Exhibit 10.7
BRAND INTEGRATION AND LICENSE AGREEMENT
This Brand Integration and License Agreement ("AGREEMENT") is entered
into as of May 8, 1999, between NBC Multimedia, Inc., a Delaware corporation
(together with its successors and assigns, "LICENSEE"), and National
Broadcasting Company, Inc., a Delaware corporation (together with its successors
and assigns, "NBC" or "LICENSOR").
WHEREAS, NBC, GE Investments Subsidiary, Inc., Neon Media
Corporation ("NMC"), ▇▇▇▇.▇▇▇, Inc. and Xenon 2, Inc. intend to enter into an
Agreement and Plan of Contribution, Investment and Merger (the "Investment
Agreement") relating to the establishment of NMC, as a wholly-owned
subsidiary of NBC Multimedia, Inc. the contribution of the Internet online
destination sites, ▇▇▇.▇▇▇ and ▇▇▇-▇▇.▇▇▇ (and, together with
▇▇▇▇▇▇▇▇▇▇▇.▇▇▇, the "CONTRIBUTED SITES") to NMC, and the merger of NMC with
and into Xenon 2, Inc., a wholly-owned subsidiary of ▇▇▇▇.▇▇▇, Inc. (together
with its successors and assigns, "NEWCO");
WHEREAS, the Licensor is the owner of all rights in and to the trademark
"NBC" (the "▇▇▇▇"), the NBC multicolor logo (the "LOGO") and the NBC
soundmark (the "CHIME");
WHEREAS, during the term of this Agreement, Licensor and Licensee intend
for Licensee to operate the Contributed Sites under the names "▇▇▇.▇▇▇",
"▇▇▇-▇▇.▇▇▇" and ▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ with the Logo appearing on the Contributed
Sites, and the parties desire to set forth in this Agreement the terms and
conditions pursuant to which the pertinent rights are to be granted to
Licensee;
WHEREAS, during the term of this Agreement, Licensor and Licensee intend
for Licensee to use the ▇▇▇▇, the Logo and the Chime on certain of Licensee's
other Internet online destination sites;
WHEREAS, it is the intention of the parties, for the mutual benefit of
Newco and NBC, that Newco and NBC will integrate each other's programming,
products and services and create a consistent cross-platform, cross-business
and cross-product marketing and promotional approach for the benefit of
Newco, NBC and their respective affiliates and brands;
NOW, THEREFORE, in consideration of the mutual agreements and
understandings set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto hereby agree as follows:
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SECTION 1 DEFINITIONS
For purposes of this Agreement, in addition to the capitalized terms
defined elsewhere in this Agreement, the following terms shall have the
following respective meanings:
1.1 "AFFILIATE" means with respect to a specified Person, any
Person that directly or indirectly, through one or more intermediaries,
Controls, is Controlled by, or is under common Control with, the specified
Person.
1.2 "CHANGE OF CONTROL" means any of the following: (i) a
merger, consolidation or other business combination or transaction to which a
Person is a party if the shareholders of such Person immediately prior to the
effective date of such merger, consolidation or other business combination or
transaction, do not have beneficial ownership of voting securities representing
50% or more of the total voting power of the surviving corporation or its parent
immediately following such merger, consolidation or other business combination
or transaction; (ii) any Person shall have beneficial ownership of 50% or more
of the total voting power of another Person, and in the case of Newco, any
Person shall have beneficial ownership of 20% or more of the outstanding shares
of Class A Stock (as such term is defined in Newco's Certificate of
Incorporation) at a time when the holders of Class B Stock do not elect a
majority of the Board of Directors of Newco; (iii) a sale of all or
substantially all of the consolidated assets of a Person to another Person; or
(iv) a liquidation or dissolution of a Person.
1.3 "CLASS A DIRECTORS" shall have the meaning set forth in
Newco's Certificate of Incorporation.
1.4 "CLASS B DIRECTORS" shall have the meaning set forth in
Newco's Certificate of Incorporation.
1.5 "CLASS B STOCK" shall have the meaning set forth in Newco's
Certificate of Incorporation.
1.6 "CO-BRAND" means an arrangement pursuant to which one party
to the arrangement authorizes another party to use the brands or trademarks of
the first party in connection with the other party's property, products or
services.
1.7 "CONTENT" means headlines, summaries, features, stories,
commodity information, links to databases of information, and other information.
1.8 "CONTROL (OR CONTROLLED OR CONTROLLING)" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, as trustee or executor, by contract or credit arrangement
or otherwise.
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1.9 "CONTROLLING INTEREST" means the acquisition of (a) all of
the equity of a Person or all of a business, division or operation, (b) less
than all of the equity of a Person, business, division or operation together
with the contractual or other right to dispose of such Person, business,
division or operation in accordance with Section 4 of this Agreement without the
NBC Indemnified Group incurring any liability or obligation to such Person or
such Person's equity holders with respect to claims for breach of fiduciary or
similar duties, for which Newco does not agree to fully pay, indemnify and hold
harmless the NBC Indemnified Group which indemnity must be binding and
enforceable against Newco.
1.10 "DEFAULT" means Content that appears in all versions of the
Newco Sites (as defined below), including but not limited to all Co-Branded
versions.
1.11 "EFFECTIVE DATE" shall mean the Closing Date, as such term is
defined in the Investment Agreement.
1.12 "INAPPROPRIATE CONTENT" means any material, including text,
graphics, audio or video material, which (a) is pornographic or which contains
nudity, explicit sexual material or depictions of sexual acts of a nature, type
or degree that NBC Television Network would not normally include in an on-air
broadcast, as determined by NBC in its sole and absolute discretion or (b) would
otherwise not be normally broadcast on NBC Television Network, in accordance
with NBC's Broadcast Standards and Practices as in effect from time to time and
as determined by NBC in its sole and absolute discretion, in each case as NBC
would apply to any material broadcast on NBC Television Network or delivered
over the Internet, as the case may be.
1.13 "INTERACTIVE OR ENHANCED TV" means (a) television or
television-like programs (i.e., full motion video no less than two minutes in
length, including, without limitation, everything broadcast on the NBC
Television, all current and future television stations owned and operated by NBC
or any cable or digital network owned or controlled by NBC ("TELEVISION
PROGRAMS")) which are delivered via any transmission method and which
incorporate interactivity with the end user (via any back channel) such as
choice of camera feeds, click-to-order, polling, game playing and VCR-type
functionality (e.g., time shifting, cue and review, indexing, slow motion,
etc.), (b) all interactive content and/or applications that are related to, and
delivered simultaneously with, such Television Programs and/or (c) any other
content and/or applications which are intended to be viewed using a device, a
primary purpose of which is the viewing of Television Programs.
1.14 "INTERACTIVE DELIVERY" means the delivery of content for use
by an end user to a monitor or viewing screen, whereby such delivery occurs by
means of telephone lines, cable television systems, optical fiber connections,
cellular phones, satellites, wireless broadcast or other means of transmission
now known or hereafter devised, provided that the end user has the ability to
selectively manipulate the presentation to effect substantive content changes
during its use (E.G., a user can select the Internet page which such user will
view). For purposes of clarity, it is understood that Interactive Delivery will
NOT include transmission of any kind, now or hereafter devised, which makes
programs and other audio and/or visual recordings of any length, available for
viewing in a linear predetermined presentation (E.G., broadcast television,
cable
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television, pay-per-view, video-on-demand) with selective manipulation
available to the viewer, for example, time delay viewing of a program, color
adjustment, volume control, choice of camera feeds, or textual and/or visual
and/or audio material which enhances or provides additional information
supplementary to and related to the subject matter of the linear
predetermined presentation or presentations, such as (i) a separate stream of
material with no return path, (ii) a separate stream of material with a
return path that is not integrated or connected with the device delivering
the linear presentation, or (iii) a separate stream of material with a return
path that permits responses (E.G., polling) that do not effect sufficient
content change to or manipulation of the linear presentation so as to
constitute Interactive Delivery (as an example of an insufficient change,
acknowledging poll results); PROVIDED, HOWEVER, that Interactive Delivery
shall not include the delivery of Interactive or Enhanced TV or the delivery
(whether by Interactive Delivery or otherwise) of audio and/or visual
recordings of two minutes or more in length. In addition, Interactive
Delivery shall not include the delivery of content to the end user which
occurs principally by transporting a physical object incorporating the
content, such as magnetic disks or optical disks (for example, CD-ROM).
1.15 "LICENSED MARKS" means the ▇▇▇▇, the Logo (including any
derivatives of, replacements for, or successors to such trademark and logo
approved or created by Licensor), the URLs for "▇▇▇.▇▇▇", "▇▇▇-▇▇.▇▇▇" and
"▇▇▇▇▇▇▇▇▇▇▇.▇▇▇", the Chime and, to the extent that it can be obtained in a
commercially reasonable manner, the URL for "▇▇▇▇▇▇▇▇▇▇▇.▇▇▇".
1.16 "NBC BUSINESS" means the business of delivering Licensed
Content (as defined below) on the Contributed Sites.
1.17 "NBC BUSINESS MARKS" means any trademarks owned, controlled
or licensable by NBC (other than the Licensed Marks) that are contained in or
identify the Licensed Content.
1.18 "NBC STUDIOS" means NBC Studios, Inc., any other Subsidiary
of NBC, or NBC itself that owns or produces a television entertainment program
that is broadcast on the NBC Television Network.
1.19 "NBC STUDIOS CONTENT" means any content from, or directly
related to, television entertainment programs that are (a) broadcast on the
NBC Television Network and (b) either (i) entirely owned by NBC Studios or
(ii) produced pursuant to a joint production or joint venture arrangement or
agreement between NBC Studios and a third party that provides NBC Studios
with all rights necessary for NBC Studios to provide the Interactive Delivery
rights in such programs to Licensee, including, without limitation, content
from or directly related to the "Access Hollywood" television program for so
long as NBC Studios has all rights to provide the Interactive Delivery rights
in such program to Licensee.
1.20 "NBC COMPETING BUSINESS" means a business, division or
operation that distributes broad-based audio and/or visual content of two
minutes or more in length for viewing through a monitor or viewing device
(whether the distribution is through broadcast or cable, optical fiber
connections, satellite, wireless broadcast or any other means of transmission
now known or hereafter devised, other than on the Internet, and whether on one
or more channels),
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across several types of content, such as: comedies, dramas, talk shows, news,
sports, movies and children's programming.
