* Confidential treatment has been granted for certain portions of this
exhibit. Omitted portions have been filed separately with the Commission.
CONTENT PROVIDER AGREEMENT AND LICENSE
This AGREEMENT effective as of the 23rd day of April, 1999, by
and between Change Your Xxxx.xxx, LLC ("Change Your Life"), a Delaware limited
liability company, with its principal offices at 000 Xxxxxxxx, Xxx Xxxx, XX
00000, Xxxxxxx X. Xxxxxxx, an individual resident in San Diego, California
("Xxxxxxx"), Xxxxxxx Research International Inc., a Nevada corporation, with its
principal offices at 0000 Xxxx Xxxxxx Xxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxxxxxx
00000 (Xxxxxxx and Xxxxxxx Research International Inc., collectively, the
"Xxxxxxx Group"). Change Your Life and the Xxxxxxx Group may hereinafter each be
referred to as a "Party" and collectively as the "Parties".
1. DEFINITIONS
1.1 "Content" means text, graphics, photographs, animation,
characters, illustrations, features, recordings, video, audio,
CD-ROMS, proprietary software packages, tools and systems, and/or
other data or information relating to any subject.
1.2 "CYL" means Change Your Life and any divisions, subsidiaries, and
successors thereto and any parent or affiliate thereof.
1.3 "Change Your Life Content" means (i) any Content developed, owned
or controlled by Change Your Life and (ii) any interactive
Content supplied to Change Your Life by the Xxxxxxx Group, other
than Xxxxxxx Group Property.
1.4 "Change Your Life Site Channel" means a generic area within the
Change Your Life Site that is targeted to a specific subject
matter (such as career, relationships, etc.) but excludes those
features or areas that do not relate to one particular subject
matter (i.e. shopping, chat and community).
1.5 "CYL Network" means all channels, programming, products, services
and ventures featured on the Change Your Life Site as well as
other channels, programming, products and ventures whether or not
appearing on the Change Your Life Site, such as co-branded,
syndicated, private label and joint venture and partnership
offerings and endeavors, in which CYL has input or an economic
interest.
1.6 "Change Your Life Site" means the Internet sites or areas
developed, supported, sponsored, owned or controlled by Change
Your Life whether for business or consumer applications.
1.7 "Enhancement Development Cost" means direct, out-of-pocket cash
development costs (excluding any general and administrative costs
and other overhead items) expended by the Xxxxxxx Group to
develop an Enhancement.
1.8 "Fixed Icon" means a branded button that is placed in a fixed
position on the home page of a Change Your Life Site Channel and
links directly to the Xxxxxxx Group/Change Your Life Site.
1.9 "Impression" means user exposure to a page on the Change Your
Life Site.
1.10 "Intellectual Property Rights" means all inventions, discoveries,
trademarks, patents, domain names, URLs, trade names, copyrights,
moral rights, jingles, know-how, intellectual property, software,
shop rights, licenses, developments, research data, designs,
technology, trade secrets, test procedures, processes, route
lists, customer lists (subject to the limitations set forth in
Exhibit B hereto), computer programs, computer discs, computer
tapes, literature, reports and other confidential information,
intellectual and similar intangible property rights, whether or
not patentable or copyrightable (or otherwise subject to legally
enforceable restrictions or protections against unauthorized
third party usage), and any and all applications for,
registrations of and extensions, divisions, renewals and
reissuance of, any of the foregoing, and rights therein,
including without limitation (a) rights under any royalty or
licensing agreements, and (b) programming and programming rights,
on any distribution medium (i.e. audio, video, film, digital).
1.11 "Internet" means any network of interconnected computer networks,
using the Transmission Control Protocol/Internet Protocol and/or
such other standard network interconnection protocols as may be
adopted from time to time, which is used to transmit Content that
is directly or indirectly delivered to a computer or other
digital electronic device for display to an end-user, whether
such Content is delivered through on-line browsers, off-line
browsers, or through "push" technology, electronic mail,
broadband distribution, satellite, wireless or otherwise, and any
subset of such network, such as "intranets."
1.12 "Internet Site" means any site or service delivering Content on
or through the Internet, world-wide web, corporate intranets,
private data networks or proprietary on-line service, including,
without limitation, America Online, Compuserve, Prodigy and the
Microsoft Network.
1.13 "Person" means any natural person, legal entity, or other
organized group of persons or entities. (All pronouns whether
personal or impersonal, which refer to a Person include natural
persons and other Persons.)
1.14 "Xxxxxxx Group Core Business" means in-person seminars,
television infomercials, one-on-one human coaching, printed books
and audio and video tapes, marketed, distributed or supplied by
the Xxxxxxx Group, other than on or through the Internet.
1.15 "Xxxxxxx Group/Change Your Life Content" means new Content (i)
created jointly by Change Your Life and the Xxxxxxx Group or
their representatives, (ii) created by Change Your Life based on
or derived from Xxxxxxx Group Content or (iii) any
2
Enhancement for which the Enhancement Development Cost has been
recouped as set forth in Section 2.4.
1.16 "Xxxxxxx Group Content" means any existing or future non-Internet
Content (i.e. Content that is not distributed on or through or
utilizes the Internet) that is owned by the Xxxxxxx Group and
relates to, among other things, the Xxxxxxx Group Core Business.
1.17 "Xxxxxxx Group/Change Your Life Site" is defined in Section 2.1
hereof.
1.18 "Xxxxxxx Group Products" means all existing and future Xxxxxxx
Group-branded, affiliated and sourced products, including books,
audio and video tapes and other merchandise, but shall exclude
off-line coaching services that are not marketed, serviced or
supported through the Internet.
1.19 "Xxxxxxx Group Marks" means the existing trademarks and service
marks of the Xxxxxxx Group set forth on Exhibit E hereto, as from
time to time amended so as to include all future trademarks and
service marks, to the extent that the Xxxxxxx Group has an
interest therein.
1.20 "Xxxxxxx Group Property" is defined in Section 9.1(a) hereof.
1.21 "Xxxxxxx Group Content Deliverables" is defined in Exhibit A
hereof.
2. DISTRIBUTION; PROGRAMMING
2.1 XXXXXXX GROUP/CHANGE YOUR LIFE SITE. The Xxxxxxx Group shall have a
co-branded area on the Change Your Life Site (the "Xxxxxxx Group/Change Your
Life Site"). In addition, the Xxxxxxx Group will receive a Fixed Icon within
one-half of up to six Change Your Life Site Channels, i.e. no more than three
Fixed Icons. In the event of an odd number of channels (up to and including five
channels), the number of channels for the purpose of calculating the number of
Fixed Icons for the Xxxxxxx Group shall be rounded up to the next even number,
i.e. one shall become two, three shall become four and five shall become six. If
there are more than six Change Your Life Site Channels, the Xxxxxxx Group and
Change Your Life shall mutually agree on the number of additional Fixed Icons to
be provided to the Xxxxxxx Group within the additional Change Your Life Site
Channels, which shall in any event result in Fixed Icons in at least one-third
of such additional Change Your Life Site Channels. The Xxxxxxx Group will be
listed as a resource on those Change Your Life Site Channels in which the
Xxxxxxx Group does not have a Fixed Icon.
2.2 CONTENT. Subject to the terms of this Agreement, CYL shall have the
right to integrate, use and develop existing or future Xxxxxxx Group Content and
Xxxxxxx Group/Change Your Life Content anywhere on the CYL Network as further
described in Section 3 hereof. The Xxxxxxx Group/Change Your Life Site shall
consist of (i) Xxxxxxx Group Content and any other Content licensed, sublicensed
and/or published by the Xxxxxxx Group in connection with its products, services
or publications including, without limitation, elements described on EXHIBIT A
3
hereto, (ii) Xxxxxxx Group/Change Your Life Content, (iii) Change Your Life
Content and any other Content licensed, sublicensed and/or published by CYL in
connection with its products, services or publications and (iv) other elements
as mutually agreed by CYL and the Xxxxxxx Group. The Xxxxxxx Group shall not
authorize or permit any third party (including but not limited to affiliates,
unaffiliated parties, strategic partners, joint venture partners and others) to
distribute any Content on the CYL Network without CYL's prior written approval.
2.3 DEDICATED EMPLOYEES. Change Your Life will dedicate a team of at
least six individuals whose primary responsibility will be the development and
maintenance of the (i) Xxxxxxx Group Content on the CYL Network and (ii) Xxxxxxx
Group/Change Your Life Content (the "Xxxxxxx Team"). Such individuals will be
employed by and subject to the management control of Change Your Life; PROVIDED,
HOWEVER, that Xxxxxxx will have the right to approve the selection of the
General Manager of the Xxxxxxx Team. All other personnel and resources to be
dedicated to any Xxxxxxx Group project will be determined in accordance with and
subject to Change Your Life's periodic personnel and budgeting process.
2.4 XXXXXXX GROUP ENHANCEMENTS. (a) If the Xxxxxxx Group proposes that
Change Your Life develop an Internet-based product offering that was not
previously agreed to by the Parties (an "Enhancement Product") and Change Your
Life determines not to commit development dollars to such Enhancement Product
(an "Enhancement"), then the Xxxxxxx Group may develop such Enhancement
utilizing its own funding and resources; PROVIDED, HOWEVER, such Enhancement (i)
shall conform to all uniformity and technical requirements of Change Your Life,
including, without limitation, look, feel and functionality, (ii) shall not be
available outside the CYL Network, (iii) shall not cause or result in a material
adverse effect on CYL and (iv) shall not be developed within six months of the
launch of the CYL Network. CYL will not be permitted to distribute such
Enhancement outside of the Xxxxxxx Group/Change Your Life Site without the
consent of the Xxxxxxx Group until the Xxxxxxx Group recoups its Enhancement
Development Cost plus fifty percent (50%) of such costs from the compensation to
which it is entitled pursuant to Section 7, at which time the Enhancement shall
be deemed to be Xxxxxxx Group/Change Your Life Content. Change Your Life may
incur and shall charge the Xxxxxxx Group for certain costs associated with an
Enhancement (if applicable), including, without limitation, cost of (a)
integrating of such Enhancement in the Xxxxxxx Group/Change Your Life Site, (b)
servicing, sales commissions and tracking of advertising or sponsorship
associated with such Enhancement, (c) transaction processing associated with
such Enhancement and (d) any revenue sharing arrangements with marketing and
distribution partners of CYL ("Change Your Life Enhancement Costs"). CYL will
charge the Xxxxxxx Group for Change Your Life Enhancements Costs based on its
then current actual costs.
