the AAA / BBB partnership when discussing BBB features. Any such promotional placement featuring the AAA brand will come at no additional cost to AAA.
3.8 AAA Policies
BBB acknowledges that Users who purchase books through the Program will be deemed to be customers of AAA and subject to all AAA rules, policies and operating procedures concerning customer orders, customer service and books sales. AAA may change its policies and operating procedures at any time. In addition, AAA will provide commercially reasonable efforts to present accurate information with respect to any given book or AAA program.
Section 4. Impression Guarantees
4.1 In connection with each of the promotions listed below (as described in further detail in Section 3 above), BBB guarantees to provide at least the following number of Impressions (as defined below) to AAA during each of the Initial Term and the Renewal Term, if any (the 'Impression Guarantees'):
PROMOTION NO. OF IMPRESSIONS
Book Club_______
Search Engine Integration __
Shopping________
Banner Advertising _________
Newsletter _______
4.2 In the event that BBB fails to meet the Impression Guarantees, then BBB shall be required to either, at AAA's option: (a) continue to provide the Promotional Placements and Opportunities until the guaranteed number of Impressions have been met, in which case the applicable term of this Agreement shall be extended, at no additional cost to AAA, until such guarantees are met; or (b) cooperate in good faith with AAA to develop and implement such other advertising or promotional placements as are acceptable to AAA to 'make good' the shortfall. In addition, if BBB fails to meet the Impression Guarantees, AAA may at any time thereafter terminate this Agreement upon thirty (30) days written notice.
4.3 BBB shall provide to AAA on a quarterly basis, within thirty (30) days following the end of each calendar quarter, a written report signed by an authorized representative of BBB showing in reasonable detail the number of Impressions delivered during such quarter. BBB shall keep and retain, during the term of this Agreement and for a period of three years thereafter, books and records sufficient to demonstrate the number of Impressions delivered, and AAA shall have the right to have such books and records examined by an independent third party acceptable to BBB as are necessary to verify the number of Impressions reported to AAA. AAA is entitled to conduct such an audit only during normal business hours and no more frequently than once per calendar year. AAA agrees to provide BBB with at least one (1) week advance notice of any audit. If the audit reveals that the number of Impressions was misreported by more that ten percent (10%), BBB will pay for all costs reasonably incurred by AAA in connection with the audit.
4.4 As used herein, the term 'Impressions' shall mean a User's viewing of a web page or equivalent containing one or more promotional hypertext links to the AAA Web Site of the nature specified in the applicable portion of Section 3.
Section 5. Legal Compliance
Both Parties shall operate their respective Web sites and services in compliance with all applicable laws and regulations and each will be solely responsible for obtaining all required governmental authorizations necessary for the full performance of its services as provided for under this Agreement.
Section 6. Maintenance
Each Party shall monitor and periodically test the general availability and operation of its Web site.
Section 7. Compensation
7.1 Upfront Fees
7.1.1 AAA agrees to pay BBB, upon the signing of this Agreement, an upfront, nonrefundable, non-recoupable setup fee in the amount of ____.
7.1.2 In the event that this Agreement is renewed, AAA agrees to pay BBB, within thirty (30) days after the commencement of the Renewal Term, an upfront, nonrefundable, non-recoupable renewal fee in the amount of _______.
7.2 Referral Fees
7.2.1 In addition to the above fee, AAA shall pay to BBB, on a quarterly basis-and payable within thirty (30) days after the end of each quarter, referral fees based upon a percentage of the Sale Price of Qualifying Books actually purchased from AAA (the 'Referral Fees'). AAA shall receive a credit for any Referral Fees paid on Qualifying Books which are later returned. The term 'Sale Price' as used herein shall mean the sale price (i.e. the price listed under the 'Our Price' heading) for such book listed in the AAA catalog in effect at the time of order and does not include costs for shipping, handling, gift-wrapping, and taxes. The term 'Qualifying Books' as used herein shall mean all in-print books listed in AAA's catalogue at the time of order that are purchased by Users as a direct result of following a hypertext link from the Network to the AAA Web Site. Notwithstanding anything herein to the contrary, sales of books listed in our catalog or in search results __% 'out of print' or 'hard to find' are not eligible for any Referral Fees.
7.2.2 BBB will earn referral fees according to the following fee schedule:
(a) ___% of the Sales Price on sales of each Individually Linked Book (as defined below) that, on the date of order, is listed in the AAA catalog at ___%-___% off the publishers list price;
(b) ___% of the Sales Price on sales of each Individually Linked Book that, on the date of order, is listed in the AAA catalog at the publisher's list price (such as special order books);
(c) ___% of the Sales Price on sales of Individually Linked Book that, on the date of order, is listed in the AAA catalog at more than___% off the publishers list price;
(d) ___% of the Sales Price on sales of Qualifying Books other than Individually Linked Books; and
(e) the Referral Fees for Individually Linked Books as set forth in Sections 7.2.2 (a),
(b) and (c) shall be increased to ___% of the fees specified therein for any Individually Linked Books shipped prior to ____,_____,____(M/D/Y).