1.21 "NBC COMPETITOR" means a Person, division or operation whose
Primary Business (as defined below) is a NBC Competing Business and all direct
and indirect Subsidiaries of such Person, division or operations. The NBC
Competitors include, without limitation, as of the date hereof, Disney/ABC, CBS,
News Corporation/Fox, Viacom (UPN), Time Warner (WB), Liberty Media, ▇▇▇▇▇▇ and
USA Network.
1.22 "NEWCO BUSINESS" means (a) an information, navigation and
content aggregation service distributed, all or substantially all, through the
Internet that provides, across more than six topics of general interest that do
not relate to each other or to a common topic, a combination of all or
substantially all of the following: Internet searching, content aggregation,
topical interest categories and web directories (a "PORTAL SERVICE"), (b) a
broad-based community service distributed, all or substantially all, through the
Internet that offers its members homepages, e-mail and chat rooms and may offer,
in some cases, message boards, clip art, software libraries and/or online
greeting cards (a "COMMUNITY SERVICE"); or (c) a service of direct marketing a
broad range of third party products and services through Internet e-mail to
registered members of such service (an "E-COMMERCE SERVICE"). For the avoidance
of doubt, the term "Newco Business " does not include any Vertical Internet
Business or any service that is not conducted, all or substantially all, on the
Internet. Portal Services include, as of the date hereof, Microsoft Start,
Netscape Netcenter, AOL, Yahoo, Excite, Lycos, Infoseek, Go Network, LookSmart
and Alta Vista. Community Services include, as of the date hereof, Tripod,
WhoWhere, Angelfire, GeoCities and ▇▇▇▇▇▇▇▇.▇▇▇. e-Commerce Services include,
as of the date hereof, ▇▇▇.▇▇▇ and ▇▇▇▇▇▇.▇▇▇.
1.23 "NEWCO COMPETITOR" means a Person, division or operation
whose Primary Business is a Newco Business and all direct and indirect
Subsidiaries of such Person, division or operation.
1.24 "NEWCO SITES" means all of the Internet sites for which
Newco owns or controlled by Newco.
1.25 "NON-PRIMARY COMPETITOR" means a Person that is not a Newco
Competitor, but directly or indirectly engages in a Newco Business or has a
Controlling Interest in a Person who engages in a Newco Business.
1.26 "PERSON" shall mean an individual or a corporation,
partnership, limited liability company, joint venture, trust or any other entity
or organization.
1.27 "PREFERRED" means (i) when a link to or display of Content
appears in a list, the link or Content is in the Default, top-most, and
left-most position, but is in any event above the fold in any standard screen
resolution; or (ii) when a link to or display of Content appears in a format
other than a list, the link or Content is visually more prominent than links
to or Content displayed from competitive services, but is in any event above
the fold in any standard screen resolution.
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1.28 "PRIMARY BUSINESS" of a Person means a business that (a)
generates at least one third of that Person's revenues and more revenues than
any Subsidiary, other business, division or operation of such Person or (b)
accounts for at least one third of that Person's value and more value than any
other Subsidiary, business, division or operation of such Person; PROVIDED,
HOWEVER, that a Person may not have two Primary Businesses and in the event that
the application of subparagraphs (a) and (b) above result in two Primary
Business, subparagraph (a) shall govern.
1.29 "PROMINENT" means (i) when a link to or display of Content
appears in a list, the link or Content is within two (2) places of the Default,
top-most, and left-most position, but is in any event above the fold in any
standard screen resolution; or (ii) when a link to or display of Content appears
in a format other than a list, the link or Content is visually more prominent
than links to or Content displayed from all but two (2) competitive services,
but is in any event above the fold in any standard screen resolution.
1.30 "STRATEGIC INTERNET BUSINESS" means (a) a Vertical Internet
Business or an Internet technology that is owned (or announced that it is
being purchased, pursuant to a binding agreement) and integral to the Portal
Service, Community Service and/or e-Commerce Service of at least one of the
four largest Newco Competitors or (b) a Vertical Internet Business or an
Internet technology that is of equal importance to a Vertical Internet
Business or an Internet technology that is owned (or announced that it is
being purchased, pursuant to a binding agreement) and integral to the Portal
Service, Community Service and/or e-Commerce Service of at least one of the
four largest Newco Competitors; PROVIDED, HOWEVER, that a technology that is
equally important to Internet businesses other than Portal Service, Community
Services or e-Commerce Services (for example, an Internet browser (eg,
Microsoft Explorer) or an operating system (eg, Microsoft Windows)) shall not
be considered to be a Strategic Internet Business. The largest Newco
Competitors shall be determined by the aggregate reach of the combined sites
of a Newco Competitor and calculated by the then-leading Internet rating
service, which service shall be agreed to by the parties (or in the event the
parties cannot agree, shall be Media Metrix). As of the date hereof, the
parties agree that the leading Internet rating service is Media Metrix. For
example, the four largest Newco Competitors, as determined by the March 1999
Media Metrix ratings were AOL, Microsoft, Lycos and Yahoo.
1.31 "SUBSIDIARY" means, as to any Person, another Person of which
outstanding securities having the power to elect a majority of the members of
the board of directors (or comparable body or authority performing similar
functions) of such other Person are at the time owned, directly or indirectly
through one or more intermediaries, or both, by such first Person.
1.32 "TOPIC" means a sub-section of the Newco Sites that
organizes information about a particular area of interest. Topics are organized
in a hierarchy, with the top-most level of the hierarchy being referred to as
the "Main Topic Page" and pages within the Topic but below the Main Topic Page
being referred to as "Sup-Topic Pages."
1.33 "URL" means a Universal Resource Locator.
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1.34 "VERTICAL INTERNET BUSINESS" means any information,
navigation and content aggregation service, community service or e-commerce
service that is designed to organize a specific type of content that is limited
in scope or by topic -- for example, an Internet service that provides content
aggregation for money, business and financial services (eg, CBS Marketwatch), an
Internet service that provides community services limited to certain topics (eg,
Launch Media, a music community) or that is limited to certain groups (eg,
iVillage, a women's community) or an Internet service that markets and sells a
limited type or category of product or service (eg, consumer electronics --
▇▇▇▇▇▇▇.▇▇▇ or mail - ▇▇▇▇.▇▇▇) or that is limited to marketing and selling
primarily NBC Merchandise. For the avoidance of doubt, "Vertical Internet
Business" does not include any portion of any business or any other activity
that is not conducted, all or substantially all, on the Internet.
SECTION 2 LICENSE GRANT
2.1 GRANT OF EXCLUSIVE LICENSE. NBC hereby grants to Licensee
and its wholly-owned Subsidiaries an exclusive, royalty-free, non-transferable
(except in connection with a transaction described in Section 13.2), worldwide,
fully paid up license, subject to compliance with the terms and conditions of
this Agreement:
2.1.1 to use, reproduce and display the Licensed Marks solely for
the Interactive Delivery on the Contributed Sites of NBC
Studio's television entertainment programs as to which NBC
or its Subsidiaries has the right to license Licensee (and,
following the Effective Date, Newco) for Interactive
Delivery;
2.1.2 to reproduce, transmit and display the NBC Studio Content
for Interactive Delivery and to create interactive
programming solely for Interactive Delivery from such
content on the Contributed Sites (collectively, the
"LICENSED CONTENT"), including, for example, the right to
create member clubs and chat rooms on the Contributed Sites
for NBC Studios Content that NBC Studios owns;
2.1.3 to use the Licensed Content in advertising, marketing and
promotion of the Licensed Content and the Contributed Sites,
in accordance with the terms and conditions hereof; and
2.1.4 to use, reproduce and display the ▇▇▇▇ in the form of "NBC
Internet, Inc." and "NBCi" and to use, reproduce and display
the ▇▇▇▇ in such form as the corporate name of Licensee and
for all purposes reasonably incident thereto;
PROVIDED, HOWEVER, that Licensee may not use any of the Licensed Content to
sell, market, merchandise or otherwise promote products or services in any
manner whatsoever or to engage in an e-Commerce Service and; PROVIDED, FURTHER,
that none of the Licensed Marks or the Licensed Content may appear on any page
displaying, directly linking or referring to a site containing Inappropriate
Content.
2.2 GRANT OF NON-EXCLUSIVE LICENSE. From and after the
Effective Date, NBC hereby grants to Licensee and its wholly-owned Subsidiaries
a non-exclusive, royalty-free, non-
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transferable (except in connection with a transaction described in Section
13.2), worldwide, fully paid up license, subject to compliance with the terms
and conditions of this Agreement:
2.2.1 to use, reproduce and display the Licensed Marks for the
Portal Service, the Community Service and the e-Commerce
Service of Newco;
2.2.2 to use, reproduce and display the Licensed Marks and the NBC
Business Marks solely for the NBC Business on the
Contributed Sites;
2.2.3 to use, reproduce and display the Licensed Marks and the NBC
Business Marks in advertising, marketing and promotion of
the Contributed Sites; and
2.2.4 to use, reproduce and display the Licensed Marks in
advertising, marketing and promotion of Newco's Portal
Service, Community Service and e-Commerce Service, including
but not limited to Newco's press releases, letterhead and
business cards, in accordance with the terms and conditions
hereof;
PROVIDED, HOWEVER, that Licensee may not use any of the NBC Business Marks to
sell, market, merchandise or otherwise promote products or services in any
manner whatsoever or to engage in an e-Commerce Service and; PROVIDED, FURTHER,
that none of the Licensed Marks or the NBC Business Marks may appear on any page
displaying, directly linking or referring to a site containing Inappropriate
Content.
2.3 PROPERTY OF LICENSOR. Licensee agrees that the Licensed
Marks, the NBC Business Marks and the Licensed Content, used alone or with other
elements, together with the goodwill of the business symbolized thereby, are and
at all times shall remain the property of Licensor. Licensee agrees and
acknowledges that this Agreement constitutes a license, and that no ownership
interest in and to the Licensed Marks, the NBC Business Marks or the Licensed
Content is intended to be transferred by this Agreement. Licensee recognizes
the value of the goodwill associated with the Licensed Marks, the NBC Business
Marks and the Licensed Content, and that the Licensed Marks, the NBC Business
Marks and the Licensed Content have acquired secondary meaning in the mind of
the public. Licensee agrees (i) to do nothing inconsistent with such ownership
and that all use of the Licensed Marks, the NBC Business Marks and the Licensed
Content by Licensee, including all goodwill generated by Licensee's use and by
permitted licensees of the Licensed Marks, the NBC Business Marks and the
Licensed Content, shall accrue and inure to the benefit of and be on behalf of
Licensor; (ii) not to register or apply for registration of any element of the
Licensed Marks, the NBC Business Marks or the Licensed Content; (iii) not to
assert any adverse claim against Licensor based upon its use of the Licensed
Marks, the NBC Business Marks or the Licensed Content; (iv) not to challenge or
contest Licensor's ownership of the ▇▇▇▇, the Logo, the Chime or any element of
the Licensed Marks, the NBC Business Marks or the Licensed Content, the validity
of the ▇▇▇▇, the Logo, the Chime or any element of the Licensed Marks, the NBC
Business Marks or the Licensed Content, or the validity of the license granted
herein; and (v) to assist Licensor in recording this Agreement with appropriate
government authorities and in procuring any desired registration for the
Licensed Marks, the NBC Business Marks or the Licensed Content in the name of
Licensor, as may be requested by Licensor (at Licensor's sole expense).