(b) Until the Xxxxxxx Group has received an amount equal to
its Enhancement Development Cost plus fifty percent (50%), the Xxxxxxx Group
shall (i) be entitled to receive in cash upon receipt by Change Your Life a
share of those advertising revenues that are directly attributable to such
Enhancement, which revenue share shall be 25% greater than the Standard
Advertising Revenue Amount set forth on Exhibit B and (ii) if such Enhancement
is a fee-based product (i.e., user of Enhancement must pay for use of such
Enhancement), then the Xxxxxxx
4
Group shall be entitled to receive any revenues net of Change Your Life
Enhancement Costs, received by Change Your Life and directly attributable to
such Enhancement.
If the Xxxxxxx Group collects revenues associated with such Enhancement, then
the Xxxxxxx Group will remit to Change Your Life all Change Your Life
Enhancements Costs. After the Xxxxxxx Group has recouped its Enhancement
Development Cost plus fifty percent (50%) for such Enhancement, the terms of
Section 7 hereof shall apply.
(c) Each Enhancement shall comply with the following terms:
(i) no Enhancement may reside outside the domain
of the Change Your Life Site or on any
server outside the CYL Network;
(ii) before an Enhancement may be implemented,
Change Your Life must be provided with
adequate time in its reasonable discretion
to review fully and approve in its
reasonable discretion all technology, Look,
Feel and Functionality (subject to Xxxxxxx'
rights set forth in Section 3.4 hereof) and
production plans and designs;
(iii) Change Your Life shall have the right in its
reasonable discretion to approve
arrangements for the development,
production, merchandising and sponsorship
for the Enhancement; and
(iv) users of the Enhancement shall not be
required to go through a registration
process (or any similar process) to access
and use the Enhancement.
2.5 CHANGE YOUR LIFE SITE. Subject to the terms of this Agreement,
Change Your Life shall have the following rights. Change Your Life shall have
the sole and exclusive right to determine all Change Your Life Content and other
elements that will be displayed on the Change Your Life Site. Change Your Life
shall have the sole and exclusive right to redesign or modify the organization,
structure, look, feel and functionality, navigation and other elements of the
Change Your Life Site. If Change Your Life implements such redesign or
modifications to the Change Your Life Site in a manner that substantially
modifies the placement of the Fixed Icons, then Change Your Life will work with
the Xxxxxxx Group in good faith to assure that any new placement of the Fixed
Icons is reasonably satisfactory to the Xxxxxxx Group.
2.6 RIGHT TO CONFORM TO INTERNATIONAL LOCAL MARKETS. Change Your Life
shall have the right to conform, and the Xxxxxxx Group shall assist Change Your
Life in conforming, the Xxxxxxx Group Content for markets outside the United
States, including translating the Xxxxxxx Group Content into languages other
than English and making any other stylistic changes to the Xxxxxxx Group Content
to conform it to a local market.
2.7 CHANGE YOUR LIFE LOOK, FEEL AND FUNCTIONALITY. The Xxxxxxx Group
acknowledges and agrees that Change Your Life shall own all right, title and
interest in and to
5
the distinctive and particular elements of graphics, design, organization,
presentation, layout, user interface, navigation, links, trade dress and
stylistic convention (including the digital implementations thereof) within the
Change Your Life Site, and the total appearance and impression substantially
formed by the combination, coordination and interaction of these elements and
any copyrights or other Intellectual Property Rights therein (the "Look, Feel
and Functionality"). Change Your Life shall have editorial control over: (1) the
Change Your Life Site (other than the Xxxxxxx Group/Change Your Life Site), (2)
the portions of the Change Your Life Sites that frame the Xxxxxxx Group/Change
Your Life Site (the "Change Your Life Site Frames") and (3) the main screen for
the Change Your Life Site. Change Your Life may, in its sole discretion,
incorporate navigational icons, links and pointers or other Content into such
Change Your Life Site Frames.
2.8 OTHER SITES. The Xxxxxxx Group agrees and acknowledges that certain
third-party Content providers now or in the future associated with the Change
Your Life Site will have expended or may expend varying efforts and amounts of
money to independently develop their Content, and therefore the Xxxxxxx
Group/Change Your Life Site may look and feel substantially different from the
sites developed by other Content providers on the Change Your Life Site.
2.9 FULFILLMENT. The Xxxxxxx Group will sell or arrange for the sale of
Xxxxxxx Group Products (other than seminars and off-line one-on-one human
coaching services) to Change Your Life at the Xxxxxxx Group's cost for such
Xxxxxxx Group Products. The Xxxxxxx Group will also make available to Change
Your Life those discounts or other concessions on Xxxxxxx Group Products that it
makes available to other third parties or to which the Xxxxxxx Group may be
entitled. The Xxxxxxx Group will permit Change Your Life to offer any
promotional pricing, discount or price reduction that may be offered by any
other distribution channel for Xxxxxxx Group Products. The Xxxxxxx Group will
also permit CYL to sell its live seminars, live events attendance and off-line
one-on-one person-to-person, real-time coaching services. The Parties
acknowledge that in connection with providing such off-line, one-on-one,
person-to-person, real-time, coaching services, the coaching participants may
use the Internet to share non-interactive documents relating to the coaching in
which case Change Your Life will receive a fee, subject to the last clause of
this sentence, equal to 1% of the fee received by the Xxxxxxx Group from such
coaching call but in no event shall the fee to Change Your Life be less than 50
cents per call, unless the costs of such document sharing to Change Your Life
are in excess of such amounts, in which case a higher fee to be agreed by the
Parties will be established to adequately compensate Change Your Life for its
additional costs for its services. To the extent any such coaching has been sold
on-line, then Change Your Life shall be entitled to the revenues from such sale
as specified in Exhibit B hereto.
6
2.10 INTERNET EVENTS. Xxxxxxx will conduct on-line chats of at least
one hour duration on the Change Your Life Site at the following levels:
------------------------------------------ -----------------------------------------------
YEARS NUMBER OF CHATS
------------------------------------------ -----------------------------------------------
in years 1-5 at least ten per year
------------------------------------------ -----------------------------------------------
in years 6-10 at least five per year
------------------------------------------ -----------------------------------------------
thereafter such numbers as are mutually agreed by Change
Your Life and Xxxxxxx
------------------------------------------ -----------------------------------------------
Change Your Life and Xxxxxxx will co-ordinate with each other to establish a
mutually agreeable schedule for the above on-line chats in advance of each
quarter during the term of this commitment, provided that changes for marketing
and other purposes may be necessary and the parties will use their best efforts
to accommodate such changes as they arise. To the extent Xxxxxxx is unavailable
at any time due to death, disability or legal restriction to provide the on-line
chats outlined above, the Xxxxxxx Group will assist, if requested by Change Your
Life, with the process of obtaining a replacement spokesperson acceptable to
Change Your Life, but in no event will the failure of Xxxxxxx to complete the
on-line chats for the reasons specified above be deemed to be a breach of this
Agreement by Xxxxxxx or the Xxxxxxx Group.
2.11 OTHER EXPERTS. The Xxxxxxx Group will use its best efforts to
attract other key Content providers as Content providers for the CYL Network.
2.12 ADVERTISING. The Xxxxxxx Group will collaborate with, make
introductions and provide other reasonable assistance to facilitate sponsorship
and advertising sales for the CYL Network from the Xxxxxxx Group's existing and
future corporate relationships and clients.
2.13 INFORMATION/INVESTOR RELATIONS. The Xxxxxxx Group will cooperate
with and supply to CYL all materials and information reasonably requested by CYL
for regulatory compliance and required disclosures, in each case as required
under applicable law or by CYL's other contractual arrangements. In addition,
Xxxxxxx will dedicate reasonable time and energy to promote CYL to the
investment community, including, without limitation, attendance at meetings and
participation on teleconferences with brokerage firms, analysts and significant
investors.
2.14 XXXXX-XXXXXX. The Xxxxxxx Group will facilitate the negotiation
and execution of an agreement between CYL and Xxxxx-Xxxxxx (or any successor
thereto) for, among other things, the right to broadcast over the CYL Network
excerpts from infomercials that promote Xxxxxxx Group Products. This assistance
from the Xxxxxxx Group shall not require it to undertake any actions that would
be detrimental, in the reasonable judgment of the Xxxxxxx Group, to its share of
revenues from Xxxxx-Xxxxxx.
7
2.15 COACHING. If Change Your Life offers for sale person-to-person,
coaching services on the Change Your Life Site, the Xxxxxxx Group will be the
exclusive provider of such coaching services. Xxxxxxx will have approval over
the coaching services sold by the Change Your Life Site and will work with
Change Your Life to develop the appropriate types of coaching services.
Notwithstanding the foregoing, the Xxxxxxx Group exclusivity with regard to
coaching services is subject to the following provisions: (1) there will be
various pricing options, each option offering a relative value; (2) more than
one type of approach to coaching may be offered including coaching services
either offered by or branded under a name different that one related to the
Xxxxxxx Group; and (3) there may be private label versions of the coaching
services. Subject to Section 7 and Exhibit B attached hereto, Change Your Life
and the Xxxxxxx Group will share revenue associated with such coaching services.
Nothing contained in this Section 2.15 shall be deemed to restrict the Xxxxxxx
Group from providing offline one-on-one human coaching. However, if the Xxxxxxx
Group is no longer actively engaged in providing coaching services or Xxxxxxx,
individually, is no longer directing the Xxxxxxx Group coaching services, then
the Xxxxxxx Group shall no longer be the exclusive provider of coaching services
for Change Your Life.