The term 'Individually Linked Books' as used herein shall mean books which are specifically featured by title in a Promotional Placement or Opportunity on the Network (as described in Section 3 above) and purchased by Users as a direct result of following a link on the Network to the Amazori.com Web Site that specifically identifies the title of such book.
7.3 Referral Fee Guarantee
7.3.1 Initial Term
Notwithstanding the foregoing Section 7.2, if during the course of the Initial Term of this Agreement BBB earns less than ___in Referral Fees (the 'Target Referral Fee Amount'), AAA shall include, in the final quarterly Referral Fee payment for Referral Fees earned during the Initial Term, that amount which causes BBB's total Referral Fees for the Initial Term to equal not less than the Target Referral Fee Amount. Any amount earned by BBB during the Initial Term in excess of the Target Referral Fee Amount shall be due and owing to BBB in accordance with the above-mentioned quarterly payment schedule.
7.3.2 Renewal Term
Notwithstanding the foregoing Section 7.2, if during the course of the Renewal Term of this Agreement, BBB earns less than ___ in Referral Fees (the 'Renewal Target Referral Fee Amount'), AAA shall include, in the final quarterly Referral Fee payment for Referral Fees earned during the Renewal Term, that amount which causes BBB's total Referral Fee for the Renewal Term to equal not less than the Renewal Target Referral Fee Amount. Any amount earned by BBB during the Renewal Term in excess of the Renewal Target Referral Fee Amount shall be due and owing to BBB in accordance with the abovementioned quarterly payment schedule.
Section 8. Reports and Audit
AAA shall track sales from BBB through a uniform resource locator and shall provide BBB with monthly reports in a form satisfactory to BBB. BBB shall have the right to have examined by an independent certified public accounting fin-n acceptable to AAA, such of AAA's books and records as are necessary to verify the accuracy of payments made to BBB pursuant to this Agreement. BBB is entitled to conduct such an audit only during normal business hours and no more frequently than once per calendar year. BBB agrees to provide AAA with at least one week advance notice of any audit. The audit will be limited to revenue generated pursuant to this Agreement and the calculation of payments due to BBB under this Agreement. If the audit reveals that AAA has paid BBB less than the sum to which BBB is entitled, AAA agrees to pay BBB the additional sums due. If such sums exceed ___ of the total monies paid to BBB under the Agreement, AAA will pay for all costs reasonably incurred by BBB in connection with the audit.
Section 9. Representations and Warranties; Limitation of liability
9.1 Each party hereby represents and warrants that: (a) it is a corporation duly organized and validly existing and in good standing under the laws of the state of its incorporation, (b) it has full power and authority to enter into this Agreement and to perform its obligations hereunder; (c) it has obtained all permits, licenses, and other governmental authorizations and approvals required for its performance under this Agreement; and (d) the services to be rendered by each party under this Agreement neither infringe nor violate any patent, copyright, trade secret, trademark, or other proprietary right of any third party.
9.2 AAA will remain solely responsible for the operation of the AAA Site, and BBB will remain solely responsible for the operation of the Network. Each Party (a) acknowledges that the AAA Web Site and the Network may be subject to temporary shutdowns due to causes beyond the operating Party's reasonable control, and (b) subject to the specific terms of this Agreement, retains sole right and control over the programming, content and conduct of transactions over its respective site or service. Each party specifically disclaims any representation or warranty regarding (a) the amount of sales that aaa may generate during the term, and (b) any economic or other benefit that the other party might obtain through its participation in this agreement.
9.3 neither aaa nor bbb will be liable to the other for any indirect, special, punitive or consequential damages (including, without limitation, lost profits or lost data) arising out of this agreement. Each party's entire liability arising from this agreement (except for liabilities arising under section 13 or resulting from the party's willful misconduct), whether in contract or tort, will not exceed the amounts to be paid by amazoin.com under section 7.
Section 10. Fulfillment
AAA shall be solely responsible for (a) fulfilling all orders for its products and (b) calculating, collecting and paying all appropriate taxes associated with payment processing. AAA's products offered through the Network will be supported by the same warranty and return policy for such products as offered through other AAA channels.
Section 11. Intellectual Property Rights
11.1 Subject to the license granted to BBB under Section 11.3, AAA reserves all of its right, title and interest in its intellectual property rights (e.g., patents, copyrights, trade secrets, trademarks and other intellectual property rights). Subject to the license granted to AAA under Section 1 1.2, BBB reserves all of its right, title and interest in its intellectual property rights.
11.2 AAA hereby grants to BBB, during the term of this Agreement and any extensions or renewals thereof, a non-exclusive, non-transferable, royalty-free license to establish hyperlinks between the Party's Web Sites and to use AAA's trade names, logos, trademarks and service marks (the 'AAA Marks') on the Network as is reasonably necessary to establish and promote such hyperlinks and to otherwise perform its obligations under this Agreement; provided, however, that any promotional materials or usages containing any of the AAA Marks will be subject to AAA's prior written approval.