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2.4 CONFUSINGLY SIMILAR MARKS. Licensee shall not adopt or use
any trademark, service ▇▇▇▇, tradename, trading style, fictitious business name,
logo or design which may be confusingly similar to the ▇▇▇▇, the Logo, the Chime
or any element of the Licensed Marks, the NE Business Marks or the Licensed
Content.
2.5 REGISTRATION OF THE LICENSED MARKS, THE NBC BUSINESS MARKS,
AND THE LICENSED CONTENT. Licensee acknowledges that Licensor has applied or
may apply for trademark registrations for the ▇▇▇▇, the Logo and the Chime in
the United States of America and throughout the world. Licensee shall assist
Licensor, at Licensor's request and sole expense, in the procurement and
maintenance of the registrations for the ▇▇▇▇, the Logo and the Chime, and in
the procurement and maintenance of Licensor's rights in the ▇▇▇▇, the Logo, the
Chime, the Licensed Marks, the NBC Business Marks and the Licensed Content
(including all intellectual property rights therein whether recognized now or in
the future). In connection therewith, Licensee shall, without limitation, at
Licensor's request and at Licensor's expense, execute and deliver to Licensor in
such form as it may reasonably request, all instruments necessary to (i)
effectuate copyright and trademark protection; (ii) record Licensee as a
registered user of any trademarks pursuant to this Agreement, and (iii) cancel
any such registration. Such registration shall be handled by attorneys selected
or approved and paid for by Licensor unless agreed to in writing by Licensor.
Licensor alone shall have the right to make all filings necessary for trademark
clearance and risk analysis concerning use of, and shall in its own name have
the right to make all filings necessary to register, the ▇▇▇▇, the Logo, the
Chime, the NBC Business Marks and the Licensed Content in those jurisdictions in
which such registrations may be required in order for Licensee to conduct its
business. Licensor agrees to consider in good faith Licensee's request for
additional registrations or extension of the goods and services covered by the
registrations of the Licensed Marks, the NBC Business Marks or the Licensed
Content; PROVIDED, HOWEVER, that Licensor shall determine in its sole and
absolute discretion whether to apply for any such additional registrations or
extensions using the same standard that Licensor applies to additional
registrations or extensions of its owns marks and content and; PROVIDED,
FURTHER, that if Licensor decides to apply for any such additional registration
or extension, they shall be handled by Licensor and its attorneys at Licensee's
sole expense. Licensee shall not apply for or register any of the Licensed
Marks, the NBC Business Marks or the Licensed Content in the United States of
America or anywhere else in the world without the prior written consent of
Licensor. Licensor makes no warranty or representation that trademark or
copyright protection shall be secured in the ▇▇▇▇, the Logo, the Chime or any
element of the Licensed Marks, the NBC Business Marks or the Licensed Content.
2.6 REFERENTIAL USE. Licensor also hereby grants to Licensee
the right to license or permit (without the right to sublicense) the referential
use of the Licensed Marks, the NBC Business Marks and the Licensed Content by
authorized third parties for advertising, marketing or promotion in accordance
with the terms of Sections 2.1 and 2.2 above. Such licenses shall be in writing
and approved by appropriate legal counsel acting for Licensor in advance of such
use, and shall be substantially as protective of the Licensed Marks, the NBC
Business Marks and the Licensed Content as this Agreement. Licensee shall
notify NBC's Law Department sufficiently in advance of the granting of any such
license (or any generic type thereof) to provide Licensor a full opportunity to
exercise its rights of approval in a deliberate manner. Licensee shall not
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purport to grant any licenses to use the Licensed Marks, the NBC Business Marks
or the Licensed Content without the prior written consent of NBC's Law
Department, and any such purported grant made without such consent shall have no
effect and shall be null and void from its inception. Licensor may specify the
person to whom Licensee shall send such requests for approval. Licensor shall
be deemed to have approved a request for a license or referential use if
Licensee complies with Section 3.7 hereof and Licensor does not object in
writing within the time period specified therein.
2.7 RESERVATION OF RIGHTS. All rights in the Licensed Marks,
the NBC Business Marks and the Licensed Content not expressly granted hereunder
to Licensee (except to the extent the rights are exclusively licensed to
Licensee pursuant to Section 2.1 hereunder) are reserved by Licensor and may be
exercised by Licensor or any of its affiliates concurrently herewith. Licensor
shall make no use of the Licensed Marks, the NBC Business Marks or the Licensed
Content other than as expressly permitted hereunder, including, without
limitation, the right to create and register URLs for the marketing, licensing
and selling of NBC Merchandise (as defined below). All rights in and to all
other trademarks, service marks, trade names, trading styles, business names and
fictitious business names, regardless of whether the ▇▇▇▇, the Logo or the Chime
are a part thereof, are reserved to Licensor, its affiliates and its other
licensees. Licensee shall not use any of the Licensed Marks, the NBC Business
Marks or the Licensed Content together or in combination with any other
trademark, service ▇▇▇▇, tradename, trading style, fictitious name, logo, name,
character, symbol, design, likeness or literary or artistic material in such a
manner that might tend to create a composite ▇▇▇▇, unless otherwise approved in
advance by Licensor (subject to Section 3.7 hereof). Other than the use of the
Licensed Marks, the NBC Business Marks and the Licensed Content as expressly
permitted pursuant to Sections 2.1 and 2.2, Licensor specifically reserves all
rights to the Licensed Marks, the NBC Business Marks and the Licensed Content
(except to the extent the rights are exclusively licensed to Licensee pursuant
to Section 2.1 hereunder) for digital television exhibition, digital and analog
broadcast, terrestrial, cable or satellite television and on any other
television channel or service, including, without limitation, the NBC Television
Network, all NBC TV affiliates, the CNBC and MSNBC cable and Internet networks
and Interactive or Enhanced TV.
2.8 MANDATORY USE OF LICENSED MARKS. During the term of this
Agreement, (i) Licensee shall at all times brand all or substantially all of the
pages of the Contributed Sites, and all or substantially all of the pages
containing any Licensed Content, using the ▇▇▇▇, as well as the Logo (where
appropriate) with the Logo conforming to the sample provided by Licensor, from
time to time, with "branded" or "branding" as used herein meaning that the ▇▇▇▇
and the Logo shall appear, at a minimum, on all or substantially all of the
pages on the Contributed Sites, as well as all or substantially all of the pages
of the Newco Sites containing Licensed Content; and (ii) the ▇▇▇▇, as well as
the Logo shall be prominently featured in any advertising, marketing or
promotion for the Contributed Sites.
10
2.9 THIRD PARTY RIGHTS. Licensee acknowledges that the licenses
granted pursuant to Sections 2.1 and 2.2 hereof and the use of the Licensed
Marks, the NBC Business Marks and the Licensed Content by Licensee may be
subject to third party rights, terms, conditions, obligations, limitations
and restrictions (collectively, "THIRD PARTY RIGHTS"), including, without
limitation, the rights of, and royalty payments to, (a) entertainment and
creative talent, personalities and personnel, (b) third party packagers,
producers and studios and (c) various unions (including, for example, the
Screen Actors Guild and the Writers Guild). Licensor shall notify and
apprise Licensee of such Third Party Rights and shall use its good faith
efforts, as determined by Licensor in its sole and absolute discretion using
the same standard that Licensor applies to its own works and content that are
subject to Third Party Rights, to work with Licensee to develop methodologies
for creating interactive programming for the Contributed Sites that has the
minimum applicability of Third Party Rights. Licensee, in turn, shall comply
with all such Third Party Rights, as determined and interpreted by Licensor,
in good faith and in its sole and absolute discretion using the same standard
that Licensor applies to its own marks and content, including making payments
to all holders of Third Party Rights.
2.10 NO OTHER USES OF THE CONTRIBUTED SITES. Licensor
acknowledges that Licensee shall have the exclusive right to use the
Contributed Sites, subject to the terms and conditions of this Agreement, and
agrees not to grant, license, sublicense, assign, transfer or otherwise
encumber the URLs to any of the Contributed Sites without the prior written
consent of Licensee. Licensee also agrees not to conduct any business,
division or operation on the Contributed Sites (except as permitted herein)
without the prior written consent of Licensor, subject to Sections 3.6 and
3.7 hereof.
SECTION 3. QUALITY AND CREATIVE CONTROL
3.1 CREATIVE CONTROL. Licensor shall direct the creative and
editorial aspects of ▇▇▇.▇▇▇ to the degree deemed necessary by NBC to ensure
that ▇▇▇.▇▇▇ will serve as NBC Television's primary promotional vehicle on the
Internet and will do so in a manner consistent with NBC's reputation and
standard of quality. As such, Licensee shall continue performing all
obligations concerning ▇▇▇.▇▇▇ and NBC-IN pursuant to contracts, agreements or
understandings entered into prior to the date of the Investment Agreement or,
following such date, if entered into in accordance with the terms and conditions
of the Investment Agreement.
3.2 BUDGET. Newco shall establish an annual budget for ▇▇▇.▇▇▇
at a level intended to provide Newco with as much NBC Television Network
content and at least as substantive a promotional impact for NBC TV Network
as currently provided by ▇▇▇.▇▇▇. If NBC requires or desires additional
promotion or content on ▇▇▇.▇▇▇ other than that provided in accordance with
such budget, such additional promotion or content will be provided on ▇▇▇.▇▇▇
as directed by NBC, provided that NBC shall reimburse Newco for its actual
and reasonable out-of-pocket costs (net of any incremental revenue to
Licensee) for providing such additional promotion or content.