3. LICENSE
3.1 EXCLUSIVE GRANT. The Xxxxxxx Group grants to CYL, during the term
of this Agreement and subject to the terms and conditions contained herein and
the rights of third parties (if any), the exclusive, worldwide right and license
on the Internet:
(a) to use, copy, publicly display, edit, revise, amend,
modify, extend, perform, distribute or otherwise make available Xxxxxxx Group
Content on the CYL Network;
(b) to permit users of the CYL Network to view, access,
retrieve, copy and print any Xxxxxxx Group Content distributed thereon;
(c) to use the Xxxxxxx Marks, the likeness of Xxxxxxx and the
Xxxxxxx Group Content and in connection with advertising, promotion and
operation of the CYL Network; and
(d) to advertise, promote, utilize as Content and sell Xxxxxxx
Group Products on the Internet (provided that the exclusivity with respect to
this Section 3.1(d) is subject to Section 9.3).
3.2 SOLE INTERNET DISTRIBUTION. Subject to Section 9.3, the Xxxxxxx
Group/Change Your Life Site will be the Xxxxxxx Group's sole authorized Internet
Site or presence, and the Xxxxxxx Group will not maintain any other Internet
Site or presence. The Xxxxxxx Group will incorporate the contents of its
existing website(s) into the Xxxxxxx Group/Change Your Life Site and shall not,
during the term of this Agreement, sponsor, support or maintain any other
website.
3.3 XXXXXXX GROUP CONTENT. (a) CYL shall have access to and the Xxxxxxx
Group shall deliver, at times reasonably requested by CYL, all Xxxxxxx Group
Content. Notwithstanding the foregoing, Xxxxxxx shall have approval and control
over Xxxxxxx Group Content and shall have the right to refuse to deliver to CYL
specific Xxxxxxx Group Content if,
8
in Xxxxxxx' judgment, the Xxxxxxx Group Content or the use contemplated by CYL,
conflicts with, interferes with or is detrimental to Xxxxxxx'x interests,
reputation or business or might subject Xxxxxxx to unfavorable regulatory
action, violate any law, infringe the rights of any person, or subject Xxxxxxx
to liability for any reason; provided that a refusal by the Xxxxxxx Group to
deliver certain Xxxxxxx Group Content shall not diminish its obligation to
provide Content generally hereunder.
(b) The Xxxxxxx Group will assist Change Your Life in developing and
producing new Content, services and utilities that will be updated on an ongoing
basis. The Xxxxxxx Group will collaborate with Change Your Life in the
development and production of the Change Your Life member experience. For those
Change Your Life Site Channels in which the Xxxxxxx Group has a Fixed Icon, the
Xxxxxxx Group will:
(i) collaborate in the process of developing core tools
and resources;
(ii) provide text and proprietary artwork and images;
(iii) provide a complete list of appropriate products and
services to be offered by Change Your Life in such
Change Your Life Site Channels;
(iv) provide answers to questions from members of Change
Your Life;
(v) actively participate in the development of
educational programs to be offered in such Change
Your Life Site Channels; and
(vi) train and provide qualified personnel (to be
compensated by Change Your Life) for message boards
and chat services.
3.4 OPERATION OF XXXXXXX GROUP/CHANGE YOUR LIFE SITE. (a) During the
term of this Agreement and subject to the then applicable uniformity
requirements of Change Your Life including, without limitation, Look, Feel and
Functionality, Xxxxxxx, individually and not through intermediaries, shall have
the right to approve and create the Content and the look and feel on the Xxxxxxx
Group/Change Your Life Site and to have it displayed on the Xxxxxxx Group/Change
Your Life Site, provided however, that CYL shall not be obligated to place any
Content on the Xxxxxxx Group/Change Your Life Site that (i) does not meet Change
Your Life's technical requirements, (ii) is outside of the personal and
professional improvement category, (iii) would result in a violation of any
applicable governmental law, rule or regulation or any other terms of this
Agreement, or conflict with any third party rights, (iv) is morally offensive,
(v) violates or conflicts with any applicable restrictions or limitations placed
on CYL by its third party promotional and marketing partners or (vi) would
result in a material adverse effect on CYL. In the event that Xxxxxxx is no
longer actively involved in the Xxxxxxx Group's businesses, the Xxxxxxx Group
shall have the right to designate one person who shall succeed Xxxxxxx with
respect to the rights set forth in the prior sentence, provided such person has
final decision-making authority on all such decisions.
(b) Change Your Life shall provide the Xxxxxxx Group with those
data and systems
9
services that may be reasonably required for the maintenance
of the Xxxxxxx Group/Change Your Life Content and the Xxxxxxx Group/Change
Your Life Site.
(c) Subject to the terms and provisions of this Agreement, Change
Your Life shall have sole authority over budgeting and operational issues
affecting the Change Your Life Site and the Xxxxxxx Group/Change Your Life
Site.
4. PROMOTION
4.1 COOPERATION. Each Party shall cooperate with and reasonably assist
the other Party in supplying all necessary materials for marketing and
promotional activities of Change Your Life. The Xxxxxxx Group will assist Change
Your Life in (i) securing appropriate advertisers and sponsors for the Change
Your Life Site and (ii) developing sponsor-funded programs for the Change Your
Life Site and the Xxxxxxx Group/Change Your Life Site.
4.2 PROMOTION OF CYL BY THE XXXXXXX GROUP. The Xxxxxxx Group agrees to
use its reasonable efforts to promote Change Your Life, including but not
limited to promotion of the affiliation between the Xxxxxxx Group and Change
Your Life. Further, the Xxxxxxx Group will and will use its reasonable efforts
to cause third-party distribution partners of the Xxxxxxx Group to:
(a) feature the URL for the Change Your Life Site and any
keywords or locators for any Change Your Life interactive
marketing and distribution partners in all existing and
future books, tapes, off-line class and seminar materials
and any and all other printed materials (including the
promotional materials used by the Xxxxxxx Group to promote
the Xxxxxxx Group Core Business);
(b) mention and/or display the Xxxxxxx Group/Change Your Life
Site and its relationship with Change Your Life in all
applicable television, print, and radio appearances or
interviews; and
(c) include Change Your Life-branded Internet access software
(or that of a CYL distribution/media partner), with
Xxxxxxx Group books, recorded audio content and off-line
seminar and appearance materials.
The undertaking in this Section 4.2 with respect to third-party distribution
partners shall not require the Xxxxxxx Group to undertake any actions that would
be detrimental, in its reasonable judgment, to its share of revenues from such
distribution partners or breach any of its contractual obligations. In such
promotions, Change Your Life shall have the right to control the manner in which
the Change Your Life logo is displayed and the Change Your Life Site described.
4.3 QUALITY CONTROL AND APPROVALS. (a) The Xxxxxxx Group will provide
camera-ready specimens of the Xxxxxxx Marks and the likeness of Xxxxxxx for use
by CYL as specified in Section 3.1. In the event that
10
CYL utilizes the Xxxxxxx Marks or the likeness of Xxxxxxx to advertise or
promote the CYL Network (the "CYL Promotional Materials") without including any
other third party Content provider on such advertisement or promotion, then CYL
will provide the Xxxxxxx Group with an example of such CYL Promotional Materials
for prior approval by the Xxxxxxx Group. If the Xxxxxxx Group does not respond
within 5 days of delivery of such CYL Promotional Materials then the Xxxxxxx
Group will be deemed to have approved such CYL Promotional Materials. If such
CYL Promotional Materials also feature other Content providers of the CYL
Network, no approval shall be necessary, however, the Xxxxxxx Group may request
the removal of any Xxxxxxx Marks or likeness of Xxxxxxx as soon as commercially
practicable if in the Xxxxxxx Group's reasonable judgment, the use thereof does
not comply with the terms and provisions of this Section 4.3.
(b) CYL recognizes and understands the importance of the exercise of
control by the Xxxxxxx Group over the quality of the services provided by CYL
using the Xxxxxxx Marks. CYL agrees that the services provided by CYL under the
Xxxxxxx Marks will be of a quality standard reasonably acceptable to the Xxxxxxx
Group and further agrees to respond to any reasonable objections by the Xxxxxxx
Group in this regard; PROVIDED, HOWEVER, that use of the Xxxxxxx Marks in
connection with services of a quality at least equal to that of CYL's services
generally shall be deemed to be compliance by CYL of all quality control
obligations hereunder.
4.4 PROMOTION OF THE XXXXXXX GROUP BY CHANGE YOUR LIFE. Change Your
Life agrees to use its reasonable efforts to promote the Xxxxxxx Group,
including promoting the Xxxxxxx Group's affiliation with Change Your Life.
Change Your Life shall also commit in the first ten years of the operation of
the Change Your Life Site to reserve a pool equal to approximately 10% of the
total Impressions received by the Change Your Life Site each quarter during the
following quarter (the "Impressions Pool") to be directed exclusively to the
Change Your Life Site experts. The Xxxxxxx Group will be prominently featured
and receive that share of the Impressions Pool that is granted to the expert
tier level in which the Xxxxxxx Group is placed by Change Your Life which,
during the term of this Agreement, shall be in the highest tier available for
any expert of Change Your Life.
4.5 JOINT PRESS RELEASE. On a date to be determined by Change Your
Life, Change Your Life and the Xxxxxxx Group shall jointly issue one or more
press releases regarding the Xxxxxxx Group affiliation with Change Your Life and
the availability of the Xxxxxxx Group Content through the CYL Network. Any
additional press releases by either Change Your Life or the Xxxxxxx Group that
contain information that is in addition to (a) a description or reference to the
arrangements between Change Your Life and the Xxxxxxx Group, such as a list of
Change Your Life experts and a description of their website features and tools
on the CYL Network, (b) previously approved standard disclosures and tag lines
of the other party or (c) previously released and mutually approved CYL
Promotional Materials, shall require the prior approval of the other Party
hereto. The Parties agree that any release that includes Xxxxxxx shall identify
him as Chairman and a founder of CYL.
