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EXHIBIT 10.11
CONFIDENTIAL TREATMENT REQUESTED
BROADBAND CONTENT TEAMING AGREEMENT
This Broadband Content Teaming Agreement (the "Agreement") is entered into by
and between xxxxxxxxx.xxx, a Delaware corporation ("xxxxxxxxx.xxx") and I(3)S
Inc., a Texas corporation ("I3S"), known jointly as the "Parties," this 19th
day of February, 1999 (the "Effective Date").
1. DEFINITIONS:
1.1 "Co-Branded Page(s)" shall mean a web page(s) created by I3S that
contains equally prominent branding of xxxxxxxxx.xxx and I3S for
placement on I3S's website.
1.2 "Confidential Information" shall mean any information of a Disclosing
Party that the Receiving Party knows or reasonably should know to be
confidential or proprietary information of the Disclosing Party,
whether of a technical, business or other nature.
1.3 "Disclosing Party" shall mean a party who discloses Confidential
Information to a Receiving Party.
1.4 "Events" shall mean xxxxxxxxx.xxx multicast and unicast live and
on-demand or archived events available to users from the Co-Branded
Page and which xxxxxxxxx.xxx possesses the copyright or license to
distribute over the Internet, which Events are set forth on EXHIBIT A
attached hereto and made a part hereof for all purposes, as such
Exhibit may be amended from time to time.
1.5 "Marks" shall mean a party's logos, trade names, trademarks and
service marks, collectively.
1.6 "Multicast" shall mean any system, procedure or technology, as
updated from time to time, which distributes data (including, without
limitation, audio or video) over the System which causes or allows
such data to be accessed, duplicated, or replicated as and when
needed by routers, switches, terminal servers, or other equipment,
including, without limitation, the single transmission of data which
can simultaneously service numerous, multiple receivers.
1.7 "Multicasting" is the utilization of Multicast.
1.8 Except for content independently developed or acquired by I3S,
"Multicast Privilege" is the right of first reservation and access to
act as a distributor of each Event made accessible from the
Co-Branded Page(s) on the System and for which xxxxxxxxx.xxx
possesses the exclusive right or license to distribute said Event
over the Internet.
1.9 "Receiving Party" shall mean a party who receives Confidential
Information from a Disclosing Party.
1.l0 "Sponsorship" shall mean gateway, banner, button, and/or interstitial
advertising that is sold to an advertiser on the premise that it will
appear in connection specifically with the Multicast Events on the
Co-Branded Page(s) and not as part of a general rotation of
advertising on the xxxxxxxxx.xxx Web site (e.g. a rotation on all
sports content or a run of site rotation).
1.11 "Sponsorship Revenue" shall mean the aggregate amount of Sponsorship
revenue collected by xxxxxxxxx.xxx in connection with the Multicast
Events on the Co-Branded Page(s) after all applicable commissions and
agency fees associated with such sale, if any, have been paid.
l.12 "System" is any wireless network (including, without limitation,
direct broadcast satellites, hand held devices, microwave dish
facilitated data transmission, Vertical Blanking Interval (VBI),
wireless cable and data broadcasting, Teledesic, Iridium and other
satellites, and any and all other wireless networks) or wired network
(including, without limitation, the Internet, the Internet II, or any
other online services network which utilizes computer terminals,
terminal servers, modems, cable modems, HFC, coaxial cable, xDSL,
routers, splitters,
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switches, multicasting technology, power lines, or other high speed
data connections and any and all other wired networks) that
distributes audio, video, or other programming using digital
algorithms, one and/or two-way digital services, or any other means
now existing or hereafter created.
2. MULTICAST PRIVILEGE AND EVENT DISTRIBUTION LICENSE:
2.1 I3S hereby grants to xxxxxxxxx.xxx the exclusive Multicast Privilege
for the term of this Agreement. xxxxxxxxx.xxx hereby grants I3S,
solely with respect to properties served by the I3S network, the
exclusive right and license to distribute the Events; provided, that
nothing contained in this section 2.1 shall prohibit xxxxxxxxx.xxx
from distributing the Events from the xxxxxxxxx.xxx Web sites, nor
shall it constitute a violation of this Agreement if I3S customers
are able to access the Events through the xxxxxxxxx.xxx Web sites.