11
3.3 USE OF THE ▇▇▇▇. The use of the ▇▇▇▇ shall be limited to
the ▇▇▇▇ as it appears in the ▇▇▇▇, the use of the Logo shall be limited to the
Logo, and the use of the Chime shall be limited to the sounds of the Chime.
3.4 FIRST-CLASS SERVICES. Each of the Portal Service, the
Community Service and the e-Commerce Service of Newco, to the extent any of them
uses any of the Licensed Marks, the NBC Business Marks or the Licensed Content,
shall meet or exceed industry standards for first class Internet services in
each such type or category and each such service shall be of high quality
consistent with Licensee being a commercially viable business; it being
understood that the services provided as of the date hereof by ▇▇▇▇.▇▇▇ and
▇▇▇▇.▇▇▇ are considered to meet the standards set forth herein as determined as
of the date hereof.
3.5 LICENSEE COVENANTS. Licensee shall (i) maintain the quality
of the Contributed Sites and the Portal Service, Community Service and
e-Commerce Service of Newco in accordance with Section 3 of this Agreement,
(ii) cooperate with Licensor to facilitate Licensor's control of the nature
and quality of the Contributed Sites and the use of the Licensed Marks, the
NBC Business Marks and the Licensed Content, (iii) permit reasonable
inspection of the Contributed Sites and the Portal Service and Community
Service of Newco to ensure such quality, (iv) limit its use of the Licensed
Marks, the NBC Business Marks and the Licensed Content to those provided or
approved by Licensor and (v) supply Licensor with specimens of all uses of
the ▇▇▇▇, the Logo, the Chime, the Licensed Marks, the NBC Business Marks and
the Licensed Content upon request. Licensee shall promptly correct all
deficiencies in the use of the Licensed Marks, the NBC Business Marks and the
Licensed Content, shall take measures reasonably designed to correct
objective defects in the use of the Licensed Marks, the NBC Business Marks or
the Licensed Content and shall promptly take all reasonable measures that are
reasonably available to Licensee to cure any breach of the substantive
quality control provisions in Sections 2 and 3 as to which Licensee has
actual knowledge, whether or not Licensee is notified of such breach by
Licensor and whether or not such breach would give rise to Licensor's right
to terminate this Agreement pursuant to Section 12 hereof.
3.6 APPROVAL FOR USES OF THE LICENSED MARKS AND LICENSED CONTENT.
Licensee shall submit for approval to Licensor and Licensor shall have sole
right of approval over any uses of the Licensed Marks, the NBC Business Marks
or the Licensed Content, including (i) all new services of Licensee that will
contain the Licensed Marks, the NBC Business Marks or the Licensed Content
and (ii) all advertising, marketing and promotional materials created,
produced, commissioned or licensed for use in connection with the Portal
Service, Community Service or the e-Commerce Service of Newco, whether
produced, commissioned or licensed by Licensee or by any third party;
PROVIDED, HOWEVER, that, with respect to the Licensed Marks, Licensor shall
apply the same
12
standard for approval as it applies to any proposed use by NBC, its
Subsidiaries or any other third party. Licensee shall submit, upon
Licensor's reasonable request and for Licensor's approval or rejection,
proofs or other representations of any use, advertising or other promotional
materials, including, as applicable, screen shots, television and radio
commercials, print advertisements, promotional materials and other materials,
specifications or information containing any of the Licensed Marks, the NBC
Business Marks or the Licensed Content; PROVIDED, HOWEVER, that, with respect
to the Licensed Marks, Licensor shall apply the same standard for approval as
it applies to any proposed use by NBC, its Subsidiaries or any other third
party. Licensor shall designate individual representatives with authority to
approve or disapprove of any use of the Licensed Marks, the NBC Business
Marks or the Licensed Content by Licensee; it being understood that
individuals from NBC's Law Department will review potential uses of the
Licensed Marks and individuals from NBC's Entertainment Division will review
potential uses of the NBC Business Marks or the Licensed Content. Licensee
shall have no right to use the Licensed Marks, the NBC Business Marks or the
Licensed Content in a manner or form not approved by Licensee in accordance
with the terms and conditions of this Agreement.
3.7 DEEMED APPROVALS. Provided that Licensee has provided true
and complete copies, in final form, along with materials and other information
requested by Licensor with respect to any such proposed use or advertisement
including any of the Licensed Marks, the NBC Business Marks or the Licensed
Content, any such use that is submitted and described in final form and not
rejected within 7 days of the receipt by Licensor of the proposed use, and any
such advertisement that is submitted in final form and not rejected within 7
days, shall be deemed to be approved. Prior approval by Licensor of a format
and purpose of use of any of the Licensed Marks, the NBC Business Marks or the
Licensed Content by Licensee, or use by Licensor of a Licensed ▇▇▇▇, an NBC
Business ▇▇▇▇, or Licensed Content on the Contributed Sites during the two years
prior to the date hereof, shall constitute permission to use such Licensed ▇▇▇▇,
such NBC Business ▇▇▇▇ or such Licensed Content on the Contributed Sites in the
specific manner and for the format and purpose of use so approved without the
necessity of seeking separate approvals for each additional specific use.
3.8 COMPLIANCE WITH LAW. Licensee agrees to perform this
Agreement in accordance with all laws, statutes, ordinances, rules, regulations
and requirements of all governmental agencies or authorities having jurisdiction
with respect to the Contributed Sites and Newco's Portal Service, Community
Service and e-Commerce Service, including any rules or requirements promulgated
by any body established by multilateral consent to govern any aspect of the
Internet.
3.9 LICENSOR'S GUIDELINES. Licensor will provide Licensee with
reasonable written guidelines regarding use of the Licensed Marks , and which
from time to time may be amended by Licensor, including if required by such
guidelines use of trademark symbols where appropriate (for example, -TM- or
-Registered Trademark-), and inclusion of Licensor's standard trademark
attribution legends in all such materials, and the grant of the License herein
to Licensee is also contingent upon Licensee's conformance with these
guidelines. Licensee shall not alter, mutilate, dilute, create derivative forms
of, or otherwise change the format of the ▇▇▇▇, the Logo, the Chime or any
element of the Licensed Marks, the NBC Business Marks or the Licensed Content in
any way or for any purpose without Licensor's prior written approval; PROVIDED,
HOWEVER, that, with respect to the Licensed Marks, Licensor shall apply the same
standard for approval as it applies to any proposed use by NBC, its Subsidiaries
or any other third party.
13
3.10 NO SUBLICENSING OR ENCUMBRANCES. Licensee shall not
sublicense (except as permitted herein), pledge, offer as security or
otherwise encumber any element of the Licensed Marks in any way or its rights
hereunder without the prior written consent of Licensor.
▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇.
4.1 RESTRICTIONS ON RELATIONSHIPS WITH NEWCO COMPETITORS. NBC
and its direct and indirect Subsidiaries (other than Newco and its direct and
indirect Subsidiaries) will not (i) authorize or permit a Newco Competitor
(other than Newco and its direct and indirect Subsidiaries) to Co-Brand any of
its properties, products or services with any of the Licensed Marks, (ii)
operate a Portal Service or a Community Service, (iii) operate an e-Commerce
Service that competes in scope and range with Newco's e-Commerce Service as of
the Effective Date or as expanded hereafter, (iv) invest in, purchase or loan
money to a Newco Competitor (v) grant a license to a third party, in each case,
to use the Licensed Marks or provide any of the Licensed Content to any third
party for Interactive Delivery on any Internet site, or (vi) use the Licensed
Marks for Interactive Delivery of NBC Studio's television entertainment programs
on any Internet site.
4.2 FIRST LOOK RIGHT FOR NON-PRIMARY COMPETITORS. In the event
that NBC or its direct or indirect Subsidiaries acquires a Controlling Interest
in a Non-Primary Competitor, then, following such acquisition, NBC and the Class
A Directors of Newco shall enter into good faith discussions concerning the
purchase by Newco of such Non-Primary Competitor at the fair market value
thereof, as determined by the parties or pursuant to a third party valuation
procedure set forth in Section 8 below. NBC shall give written notice to Newco
of such acquisition within 15 days after the effective date of such acquisition.
In the event that the Class A Directors determine that Newco shall not purchase
such Non-Primary Competitor on terms to which NBC is willing to agree (or make
no decision within the later of (a) 3 months following the commencement of such
good faith discussions or (b) 30 days following completion of the valuation
procedure), then, notwithstanding anything to the contrary in this Agreement,
NBC may continue to own, control and operate such Non-Primary Competitor or any
interest therein but may not permit such Non-Primary Competitor to use the
Licensed Marks to brand or Co-Brand its products or services until the 24 month
anniversary following the acquisition of such Non-Primary Competitor by NBC
(after which time the Licensed Marks may be used to brand or Co-Brand such
products and services).
4.3 FIRST LOOK RIGHTS FOR STRATEGIC INTERNET BUSINESS. In the
event that NBC or its direct and indirect Subsidiaries acquires a Controlling
Interest in a Person whose Primary Business is a Strategic Internet Business,
then, following such acquisition, NBC and the Class A Directors of Newco shall
enter into good faith discussions concerning the purchase by Newco of such
Strategic Internet Business at the fair market value thereof, as determined by
the parties or pursuant to the third party valuation procedure set forth in
Section 8 below. NBC shall give written notice to Newco of such acquisition
within 15 days after the effective date of such acquisition. In the event that
the Class A Directors determine that Newco shall not purchase such Strategic
Internet Business on terms to which NBC is willing to agree (or make no decision
within the later of (a) 3 months following the commencement of such good faith
discussions or
14
(b) 30 days following completion of the valuation procedure), then,
notwithstanding anything to the contrary in this Agreement, NBC may continue
to own, control and operate such Strategic Internet Business or any interest
therein but may not permit such Strategic Internet Business to use the
Licensed Marks to brand or Co-Brand its products or services until the 24
month anniversary following the acquisition of such Strategic Internet
Business by NBC (after which time the Licensed Marks may be used to brand or
Co-Brand such products and services). In the event that the Class A
Directors determine that Newco shall not purchase such Strategic Internet
Business and for so long as NBC or its direct or indirect Subsidiaries hold a
beneficial ownership exceeding 5% in such Strategic Internet Business, the
only Board approval required for the acquisition by Newco of any Person or
asset that directly competes in the same product or category with such
Strategic Internet Business shall be the approval of a Board of Directors
committee consisting solely of Class A Directors; PROVIDED that such
acquisitions do not exceed, in the aggregate, a comparable value to such
Strategic Internet Business (as determined based on the value of the
Strategic Internet Business at the time of the Class A Director vote). For
example, a $50 million acquisition is comparable to a $200 million
acquisition, but a $500 million acquisition is not comparable to a $2 billion
acquisition.