4.6 USE OF LOGO AND/OR TAG LINE. The Xxxxxxx Group shall provide CYL
with its logo and/or tag line, if any, in an electronic form and hereby grants
CYL the right to use such logo
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and/or tagline in accordance with the terms of this Agreement. In the event that
the Xxxxxxx Group's logo and/or tag line is modified, the Xxxxxxx Group shall
provide CYL with 30 business days advance written notice, including such
modified logo and/or tag line and CYL shall have 30 business days to incorporate
such modified logo and/or tag line into their programming.
4.7 RESPONSE TO QUESTIONS/COMMENTS, CUSTOMER SERVICE. The Xxxxxxx Group
shall use its best efforts to respond promptly and professionally to questions,
comments, complaints and other reasonable requests regarding the Xxxxxxx
Group/Change Your Life Site by CYL users and shall cooperate with and provide
answers to commonly asked questions regarding the Xxxxxxx Group to Change Your
Life in order to assist Change Your Life in promptly answering the same. Change
Your Life shall co-operate with and provide answers to commonly asked questions
regarding Change Your Life to the Xxxxxxx Group in order to assist the Xxxxxxx
Group in promptly answering the same.
4.8 STATEMENTS TO THIRD PARTIES. Neither Party shall make, publish, or
otherwise communicate or cause to be made, published or otherwise communicated,
any deleterious remarks whatsoever to any third parties concerning the other
Party or its affiliates, directors, officers, employees or agents, including,
without limitation, the other Party's business projects, business capabilities,
performance of duties and services or financial position.
4.9 LIMITATION OF PROMOTION. Subject to the terms of Section 9.3(b),
the Xxxxxxx Group will not promote any other Internet Site or Internet product
or service without the prior written consent of Change Your Life.
5. TERM
5.1 DURATION. Subject to this Section 5, this Agreement and the
licenses granted hereunder shall be perpetual. The Agreement may, however, be
terminated or its term abbreviated in accordance with the terms and conditions
of Section 5.2 hereof.
5.2 FINANCIAL TESTS. Within 90 days of the tenth anniversary of the
date of the launch of the Change Your Life Site (the "Tenth Anniversary Date"),
Change Your Life and the Xxxxxxx Group will determine if the following two tests
have been met:
(a) Change Your Life has been able to secure in the aggregate
equity, debt or commercial credit financing coupled with cumulative (measured
from the fiscal year in which Change Your Life achieves at least break even cash
flow) positive, free cash flow in an amount of at least $40 million in the ten
year period beginning on the date of this Agreement; and
(b) Change Your Life has at least $10 million in working
capital, measured on the basis of the average of the working capital amounts at
the end of the last four fiscal quarters ending prior to the Tenth Anniversary
Date.
If the conditions in (a) and (b) above have been determined
not to have been met, then either Party may notify the other within 30 days
thereof that it will not thereafter continue with the Agreement. If no such
notice is given, then the Agreement will continue.
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5.3 POSSIBLE REDUCTION IN TERM. Beginning with the eleventh year
following the launch of the Change Your Life Site, Change Your Life will commit
to certain amounts of annual promotions for Xxxxxxx, the Xxxxxxx Group/Change
Your Life Site and Xxxxxxx Group Products (taken together). These promotions
will be reviewed beginning at the end of the eleventh year following the launch
of the Change Your Life Site and on each anniversary thereafter (each an "Option
Year") to determine if the following conditions have been met:
(a) Change Your Life has devoted in the equivalent period
specified below off-line marketing dollars to Xxxxxxx, the Xxxxxxx Group/Change
Your Life Site and Xxxxxxx Group Products (taken together) in an amount at least
equal to the highest amount spent on any other single expert, calculated on the
basis of the higher amount spent in the following two periods: (i) the last
fiscal year and (ii) an average of the prior ten fiscal years (based on the
highest amount spent on any other single expert in each of the prior years);
(b) On-line promotion in the equivalent period specified below
of Xxxxxxx, the Xxxxxxx Group/Change Your Life Site and Xxxxxxx Group Products
(taken together) has been in an amount and of a value at least equal to the
amount and value provided to the expert adviser featured on the Change Your Life
Site to whom CYL has provided the highest on-line promotion in the equivalent
period, taking into account, in determining value, positioning, size, time of
day and other features, calculated on the basis of the higher amount and value
provided in the following two periods: (i) the last fiscal year or (ii) an
average of the prior ten fiscal years (based on the average of the amounts and
value of on-line promotions for the expert with the highest amounts spent in
each of the prior years);
If the conditions in either (a) or (b) above have not been met in each
respective Option Year, then Change Your Life shall have a period of three
months, unless CYL and the Xxxxxxx Group agree in writing to a longer period, to
cure any deficiency. If Change Your Life does not do so within said period,
either Party may notify the other within 30 days of the end of such three month
period that it will not thereafter continue with the Agreement. If no such
notice is given, then the Agreement shall continue.
5.4 TERMINATION EVENTS. (a) In the event of a breach of a material term
of (x) this Agreement by Change Your Life or the Xxxxxxx Group (y) of Sections
3.3 and 8.5 of the Contribution and Exchange Agreement by and among Change Your
Life, GHS, Inc. and certain of the stockholders of GHS, Inc. or (z) of the
obligations of GHS, Inc. to Xxxxxxx under that certain letter agreement dated
April 23, 1999 regarding reimbursement of expenses, the non-breaching party may
terminate this Agreement provided that it has given the breaching party written
notice of such breach and the breaching party has not within the 45 business
days of the receipt of such notice, corrected such breach if it is capable of
correction, provided however, that if the breaching party believes the breach is
incapable of being cured, said question shall be referred to arbitration under
the terms of Section 13.5. In the event the arbitration concludes that the
breach was curable but was not cured, then the Agreement shall terminate upon
such finding and the breaching party may be found liable for damages in the
arbitration. If, however, the arbitration finds that the breach was not capable
of being cured, then damages may be assessed
13
against the breaching party, but the Agreement will not terminate unless the
same breach occurs again, in which case, notwithstanding the fact that the
subsequent breach is incapable of being cured, the Agreement will terminate.
(b) The Xxxxxxx Group shall have the right to terminate this
Agreement upon providing written notice to Change Your Life if Change Your Life:
(i) becomes insolvent or unable to pay its debts as they mature or makes an
assignment for the benefit of its creditors; (ii) is the subject of a voluntary
petition in bankruptcy or any voluntary proceeding relating to insolvency,
receivership, liquidation, or composition for the benefit of creditors, if such
petition or proceeding is not dismissed within sixty (60) days of filing; (iii)
becomes the subject of any involuntary petition in bankruptcy or any involuntary
proceeding relating to insolvency, receivership, liquidation, or composition for
the benefit of creditors, if such petition or proceeding is not dismissed within
sixty (60) days of filing; or (iv) is liquidated or dissolved.
5.5 RIGHTS UPON TERMINATION OF AGREEMENT. In the event that this
Agreement is terminated in accordance with the terms hereof and no other
agreement is reached by the parties hereto, CYL shall cease all use of the
Xxxxxxx Group Marks as provided in Section 6.3 below. Notwithstanding the
foregoing, CYL shall be permitted to continue to use and modify the Content
derived from the Xxxxxxx Group Content in connection with the operation of the
CYL Network provided that they are in the form used on or before the termination
date and do not include the Xxxxxxx Group Marks and any non-interactive Xxxxxxx
Group Content shall be returned to the Xxxxxxx Group upon its request. In the
event that the Xxxxxxx Group Content from which the Content described above is
derived was copyrighted by the Xxxxxxx Group, then CYL shall pay the royalty set
forth on Exhibit B for its continued use following termination of this
Agreement.
6. TRADEMARKS
6.1 DELIVERY. (a) Each Party acknowledges that the Xxxxxxx Group Marks
are trademarks exclusively owned or controlled by the Xxxxxxx Group and that all
uses by CYL of such Xxxxxxx Group Marks shall inure to the Xxxxxxx Group
benefit.
(b) In the event that during the term of this Agreement CYL shall
create any proprietary right in any Xxxxxxx Group Marks, as a result of the
exercise by CYL of any right granted to it hereunder, such proprietary right
shall immediately vest in the Xxxxxxx Group and CYL shall be authorized to use
for no additional consideration such new proprietary right as though the same
had specifically been included in this Agreement.
6.2 APPLICATIONS. Change Your Life shall not file any application in
any country to register a trademark that contains "Xxxxxxx " or any other
trademark that is the same as, similar to, or misleading with respect to the
Xxxxxxx Group Marks. If any application for registration is filed in any country
by Change Your Life in contravention of this Section 6.2, the Xxxxxxx Group
shall have the right to take appropriate action against Change Your Life,
including seeking injunctive relief, to prohibit or otherwise restrain Change
Your Life from using such trademark. The Xxxxxxx Group shall not file any
application in any country to register a
14
trademark that contains "Change Your Life" or any other trademark which is the
same as, similar to, or misleading with respect to CYL or its marks. If any
application for registration is filed in any country by the Xxxxxxx Group in
contravention of this Section 6.2, Change Your Life shall have the right to take
appropriate action against the Xxxxxxx Group, including seeking injunctive
relief, to prohibit or otherwise restrain the Xxxxxxx Group's use of such
trademark.
6.3 TERMINATION. Upon termination of this Agreement, CYL shall cease
all use of the Xxxxxxx Group Marks, as soon as commercially and technically
practicable but in no event longer than 90 business days from the date of
termination.
7. COMPENSATION
7.1 REVENUE SHARING. Change Your Life and the Xxxxxxx Group shall share
in revenues attributable to the Xxxxxxx Group Content, Xxxxxxx Group/Change Your
Life Content and/or Xxxxxxx Group Products as described in EXHIBIT B attached
hereto.
7.2 PAYMENT. Except as otherwise specified herein, each Party agrees to
pay the other Party all amounts received and payable to the other Party under
this Agreement, less a reserve for returns of 15% and bad debts, on a quarterly
basis within 45 days of the end of the calendar quarter in which such amounts
were collected by such Party and recognized as revenues in accordance with
generally accepted accounting principles.