11.3 BBB hereby grants to AAA, during the term of this Agreement and any extensions or renewals thereof, a non-exclusive, nontransferable, royalty-free license to establish hyperlinks between the Party's Web Sites and to use BBB's trade names, logos, trademarks and service marks (the 'BBB Marks') as is reasonably necessary to establish and promote such hyperlinks and to otherwise perform its obligations under this Agreement; provided, however, that any promotional materials or usages containing any of the BBB Marks will be subject to BBB's prior written approval.
11.4 Neither Party will modify, alter or obfuscate the other Party's Marks or use the other Party's Marks in a manner that disparages the other Party or its products or services, or portrays the other Party or its products or services in a false, competitively adverse or poor light. Each Party will comply with the other Party's requests as to the form of use of the other Party's Marks and will avoid any action that diminishes the value of such Marks. Either Party's unauthorized use of the other's Marks is strictly prohibited. Upon termination of this Agreement and upon written request, the Party in receipt of the requesting Party's intellectual or proprietary property and/or information pursuant to this Agreement shall return such information to the requesting Party.
Section 12. Confidentiality
Except as expressly set forth herein, BBB and AAA shall maintain in confidence the terms of this Agreement. It is expected that pursuant to discussions to date and to this Agreement, the Parties may disclose to one another certain information, as defined herein, which is considered by the disclosing Party to be proprietary or confidential information (the 'Confidential Information'). Confidential Information is defined as any information, communication or data, in any form, including, but not limited to oral, written, graphic or electromagnetic forms, models or samples, which the disclosing party identifies as confidential or which or is of such a nature that the receiving party should reasonably understand that the disclosing party desires to protect such information, communication or data against unrestricted disclosure or use, including without limitation, business information, financial data and marketing data. All Confidential Information shall remain the sole property of the disclosing party and its confidentiality shall be maintained and protected by the receiving party with the same degree of care as the receiving party uses for its own confidential and proprietary information. The receiving party shall not use the Confidential Information of the other party except as necessary to fulfill its obligations under this Agreement, nor shall it disclose such Confidential Information to any third party without the prior written consent of the disclosing party. The restrictions on the use or disclosure of any Confidential Information shall not apply to any Confidential Information: (i) after it has become generally available to the public without breach of this Agreement by the receiving party; (ii) is rightfully in the receiving party's possession prior to disclosure to it by the disclosing party; (iii) is independently developed by the receiving party; (iv) is rightfully received by the receiving party from a third party without a duty of confidentiality; or (v) is disclosed under operation of law.
Section 13. Indemnification
13.1 AAA will defend and indemnify BBB and its affiliates (and their respective employees, directors and representatives) against any claim or action brought by a third party, to the extent relating to (a) the operation of the AAA Web Site, (b) any breach of its obligations under this Agreement, or (c) the violation of third-party intellectual property rights by any editorial content or other materials provided by AAA for display on the Network. Subject to BBB's compliance with the procedures described in Section 13.3, AAA will pay any award against BBB or its affiliates (or their respective employees, directors or representatives) and any costs and attorneys' fees reasonably incurred by BBB and its affiliates resulting from any such claim or action.
13.2 BBB will defend and indemnify AAA and its affiliates (and their respective employees, directors and representatives) against any claim or action brought by a third party, to the extent relating to (a) the operation of the Network, (b) any breach of its obligations under this Agreement, or (c) the violation of third-party intellectual property rights by any materials provided by BBB for display on the AAA Web Site. Subject to AAA's compliance with the procedures described in Section 13.3, BBB will pay any award against AAA or its affiliates (or their respective employees, directors or representatives) and any costs and attorneys' fees reasonably incurred by AAA and its affiliates resulting from any such claim or action.
13.3 ' In connection with any claim or action described in this Section, the Party seeking indemnification (a) will give the indemnifying Party prompt written notice of the claim, (b) will cooperate with the indemnifying Party (at the indemnifying Party's expense) in connection with the defense and settlement of the claim, and (c) will permit the indemnifying Party to control the defense and settlement of the claim, provided that the indemnifying Party may not settle the claim without the indemnified Party's prior written consent (which will not be unreasonably withheld). Further, the indemnified Party (at its cost) may participate in the defense and settlement of the claim.
Section 14. Traffic Data
On a quarterly basis, BBB will use its best efforts to provide AAA with mutually agreed data concerning search and browsing behavior on the Network, to the extent such behavior reasonably could relate to the online promotion or sale of books or other products that AAA i-nay sell from time to time. AAA shall treat such data as Confidential Information and will not use it iii except in accordance with reasonable guidelines to be agreed by the Parties. Notwithstanding anything contained in this Section, BBB will not be required to deliver to AAA any user data in violation of its then-existing policies regarding the protection of user information.
Section 15. Dispute Resolution
15.1 In a] I discussions and activities relating to this Agreement, AAA and BBB will cooperate in good faith to accomplish the objectives specified in this Agreement. If any dispute arises relating to either Party's rights or obligations under this agreement, and the Parties are unable to resolve the dispute in the ordinary course of business, AAA and BBB will use good-faith efforts to resolve the matter in accordance with this Section 15.