4.4 FIRST LOOK RIGHTS FOR A NON-PRIMARY STRATEGIC INTERNET
BUSINESS. (a) In the event that NBC acquires a Controlling Interest in a
Person whose Primary Business is not a Strategic Internet Business, but is the
direct or indirect owner of a Controlling Interest in a Person, or in a division
or operation of a Person, engaged in a Strategic Internet Business, then,
following such acquisition, NBC, in its sole and absolute discretion, may decide
to enter into good faith discussions with the Class A Directors of Newco
concerning the purchase by Newco of such Strategic Internet Business at the fair
market value thereof, as determined by the parties or pursuant to the third
party valuation procedure set forth in Section 8 below. NBC shall give written
notice to Newco of such acquisition within 15 days after the effective date of
such acquisition. In the event that NBC offers to enter into such good faith
discussions and the Class A Directors determine that Newco shall not purchase
such Strategic Internet Business on terms to which NBC is willing to agree (or
make no decision within the later of (a) 3 months following the commencement of
such good faith discussions or (b) 30 days following completion of the valuation
procedure), then, notwithstanding anything to the contrary in this Agreement,
NBC may continue to own, control and operate such Strategic Internet Business or
any interest therein but may not permit such Strategic Internet Business to use
the Licensed Marks to brand or Co-Brand its products or services until the 24
month anniversary following the acquisition of such Strategic Internet Business
by NBC (after which time the Licensed Marks may be used to brand or Co-Brand
such products and services). In the event that the Class A Directors determine
that Newco shall not purchase such Strategic Internet Business and for so long
as NBC or its direct or indirect Subsidiaries hold a beneficial ownership
exceeding 5% in such Strategic Internet Business, the only Board approval
required for the acquisition by Newco of any acquisition by Newco of any Person
or asset that directly competes in the same product or category with such
Strategic Internet Business shall be the approval of a Board of Directors
committee consisting solely of Class A Directors; PROVIDED that such
acquisitions do not exceed, in the aggregate, a comparable value to such
Strategic Internet Business (as determined based on the value of the Strategic
Internet Business at the time of the Class A Director vote). For example, a $50
million acquisition is comparable to a $200 million acquisition, but a $500
million acquisition is not
15
comparable to a $2 billion acquisition. However, in the event that NBC
determines not to enter into such good faith discussions with the Class A
Directors, then NBC may continue to own, control and operate such Strategic
Internet Business or any interest therein but may not permit such Strategic
Internet Business to use the Licensed Marks nor Co-Brand or rebrand such
Strategic Internet Business with the Licensed Marks during the term of this
Agreement.
(b) In the event that NBC or its direct or indirect Subsidiaries
acquires a beneficial ownership interest that is less than a Controlling
Interest in a Person whose Primary Business is a Strategic Internet Business or
in a Person whose Primary Business is not a Strategic Internet Business, but is
the beneficial owner of less than a Controlling Interest in a Person, or in a
division or operation of a Person, engaged in a Strategic Internet Business,
then NBC shall negotiate in good faith to obtain strategic carriage and
investment rights for Newco on terms advantageous to Newco and at Newco's cost.
4.5 DISAPPROVED ASSET. For so long as the Class B Stock
constitutes at least 20% of the outstanding capital stock of Newco, if (a) the
Board of Directors of Newco votes not to approve Newco's acquisition of an asset
that Newco management in good faith seeks to acquire and has a reasonable
opportunity to acquire (a "DISAPPROVED ASSET"), (b) a majority of the Class A
Directors voted to approve such acquisition and (c) NBC or any of its
Subsidiaries acquires a Controlling Interest in such Disapproved Asset during
the one year period following such Board vote, then in such event any
acquisition by Newco of an asset that directly competes in the same product or
category with the Disapproved Asset shall be subject only to the approval of a
Board of Directors committee consisting solely of Class A Directors; PROVIDED
that such acquisitions do not exceed, in the aggregate, a comparable value to
such Disapproved Asset (as determined based on the value of the Strategic
Internet Business at the time of the Class A Director vote). For example, a $50
million acquisition is comparable to a $200 million acquisition, but a $500
million acquisition is not comparable to a $2 billion acquisition.
SECTION 5 RESTRICTIONS ON NEWCO.
5.1 RESTRICTIONS ON RELATIONSHIPS WITH NBC COMPETITORS. (a)
Newco and its direct or indirect Subsidiaries will not (i) authorize or permit a
NBC Competitor to Co-Brand any of its properties, products or services with any
of Newco's brands or trademarks (including the Snap brand), (ii) invest in,
purchase or loan money to a NBC Competitor, (iii) sell or issue to a NBC
Competitor or any of its Affiliates any stock or other securities of Newco or
any of its Subsidiaries, (iv) share data collected with respect to end users of
▇▇▇.▇▇▇ or NE-IN with, or act as a service bureau with respect to such data on
behalf of, any NBC Competitor or a NBC Competing Business or (v) engage in a NBC
Competing Business.
(b) For as long as Newco is utilizing the ▇▇▇▇ as licensed in Section
2.1.4, neither Newco nor any of its Subsidiaries will directly or indirectly
engage in any business or operation other than the Newco Business, the
Interactive Delivery of Content, Strategic Internet Businesses, and any other
business or operation conducted all or substantially all over the Internet and
activities reasonably necessary to support such businesses.
16
5.2 RESTRICTIONS ON THE INTERACTIVE DELIVERY OF NEWS. (a)
Without NBC's prior written consent, neither Newco nor any of its Subsidiaries
shall, directly or indirectly, acquire any Person or asset or operate any
business, division or operation that, directly or indirectly, creates or engages
in the Interactive Delivery of (i) general local, national and international
news or (ii) news related to (A) business, finance, personal finance or money
management, (B) news history/archives, (C) political commentary, (D) consumer
news, (E) health news, (F) sports news, (G) weather, (H) basic science news or
(I) entertainment (including performing arts), in each case of the type
typically included in general circulation daily newspapers such as the NEW YORK
TIMES and the WALL STREET JOURNAL, broadcast news programming or general
interest magazines such as TIME, NEWSWEEK, FORBES and MONEY and niche business
magazines not of a technical nature such as BROADCAST & CABLE MAGAZINE
(collectively, "RESTRICTED NEWS"); PROVIDED, HOWEVER, that Newco and such
controlled Affiliates may create or engage in the Interactive Delivery of such
level and amount of Restricted News as provided by NE Portal as of the date of
the Investment Agreement, as set forth in Exhibit 5.2 attached hereto. Other
than the restrictions contained in the preceding sentence, none of Newco nor any
of its controlled Affiliates shall be restricted from the Interactive Delivery
of news or sports.
(b) Notwithstanding anything to the contrary contained in this
Agreement, NBC shall not be entitled to terminate this Agreement for any breach
by Newco or its Subsidiaries of this Section 5.2 and, in addition, NBC's sole
and exclusive remedy for any such breach shall be specific performance by Newco
or such Subsidiary of this Section 5.2; PROVIDED, HOWEVER, that if specific
performance is unavailable or rejected by any court of competent jurisdiction
(on grounds other than the merits of such claim of breach), NBC may seek damages
for breach of contract, but not indemnification under Section 11.
SECTION 6 GENERAL EXCEPTIONS
Nothing in this Agreement shall be interpreted as limiting in any way the
ability of any party or its Affiliates from (i) promoting, advertising or
undertaking market research concerning any aspect of such party or its
Affiliates or any of their respective businesses, operations, programs, products
or services at any time in any media (including, for example, displaying the
Licensed Marks on third party Internet sites to promote Television Programs
broadcast on NBC Television Network, any current and future broadcast television
station owned or controlled by NBC or any cable or digital network owned or
controlled by NBC), (ii) selling advertisements, sponsorships or promotions to
any Newco Competitor, Newco Business, Non-Primary Competitor, NBC Competitor or
NBC Competing Business for cash or, subject to the minority investment
limitations described below, for equity, other securities or any other property,
(iii) distributing content (whether distributed via the Internet, television or
any other media) at any time and in any media, regardless of whether such
content is distributed or syndicated on or through or created or provided by a
Newco Competitor, a Non-Primary Competitor, a Newco Business, a NBC Competitor
or a NBC Competing Business, (iv) entering into a relationship with a Newco
Competitor, a Newco Business, a Non-Primary Competitor, a Newco Business, a NBC
Competitor or a NBC Competing Business for customary, non-strategic Internet
traffic arrangements in the ordinary course of business of such party or its
Affiliates, (v) entering into a relationship with another entity, whether or not
a Newco Competitor, a Non-Primary Competitor,
17
a Newco Business, NBC Competitor or a NBC Competing Business, with respect to
Interactive or Enhanced TV or otherwise providing Interactive or Enhanced TV,
(vi) acquiring investments in Newco Competitors, Non-Primary Competitors,
Newco Businesses, NBC Competitors or NBC Competing Businesses of not more
than 20% of the voting securities or value (as determined by market
capitalization at the time such investment is made) and that do not entitle
the acquiror to appoint a majority of the Board of Directors (or similar
governing body) of, or grant the acquiror majority voting control (by voting
trust, stockholder agreement or similar arrangement) over, such entity or
business, (vii) acquiring investments in companies that develop independently
into Newco Competitors, Non-Primary Competitors, Newco Businesses, NBC
Competitors or NBC Competing Businesses of not more than 20% of the voting
securities or value (as determined by market capitalization at the time such
investment is made) and that do not entitle the acquiror to appoint a
majority of the Board of Directors (or similar governing body) of, or grant
the acquiror majority voting control (by voting trust, stockholder agreement
or similar arrangement) over, such entity or business, (viii) the broadcast
or streaming, whether over the Internet or otherwise, of Television Programs,
including, without limitation, any program broadcast on the NBC Television
Network, all current and future broadcast television stations owned or
controlled by NBC or Newco and any cable or digital network owned or
controlled by NBC or Newco, (ix) owning, controlling or operating ▇▇▇▇.▇▇▇,
▇▇▇▇▇.▇▇▇ or their respective Subsidiaries, or any interest therein,
permitting ▇▇▇▇.▇▇▇, ▇▇▇▇▇.▇▇▇ or their respective Subsidiares to use the
Licensed Marks or the NBC Business Marks, entering into relationships with
Newco Competitors, Non-Primary Competitors, Newco Businesses or NBC
Competitors with respect to ▇▇▇▇.▇▇▇, ▇▇▇▇▇.▇▇▇ or their respective
Subsidiaries, as well as any activities, operations or investments of
▇▇▇▇.▇▇▇ and ▇▇▇▇▇.▇▇▇ and their respective Subsidiaries in the Interactive
Delivery of news, financial services or sports and/or products or services
related thereto, (x) owning or continuing relations (whether contractual or
otherwise) with ValueVision, so long as neither NBC or Newco acquires
beneficial ownership of 50% or more of the total voting power of such entity,
(xi) merchandising, licensing and sale of NBC and Newco products, Television
Programs or television properties and (xii) marketing, licensing and sale,
through an e-Commerce Service or any other wholesale, retail or Internet
service or sales channel (whether now known or hereafter devised), of
products or services branded or Co-Branded with the Licensed Marks, the NBC
Business Marks or the Licensed Content or of products or services based on,
related to, or appearing on any Television Program broadcast on the NBC
Television Network, any current and future broadcast television station owned
or controlled by NBC or any cable or digital network owned or controlled by
NBC (collectively, "NBC MERCHANDISE").