7.3 CURRENCY, INTEREST AND TAXES. Each Party shall be responsible for
all applicable national, state and local taxes, value added or sales taxes,
exchange, interest, banking, collection and other charges and levies and
assessments pertaining to payments received by such Party other than U.S. taxes
based on the other Party's net income. If either Party is required by law to
make any deduction or to withhold from any sum payable to the other Party
hereunder, such Party shall effect such deduction or withholding, remit such
amounts to the appropriate taxing authorities and promptly furnish the other
Party with tax receipts evidencing the payments of such amounts.
8. ACCOUNTINGS
8.1 PERIODIC REPORTS. (a) Change Your Life will compute and report
revenues and usage data for the Xxxxxxx Group/Change Your Life Site and the
Xxxxxxx Group/Change Your Life Content ("Quarterly Reports") on a calendar
quarter basis for the prior quarterly period. Change Your Life shall provide the
Xxxxxxx Group with each Quarterly Report and payment (as described in Section
7.2) within forty-five days after the calendar quarterly period to which such
Quarterly Report pertains. Acceptance by the Xxxxxxx Group of any Quarterly
Report or payment shall not preclude the Xxxxxxx Group from challenging the
accuracy thereof.
(b) The Xxxxxxx Group will compute and report revenues and usage data
for each Enhancement ("Enhancement Reports") on a calendar quarter basis for the
prior quarterly period. The Xxxxxxx Group shall provide Change Your Life with
each Enhancement Report and payment (as described in Sections 2.4 and 7.2)
within forty-five days after the calendar quarterly period to which such
Enhancement Report pertains. Acceptance by Change Your Life of any
15
Enhancement Report or payment shall not preclude Change Your Life from
challenging the accuracy thereof.
8.2 MAINTENANCE OF RECORDS; EXAMINATION. Change Your Life will maintain
accurate books and records with respect to its business. The Xxxxxxx Group may,
at its own expense, examine and copy those books and records that pertain to the
Quarterly Report, as provided in this Section 8.2. The Xxxxxxx Group may must
examine a particular statement within 3 years after the date when Change Your
Life sends the respective Quarterly Report. Change Your Life will be deemed
conclusively to have sent the Xxxxxxx Group the statement concerned on the date
prescribed in Section 8.1. The Xxxxxxx Group may make such examinations only
during Change Your Life's usual business hours and at the place where Change
Your Life keeps its books and records. Such books and records shall be kept at
the Change Your Life office in New York, New York, unless otherwise notified.
The Xxxxxxx Group will be required to notify Change Your Life at least ten
business days before the date of planned examination. If the Xxxxxxx Group's
examination has not been completed within two months from the time the Xxxxxxx
Group begins such examination, Change Your Life may require the Xxxxxxx Group to
terminate such examination on seven days notice to the Xxxxxxx Group at any
time, provided that Change Your Life has reasonably cooperated with the Xxxxxxx
Group in the examination of such books and records. In the event that an
examination conducted pursuant to the terms of this Section 8.2 results in a
change in the amounts owing to the Xxxxxxx Group by Change Your Life of more
than ten percent (10%) of the total amount reported, then Change Your Life shall
pay both its and the Xxxxxxx Group's expenses of such examination.
9. RIGHTS
9.1 OWNERSHIP. (a) As between the Xxxxxxx Group and CYL, the Xxxxxxx
Group shall be the exclusive owner of and shall have all right, title and
interest in and to the Xxxxxxx Group Content and the Xxxxxxx Group Marks,
including all Intellectual Property Rights therein, but excluding the Change
Your Life Content and the Xxxxxxx Group/Change Your Life Content (the "Xxxxxxx
Group Property").
(b) Change Your Life shall be the exclusive owner of and shall have all
right, title and interest in and to the Change Your Life Content or any Content
derived therefrom, the Xxxxxxx Group/Change Your Life Content or any Content
derived therefrom, the Change Your Life Site, all trademarks of Change Your
Life, and all Intellectual Property Rights contained in each of the above,
excluding the Xxxxxxx Group Property.
9.2 NECESSARY ACTION. Each Party agrees to take all action and
cooperate as is reasonably necessary, at the other Party's request and expense,
to protect the other's respective rights, titles, and interests specified in
this Article 9, and further agrees to execute any documents that might be
necessary to perfect each Party's ownership of such rights, titles, and
interests.
9.3 RESTRICTIONS. Anything contained in this Agreement to the contrary
notwithstanding, the Xxxxxxx Group shall be permitted:
16
(i) to conduct any activity in connection with the Xxxxxxx
Group Core Business conducted during the term of this Agreement,
PROVIDED that (x) such activity is not a product offering designed as
an Internet product offering, (y) any Internet promotion of a Xxxxxxx
Group Core Business offering (a) is only a portion of the main
distribution channels for the Xxxxxxx Group Core Business product
offering, (b) is on a non-interactive commerce website (except
interactivity employed solely to order Xxxxxxx Group Products) or to
download a Xxxxxxx Group Product (such as an audio or video tape) via
the Internet as an alternative delivery route of a third party
distributor, provided that said website does not predominately feature
Xxxxxxx, the Xxxxxxx Group or Xxxxxxx Group Products, (c) is other than
an interactive offering (except interactivity employed solely to order
or download (as an alternative delivery route) Xxxxxxx Group Products)
and (d) does not mimic or incorporate any Xxxxxxx Group/Change Your
Life Content. For example, an Internet appearance on a Simon & Xxxxxxxx
website to promote a new book would be permitted;
(ii) to conduct Internet sales and marketing training for
employees of companies in which the Xxxxxxx Group owns at least 20% of
the equity or equity with a fair market value of at least $250,000
whichever is lower, provided that such equity was not purchased with a
view towards circumventing the terms of this Agreement, and provided
further that any such training on the Internet shall require the
royalty payments to Change Your Life specified on Schedule B hereto;
and
(iii) to continue to provide in-house, corporate consulting
services and products that include client seminars, presentations and
training that may be broadcast via satellite, teleconference or
inter-company networks such as intranets; provided however, that such
intranet broadcasts will be one-directional, for client company use
only and non-interactive except for questions and answers, audience
group responses and Xxxxxxx' Outcome Purpose Action (OPA) offerings.
The Xxxxxxx Group will include restrictions consistent with the terms of this
Agreement, particularly Section 9.3 hereof, in all new distribution agreements
and in all renewals of existing distribution agreements.
10. WARRANTIES; REPRESENTATIONS; INDEMNITIES
10.1 AUTHORITY AND OBLIGATION OF EACH PARTY. Each Party represents and
warrants to the other, as of the date hereof, that (a) such party has the full
right, power and authority to enter into this Agreement, to grant the licenses
hereunder and to perform the acts required of it hereunder, (b) the execution,
delivery and performance by such party of this Agreement are within its powers
and have been duly authorized by all necessary action on its part; (c) the
execution of this Agreement by such party and the performance by such party of
its obligations and duties hereunder do not and will not violate any agreement,
applicable law, judgment, injunction, order or decree to which such party is a
party or by which it is otherwise bound; (d) when executed and delivered by it,
this Agreement will constitute the legal, valid and binding obligation of such
party, enforceable against such party in accordance with its terms; (e) such
17
party acknowledges that the other party makes no representations, warranties or
agreements related to the subject matter hereof which are not expressly provided
for in this Agreement.
10.2 REPRESENTATIONS. (a) The Xxxxxxx Group represents, warrants and
covenants that: (i) it has sufficient right and authority to grant to CYL all
licenses and rights granted by the Xxxxxxx Group hereunder; (ii) the Xxxxxxx
Group Marks and the use thereof as permitted pursuant to this Agreement shall
not violate any law or infringe upon or violate any rights of any Person; (iii)
the Xxxxxxx Group Content and the use thereof as permitted pursuant to this
Agreement shall not violate any law or infringe upon or violate any rights of
any Person under any law; (iv) no Person other than those Persons specifically
identified on Exhibit D hereto and who may be Parties to this Agreement has any
ownership right or interest in or with respect to the Xxxxxxx Group Marks or
Xxxxxxx Group Content and the Xxxxxxx Group shall not transfer or assign any
ownership right or interest, in or with respect to the Xxxxxxx Group Marks or
the Xxxxxxx Group Content, unless the transferee becomes a party to this
Agreement and bound by the terms and provisions hereof; (v) Exhibit E contains a
true and complete list of all Xxxxxxx Group Marks used in connection with the
(x) Xxxxxxx Group Content or (y) any Intellectual Property used by the Xxxxxxx
Group and (vi) no Person in the Xxxxxxx Group or any affiliate of the Xxxxxxx
Group has, during the term of this Agreement, or will, enter into any business
or contractual or other relationship that is directly or indirectly competitive
with CYL's business or would have any ownership, control or interest over the
subject matter of this Agreement.
(b) Change Your Life represents and warrants that: (i) it owns
or controls all right, title, and interest in and to the Change Your Life Site,
and all Intellectual Property Rights therein, necessary to carry out its
obligations hereunder; (ii) it is has the full power and authority to enter into
and fully perform this Agreement; (iii) the Change Your Life Site, any Change
Your Life Content and any Content developed or furnished by Change Your Life
hereunder and the use thereof shall not violate any law or infringe upon or
violate any rights of any Person; and (iv) the Change Your Life Site will be
produced, advertised, distributed, transmitted and licensed in accordance with
all applicable federal, state, local and foreign laws and in a manner that will
not reflect adversely on Xxxxxxx.