Subject to the terms of this Agreement, I3S and xxxxxxxxx.xxx may
elect to jointly distribute the Events over systems operated by other
broadband Internet service providers.
2.2 Xxxxxxxxx.xxx grants I3S the right to the enjoyment of ancillary
benefits, which include (a) the ability to attract customers by
promoting the extensive and varied content made available by the
alliance between xxxxxxxxx.xxx's multicast programming and I3S's
multicast capabilities and its System, and (b) designation as a
xxxxxxxxx.xxx IP Multicast affiliate in the form of a multicast
affiliate logo to be provided by xxxxxxxxx.xxx.
2.3 I3S shall install at a local loop (DS3 or OC3, as applicable, in the
determination of I3S) to connect to xxxxxxxxx.xxx's network in order
to ensure the highest level of service to I3S users. I3S agrees to
absorb any and all expenses associated with the installation and
maintenance of said local loop, and to comply with the Acceptable Use
Policies of xxxxxxxxx.xxx.
3. CO-BRANDED PAGES; EDITORIAL REVIEW BOARD:
3.1 I3S shall create a Co-Branded Page(s), which shall be subject to
review and prior approval of the Editorial Board (as hereinafter
defined), to co-promote the Events. The Events to be included on the
Co-Branded Page(s) will be mutually selected by xxxxxxxxx.xxx and
I3S, and shall include, without limitation, live television and radio
station feeds, concerts, sporting and business services events, as
well as on-demand movies, music and similar types of content. The
Events will be accessible from such locations on the Internet as
designated by xxxxxxxxx.xxx, including, but not limited to, the
Co-Branded Page(s). I3S agrees to update such Co-Branded Page(s) as
soon as reasonably practical, but in no event in excess of 3 business
days after receipt of new Event entries from xxxxxxxxx.xxx.
3.2 I3S shall pay xxxxxxxxx.xxx a fee equal to *** per month during the
term of this Agreement for the encoding, serving and maintenance of
the Events for placement on the Co-Branded Page(s), due and payable
quarterly within 30 days of receipt of an invoice from xxxxxxxxx.xxx.
Except for Sponsorship sales initiated by I3S, Xxxxxxxxx.xxx will
have the exclusive right to sell all Sponsorship and all other
advertising in connection with the Co-Branded Page(s). All monthly
Sponsorship or advertising revenue, whether paid in advance or not,
generated by sponsors or advertisers in connection with the Agreement
will be billed and collected by Xxxxxxxxx.xxx throughout the term of
the Agreement; provided, however, that, by the fifteenth (15th) day
after the expiration of each calendar quarter hereafter Xxxxxxxxx.xxx
shall pay I3S a revenue sharing fee ("I3S Revenue Sharing Fee") in an
amount equal to ****** ** of all such Sponsorship and advertising
revenue generated in the immediately preceding calendar quarter. All
monthly revenue generated by Subscribers for premium pay streaming
content services under this Agreement, whether paid in advance or
not, will be billed and collected by I3S throughout the term of this
Agreement; provided, however, that, by the fifteenth (15th) day after
the expiration of each calendar quarter hereafter I3S shall pay
Xxxxxxxxx.xxx a revenue sharing fee ("Xxxxxxxxx.xxx Revenue Sharing
Fee") in an amount equal to ***** of all such Subscriber-generated
revenue in the immediately preceding calendar quarter. The I3S
Revenue Sharing Fee and the Xxxxxxxxx.xxx Revenue Sharing Fee are
hereinafter collectively referred to as the "Revenue Sharing Fees".
Notwithstanding anything to the contrary contained herein, no Events
shall be offered on a subscription or pay per view basis without the
prior written approval of xxxxxxxxx.xxx.
3.3 The revenue derived from the sale of all other advertising on the
xxxxxxxxx.xxx Web site (even if such advertising appears on pages,
other than the Co-Branded Pages through which the Events are
accessible), will be retained by xxxxxxxxx.xxx in its entirety.