SECTION 7 PREFERRED CARRIAGE AND OTHER ARRANGEMENTS
7.1 CARRIAGE OF NBC SERVICES. Newco agrees, for no additional
consideration, that certain of NBC's Content shall be displayed on the Newco
Sites and shall receive placement as follows, as soon as practicable but not
exceeding six (6) months from the Effective Date and subject to any third party
agreements in effect as of the date hereof (it being understood that Licensee
(and/or Newco, as the case may be) shall use its reasonable commercial efforts
to terminate such third party agreements):
18
7.1.1 ENTERTAINMENT AND TELEVISION. In the entertainment Topic
(and its successors including any new Topics into which such Topic may be
converted or merged) and the Sub-Topic Pages for such Topics (and their
successors including any new Topics into which such Sub-Topics may be moved or
merged), the Newco Sites will display and link to ▇▇▇.▇▇▇ and ▇▇▇.▇▇▇ Content as
a Prominent but non-exclusive Content provider. In the television Topic (and its
successors including any new Topics into which such Topic may be converted or
merged) and the Sub-Topic Pages for such Topics that reasonably relate to
▇▇▇.▇▇▇ Content (and their successors including any new Topics into which such
Sub-Topics may be moved or merged), the Newco Sites will display and link to
▇▇▇.▇▇▇ and ▇▇▇.▇▇▇ Content as a the Preferred and Default but non-exclusive
Content provider.
7.1.2 MONEY, FINANCE AND BUSINESS. In the Money, Finance and
Business Topics (and their successors including any new Topics into which such
Topics may be converted or merged) and the Sub-Topic Pages for such Topics for
which ▇▇▇▇.▇▇▇ provides Content on ▇▇▇▇.▇▇▇ (and their successors including any
new Topics into which such Sub-Topics may be moved or merged), the Newco Sites
will display and link to ▇▇▇▇.▇▇▇ and ▇▇▇▇.▇▇▇ Content as a the Preferred and
Default but non-exclusive Content provider; PROVIDED, HOWEVER, that Newco's
search engine is the Preferred Internet search engine on ▇▇▇▇.▇▇▇.
7.1.3 LOCAL. In the Local Topic (and its successor including any
new Topics into which such Topic may be converted or merged) and the Sub-Topic
Pages for such Topics that reasonably relate to NBC-IN Content (and their
successors including any new Topics into which such Sub-Topics may be moved or
merged), the Newco Sites will display and link to NBC-IN and NBC-IN Content as a
the Preferred and Default but non-exclusive Content provider; provided, that
NBC-IN's Content, taken as a whole, remains reasonably competitive with that of
its principal competitors. In addition, the Newco Sites will provide a fixed
position branded link to the appropriate NBC-IN affiliated television station
site positioned in a Prominent location on each Sub-Topic page relating to such
NBC-IN affiliate's city.
7.1.4 NEWS. In the News Topics (and their successors including
any new Topics into which such Topics may be converted or merged) and the
Sub-Topic Pages for such Topics for which ▇▇▇▇▇.▇▇▇ provides Content on
▇▇▇▇▇.▇▇▇ (and their successors including any new Topics into which such
Sub-Topics may be moved or merged), the Newco Sites will display and link to
▇▇▇▇▇.▇▇▇ and ▇▇▇▇▇.▇▇▇ Content as a the Preferred and Default but
non-exclusive Content provider; PROVIDED, HOWEVER, that MSNBC's Content,
taken as a whole, remains reasonably competitive with that of its principal
competitors.
7.1.5 MAINTENANCE OF POSITIONING. Newco shall not re-design,
reorganize or otherwise modify the pages upon which NBC Content appears in any
manner that would diminish, or otherwise reduce the value of, the positioning
and other advantages guaranteed to NBC pursuant to this Section 7.
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7.2 MERCHANDISING AND LICENSING. NBC and Newco shall use their
good faith efforts to negotiate terms and conditions for the non-exclusive
marketing, licensing and selling of NBC Merchandise on ▇▇▇.▇▇▇ and Newco's
e-Commerce Service on a mutually-beneficial basis.
7.3 DATA SHARING. Newco shall provide NBC, its direct and
indirect Subsidiaries and its broadcast television affiliates with the
maximum amount of access to the registration database of (a) each of the
Newco Sites that is permissible in accordance with the privacy policy of each
such Newco Site for the purpose of assisting NBC in the market research,
demographics and/or promotion of the NBC Television Network, any current and
future broadcast television station owned or controlled by NBC, any cable or
digital network owned or controlled by NBC and any programming appearing
thereon and (b) each of the Contributed Sites that is permissable in
accordance with the privacy policy of each such Contributed Site for the
purpose of assisting NBC in the marketing, licensing and selling of NBC
Merchandise, and in each case shall use all reasonable efforts to coordinate
with NBC and such Persons regarding the use of such registration databases
for such purposes in accordance with such privacy policies. In addition,
Newco shall provide NBC with a comprehensive set of statistics and data with
respect to the activities of the end users of the Contributed Sites, and with
all information provided by such end users, in response polls and
questionnaires regarding the NBC Television Network, all current and future
broadcast television stations owned or controlled by NBC and any cable or
digital network owned or controlled by NBC, the programming appearing thereon
and NBC Merchandise. Such statistics, data and information shall be made
available at such times, in such formats and via such methods as are
reasonably specified by NBC. NBC shall reimburse Newco for its out-of-pocket
expenses necessary to provide NBC with the requested statistics and data, to
the extent that such expenses are not included in the budget of ▇▇▇.▇▇▇
established in accordance with Section 3.2 hereof; PROVIDED, HOWEVER, that
NBC shall have the right to agree to any amount exceeding $1,000 to be paid
hereunder before NBC agrees to be bound to any such payments or, if no amount
is agreed upon, NBC shall be deemed to have approved payment of such amount
if NBC does not object in writing within seven (7) days of receiving written
notification from Newco of such out-of-pocket expenses; it being understood
that Newco shall not be required to provide such statistics and data if NBC
does not reimburse Newco for its expenses in accordance with this sentence.
7.4 NBC ENTERTAINMENT PERSONALITIES. NBC shall make good faith
efforts to obtain the necessary rights for Newco (at Newco's cost) to use the
names, likenesses and voices of NBC's entertainment or creative talent,
personalities and personnel solely for the Interactive Delivery of such names,
likenesses and voices on the Contributed Sites, Newco's Portal Service and
Newco's Community Service and the marketing and promotion thereof, and Newco
agrees that all contacts and relationships (contractual or otherwise) with NBC's
entertainment or creative talent, personalities and personnel shall be
exclusively handled by NBC in its sole and absolute discretion and in good faith
on behalf of Newco; it being understood that NBC shall not be obligated to
obtain any such rights or even enter into any discussion with any such
personality if NBC believes, in good faith, that such discussion or request for
rights would disadvantage or jeopardize, in any manner, its contacts or
relationships with its entertainment or creative talent and personalities or any
third party packager, producer or studio. In performance of its
20
obligations under this Section 7.4, NBC shall consult with Newco as to which
rights Newco desires to obtain and, if any rights are obtained on behalf of
Newco, Newco shall reimburse NBC for any out-of-pocket costs for obtaining
such rights, including, without limitation, any amount agreed by NBC to be
paid to such entertainment or creative talent, personality or personnel;
PROVIDED, HOWEVER, that Newco shall have the right to agree to any amount
exceeding $1,000 to be paid hereunder before Newco agrees to be bound to any
such payments or, if no amount is agreed upon, Newco shall be deemed to have
approved payment of such amount if Newco does not object in writing within
seven (7) days of receiving written notification from NBC of such
out-of-pocket costs.
7.5 INTERACTIVE RIGHTS TO NBC ENTERTAINMENT PROPERTIES. (a)
NBC shall make good faith efforts, on a case-by-case basis as requested by
Newco, to obtain the rights for Newco (at Newco's cost) for entertainment
television programs and entertainment television content broadcast on the NBC
Television Network as to which NBC does not have the right to provide for
Interactive Delivery solely for Interactive Delivery on the Contributed Sites,
Newco's Portal Service and Newco's Community Service and the marketing and
promotion thereof, and Newco agrees that all contacts and relationships
(contractual or otherwise) with concerning such rights shall be exclusively
handled by NBC in its sole and absolute discretion and in good faith on behalf
of Newco; it being understood that NBC shall not be obligated to obtain any such
rights or even enter into any discussion with any third party if NBC believes,
in good faith, that such discussion or request for rights would disadvantage or
jeopardize, in any manner, its contacts or relationships with such third party,
any entertainment or creative talent, personality or personnel or any third
party packager, producer or studio. In performance of its obligations under
this Section 7.5, NBC shall consult with Newco as to which rights Newco desires
to obtain and, if any rights are obtained on behalf of Newco, Newco shall
reimburse NBC for any out-of-pocket costs for obtaining such rights, including,
without limitation, any amount agreed by NBC to be paid to such third party;
PROVIDED, HOWEVER, that Newco shall have the right to agree to any amount
exceeding $1,000 to be paid hereunder before NBC agrees to be bound to any such
payments or, if no amount is agreed upon, Newco shall be deemed to have approved
payment of such amount if Newco does not object in writing within seven (7) days
of receiving written notification from NBC of such out-of-pocket costs.