10.3 INDEMNITIES. (a) The Xxxxxxx Group shall indemnify and hold
harmless CYL and its officers, agents and employees from and against any and all
losses, liabilities, costs, expenses (including reasonable attorneys' fees),
claims, penalties, judgments and damages, resulting from or arising out of:
(i) any breach by the Xxxxxxx Group of any representation or
warranty made in this Agreement, including, but not limited to, any infringement
or alleged infringement or violation of rights of third parties, including
copyright, trademark, trade dress, trade secrets, design right, patent, moral
right, right of publicity, defamation, libel, know-how and/or any other present
or future intellectual property right of any type; (ii) any injury to person or
property caused by any material, product, or service sold or distributed in
connection with Xxxxxxx' participation in the CYL Network or any activity
conducted or action taken by the Xxxxxxx Group, directly or indirectly, in
connection with the Xxxxxxx Group's CYL Site; and (iii) the Xxxxxxx Group
Content and any material to which users can directly link through the Xxxxxxx
18
Group Content or other information supplied by the Xxxxxxx Group.
(b) Change Your Life shall indemnify and hold harmless the
Xxxxxxx Group and its officers, agents and employees from and against any and
all losses, liabilities, costs, expenses (including reasonable attorneys' fees),
claims, penalties, judgments and damages, resulting from or arising out of: (a)
any breach by Change Your Life of this Agreement, including, but not limited to,
any infringement or alleged infringement or violation of rights of third
parties, including copyright, trademark, trade dress, trade secrets, design
right, patent, moral right, right of publicity, defamation, libel, know-how
and/or any other present or future intellectual property right of any type; (b)
any injury to person or property caused by any material, product, or service
sold or distributed in connection with the CYL Network not in connection with
the Xxxxxxx Group/Change Your Life Site and (c) the Change Your Life Content and
any material which users can directly link through the Change Your Life Content,
other than Xxxxxxx Group Content incorporated in the CYL Network.
(c) PROMPT NOTIFICATION. Each party to this Agreement agrees
to (a) promptly inform the other in writing of any information related to the
CYL Network which could reasonably lead to a claim, demand or liability against
Change Your Life or the Xxxxxxx Group by any third party; PROVIDED, HOWEVER,
that failure to give prompt notice will not relieve either party of any
liability hereunder (except to the extent such failure causes or leads to actual
material prejudice to the other party); and (b) cooperate fully with the other
Party, at that other Party's expense, in defending or settling such claim.
11. CONFIDENTIALITY
11.1 CONFIDENTIAL INFORMATION. For the purposes of this Agreement,
"Confidential Information" means any information relating to or disclosed during
the term of the Agreement, which is, or should be reasonably understood to be,
confidential or proprietary to the disclosing Party, including, but not limited
to, information about Change Your Life subscribers, technical processes and
formulas, source codes, product designs, sales, cost and other unpublished
financial information, product and business plans, projections, usage and
marketing data. "Confidential Information" shall not include information (a)
already lawfully known to or independently developed by the receiving Party, (b)
disclosed in published materials, (c) generally known to the public, (d)
lawfully obtained from any third party or (e) required or reasonably advised to
be disclosed by law.
11.2 CONFIDENTIALITY. Each Party acknowledges that Confidential
Information may be disclosed to the other Party during the course of this
Agreement. Each Party agrees that it (a) will not disclose to any third party or
use any Confidential Information disclosed to it except as expressly permitted
in this Agreement and (b) shall take reasonable steps, at least substantially
equivalent to the steps it takes to protect its own proprietary information, to
prevent the duplication or disclosure of Confidential Information of the other
Party, other than by or to its employees or agents who must have access to such
Confidential Information to perform such Party's obligations hereunder, which
employees shall each agree to comply with this Article 11 of this Agreement.
19
11.3 DISCLOSURE. Notwithstanding the foregoing, each party may disclose
Confidential Information (a) to the extent required by a court of competent
jurisdiction or other governmental authority or (b) on a "need-to-know" basis
under an obligation of confidentiality to its legal counsel, accountants, banks
and other financing sources and their advisors.
11.4 TERMS AND CONDITIONS OF AGREEMENT CONFIDENTIAL. The terms and
conditions of this Agreement will be deemed to be the Confidential Information
of each Party an will not be disclosed without the written consent of the other
party or as otherwise provided in this Agreement or as required by law or
regulation.
12. PRIVACY
12.1 PROTECTION OF PRIVACY. Change Your Life shall establish, and the
Xxxxxxx Group and Change Your Life shall adhere to and enforce the terms of, a
privacy policy (which policy may be modified from time to time) for the
protection of the privacy of all subscribers to or users of Change Your Life.
12.2 SUBSCRIBER INFORMATION. The Xxxxxxx Group shall not sell or
otherwise make available to any third party, any information about Change Your
Life subscribers collected via the Change Your Life Site ("Subscriber
Information") except to the extent that such Subscriber Information is required
by a third party to fulfill the purchase of any products or services purchased
via the Change Your Life Site. Furthermore, except for promotional activities
expressly permitted under this Agreement, the Xxxxxxx Group will not use any
Subscriber Information except to the extent that such Subscriber Information is
required by the Xxxxxxx Group to fulfill the purchase of any products or
services purchased via the Change Your Life Site unless (a) such use conforms
with Change Your Life's then-current privacy policy and the Xxxxxxx Group has
obtained Change Your Life's prior written consent for such use; or (b) the
Subscriber Information to be used consists only of information input directly by
a Change Your Life subscriber after such subscriber has either viewed (or been
given a clear and conspicuous opportunity to view) a clear disclosure of how
such information may be used by the Xxxxxxx Group and/or had the opportunity to
"opt out" of any use of such information. This paragraph will survive the
termination of this Agreement for a period of two years.
12.3 SOLICITATION OF SUBSCRIBERS. During the Term of this Agreement
neither the Xxxxxxx Group nor its agents will (a) solicit or participate in the
solicitation of CYL subscribers when that solicitation is for the benefit of any
entity (including the Xxxxxxx Group) which could reasonably be construed to be
or become in competition with CYL or (b) promote any services which could
reasonably be construed to be in competition with services available through
CYL, including, but not limited to, services available through the Internet and
the on-line services of any aggregators of personal and professional development
Content.
13. TREATMENT OF CLAIMS
13.1 DAMAGES. UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO
THE OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY
DAMAGES (EVEN IF THAT PARTY HAS BEEN ADVISED
20
OF THE POSSIBILITY OF SUCH DAMAGES) ARISING FROM BREACH OF THIS AGREEMENT, THE
USE OF OR INABILITY TO USE CYL NETWORK OR ANY OTHER PROVISION OF THIS AGREEMENT,
SUCH AS, BUT NOT LIMITED TO, LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST
BUSINESS (COLLECTIVELY, "DISCLAIMED DAMAGES"); PROVIDED THAT EACH PARTY SHALL
REMAIN LIABLE TO THE OTHER PARTY TO THE EXTENT ANY DISCLAIMED DAMAGES ARE
CLAIMED BY A THIRD PARTY AND ARE SUBJECT TO INDEMNIFICATION ABOVE. EXCEPT AS
PROVIDED ABOVE IN THE "INDEMNITY" SECTION, NEITHER PARTY SHALL BE LIABLE TO THE
OTHER PARTY FOR MORE THAN THE AGGREGATE AMOUNTS PAYABLE HEREUNDER; PROVIDED THAT
EACH PARTY SHALL REMAIN LIABLE FOR THE AGGREGATE AMOUNT OF ANY PAYMENT
OBLIGATIONS OWED TO THE OTHER PARTY UNDER THE PROVISIONS OF THIS AGREEMENT.
13.2 NO ADDITIONAL WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, NEITHER PARTY MAKES, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS,
ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE CYL
NETWORK, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR
COURSE OF PERFORMANCE. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, CYL
SPECIFICALLY DISCLAIMS ANY WARRANTY REGARDING THE PROFITABILITY OF THE CYL
NETWORK OR THE XXXXXXX GROUP/CHANGE YOUR LIFE SITE.
13.3 ACKNOWLEDGMENT. CHANGE YOUR LIFE AND THE XXXXXXX GROUP EACH
ACKNOWLEDGE THAT THE PROVISIONS OF THIS AGREEMENT WERE NEGOTIATED TO REFLECT AN
INFORMED, VOLUNTARY ALLOCATION BETWEEN THEM OF ALL RISKS (BOTH KNOWN AND
UNKNOWN) ASSOCIATED WITH THE TRANSACTIONS CONTEMPLATED HEREUNDER. THE
LIMITATIONS AND DISCLAIMERS RELATED TO WARRANTIES AND LIABILITY CONTAINED IN
THIS AGREEMENT ARE INTENDED TO LIMIT THE CIRCUMSTANCES AND EXTENT OF LIABILITY.
THE PROVISIONS OF THIS SECTION 14 SHALL BE ENFORCEABLE INDEPENDENT OF AND
SEVERABLE FROM ANY OTHER ENFORCEABLE OR UNENFORCEABLE PROVISION OF THIS
AGREEMENT.
13.4 DISPUTE RESOLUTION. (a) Sections 2.4, 2.15., 3.4, 5.3(b) and
9.3(i) and 9.3 (iii) are sections that relate to issues that could not be
adequately described as of the date of this Agreement. Although the parties
intend to co-operate in good faith on such matters, in the event that a dispute
on such matters arises, the following dispute resolution mechanism shall be
employed. Each of the Xxxxxxx Group and Change Your Life shall appoint one
member of the Board of Directors of Change Your Life (other than Xxxxxxx and the
Chief Executive Officer of Change Your Life) or if Xxxxxxx has no nominees then
serving on the Board of Directors of Change Your Life, he may appoint a third
party (other than himself or an affiliate of the Xxxxxxx Group) and these two
designees shall appoint a third person who may, but shall not be required, to be
a member of the Board of Directors of Change Your Life. This group of three
persons shall be empowered as mediators to consider any dispute(s) presented to
them. If this mediation
21
process does not resolve the dispute in a mutually satisfactory manner for
disputes arising under Sections 2.15, 5.3(b) or 9.3 (i) and 9.3 (iii), then the
matter may be submitted by any party to arbitration as provided for in Section
13.5. The referral to arbitration may occur at any time within sixty (60) days
of the decision of the mediators, but in the event the dispute arises under
Sections 2.15, 5.3(b) or 9.3 (i) or 9.3 (iii), the mediators will be instructed
to determine the matter within thirty (30) days of the appointment of the
mediators. If the mediators have not done so, then any party may submit the
matter to arbitration under Section 13.5, provided the dispute has arisen under
Sections 2.15, 5.3(b) or 9.3 (i) or 9.3 (iii), within the subsequent sixty (60)
day period. For disputes arising under Sections 2.4 or 3.4, the determination of
the mediators shall be final and binding on all Parties without the ability to
resort to the provisions of Section 13.4(b), arbitration or any court process.