15.2 Within five (5) business days following the written request of either Party (which will describe the nature of the dispute and other relevant information), the Parties' managers who are responsible for the AAA/BBB relationship will meet to resolve the dispute at a mutually convenient time and place. If the relationship managers are unable to resolve the dispute within two (2) business days following their initial meeting, they will refer the matter to the Parties' divisional executives who are responsible for the administration of this Agreement, along with a written statement (or statements) describing the nature of the dispute and other relevant information.
15.3 Within five (5) business days following the referral of the matter to the Parties' divisional executives, the divisional executives will meet to resolve the dispute at a mutually convenient time and place. Additional representatives of the parties may be present at the meeting. If the divisional executives are unable to resolve the dispute within two (2) business days following their initial meeting, they will refer the matter to the Parties' Chief Executive Officers (or other appropriate corporate officer with the authority to settle disputes), along with a written statement (or statements) describing the nature of the dispute and other relevant information.
15.4 Within five (5) business days following the referral of the matter to the Parties' CEOs, the CEOs will meet to resolve the dispute at a mutually convenient time and place. Additional representatives of the parties may be present at the meeting. If the CEOs are unable to resolve the dispute within two (2) business days following their initial meeting (or such later date as they may agree), the Parties will be free to pursue whatever remedies may be available at law or in equity.
15.5 All negotiations pursuant to this Section IS will be confidential and treated as compromise and settlement negotiations for purposes of applicable rules of evidence. Any resolution reached under this Section will be reduced to writing and signed by the Parties. During any dispute resolution procedure conducted under this Section, the Parties will diligently perform all obligations hereunder that are not directly related to the dispute.
Section 16. General Provisions
16.1 The Parties are entering this Agreement as independent contractors, and this Agreement will not be construed to create a partnership, joint venture or employment relationship between them. Neither Party will represent itself to be an employee or agent of the other or enter into any agreement on the other's behalf of or in the other's name.
16.2 Following the execution of this Agreement, AAA and BBB will prepare and distribute a joint press release (or coordinated press releases) announcing the transaction. The contents and timing of the release (or releases) will be mutually agreed by the Parties. Neither Party will issue any further press releases, make any other disclosures regarding this Agreement or its terms or use the other Party's trademarks, trade names or other proprietary marks without the other Party's prior written consent.
16.3 In its performance of this Agreement, each Party will comply with all applicable laws, regulations, orders and other requirements, now or hereafter in effect, of governmental authorities having jurisdiction. Without limiting the generality of the foregoing, each Party will pay, collect and remit such taxes as may be imposed with respect to any compensation, royalties or transactions under this Agreement. Except as expressly provided herein, each Party will be responsible for all costs and expenses incurred by it in connection with the negotiation, execution and performance of this Agreement.
16.4 Neither AAA nor BBB will be liable for, or will be considered to be in breach of or default under this Agreement on account of, any delay or failure to perform as required by this Agreement as a result of any causes or conditions that are beyond such Party's reasonable control and that such Party is unable to overcome through the exercise of commercially reasonable diligence. If any force majeure event occurs, the affected Party will give prompt written notice to the other Party and will use commercially reasonable efforts to minimize the impact of the event.
16.5 Any notice or other communication under this Agreement given by any Party to any other Party will be in writing and will be deemed properly given when sent to the intended recipient by registered letter, receipted commercial courier, or electronically receipted facsimile transmission (acknowledged in like manner by the intended recipient) at its address and to the attention of the individual specified below its signature at the end of this Agreement. Any Party may from time to time change such address or individual by giving the other Party notice of such change in accordance with this Section 16.5.
16.6 Neither AAA nor BBB may assign this Agreement, in whole or in part, without the other Party's prior written consent (which will not be withheld unreasonably), except to (a) any corporation resulting from any merger, consolidation or other reorganization involving the assigning Party, (b) any of its Affiliates, or (c) any individual or entity to which the assigning Party may transfer substantially all of its assets; provided that the assignee agrees in writing to be bound by all the terms and conditions of this Agreement. Subject to the foregoing, this Agreement will be binding on and enforceable by the Parties and their respective successors and permitted assigns.
16.7 The failure of either party to enforce any provision of this Agreement will not constitute a waiver of the party's rights to subsequently enforce the provision. Any remedies specified in this Agreement are in addition to any other remedies that may be available at law or in equity.
16.8 This Agreement (a) represents the entire agreement between the parties with respect to the subject matter hereof and supersedes any previous or contemporaneous oral or written agreements regarding such subject matter, (b) may be amended or modified only by a written instrument signed by a duly authorized agent of each party, and (c) will be interpreted, construed and enforced in all respects in accordance with the laws of the State of Washington, without reference to its choice of law rules. If any provision of this Agreement is held to be invalid, such invalidity will not effect the remaining provisions. The parties agree that the venue for any disputes hereunder shall be King County, Washington, if such dispute is brought by BBB, and in New York City, Borough of Manhattan, New York, if such dispute is brought by AAA..
16.9 If any provision of this Agreement shall be declared by any court of competent jurisdiction to be illegal, void or unenforceable, all other provisions of this Agreement shall not be affected and shall remain in full force and effect.
16.10 This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument.
IN WITNESS WHEREOF, the Parties hereto have executed and delivered this Agreement as of the date first above written.
AAA, Inc. BBB, Inc.