Except for a *** percent ** advertising sales commission
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to be paid to xxxxxxxxx.xxx in consideration of advertising sales
sold by xxxxxxxxx.xxx on the BroadbandNOW!(TM) Web site, the revenue
derived from the sale of all other advertising and sponsorships on
the BroadbandNOW!(TM) Web site (even if such advertising or
sponsorships appear on pages, other than the Co-Branded Pages,
through which the Events are accessible), will be retained by I3S
in its entirety.
3.4 Subject to the terms and provisions of this Agreement, I3S and
xxxxxxxxx.xxx shall jointly market, offer, provide and sell the
Events to other third parties providing broadband or high speed
Internet access services. The parties shall create an Editorial
Board, composed of 2 appointees from each party, to review and
approve the content, layout and structure of the Co-Branded Pages.
The Editorial Board shall meet on a periodic basis as agreed by its
members, but no less than once each calendar quarter hereafter. The
Editorial Board shall create and maintain such procedures and
internal operational processes as it shall deem necessary and prudent
to carry out its intents and purposes hereunder.
4. ACCOUNTS: I3S will cooperate with xxxxxxxxx.xxx to ensure that all
accounts and/or ports will be enabled to receive traffic from
xxxxxxxxx.xxx. I3S represents and warrants that as of the Effective Date
I3S has exclusive rights to provide high speed data services, including,
without limitation, the distribution of Events, to 1,000,000 apartment
units, nationwide. I3S agrees to inform xxxxxxxxx.xxx on a quarterly basis
of any additional accounts and or ports added to the I3S network.
5. PROMOTIONS: I3S shall be entitled to advertise its participation in
xxxxxxxxx.xxx's multicast and unicast programming, subject to
xxxxxxxxx.xxx's reasonable prior review and approval of such advertising.
I3S shall also provide a hyperlink from its home page to xxxxxxxxx.xxx's
home page, or to other pages on the xxxxxxxxx.xxx Web site as xxxxxxxxx.xxx
may reasonably designate upon consultation with I3S.
6. DEMOGRAPHICS: Xxxxxxxxx.xxx and I3S agree to jointly develop a system to
track behavior and demographics information for users who access the Events
on the Co-Branded Page(s) in order to formulate a more desirable menu of
Events, which information shall not be shared with third parties without
each party's prior written approval. Only for purposes of performing
xxxxxxxxx.xxx's obligations hereunder, I3S agrees to provide
xxxxxxxxx.xxx all reasonable information necessary to determine
listenership for the Events, including, but not limited to, the I3S
subnetwork addresses.
7. TERM: This Agreement shall be effective for a period of three (3) years
commencing on the Effective Date hereof. Thereafter, this Agreement shall
automatically renew for successive one (1) year periods unless either party
delivers thirty (30) days written notice by certified mail, return receipt
requested, to the other party that such party does not agree to such
renewal, or otherwise this Agreement shall be deemed extended for each
additional one (1) year period. All provisions hereof regarding amounts
payable by either party to the other party shall survive the expiration or
earlier termination of this Agreement until such amounts are paid in full
by the obligor party.
8. LIMITATION OF LIABILITY: NEITHER PARTY WILL BE LIABLE FOR ANY SPECIAL,
INDIRECT, CONSEQUENTIAL OR INCIDENTAL DAMAGES ARISING OUT OF OR RELATED TO
THIS AGREEMENT, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING
NEGLIGENCE), AND EVEN IF EITHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES. EACH PARTY HEREBY DISCLAIMS ALL WARRANTIES, EXPRESS,
IMPLIED OR STATUTORY, WITH RESPECT TO THE SERVICES PROVIDED BY IT
HEREUNDER.
9. INTELLECTUAL PROPERTY RIGHTS: Each party acknowledges and agrees that: (i)
the other party's Marks are and shall remain the sole property of the other
party; (ii) nothing in this Agreement shall confer in the party any right
of ownership in the other party's Marks, and (iii) the party shall not now
or in the future contest the validity of the other party's Marks.
xxxxxxxxx.xxx shall defend, indemnify and hold harmless I(3)S, its parent,
subsidiaries, affiliates, directors, officers, shareholders, employees and
agents and its successors and assigns, from and against any and all claims,
demands, actions, liabilities, losses, damages and expenses, including,
without limitation, settlement costs and reasonable attorneys' fees,
arising out of or relating to any actual or alleged infringement of any
third party's trade secrets, trademark, service xxxx, copyright, patent or
other intellectual property rights (the "Intellectual Property Rights") in
connection with the use of said Intellectual Property Rights hereunder.