(b) In the event of any dispute, controversy or claim arising out of or
relating to this Agreement (other than those governed by the terms of Section
13.4(a) hereof), representatives of the parties shall meet in New York, NY, San
Diego, CA or such other city as may be agreeable to the parties as soon as
reasonably possible (but not later than ten (10) days after written notice from
one party to the other of such dispute) and shall enter into good faith
negotiations aimed at resolving the dispute. If they are unable to resolve the
dispute in a mutually satisfactory manner within thirty (30) days from the date
of such notice, the matter may be submitted by any party to arbitration as
provided for in Section 13.5.
13.5 ARBITRATION. (a) Any dispute, controversy or claim between or
among any of the parties hereto arising out of or relating to this Agreement or
the breach, termination or invalidity thereof, including any dispute as to
whether any dispute is subject to arbitration, which has not been resolved after
good faith negotiations pursuant to Section 13.4(b) hereof shall be settled by
binding arbitration administered by the American Arbitration Association in
accordance with its then current Commercial Arbitration Rules except as provided
herein.
(b) Any arbitration shall be conducted by a three person
arbitration panel. The three person arbitration panel shall consist of one party
arbitrator selected by Change Your Life, one party arbitrator selected by the
Xxxxxxx Group, each of whom shall be named within ten (10) days of the demand
for arbitration, and one neutral arbitrator selected by the first two
arbitrators. If the two party appointed arbitrators cannot agree on the neutral
arbitrator within ten (10) days of the selection of the last party appointed
arbitrator, the American Arbitration Association shall appoint the neutral
arbitrator, who shall act as chairperson. In the event of a vacancy with respect
to an arbitrator, the vacancy shall be filled within ten (10) days of notice of
the vacancy in the same manner and subject to the same requirements as are
provided for in the original appointment to that position. If the vacancy is not
filled within ten (10) days, the American Arbitration Association shall make the
appointment. Unless otherwise mutually agreed, the place of arbitration shall be
Xxx Xxxx, XX xx Xxx Xxxxx, XX, as selected by the party receiving the request
for arbitration.
(c) The law applicable to the validity of the arbitration
clause, the conduct of the arbitration, including the resort to a court for
interim relief, enforcement of the award or any other question of arbitration
law or procedure shall be the United States' Federal Arbitration Act,
22
9 U.S.C. ss. 1 ET SEQ. The parties shall be entitled to engage in reasonable
discovery including requests for the production of all relevant documents and a
reasonable number of depositions. The arbitration panel shall have the sole
discretion to determine the reasonableness of any requested document production
or deposition. It is the intent of the parties that a substantive hearing be
held within sixty (60) days of the appointment of the neutral arbitrator or the
rejection of a challenge thereto, whichever shall occur later. In the event that
the dispute referred to arbitration hereunder arises under Section 2.15, 5.3(b)
or 9.3(i) or 9.3 (iii), then the arbitrators shall be instructed to resolve the
entire matter and render their findings within a period of forty-five (45) days
of the appointment of the neutral arbitrator or the rejection of a challenge
thereto, whichever shall occur later. A stenographic record of every hearing
shall be made. The presentation of evidence shall be governed by the federal
Rules of Evidence.
(d) Any award, including any interim award, made shall be made
by a majority of the arbitrators applying the substantive law of New York and
shall (i) be in writing and state the arbitration panel's findings of fact and
conclusions of law; (ii) be made promptly, and in any event within sixty (60)
days after the conclusion of the arbitration hearing; and (iii) be binding
against the parties involved and may be entered for enforcement in any court of
competent jurisdiction.
(e) The costs of any arbitration proceeding (e.g.,
arbitrators, court reporter and room rental fees) shall be equally divided
between Change Your Life and the Xxxxxxx Group. However, each party shall pay
its own expense, including attorneys' and other professionals' fees and
disbursements.
(f) The arbitration provision set forth in this Section 13.5
shall be a complete defense to any suit, action or proceeding instituted in any
court with respect to any matter arbitrable under this Agreement, except that
judicial intervention may be sought in accordance with Section 13.6 hereof.
13.6 NO WAIVERS; INTERIM RELIEF.
The Parties mutually acknowledge that an award of damages may be
inadequate to remedy any breach hereof and that injunctive relief may be
required. Therefore, (a) a party may request a court of competent jurisdiction
to provide interim injunctive relief in aid of arbitration or to prevent a
violation of this Agreement pending arbitration, and any such request shall not
be deemed a waiver or breach of the obligations to arbitrate set forth herein
and (b) the arbitrators may order equitable relief where they deem it
appropriate and the parties agree that any interim relief ordered by the
arbitrators may be immediately and specifically enforced by a court otherwise
having jurisdiction over the parties.
14. GENERAL
14.1 ASSIGNMENT. Neither party may assign this Agreement, nor any
rights, interests or obligations thereunder, in whole or in part without the
other party's prior written consent. Any attempt to assign this Agreement
without such consent shall be void and of no effect AB INITIO. Notwithstanding
the foregoing, the Xxxxxxx Group may assign its rights and duties under the
23
Agreement to an entity, wholly-owned directly or indirectly by Xxxxxxx and
Change Your Life may assign the Agreement to an affiliate provided that such
assignee agrees in writing to succeed to all of the rights and be subject to all
of the obligations of under this Agreement. No assignment shall relieve the
assignor of its obligations under the Agreement. The Agreement shall apply to,
and shall be binding upon each of the Parties thereto, their respective
successors and permitted assigns, and all persons claiming by, through, or under
any of the aforesaid persons.
14.2 COMPLIANCE. Each party shall comply in all material respects with
all laws and regulations applicable to its activities under this Agreement.
14.3 SEVERABILITY. If any provision of this Agreement (or any portion
thereof) or the application of any such provision (or any portion thereof) to
any Person or circumstance shall be held invalid, illegal or unenforceable in
any respect by a court of competent jurisdiction, such invalidity, illegality or
unenforceability shall not affect any other provision hereof (or the remaining
portion thereof) or the application of such provision to any other Persons or
circumstances.
14.4 NOTICES. All notices or other communications required or permitted
to be given hereunder shall be in writing and shall be delivered by hand or
sent, postage prepaid, by registered, certified or express mail or reputable
overnight courier service and shall be deemed given when so delivered by hand,
or if mailed, three days after mailing (one business day in the case of express
mail or overnight courier service), as follows: (i) if to Change Your Xxxx.xxx,
Inc, 000 Xxxxxxxx, Xxx Xxxx, XX 00000 Attention of Xxxx Polish, Chief Operating
Officer with copies to: Xxxxx Xxxxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx
Xxxx, XX 00000 Attention of Xxxxx X. Xxxxxx XX, Esq., (ii) if to the Xxxxxxx
Group, 0000 Xxxx Xxxxxx Xxxxx, Xxxxx 000, Xxx Xxxxx, XX 00000; Attention of Xxx
Xxxxxxx with copies to: Loeb & Loeb, Suite 1800, 0000 Xxxxxxxx Xxxxxxxxx, Xxx
Xxxxxxx, XX 00000-000 Attention of Xxxxx X. Xxxxxxxx, Esq.
14.5 INDEPENDENT CONTRACTORS. The parties to this Agreement are
independent contractors. There is no relationship of partnership, joint venture,
employment, franchise, or agency between the parties. Neither party shall have
the power to bind the other or incur obligations on the other's behalf without
the other's prior written consent.
14.6 FAILURE TO ENFORCE RIGHTS. No failure of either party to exercise
or enforce any of its rights under this Agreement shall act as a waiver of such
right.
14.7 COMPLETE AGREEMENT. This Agreement, along with the Exhibits hereto
and the agreements entered into by the parties on a contemporaneous basis
herewith contain the entire agreement and understanding between the parties
hereto with respect to the subject matter hereof and supersedes all prior
agreements and understandings relating to such subject matter. Neither party
shall be liable or bound to any other party in any manner by any
representations, warranties or covenants relating to such subject matter except
as specifically set forth herein.
24
14.8 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement, and
shall become effective when one or more such counterparts have been signed by
each of the parties and delivered to each of the other parties.
14.9 AMENDMENTS. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
14.10 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of New York applicable to
agreements made and to be performed entirely within such State, without regard
to the conflicts of law principles of such State.
14.11 SOLE BENEFIT. This Agreement is for the sole benefit of the
parties hereto and their permitted assigns and nothing herein expressed or
implied shall give or be construed to give to any person, other than the parties
hereto and such assigns, any legal or equitable rights hereunder.
14.12 HEADINGS. The headings contained in this Agreement or in any
Exhibit or Schedule hereto are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement. All Exhibits and
Schedules annexed hereto or referred to herein are hereby incorporated in and
made a part of this Agreement as if set forth in full herein. Any capitalized
terms used in any Schedule or Exhibit but not otherwise defined therein, shall
have the meaning as defined in this Agreement. When a reference is made in this
Agreement to a Section, Exhibit or Schedule, such reference shall be to a
Section of, or an Exhibit or Schedule to, this Agreement unless otherwise
indicated.
25
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the Effective Date.
CHANGE YOUR XXXX.XXX, LLC
/s/ Xxxxx Xxx
--------------------------------
Print Name: Xxxxx Xxx
----------------------
Title: Vice President
----------------------------
Date: April 23, 1999
----------------------------
/s/ Xxxxxxx X. Xxxxxxx
--------------------------------
XXXXXXX X. XXXXXXX
Date: April 23, 1999
----------------------------
XXXXXXX RESEARCH INTERNATIONAL INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------
Print Name: Xxxxxxx X. Xxxxxxx
------------------
Title: Chairman
------------------------
Date: April 23, 1999
------------------------
26
EXHIBIT A
[Description of Xxxxxxx Group Content]
[Xxxxxxx Group Content Deliverables to be initially supplied and listed within
thirty days of signing and then updated on a regular basis.]