By: _________ By: ______
Its: ________Its: ______
Date:___,____,____(M/D/Y)
Date: __,____,____(M/D/Y)
EXHIBIT A
Competitors
As used in this Agreement, 'Competitors' includes (without limitation) the following entities: alt. book store Baker & Taylor Barnes & Noble (including B. Dalton) Bibl find Books America Books Now Book pages Book port Book serve Books a million Book Search Book Site Book smith Book Stacks Unlimited Book Web Book Zone Borders (including Walden Books) C Books Computer Literacy Bookshop Cody's Books Crown Books Ingram Inter loc Internet Book Shop Inter tain Internet Bookstore Online Book Store Powell's Books Simon and Schuster Tower Books Water stone's Words Worth Books
EXHIBIT B
Keywords
As used in this Agreement, 'Keywords' includes (without limitation) the following terms and phrases:
Book Books Bookstore Bookstores Bookseller Booksellers Amazon AAA AMZN Book Store Book Stores_____,____,____(M/D/Y)
BBB
Attention: _________.
_________ (address)
Dear Sara,
Per our discussion, AAA and BBB agree that _____,______,______(M/D/Y) shall be deemed the 'Implementation Date' of the AAA/BBB contract signed and dated ______,_______,_____(M/D/Y). The contract will run for 12 months from the 'Implementation Date' unless terminated earlier or extended as provided in the contract.
Please have this document signed and returned to us as soon as possible.
Thank you
_________ (NAME)
BBB and AAA agree that _________,_________,_________(M/D/Y) shall be the 'implementation date' of the contract signed and dated on _____,_____,____(M/D/Y).
BBB Representative AAA Represenative Confidential treatment has been requested for certain portions of this exhibit. Omitted portions have been filed separately with the Commission.
CCC PROMOTION AGREEMENT
(BBB)
This Promotion Agreement (the 'Agreement') is dated as of ____,______,_____(M/D/Y) between CCC LLC, with its principal place of business located at ______(address) ('CCC'), and BBB, Inc., with its principal place of business located at _____(address) (the 'Company'). Pursuant to this Agreement, CCC will provide various promotions to the Company to assist the Company in promoting its network of Internet sites and related services.
Accordingly, the parties hereby agree as follows:
1. Background.
1.1 The Company. The Company operates a network of Internet sites including but not limited to content pertaining to parenting, work and health, including the site located at //www.BBB.com.
1.2 CCC.operates a search and aggregation 'portal' site on the World Wide Web.
2. Definitions.
'Above the Fold' means that a particular item on a Web page is viewable on a computer screen at an 800 x 600 pixels resolution when the User first accesses such Web page, without scrolling down to view more of the Web page.
'Agreed Channels' means all of the Targeted Impressions plus up to five additional channels, as mutually agreed. Such additional channels shall initially be Business & Money, Computing, Travel, Education and Entertainment.
'Company Marks' means any trademarks, trade names, service marks and logos that may be delivered by the Company to CCC expressly for inclusion in the Promotions.
'Company Sites' means the Internet sites operated by the Company and promoted on CCC through the Promotions, including the Internet sites expressly referenced in Section 3, together with any mirror sites, co-branded sites and successors thereto.
'Content Portal' means an area on the front page of a Resource Center that is designed to be programmed with content from a third party content provider such as the Company.
'Family Center' means a Resource Center within CCC's Kids & Family Channel that is focused on family issues and is linked to directly from the front door of the CCC Site and from within the Kids & Family Channel.
'Health Center' means a Resource Center within CCC's Health Channel, currently referred to as the 'Guide to Better Health,' that is focused on health issues and is linked to directly from the front door of the CCC Site and from within the Health Channel.
'Impression' means the display of a Promotion for any Company Site on any CCC Site in accordance with this Agreement.
'Parenting Center' means a Resource Center within CCC's Kids & Family Channel that is focused on parenting issues and is linked to from within the Kids & Family Channel and from the parenting section of CCC's Living Channel.
'Products' means any product or service sold on or through the Company Sites.
'Promotions' means banners, buttons, text links, branded text, Content Portals, links within email newsletters distributed by CCC and other promotions displayed on any CCC Site, including the specific types of promotions referenced in Section 3.
'Referral Users' are any users that access the Company Site through a Promotion. All Referral Users will be tagged and tracked by the Company during the first and any subsequent visit to the Company Site via the CCC Site for the purpose of revenue sharing as referenced in Section5.3 'Resource Center' means a collection of related Web pages, links, portals and other resources on the CCC Site focused on a particular subject matter.
'CCC Box' means a search box with CCC's full Internet search functionality and containing icons for and links to the CCC Site. Each CCC Box will take users directly to the CCC Site to view the results of their search query.
'CCC Results Page' means a successful search results page on the CCC Site that is served by CCC in response to a search inquiry through a CCC Box on the Company Site.
'CCC Marks' means any trademarks, trade names, service marks and logos delivered by CCC to the Company expressly for inclusion on a Company Site.
'CCC Site' means the search and aggregation 'portal' site operated by CCC at //www.CCC.com, together with any co-branded editions of such site that have been or may be developed for CCC's third party distribution partners and licensees.