(b) Notwithstanding the foregoing, if Newco has requested
Interactive Delivery rights pursuant to Section 7.5 hereof and such rights are
obtained for Newco in connection, or as part of a package, with Television
Program rights for such entertainment television program or entertainment
television content, Newco shall pay NBC the fair market value for such
Interactive Delivery rights, as mutually agreed by NBC and Newco or as
determined in accordance with the third party valuation procedure set forth in
Section 8 below.
7.6 EMAIL ADDRESSES. Newco shall provide NBC and its direct and
indirect Subsidiaries, without charge, with email addresses on ▇▇▇.▇▇▇ for all
directors, officers, employees and agents of NBC and such Subsidiaries, and
shall allow such Persons to access their email without opening or displaying any
page on any of the Newco Sites.
21
SECTION 8 THIRD PARTY VALUATION PROCEDURE
Where this Agreement requires that fair market value be determined by
third party valuation procedure, the following procedure shall be used. First,
the parties shall enter into (or shall have conducted) good faith discussions
for a 15 day period. Second, in the event that the parties fail to agree upon a
fair market value, then either party may commence the independent appraiser
process by notifying the other party and, promptly thereafter, each party shall
select an independent appraiser from among the nationally recognized investment
banking firms which shall not have been retained by either of the parties within
the prior twelve (12) months. The parties' independent appraisers shall
calculate the fair market value, such fair market value to be determined as if
all of the relevant business or all of the equity of such Person were being sold
in a single transaction on arm's length terms between a willing buyer and a
willing seller. If the valuation determined by the independent appraisers is
reflected in the form of a range, then the median of the highest and lowest
numbers in such range shall be used. If the independent appraisers are not able
to agree on such valuation or methodology, then the fair market value shall be
the average of the determinations by the independent appraisers. If the
difference between such valuations exceeds twenty percent (20%) of the amount of
the lower of the two valuations, then the parties shall agree upon an additional
independent appraiser, which shall be selected from among the nationally
recognized investment banking firms and which shall not have been retained by
either of the parties within the prior twelve (12) months ("FINAL EVALUATOR").
The final evaluator shall determine the fair market value of the asset in
question. In the event that the final evaluator's valuation exceeds the higher
valuation of the prior two valuations or is less than the lower of such prior
valuations, then in such case the fair market value shall be set by averaging
the two valuations that are the closest in amount. In the event that the final
evaluator's valuation is less than the higher valuation of the prior two
valuations and is higher than the lower valuation of the prior two valuations,
then the fair market value shall be the final evaluator's valuation. The
parties shall attempt to complete the valuations as soon as reasonably practical
and shall instruct the independent appraisers to complete their valuations
within 30 days.
SECTION 9 REPRESENTATIONS AND WARRANTIES OF NBC
NBC represents and warrants as follows:
9.1 NBC has taken all corporate actions necessary to authorize
NBC's execution and delivery of this Agreement and performance of the
transactions or obligations contemplated hereby. This Agreement has been duly
executed and delivered by NBC and constitutes the legal, valid and binding
obligation of NBC, enforceable against NBC in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally or by general principles of equity.
9.2 NBC has all rights necessary to grant the rights granted to
Newco under Sections 2.1 and 2.2 hereof without the need for any consents,
approvals, licenses, or other authorizations.
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SECTION 10 REPRESENTATIONS AND WARRANTIES OF NEWCO
Newco represents and warrants as follows:
10.1 Newco has taken all corporate actions necessary to authorize
Newco's execution and delivery of this Agreement and performance of the
transactions or obligations contemplated hereby. This Agreement has been duly
executed and delivered by Newco and constitutes the legal, valid and binding
obligation of Newco, enforceable against Newco in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally or by general principles of equity.
SECTION 11 INDEMNITY
11.1 NBC INDEMNIFICATION OBLIGATION. As of and after the
Effective Date and subject to Newco's compliance with the terms and conditions
of this Agreement, NBC shall indemnify, defend, and hold harmless Newco and its
respective successors and assigns and the directors, officers, employees, and
agents of each ("NEWCO INDEMNIFIED GROUP") from and against any claims, actions,
assessments, losses, damages, liabilities, costs, expenses of litigation
(including reasonable attorneys' fees), and settlement amounts, together with
interest and penalties (collectively, a "LOSS" or "LOSSES"), asserted against,
resulting to, imposed upon, or incurred by a member of the Newco Indemnified
Group, to the extent arising from any of the following: (i) any claim by a
third party that Newco's use or exercise of the rights licensed or assigned
herein infringes any third party's rights; (ii) any claim by a third party
arising from NBC's use, prior to the Effective Date, of the URLs licensed
pursuant to Section 2 infringes any third party's rights; and (iii) any breach
of NBC's representations, warranties, covenants or agreements contained in this
Agreement.
11.2 NEWCO INDEMNIFICATION OBLIGATION. As of and after the
Effective Date and subject to NBC's compliance with the terms and conditions of
this Agreement, Newco shall indemnify, defend, and hold harmless NBC, its
Affiliates and their respective successors and assigns and the directors,
officers, employees, and any agents of each ("NBC Indemnified Group") from and
against any Losses, asserted against, resulting to, imposed upon, or incurred by
a member of the NBC Indemnified Group, to the extent arising from any of the
following: (i) any breach of Newco's representations, warranties, covenants or
agreements contained in this Agreement and (ii) Licensee's marketing, sale or
use of any of the Licensed Marks, the NE Business Marks or the Licensed Content
except as to those matters for which Licensor is obligated to indemnify Newco
pursuant to Section 11.1 hereof.
11.3 NOTICE OF CLAIM. The party entitled to indemnification
hereunder (the "CLAIMANT") shall promptly deliver to the party liable for such
indemnification hereunder (the "OBLIGOR") notice in writing (the "REQUIRED
NOTICE") of any claim for recovery under Section 11.1 or 11.2, specifying in
reasonable detail the nature of the Loss (the "CLAIM"); PROVIDED, HOWEVER, that
the failure to provide such notice shall not limit the Claimant's right to
indemnification hereunder except to the extent that the Obligor is materially
prejudiced hereunder. The Claimant shall provide to the Obligor as promptly as
practicable thereafter information and documentation in its possession and
reasonably requested by the Obligor to
23
support and verify the claim asserted, provided that, in so doing, it may
restrict or condition any disclosure in the interest of preserving privileges
that it may assert in any foreseeable litigation.
11.4 DEFENSE. The Claimant shall permit the Obligor to assume
the defense of such Claim and any litigation resulting therefrom (and to
prosecute by way of counterclaim or third party complaint any claim against such
third party arising out of or relating to the Claim in question) upon receipt by
the Claimant of the Obligor's written acknowledgment of its obligation to
indemnify the Claimant with respect to the Claim and its agreement to assume the
defense of such Claim. After giving such notice of assumption, the Obligor
shall not be liable under this Agreement for any legal or other expenses
subsequently incurred by the Claimant in connection with such defense but the
Obligor shall be responsible for all such expenses incurred by the Claimant in
connection with the Claim prior to such assumption. Notwithstanding the
foregoing, any Claimant shall be entitled to conduct its own defense at the cost
and expense of the Obligor if the Claimant can establish, by reasonable
evidence, that the conduct of its defense by the Obligor would reasonably be
likely to prejudice the Claimant due to the nature of any claims or
counterclaims presented or by virtue of a conflict between the interest of the
Claimant and the Obligor, and provided further that in any event the Claimant
may participate in such defense at its own expense. Counsel selected by the
Obligor or by the Claimant to defend any Claim shall be subject to the
reasonable approval of the other party. If the Obligor fails to assume the
defense of any such Claim as provided above within a reasonable time (which
shall be such period of time as will not, in the reasonable judgment of the
Claimant, result in prejudice to the rights of the Claimant) after due notice
has been given of a Claim, then until such time as the Obligor shall make such
assumption, the Claimant shall have the right to prosecute and conduct its own
defense by counsel of its choice, and in connection therewith shall have full
right to conduct the defense thereof and to enter into any compromise or
settlement thereof without the consent of the Obligor. Such defense shall be at
the cost and expense of the Obligor if the Obligor subsequently assumes such
defense as provided above, or if it is subsequently determined that the Obligor
is or was obligated to defend or indemnify the Claimant with respect to such
Claim. Wether or not the Obligor chooses to so defend or prosecute such claim,
all the parties hereto shall provide reasonable cooperation in the defense or
prosecution thereof.
11.5 SETTLEMENT. The Claimant shall have the right to determine
and adopt (or, in the case of a proposal by Obligor, to approve) a settlement of
such matter in its reasonable discretion, except that Claimant need not consent
to any settlement that (a) imposes any nonmonetary obligation or (b) Obligor
does not agree to pay in full. The Obligor shall not be liable for any
settlement of any such claim effected without its prior written consent, which
shall not be unreasonably delayed or withheld.
SECTION 12 TERM AND TERMINATION
12.1 TERM. Unless sooner terminated as provided herein, this
Agreement and the rights and licenses granted and obligations herein shall
continue in perpetuity.
12.2 GROUNDS FOR TERMINATION. The provisions of this Agreement
may be terminated as follows:
24
12.2.1 by either NBC or Newco, in the event that NBC and its direct
and indirect Subsidiaries no longer own at least 5% of
Newco's Common Stock;
12.2.2 by either NBC or Newco, in the event that (i) the other
party files any petition for bankruptcy or is adjudicated a
bankrupt or insolvent under the bankruptcy laws of any
jurisdiction; (ii) a petition in bankruptcy is filed against
the other party and such petition is not dismissed within 60
days; (iii) the other party becomes insolvent or makes an
assignment for the benefit of its creditors or an
arrangement for its creditors pursuant to any bankruptcy
law; (iv) the other party discontinues its business; or (v)
a receiver or trustee is appointed for the other party,
which appointment is not contested by that party within 60
days;
12.2.3 by NBC, in the event of a Change of Control of Newco; or
12.2.4 by NBC, in the event of any material breach by Newco of this
Agreement or any breach by Newco of any material
representation, warranty, covenant or agreement contained in
this Agreement (it being understood that the substantive
quality controls contained in Sections 2 or 3 hereof are
material covenants and agreements of this Agreement);
PROVIDED, HOWEVER, that if such breach is of such a nature
that it can reasonably be cured within 30 days following
written notice from Licensor to Licensee of such breach,
then such right of termination may not be exercised unless
such breach shall not have been cured within such 30-day
period;
12.2.5 by NBC, in the event (x) of any breach by Newco of any of
the substantive quality controls contained in Sections 2 or
3 hereof, (y) (i) if such breach is of such a nature than
it cannot reasonably be cured or (ii) if such breach is
cured within the time period specified in subsection 12.2.4
above, and (z) Licensee repeatedly breaches the substantive
quality controls contained in Sections 2 or 3 hereof
following written notice from Licensor to Licensee of such
breach, provided that NBC shall give written notice of each
instance of claimed breach on which NBC bases its claim of
termination under this subparagraph.