xxxxxxxxx.xxx's obligation pursuant to the immediately preceding sentence
is subject to the following conditions: (i) I(3)S shall give xxxxxxxxx.xxx
prompt written notice of all actions, claims or threats against I(3)S of
infringement or
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violation of Intellectual Property Rights; (ii) I(3)S shall permit
xxxxxxxxx.xxx to elect to assume complete control of such claims at its
sole discretion and expense; provided, however, that I(3)S may elect, in
such case, to retain its own counsel, at I(3)S's expense, to represent
I(3)S's interest; and further, provided, however, that xxxxxxxxx.xxx will
fully cooperate with I(3)S and keep it fully informed and refrain from
entering into any settlement or agreed judgment without I(3)S's prior
written consent, which consent shall not be unreasonably withheld, delayed
or conditioned; and (iii) I(3)S shall cooperate fully with xxxxxxxxx.xxx in
defending against claims, including making known or available to the
indemnifying party, upon reimbursement of all costs associated with
provision or reproduction of, all records and document pertaining to
claims.
10. CROSS INDEMNIFICATION FOR OBLIGATIONS UNDER THIS AGREEMENT. Each party
hereby agrees to indemnify, defend and hold harmless the other party from
any and all damages, liabilities, costs and expenses, including, without
limitation, reasonable attorneys' fees and expenses, arising out of, under
or in connection with the indemnitor party's duties, obligations, actions
or performance under this Agreement, or the indemnitor party's gross
negligence or willful misconduct.
11. LIMITATION OF LIABILITY. It is expressly understood that neither party
makes any projection, representation or warranty regarding the amount of
revenue that may be earned by the other party under this Agreement. Neither
party shall be liable to the other party for any indirect, incidental,
special, or consequential damages of any kind whatsoever; provided,
however, that this limitation of liability shall not apply to either
party's indemnification obligations under this Agreement.
12. DEFAULT. Upon the occurrence of any of the following events, a party shall
be deemed to be in default under this Agreement:
(a) Material breach of any warranty or representation by the
defaulting party;
(b) Material failure to perform the defaulting party's obligations
hereunder, including with respect to each Party its failure to make
the payments to the other Party as set forth in Section 3 hereof.
(c) The defaulting party's ceasing to conduct business in the normal
course, insolvency, the making of a general assignment for the
benefit of its creditors, suffering or permitting the appointment of
a receiver or similar officer for its business or assets or availing
itself of, or becoming subject to, any proceeding under the United
States Federal Bankruptcy Laws or any federal or state statute
relating to solvency or the protection of the rights of creditors; or
(d) Making of any warranty, representation, statement or response in
connection with this Agreement which was untrue in any material
respect on the date it was made by the defaulting party.
13. REMEDIES. In the event the defaulting party fails to cure any default set
forth hereunder for a period of thirty (30) days after written notice of
such default by the non-defaulting party, the non-defaulting party may
terminate this Agreement without further obligation on the part of the
non-defaulting party, and pursue any claims at law or in equity against the
defaulting party.
14. FAILURE TO EXERCISE REMEDY. The remedies set forth above are cumulative,
but the non-defaulting party is under no obligation to exercise any such
remedy. The exercise of, or failure to exercise, any such remedies shall
not prevent any future exercise of the same or any other remedies or
release the defaulting party from its obligations under this Agreement.
15. EFFECT OF TERMINATION. Early termination or expiration of this Agreement
shall not impair either party's then accrued rights, obligations,
liabilities or remedies hereunder.