'Targeted Impressions' means (a) any Impressions within the Kids & Family, Health, Living, or Shopping Channels; (b) other Impressions that appear in context within editorial content or tools provided by the Company (for example, a 'calorie counter' feature); (c) Impressions within email newsletters distributed pursuant to Section 3.4; (d) Impressions within My CCC, as contemplated by Section 3.5; and (e) Keyword banner Impressions delivered pursuant to Section 3.6.
'Term' means the term of this Agreement, as set forth in Section 5.
'User' means a user of the CCC Site.
3. Promotions.
3.1 Promotions within the Health Channel.
3.1.1 During the Term, the Company will have the exclusive right to program the Content Portal on the front page of the Health Center with health related content from its Better Health site or any successor Web site thereto ('Better Health'), as well as health related content from the BBB.com Site, subject to the reasonable discretion of a CCC producer.
3.1.2 Subject to the mutual agreement of the parties, to the extent CCC reasonably deems it to be appropriate editorially, CCC may include other Promotions for Better Health throughout the Health Center and may provide additional opportunities for the Company to provide content from the Better Health site for display within the Health Channel.
3.1.3 Notwithstanding the foregoing or anything herein to the contrary, the parties mutually agree that the Company's content will appear in the Health Center 31 days after CCC gives notice to the content providers currently in such center, which notice will be given within 10 days following the execution of this Agreement.
3.2 Promotions within the Kids and Family Channel
3.2.1 During the Term, the Company will have the exclusive right to program the Content Portals on the front pages of the Family Center and the Parenting Center with content from its Parent Soup site, subject to the reasonable discretion of a CCC producer.
3.2.2 Subject to the mutual agreement of the parties, to the extent CCC reasonably deems it to be appropriate editorially, CCC may include other Promotions for Parent Soup throughout the Family Center and the Parenting Center and may provide additional opportunities for the Company to provide content from the Parent Soup site for display on the CCC Site.
3.3 Promotions for CCC shall, subject to CCC's discretion include Promotions for the Company's Baby site throughout the Kids and Family, Health, Living and Shopping Channels, and CCC may provide additional opportunities for the Company to provide content from the site for display on the CCC Site, including working with CCC to create a Baby Shop.
3.4 Newsletters. If CCC develops an area where Users can register for e-mail newsletters from third party content providers, CCC will provide the Company a reasonable opportunity to offer a newsletter to Users through such area.
3.5 Promotions for My CCC. The Company's Better Health and Parent Soup content and links will be included as an initial default option for CCC's 'My CCC' personalized home page, meaning that initial default links for Better Health and Parent Soup will automatically appear on the My CCC start page for each first time User. All Company content linked to from within My CCC will be hosted in its entirety by CCC.
3.6 Keyword Banners. The Company will receive ___% of the banner advertisements served on search results pages that result from searches that include any of the 30 search terms identified in Exhibit A.
3.7 Best Labels. To the extent CCC deems it to be appropriate editorially, links to Company Sites included within CCC search results will include a 'Best' editorial label.
3.8 CCC may provide standard Promotions throughout the CCC Site in an amount sufficient to meet the minimum impressions in Section 3.9. The Company may request any reasonable reallocation of the location and type of the Promotions subject to CCC's then-current inventory availability. CCC shall not charge the Company any extra fees for such requested reallocations of Promotions if they are equivalent in value to those that would otherwise be provided by CCC hereunder.
3.9 Minimum Impressions.
3.9.1 During the first year of the Term, CCC will deliver a total of at least ___ Impressions. CCC will deliver ___ additional Impressions at no additional charge on a run-of-site basis.
3.9.2 During the second year of the Term, CCC will deliver a total of at least ___ Impressions. CCC will deliver additional Impressions at no additional charge on a run-of-site basis.
3.9.3 In each year of the Term, at least ___% of the minimum number of Impressions will be Targeted Impressions. Of the remaining minimum number of Impressions, at least half will be displayed within Agreed Channels. The remaining Impressions may be untargeted and may appear anywhere within the CCC Site (for example, run-of-site banner advertisements). Notwithstanding these minimum requirements, CCC will endeavor to deliver a larger percentage of Targeted Impressions during the Term, subject to CCC's discretion.
3.9.4 If CCC does not deliver the required number of Impressions during any year of the Term, CCC will have an additional three months to deliver such Impressions (together with any other Impressions otherwise required during such three month period hereunder) on the CCC Site. Such Impressions delivered during this three month period shall be allocated to the appropriate category, (i.e. targeted or untargeted) to fulfill the impressions guarantee pursuant to Section 3.9.3.
3.9.5 If CCC does not deliver the required number of Impressions during the additional three month period described in Section 3.9.4, CCC will have a second three month period to deliver such Impressions (together with any other Impressions otherwise required during such three month period hereunder) on the CCC Site or any other Internet site operated by CNET, Inc. or the National Broadcasting Company, Inc. or their affiliates, subject (in the case of sites other than the CCC Site) to the Company's prior consent, which shall not be unreasonably withheld, and provided that such substituted Impressions are substantially equivalent in value.