12.3 EFFECT OF TERMINATION.
12.3.1 TERMINATION OF RIGHTS AND OBLIGATIONS. Subject to Section
12.3.2 below, upon termination of this Agreement for any
reason, all rights and obligations of both parties under
this Agreement shall terminate, Licensee shall return to NBC
all master files, samples and exemplars received from NBC
or, at NBC's request, arrange to have such materials
destroyed.
12.3.2 SURVIVAL OF NON-EXCLUSIVE RIGHTS. Notwithstanding anything
to the contrary in Section 12.3.1 above, upon termination of
this Agreement pursuant to Sections 12.2.1 or 12.2.3 and, in
the case of Section 12.2.3, where a NBC Competitor does not
acquire the power to appoint a majority of the Board of
Directors of Newco or majority voting control (by voting
trust, stockholder agreement or similar
25
arrangement), the license rights granted under Sections
2.1 and 2.2 to Newco shall continue for one year after
the effective date of termination, provided that the
license set forth in Section 2.1 shall become
non-exclusive for such one year period, and Newco shall
continue to operate the Contributed Assets for such one
year period.
12.3.3 EFFECTS OF TERMINATION. Upon termination of this Agreement
for any reason, Newco shall take all reasonably necessary
actions to cause its corporate name to be changed to
eliminate the use of the ▇▇▇▇ as promptly as reasonably
practical (but in no event later than one year after the
termination of this Agreement). Upon expiration of the one
year period set forth in Section 12.3.2 above, NBC shall pay
Newco the fair market value (as determined by the parties or
in accordance with the third party valuation procedure set
forth in Section 8 above) for ▇▇▇.▇▇▇, ▇▇▇-▇▇.▇▇▇ and, to
the extent such URLs are owned by Newco, ▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ and
▇▇▇▇.▇▇▇ at the effective time of termination, and such
purchase price may be paid, in the sole discretion of NBC,
in cash or Newco stock.
12.3.4 In the event that Newco's non-exclusive license survives
pursuant to Section 12.3.2 above, the following Sections
of this Agreement shall survive during that one year
period: Sections 1, 2.1 (but only on a non-exclusive
basis), 2.2-2.9, Section 3, Section 6, Sections 7.3-7.6,
Sections 11-13. Thereafter, the following Sections of
this Agreement shall survive termination: Sections 13.1,
13.4, and 13.8 (with respect to confidential information
provided pursuant to the Agreement). In the event that
the agreement terminates or expires and Newco's
non-exclusive license does not survive under Section
12.3.2 above, the following Sections of this Agreement
shall survive termination: Sections 13.1, 13.4, and 13.8
(with respect to confidential information provided
pursuant to the Agreement).
SECTION 13 MISCELLANEOUS
13.1 LIMITATION ON LIABILITY. To the extent allowed by
applicable law, in no event shall either party be liable for any special,
consequential, incidental, indirect, or punitive damages of any kind, or any
lost profits, lost revenues, or lost business arising from or relating to this
Agreement, even if a party has been advised of the possibility of such damages,
however caused.
13.2 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon, shall inure to the benefit of and shall be enforceable by the respective
successors and assigns of the parties hereto. Neither party may assign or
otherwise transfer this Agreement, except in connection with a merger,
reorganization, or transfer of all or substantially all of the assets of such
party to which this Agreement relates, provided that the assignee or transferee
shall agree in writing to be bound by this Agreement; PROVIDED, HOWEVER, that
NBC Multimedia, Inc. may assign this Agreement to Newco in connection with the
transactions contemplated by the Investment Agreement if Newco
26
signs a counterpart to this Agreement and agrees to be bound by it. If NBC
transfers any of the Licensed Marks, the NBC Business Marks or the Licensed
Content licensed hereunder to a third party, NBC will require the transferee
to agree in writing to assume NBC's obligations hereunder with respect to the
property being transferred. Any purported assignment made in contravention
of this Section 13.2 shall be null and void from its inception.
13.3 AMENDMENT. This Agreement may be amended only by a written
instrument duly executed by Newco and NBC, which must be approved in the case of
Newco by a majority of the Class A Directors.
13.4 WAIVER OF BREACH. Except as otherwise provided in this
Agreement, any failure of any of the parties to comply with any obligation,
covenant, agreement or condition herein may be waived by the party entitled to
the benefits thereof only by a written instrument signed by the party granting
such waiver (which, in the case of Newco, must be approved by a majority of the
Class A Directors), but such waiver or failure to insist upon strict compliance
with such obligation, covenant, agreement or condition shall not operate as a
waiver of, or estoppel with respect to, any subsequent or other failure.
13.5 NOTICES. All notices and other communications provided for
hereunder shall be in writing and delivered by hand or sent by first class mail
or sent by facsimile (with such facsimile to be confirmed promptly in writing
sent by first class mail), sent as follows:
(i) If to NBC, addressed to:
National Broadcasting Company, Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇; Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) If to Licensee, addressed to:
NBC Multimedia, Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President, NBC Multimedia
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: ▇▇▇▇.▇▇▇, Inc
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address or addresses or facsimile number or numbers as any of
the parties hereto may most recently have designated in writing to the other
parties hereto by such notice. All such
27
communications shall be deemed to have been given or made when so delivered
by hand or sent by facsimile, or three business days after being so mailed.
13.6 ENTIRE AGREEMENT. This Agreement, the Investment Agreement
and the exhibits and schedules hereto and thereto contain the entire agreement
between the parties hereto with respect to the subject matter hereof and
supersedes all prior oral and written agreements and understandings between the
parties hereto with regard to such subject matter.
13.7 INFRINGEMENT OF THE LICENSED MARKS, THE NBC BUSINESS MARKS
OR THE LICENSED CONTENT. Each party shall promptly notify the other party of
any acts, claims, demands or causes of action of which it learns, based upon,
relating to, or arising from any attempt by any other Person to use any element
of the Licensed Marks, the NBC Business Marks or the Licensed Content or any
colorable imitation thereof of which such party becomes aware, in each case that
would result in a material diminution or impairment of the other party's rights
in such marks or content; it being understood that any infringement of the
Licensed Marks, the NE Business Marks or the Licensed Content would result in a
material diminution or impairment of NBC's rights in such marks or content.
Licensee also shall notify the other party promptly of any litigation or
arbitration instituted or threatened by any Person against such Party involving
the Licensed Marks, the NBC Business Marks or the Licensed Content. Licensor
shall have the sole right to decide whether or not proceedings alleging
infringement of the Licensed Marks, the NBC Business Marks or the Licensed
Content shall be brought against third parties and to control any litigation or
arbitration involving the Licensed Marks, the NBC Business Marks or the Licensed
Content. Licensor shall have the sole right to defend the Licensed Marks, the
NBC Business Marks and the Licensed Content, at its expense, against imitation,
infringement or any claim of prior use.
13.8. CONFIDENTIALITY. Neither Licensor nor Licensee shall
disclose to any third party (other than its respective employees,
consultants, contractors or financial and legal advisers, in their capacity
as such), any confidential information provided to such party under the terms
of this Agreement, and the parties shall enter into a long-form
Non-Disclosure and Confidentiality Agreement to memorialize their obligations
under this Section 13.8, except that confidential information may be
disclosed: (i) to the extent necessary to comply with law or the valid order
of a court of competent jurisdiction, in which event the party making such
disclosure shall so notify the other as promptly as practicable (and, if
possible, prior to making such disclosure) and shall seek confidential
treatment of such information; (ii) as part of its reporting or review
procedure to its affiliates, its auditors, its attorneys and potential
investors provided, however, that such affiliates, auditors, attorneys and
potential investors agree to be bound by the provisions of this Section 13.8;
(iii) in order to enforce its rights pursuant to this Agreement where that
information is already in the public domain and was released into the public
domain other than by breach of this Section 13.8; or (iv) if mutually agreed
by Licensor and Licensee in writing (and in the case of Licensee, must be
approved by a majority of the Class A Directors).
13.9 SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage that cannot adequately be addressed by monetary relief will
occur in the event any provision of this Agreement is not performed in
accordance with the terms hereof and that the parties shall be
28
entitled to specific performance of the terms hereof and interlocutory
injunctions preventing misuse of the Licensed Marks and the Licensed Content,
in addition to any other remedy at law or in equity.
13.10 CUMULATIVE REMEDIES. The rights and remedies provided by
this Agreement are cumulative and the use of any one right or remedy by any
party shall not preclude or waive its right to seek any or all other remedies.
Said rights and remedies are given in addition to any other rights the parties
may have by law, statute, ordinance or otherwise.
13.11 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, applicable to
contracts executed and to be performed entirely in such state. Each party
irrevocably and unconditionally submits, for to the exclusive jurisdiction of
any state or federal court sitting in the County of New York in any suit, action
or proceeding arising out of or relating to this Agreement and for recognition
or enforcement of any judgment relating thereto. Each party irrevocably and
unconditionally (i) waives any objection which it may now or hereafter have to
the laying of venue of any such suit, action or proceeding and (ii) accepts,
with regard to any such action or proceeding, the personal jurisdiction of such
courts and waives any defense or objection that it might otherwise have to such
courts' exercise of personal jurisdiction with respect to it. Any and all
service of process shall be effective against any party if given by registered
or certified mail, return receipt requested, or by any other means of mail which
requires a signed receipt, postage prepaid.
13.12 SEVERABILITY. In the event that any of the provisions of
this Agreement are held to be unenforceable or invalid by any court of competent
jurisdiction, the validity and enforceability of the remaining provisions will
not be affected thereby.
13.13 HEADINGS. The Section and paragraph headings contained in
this Agreement are for reference purposes only and shall not affect in any way
the meaning or interpretation of this Agreement.
13.14 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
NBC MULTIMEDIA, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President, NBC Cable and
Business Development
BROADCASTING COMPANY, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President, NBC Cable and
Business Development
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