16. EXAMINATION; AUDIT RIGHTS. Each Party agrees that the other Party has the
right to audit or otherwise examine, or have audited or otherwise examined,
on an annual basis all applicable books, records, documents, and other data
of the audited Party, including computations and projections, specifically
and only relating to the Revenue Sharing Fees under this Agreement, and the
audited Party's billing and collection of revenues from subscribers,
sponsors and advertisers. If the audited Party's audit reveals that the
auditing Party has been underpaid its applicable Revenue Sharing Fee by a
percentage in excess of five percent (5%) over the period of the audit, the
audited Party shall pay the auditing Party's reasonable costs of the audit,
in addition to paying all past due amounts owed to the auditing Party. The
audited Party shall make available at its principal place of business at
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all reasonable times during normal business hours the materials described
in the first sentence of this Section 16 for examination, audit, or
reproduction. In the event that this Agreement is completely or partially
terminated, the records relating to the Revenue Sharing Fees shall be made
available for two (2) years after any termination of this Agreement.
Records pertaining to appeals or to litigation or the settlement of claims
arising under or relating to either party's performance under this
Agreement shall be made available until disposition of such appeals,
litigation or claims.
17. NOTICE. Any notice, demand or other communication required or permitted by
any provision of this Agreement shall be deemed to have been sufficiently
given or served for all purposes when delivered in person or sent by
registered or certified mail, return receipt requested, all postage and
other charges prepaid, to the respective addresses of the parties first
noted above, or at such other address as may be designated by notice from
such party to the other party pursuant to their terms of this section.
18. PUBLIC DISCLOSURES. All media releases, public announcements, and public
disclosures by either party or its employees, agents or representatives
relating to this Agreement or the subject matter hereof, excluding any
announcement beyond the control of this disclosing party, will be approved
by the non-disclosing party in writing prior to release.
19. PERFORMANCE REVIEW. In the event of any dispute or controversy between
the parties of any kind or nature, upon the written request of either
party, each of the parties will appoint a designated officer whose task it
will be to meet for the purpose of resolving such dispute or controversy or
to negotiate for an adjustment to any provision of this Agreement needed to
resolve such dispute or controversy. Such officers will discuss the dispute
or controversy and negotiate in good faith in an effort to resolve the
dispute or controversy or renegotiate the applicable section or provision
of this Agreement without the necessity of any formal proceeding relating
thereto. No formal proceedings for the judicial or arbitrational resolution
of such dispute or controversy may be commenced until either or both of the
designated officers conclude in good faith that an amicable resolution
through continued negotiation of the matter at issue is not likely to
occur, or until thirty (30) days have elapsed from the date of the written
request, whichever is sooner.
20. ARBITRATION. Except where otherwise expressly provided, the parties hereby
agree to submit to arbitration any and all disputes, controversies,
differences, or claims which may arise between them in relation to or out
of this Agreement, or the breach thereof. If the parties fail to reach an
amicable settlement or earlier resolution by mutual agreement, any
controversy or claim relating to this Agreement shall be submitted to final
and binding arbitration pursuant to the Rules of the American Arbitration
Association then in effect, by three arbitrators knowledgeable of said
rules and as to industry standards, sitting in a location in Dallas County,
State of Texas, designated by the filing party. One arbitrator will be
appointed by each party within ten (10) days of the filing of the
arbitration claim and the two arbitrators shall appoint a third arbitrator
within thirty (30) days. None of the arbitrators shall be related to or
have any direct or indirect interest in I(3)S or xxxxxxxxx.xxx. The
arbitrators will be instructed to consider, in making any determination,
the customary practices in the industry to the extent such practices exist.
The arbitration proceeding shall commence within thirty (30) days of the
selection of the arbitrators. Discovery shall be limited so as to allow the
taking of a maximum of five (5) depositions by each party. The arbitrators
shall be authorized to provide for interim and final injunctive relief. The
parties acknowledge and agree that such arbitration shall be the sole forum
for such interim and final injunctive relief and the parties agree to
accept and abide by such injunctive relief. The arbitrators shall have the
right but not the obligation to award to the prevailing party the cost of
resolving any dispute regarding this Agreement or the formation, breach,
enforcement or performance hereof, including any reasonable fees of
attorneys, accountants and expert witnesses incurred by the prevailing
party. Punitive damages shall not be recoverable in any arbitration
initiated pursuant to this Agreement. Judgment upon the award rendered by
the arbitrators may be entered in any court having jurisdiction thereof.