4. Exclusivity.
4.1 Content provided by On Health, Women.com and Oxygen (individually, a 'Competitor') will not constitute, in the aggregate, more than ___% of the total content provided on the front page of the Health Center; the aforementioned notwithstanding, each Competitor may provide not more than ___% of the total content on that page. In addition CCC will agree not to receive any payment for such content. Promotions for On Health, Women.com and Oxygen will not constitute, in the aggregate, more than ___% of the total number of Promotions displayed within the Health Center of CCC.
4.2 Content provided by Home Arts and Oxygen (individually, a 'Competitor') will not constitute, in the aggregate, more than___% of the total content provided on the front page of the Family Center or the Parenting Center; the aforementioned notwithstanding, each Competitor may provide not more than ___% of the total content on that page. In addition CCC will agree not to receive any payment for such content. Promotions for Home Arts and Oxygen will not constitute, in the aggregate, more than ___% of the total number of Promotions displayed on the front page of the Family Center or the Parenting Center.
4.3 For purposes of this Section 4, the percentage of content provided on a page will be measured based on the total area of the page on which such content appears. In the event that CCC plans to offer any Competitor an editorial or promotional opportunity, other than standard media buys that are up to three months, or aggregation and selection of content, provided such content is not paid for, in connection with the Health Center, Family Center or Parenting Center, CCC agrees to provide the Company with such opportunity first Notwithstanding the foregoing, Company shall, at all times during the Term of this Agreement, be the preferred provider of content and promotions throughout those areas of the CCC Site which are set forth herein, the Health Center, Family Center and Parenting Center.
5. Payments.
5.1 First Year. The Company will pay CCC a total of $___with respect to the first year of the Term, as follows:
5.1.1 The Company will pay CCC a one time development fee of $___ for content integration payable within five days after execution of this Agreement;
5.1.2 The Company will pay CCC an annual slotting fee of $___for carriage of the Promotions within the CCC Site, payable in twelve equal monthly installments, within 30 days of each month; and
5.1.3 The Company will pay CCC a partnership fee of $___, payable in the following installments by the fifth day of each calendar month:
(a) $___ per month during months 1-6 of the Term
(b) $___ per month during months 7-12 of the Term
5.2 Second Year. The Company will pay CCC a total of $___ with respect to the second year of the Term, as follows:
5.2.1 The Company will pay CCC an annual slotting fee of $___for carriage of the Promotions within the CCC Site, payable in twelve equal monthly installments, within 30 days of each month; and
5.2.2 The Company will pay CCC a partnership fee of $___payable in equal monthly installments of $___ by the fifth day of each calendar month.
5.3 Revenue Sharing. The Company will pay to CCC an amount equal to ___% of all gross margin earned by the Company from sales made through the Company's site to Referral Users. Such revenue sharing will be payable monthly, simultaneously with delivery of the monthly reports referenced in Section 8.2, which will support the Company's calculation of the required payment for the preceding month.
5.4 Required payments hereunder will be made by check or wire transfer of immediately available funds as reasonably directed by CCC.
5.5 Notwithstanding the foregoing: if CCC has not delivered: (i) ___ impressions on or before the date that is six months from this Agreement then CCC and the Company will meet in good faith within 30 days of that time to re-negotiate the agreement; if no agreement is reached after that time, the Company may terminate the agreement, or (ii) ___ impressions (based on the proportions described in section 3.9 including the additional impressions as referenced in section 3.9.1 and section 3.9.2.), on or after the date that is twelve months from the date of this agreement the Company may terminate the agreement.
5.6 CCC Results Pages. CCC will pay the Company a standard monthly fee based on the daily average number of CCC Results Pages delivered to users. Such fee will be calculated as follows: (1) divide the total number of CCC Results Pages for the month by the number of days in the month, (2) divide the result by ___, (3) multiply the result by the appropriate Guaranteed Daily CPM as set forth below, and (4) multiply the result by the number of days in the month. For example, if the Company's CCC Box produces a total of ___CCC Results Pages for June, the monthly fee for June will be calculated by the following formula: Average Number of
Daily CCC Results Pages Guaranteed Daily CPM
___ $___
___ $___
___ $___
___ $___
6. Design of the Promotions and Operation of the Company Site and CCC Site
6.1 CCC and the Company will cooperate in good faith to create an 'implementation team,' which will include an account manager designated by CCC and an appropriate representative of the Company, to oversee the creation and delivery of the Promotions contemplated by this Agreement.
6.2 The Company will design any graphics and other materials required for the Promotions and will supply digital copies of such materials to CCC. Such materials will be designed and delivered in accordance with CCC's technical and editorial guidelines as defined in Exhibit B, as may be changed from time to time and communicated by CCC to the Company. CCC will provide reasonable assistance to the Company in connection with the design and delivery of such materials.
6.3 On each page of a Company Site to which Users are linked from the Promotions, the Company will display a button or other graphical link to be provided by CCC, which links back to the default CCC Site. All such links on the Company Sites will be displayed Above the Fold. CCC agrees not to specifically target (separately from the general database of CCC Users) any Users who access the CCC Site through such links.