27
EXHIBIT B
REVENUE SHARING
ADVERTISING REVENUES. Aggregate amounts collected by CYL, the Xxxxxxx Group or
either Party's agents, as the case may be, arising from the license or sale of
advertisements, promotions, links or sponsorships ("Advertisements") that appear
within any pages of the Change Your Life Site, less applicable Advertising Sales
Commissions and Distribution Fees.
ADVERTISING SALES COMMISSIONS. (i) Actual amounts paid as commission to third
party agencies or media networks by either buyer or seller in connection with
sale of an Advertisement and/or (ii) any amount payable to employees of CYL in
connection with the sale of an Advertisement.
DISTRIBUTION FEES. Any portion of Revenues earned by the Company that are paid
to a third party with whom the Company partners to distribute, market or
otherwise promote the CYL Network on any digital and/or interactive platform,
which third party shall not include a provider of content unless such provider
of content is separately a party to a distribution, marketing or promotion
agreement with the CYL.
ADJUSTED TRANSACTION REVENUES. Aggregate amounts that are paid by users of the
CYL Network or in connection with the sale, licensing, distribution or provision
any CYL Product, Xxxxxxx Group Product or CYL/Xxxxxxx Group Product (as the case
may be) and excluding in each case (a) amounts collected for sales or use taxes
or duties, (b) handling, shipping and service charges and credit or debit card
charges, (c) credits and chargebacks for returned or canceled goods or services,
(d) cost of goods sold or services and (e) fixed per person per item or session
charges (in the case of digital products only). The fixed per person per item or
session charges will be calculated and mutually agreed prior to each digital
product or service being launched within the CYL Network. [*]
CYL PRODUCT. Any product, good or service (other than a Xxxxxxx Group Product)
which CYL develops, purchases wholesale or manufactures and which CYL (or others
acting on its behalf or as distributors) offers, sells, provides, distributes or
licenses to users of the CYL Network directly or indirectly through (i) the
Change Your Life Site, (ii) any other electronic means directors at users of the
CYL Network (e.g., email offers), or (iii) an `off line' means (e.g. toll-free
number) for receiving orders related to specific offers within the CYL Network
requiring purchasers to reference a specific promotional identifier or tracking
code.
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XXXXXXX GROUP PRODUCT. Any Xxxxxxx Group Product which CYL (or others acting on
its behalf or as distributors) purchases wholesale or manufactures and offers,
sells, provides, distributes or licenses to users of the CYL Network directly or
indirectly through (i) the Change Your Life Site, (ii) any other electronic
means directed at users of the CYL Network (e.g., email offers), or (iii) an
`off line' means (e.g. toll-free number) for receiving orders related to
specific offers within the CYL Network requiring purchasers to reference a
specific promotional identifier or tracking code.
XXXXXXX GROUP OFFLINE/LIVE PRODUCT. Any offline coaching, offline seminar or
offline live event offered by the Xxxxxxx Group which CYL (or others acting on
its behalf or as distributors) offers, sells, provides, distributes or licenses
to users of the CYL Network directed or indirectly through (i) the Change Your
Life Site, (ii) any other electronic means directors at users of the CYL Network
(e.g., email offers), or (iii) an `off line' means (e.g. toll-free number) for
receiving orders related to specific offers within the CYL Network requiring
purchasers to reference a specific promotional identifier or tracking code.
CYL/XXXXXXX GROUP PRODUCT. Any product, good or service which CYL and Xxxxxxx
Group develop together and co-brand as defined in Section 1.15, and which CYL
(or others acting on its behalf or as distributors) offers, sells, provides,
distributes or licenses to users of the CYL Network directly or indirectly
through (i) the Change Your Life Site, (ii) any other electronic means directed
at users of the CYL Network (e.g., email offers), or (iii) an `off line' means
(e.g. toll-free number) for receiving orders related to specific offers within
the CYL Network requiring purchasers to reference a specific promotional
identifier or tracking code.
UNBRANDED CYL/XXXXXXX GROUP PRODUCT. Any product, good or service which is based
upon copyrighted Xxxxxxx Group Content and which after Termination of this
Agreement under Section 5.5, CYL (or others acting on its behalf or as
distributors) continues to offer, sell, provide, distribute or license to users
of the CYL Network directly or indirectly through (i) the Change Your Life Site,
(ii) any other electronic means directed at users of the CYL Network (e.g. email
offers), or (iii) an `off line' means (e.g. toll-free number) for receiving
orders related to specific offers within the CYL Network requiring purchasers to
reference a specific promotional identifier or tracking code.
XXXXXXX GROUP EXISTING CUSTOMERS. Xxxxxxx Group customers that exist as of the
date of this Agreement and Xxxxxxx Group customers that are obtained solely as a
result of direct non-Internet marketing efforts that are identified in the
customer lists that are to be provided by the Xxxxxxx Group in accordance with
Section 1.10 of this Agreement. Such Xxxxxxx Group Existing Customers will be
separately identified and their purchases will be separately tracked.
REVENUE SHARE FOR ADVERTISEMENT SALES. CYL will share Advertising Revenues with
the Xxxxxxx Group as follows: (a) if Content of the Xxxxxxx Group and/or Xxxxxxx
Group/Change Your Life Content is the only Content on a page within the Change
Your Life Site that an Advertisement(s) appears, then the Xxxxxxx Group shall be
entitled to 25% of the Advertising Revenues for Advertisements on such page or
(b) if there is Content from more than one content
29
provider of CYL on a page within the Change Your Life Site and such other
content providers are entitled to a share of Advertising Revenues, then each
such content provider shall be entitled to an amount equal to 25% of the
Advertising Revenue for Advertisements on such page multiplied by the quotient
of: (x) the number of rotating clickable icons (excluding fixed icons,
advertising and sponsorship, icons and product sales icons) that are branded by
such Content Provider on such page divided by (y) the total number of rotating
clickable icons (excluding fixed icons, advertising and sponsorship icons, and
product sales icons) on such page.
REVENUE SHARE FOR XXXXXXX GROUP PRODUCTS. CYL will share with the Xxxxxxx Group
thirty-five percent (35%) of Adjusted Transaction Revenues from Xxxxxxx Group
Products.
REVENUE SHARE FOR CYL PRODUCTS. CYL will share with the Xxxxxxx Group forty
percent (40%) of Adjusted Transaction Revenues from CYL Products that are sold
by the Xxxxxxx Group offline.
REVENUE SHARE FOR CYL/XXXXXXX GROUP PRODUCTS. CYL will share with the Xxxxxxx
Group thirty percent (30%) of Adjusted Transaction Revenues from CYL/Xxxxxxx
Group Products.
REVENUE SHARE FOR XXXXXXX GROUP OFFLINE/LIVEPRODUCTS. CYL will retain the
following amounts in connection with the sale of Xxxxxxx Group Offline/Live
Products:
(a) four percent (4%) of the first $2,000,000 of gross revenue earned
in connection with the sale of such Xxxxxxx Group Offline/Live
Products;
(b) five percent (5%) of the next $1,000,000 of gross revenue earned
in connection with the sale of such Xxxxxxx Group Offline/Live
Products; and
(c) six percent (6%) of all additional amounts of gross revenue earned
in connection with the sale of such Xxxxxxx Group Offline/Live
Products.
In the event that the Xxxxxxx Group pays or agrees to pay any member of the
Xxxxxxx Group personal account representatives (PARs) a revenue share that is
greater than the amounts set forth above in connection with the sale of Xxxxxxx
Group Offline/Live Events, the above percentages shall be modified to reflect
and CYL shall be entitled to retain such higher percentages.
REVENUE SHARE FOR UNBRANDED CYL/XXXXXXX GROUP PRODUCTS. CYL will share with the
Xxxxxxx Group eighteen percent (18%) of the Adjusted Transaction Revenues from
Unbranded CYL/Xxxxxxx Group Products as described above.
REVENUE SHARE FOR XXXXXXX GROUP EXISTING CUSTOMERS. CYL will not retain any
Adjusted Transaction Revenues from the first two purchases of Xxxxxxx Group
Products (other than purchases of book products) made by Xxxxxxx Group Existing
Customers. Thereafter, CYL will share revenue associated with Xxxxxxx Group
Existing Customers with the Xxxxxxx Group in accordance with the revenue sharing
provisions contained in this Exhibit B. Notwithstanding the foregoing, CYL will
not retain any Adjusted Transaction Revenues associated with a specific Xxxxxxx
Group Existing Customer until such Xxxxxxx Group Existing Customer has purchased
30
an aggregate of $400 of Xxxxxxx Group Product.
REVENUE FROM SALES AND MARKETING TRAINING BY THE XXXXXXX GROUP. In the event
that the Xxxxxxx Group provides sales and marketing training in accordance with
Section 9.3(ii) of this Agreement, then CYL shall be entitled to one percent
(1%) of all cash receipts received by the Xxxxxxx Group in connection therewith;
PROVIDED, HOWEVER, that if CYL in any manner assists the Xxxxxxx Group with such
sales and marketing training (including, without limitation, marketing of the
same on the Internet) the parties shall at such time agree in good faith on an
appropriate revenue share with respect thereto.
31
EXHIBIT C
(SECTION 3.1 THIRD PARTY RIGHTS)
32
EXHIBIT D
(SECTION 10.2 - LIST OF XXXXXXX ENTITIES WITH RIGHTS
LICENSED UNDER THE TERMS OF THIS AGREEMENT)
33
EXHIBIT E
(List of Xxxxxxx Group Marks)
NAME OF PERSON Nature of right, title or interest in, and
identification of, Xxxxxxx Group Xxxx and/or
Xxxxxxx Group Content
--------------------------------------------
34