Notwithstanding anything to the contrary contained herein, if, at any time
an initiating party can show that it would suffer irreparable harm by
following the above procedures solely because of the time that it would
take to engage the arbitrators and the non-filing party will not agree to
immediately appoint the arbitrators and that money damages would not be
adequate to compensate it for the harm so suffered, the initiating party
may apply to any court of competent jurisdiction for an order or judgment
granting that party a provisional remedy, including, but not limited to, a
temporary restraining order, a preliminary injunction or an attachment.
21. GENERAL PROVISIONS:
21.1 This Agreement shall constitute the entire understanding between the
parties, and supersedes all prior negotiations or understandings
between the parties concerning the subject matter contained herein.
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21.2 Xxxxxxxxx.xxx's services and the execution of the Events on the
Co-Branded Page(s) shall be provided in a businesslike, high quality
and professional manner.
21.3 I3S agrees to indemnify and hold harmless xxxxxxxxx.xxx and its
officers, directors, employees and agents from and against any and
all losses, claims, damages, liabilities, obligations, penalties,
judgments, awards, costs, expenses and disbursements, including
without limitation, the costs, expenses and disbursements, as and
when incurred, of investigating, preparing or defending any action,
suit, proceeding or investigation, caused by, relating to, based
upon, arising out of or in connection with any breach by I3S of the
representations, warranties or agreements made by it under this
Agreement.
21.4 Each party shall maintain in strict confidence, and not disclose or
distribute to any third person any Confidential Information of the
other party. Confidential Information does not include any
information that: (a) entered the public domain through no fault of
the Receiving Party; (b) is rightfully received by the Receiving
Party from a third party legally entitled to make such disclosure;
(c) is already known to the Receiving Party prior to disclosure by
the Disclosing Party; (d) is required to be disclosed pursuant to
subpoena, applicable law, or SEC rules or regulations; or (e) is
independently developed by the Receiving Party without reference to
any confidential or proprietary information of the Disclosing Party.
21.5 This Agreement shall be governed by the laws of the state of Texas
applicable to contracts entered into and to be performed entirely
within the State of Texas. The parties expressly agree that any
action at law or in equity arising out of or relating to this
Agreement shall be filed only in the state and federal courts located
in Dallas County, Dallas, Texas. The parties hereby consent and
submit to jurisdiction of such courts for the purposes of litigating
any such action.
21.6 Should any part of this Agreement be found to be illegal or otherwise
unenforceable, both Parties shall continue to be bound under the
remaining provisions of this Agreement.
21.7 This Agreement shall be binding upon and inure to the benefit of the
Parties hereto and their respective successors, assigns or purchasers
of the respective companies. In addition, upon prior written notice
to the other party, either party has the right to assign this
Agreement to any entity; provided, however that said assignee shall
unconditionally assume the assignor's obligations hereunder.
21.8 The parties hereto are independent parties, and no partnership, joint
venture, enterprise, or employment relationship shall be created or
inferred by the existence or performance of this Agreement.
21.9 The persons executing this Agreement on behalf of the parties hereto
hereby represent and warrant that: (a) he or she has the authority to
legally bind the respective party; (b) he or she has been duly
authorized to execute this Agreement, and (c) all necessary corporate
actions and requirements for execution, if any, have been taken or
have been satisfied.
21.10 This Agreement may be executed in one or more counterparts, which
when taken together, shall constitute one and the same document. The
parties hereby agree that facsimile signatures are valid and binding
on the parties.
IN WITNESS WHEREOF, the Parties hereto have caused the foregoing agreement to be
signed by a duly authorized agent of each party, the day and year first above
written.
I(3)S, Inc.: XXXXXXXXX.XXX:
I(3)S, Inc. xxxxxxxxx.xxx inc.
0000 Xxxxxxxxx Xxxxx 0000 Xxxxxx Xxxxxx
Xxxxxx, Xxxxx 00000 Xxxxxx, XX 00000
By: /s/ XXXX XXXXXXXX By: /s/ XXXXX XXXXX
------------------------------- --------------------------------
Name: Xxxx Xxxxxxxx Name: Xxxxx Xxxxx
----------------------------- ------------------------------
Title: VP & Chief Scientist Title: VP
---------------------------- -----------------------------
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EXHIBIT A
[DESCRIPTION OF EVENTS TO BE INCLUDED ON CO-BRANDED PAGE(S)]
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