6.4 Both parties will be responsible for ensuring that each URL provided to the other party for use as set forth in this Agreement, takes the User to the appropriate area within the respective site and that each party's site functions with reasonable reliability and in a commercially reasonable manner throughout the Term. In particular, both parties agree that each party's respective site will comply with the following performance standards throughout the Term:
6.4.1 Each party's site will be operational and fully functional in all material respects (i.e. capable of displaying information and conducting transactions as contemplated in the ordinary course of business) at least 97% of the time during any 30 day period.
6.4.2 The average time required to start displaying the on a page of a party's site after a link from the other party's shall not exceed a daily average of three seconds, and the average time required to deliver an entire page of a party's site over the open Internet shall not exceed a daily average of six seconds. For measurements required in this Paragraph, both parties may assume standard T1 connectivity to the Internet.
6.4.3 Without limiting the effect of Paragraphs 6.4.1 and 6.4.2 above, the Company shall provide to Users coming to the Company Sites from the Promotions at least the same level of service as is offered to Users coming directly to such Company Sites.
6.4.4 The Company Sites e shall not, to the best of the Company's knowledge: (a) contain defamatory or libelous material or material which discloses private or personal matters concerning any person, without such person's consent; (b) permit to appear or be uploaded any messages, data, images or programs which are illegal, contain nudity or sexually explicit content or are, by law, obscene, profane or pornographic; or (c) permit to appear or be uploaded any messages, data, images or programs that would knowingly or intentionally (which includes imputed intent) violate the property rights of others, including unauthorized copyrighted text, images or programs, trade secrets or other confidential proprietary information, or trademarks or service marks used in an infringing fashion.
6.4.5 If any of the performance standards set forth above are not met by either party with respect to that party's site, the other party may, after notifying the violating party, remove any or all links to such party's, at the non violating party's sole discretion. If a party's site fails to operate fully and functionally in any material respect for any period of four or more consecutive hours, even if otherwise in compliance with the performance standards, the other party may, after notifying the violating party, remove any or all links to such violating party's site, at the non-violating party's sole discretion, until such time as the violating party notifies the non-violating party that such site has resumed acceptable operation. These remedies are for each party's editorial purposes and in no way limit either party's ability to terminate this contract or pursue any other remedies hereunder in the event the performance standards set forth herein are not met.
7. Termination.
7.1 The term of this Agreement (the 'Term') will begin on the date hereof and will end on the second anniversary of the date hereof, unless otherwise terminated or extended as provided in this Agreement.
7.2 If either party commits a material breach of its obligations hereunder that is not cured within 30 days after notice thereof from the non-breaching party, the non-breaching party may terminate this Agreement at any time by giving written notice of termination to the breaching party (or ten days in the event of non-payment).
7.3 The provisions of Sections 12, 13 and 14 and any payment obligations arising prior to termination will survive any termination of this Agreement.
8. Reporting.
8.1 Within 30 days after the end of each calendar month during the Term, CCC will provide to the Company standard advertising reports, as generally offered by CCC, with respect to the Promotions.
8.2 Within 30 days after the end of each calendar month during the Term, the Company will provide to CCC a report indicating (a) the number of Users who access any Company Site by clicking on a link embedded within a Promotion delivered by CCC hereunder, in the aggregate and for each Company Site, and (b) the total revenues and gross profit earned by the Company from sales made through the Company's site to such Users. The Company will obtain such data by tagging each User who accesses any Company Site through a Promotion using a cookie or other similar technology, as agreed upon by the parties.
9. User Data.
The Company will be the sole owner of any information that the Company collects from Users through the Company Sites, and CCC will be the sole owner of any information that CCC collects from Users through the CCC Site. Notwithstanding the foregoing and subject to the provisions of Section 14.8, each party will have the unrestricted right and license to use any information provided by the other party pursuant to Section 7.
10. Company Integration of CCC.
10.1 The Company will feature a CCC Box as a part of the front page of each of the Company Sites and throughout the Company Sites as appropriate, the design, size and positioning of which will be mutually agreed upon by CCC and the Company, provided that the CCC Box appear above the fold. CCC will pay the Company for CCC Results Pages as provided in Section 5.6, above.
10.2 The CCC Results Pages delivered to users as a result of a query from Company's CCC Box will be co-branded edition of the CCC Service located at ______
10.3 On each page of a CCC Site to which Users are linked from the Company Site, CCC will display a mutually agreed upon button or other graphical link to be provided by the Company, which links back to the default Company Site. All such links on the CCC Site will be displayed Above the Fold. Company agrees not to specifically target (separately from the general database of Company Users) any Users who access the Company Site through such links.
11. Trademark Licenses.
11.1 The Company hereby grants to CCC a non-exclusive, royalty-free license, effective throughout the Term, to use, display and publish the Company Marks solely within the Promotions. Any use of the Company Marks by CCC must comply with any reasonable usage guidelines communicated by the Company to CCC from time to time. Nothing contained in this Agreement will give CCC any right, title or interest in or to the Company Marks or the goodwill associated therewith, except for the limited usage rights expressly provided above. CCC acknowledges and agrees that, as between the Company and CCC, the Company is the sole owner of all rights in and to the Company Marks.