CONFIDENTIAL TREATMENT REQUESTED
EXHIBIT 10.40
CO-MARKETING AGREEMENT
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This Co-Marketing Agreement ("Agreement") is made and entered into
October 20, 1998 ("Effective Date"), by and between WebMD, Inc., a Georgia
corporation located at 400 The Lenox Building, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇, ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇ ("Co-Marketer") and E*TRADE Group, Inc., a Delaware corporation located
at Four Embarcadero Place, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ("E*TRADE").
1. Definitions.
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a. "Co-Branded Site" means the co-branded consumer web site known
as "Destination E*TRADE" (or any other name) as described in Exhibit A attached
hereto.
b. "E*TRADE Services" means E*TRADE's electronic brokerage
services and related products available at the E*TRADE Site.
c. "E*TRADE Site" means E*TRADE's web site located at
[▇▇▇▇://▇▇▇.▇▇▇▇▇▇.▇▇▇] (or any replacement or successor address).
d. "Co-Marketer Services" means Co-Marketer's internet-based
communications and information services and related products targeting
healthcare professionals and other participants in the healthcare industry and
consumers of healthcare related information available through the Co-Marketer
Sites.
e. "Co-Marketer Sites" means Co-Marketer's professional web sites
located at [▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇] and [▇▇▇▇://▇▇▇.▇▇▇▇▇.▇▇▇▇▇▇.▇▇▇] (or any
replacement or successor addresses) and all third party co-branded or mirrored
addresses or sites thereof.
f. "Partners" means content partners, technology partners and
distribution partners of Co-Marketer.
2. Co-Marketing Obligations.
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a. Scope. The parties shall undertake and perform the obligations
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for the marketing and promotion of the Co-Marketer Services along with the
E*TRADE Services on the Co-Branded Site, the Co-Marketer Sites and/or E*TRADE
Site, to the extent specified in Exhibit A, attached hereto. All such
promotional activity shall be subject to the prior approval of both parties,
such approval not to be unreasonably withheld.
b. Restrictions. Other than by engaging in the activities
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described in Section 2.a above and Exhibit A, Co-Marketer, its Partners,
affiliates, and their employees will not (i) describe E*TRADE's brokerage
services (other than disseminating or posting promotional or advertising
materials approved in each case, in advance and before first use, by
E*TRADE pursuant to Section 3 below); (ii) recommend or endorse specific
securities; (iii) become involved in any manner in the business of providing the
financial services offered by E*TRADE, including, without limitation, by: (A)
opening, approving, maintaining, administering, or closing customer brokerage
accounts with E*TRADE; (B) soliciting, processing, or facilitating securities
transactions relating to customer brokerage accounts with E*TRADE; (C) extending
credit to any customer for the purpose of purchasing securities through, or
carrying securities with, E*TRADE; (D) answering E*TRADE customer inquiries
involving E*TRADE customer accounts or related transactions or engaging in
negotiations involving brokerage accounts or securities transactions; (E)
accepting customer securities orders, selecting among broker-dealers or routing
orders to markets for execution; (F) handling funds or securities of E*TRADE
customers, or effecting clearance or settlement of customer securities trades;
or (G) resolving or attempting to resolve any problems, discrepancies, or
disputes involving E*TRADE customer accounts or related transactions. Co-
Marketer acknowledges that engaging in any of the above activities may subject
Co-Marketer to broker-dealer registration requirements under the Securities
Exchange Act of 1934, as amended, and applicable state securities law.
3. Licensed Marks.
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a. License to E*TRADE Marks. Subject to all the terms and
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conditions of this Agreement, E*TRADE hereby grants Co-Marketer a nonexclusive,
non-transferable, non-sublicensable license to use the E*TRADE Marks solely on
the Co-Marketer Sites and the Co-Branded Site and solely in connection with the
marketing and promotion of the Co-Marketer Services and the E*TRADE Services.
"E*TRADE Marks" shall mean solely the E*TRADE name and logo specified in Exhibit
B hereto; provided, however, that E*TRADE, in its sole discretion from time to
time, may change the appearance and/or style of the E*TRADE Marks or add or
subtract from the list in Exhibit B, provided that, unless required earlier by a
court order or to avoid potential infringement liability, Co-Marketer shall have
fourteen (14) days' notice to implement any such changes. Co-Marketer hereby
acknowledges and agrees that (i) the E*TRADE Marks are owned solely and
exclusively by E*TRADE, (ii) except as set forth herein, Co-Marketer has no
rights, title or interest in or to the E*TRADE Marks and (iii) all use of the
E*TRADE Marks by Co-Marketer shall inure to the benefit of E*TRADE. Co-Marketer
agrees not to apply for registration of the E*TRADE Marks (or any ▇▇▇▇
confusingly similar thereto) anywhere in the world. Co-Marketer agrees that it
shall not engage, participate or otherwise become involved in any activity or
course of action that diminishes and/or tarnishes the image and/or reputation of
any E*TRADE ▇▇▇▇.
b. Use and Display of E*TRADE Marks. Co-Marketer acknowledges and
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agrees that the presentation and image of the E*TRADE Marks should be uniform
and consistent with respect to all services, activities and products associated
with the E*TRADE Marks. Accordingly, Co-Marketer agrees to use the E*TRADE Marks
solely in the manner which E*TRADE shall specify from time to time in E*TRADE's
sole discretion. All usage by Co-Marketer of the E*TRADE Marks shall include the
registered trademark symbol and shall be in the following form, as appropriate:
[E*TRADE ▇▇▇▇](R). All literature and materials
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printed, distributed or electronically transmitted by Co-Marketer and containing
the E*TRADE Marks shall include the following notice:
[E*TRADE ▇▇▇▇] is a registered trademark of
E*TRADE Group, Inc.
c. License to Co-Marketer Marks. Subject to all the terms and
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conditions of this Agreement, Co-Marketer hereby grants E*TRADE a nonexclusive,
non-transferable, non-sublicensable license to use the Co-Marketer Marks solely
on the E*TRADE Site and in connection with the marketing and distribution of the
E*TRADE Services to its customers. "Co-Marketer Marks" shall mean solely the Co-
Marketer trade names, marks and logos specified in Exhibit C hereto; provided,
however, that Co-Marketer, in its sole discretion from time to time, may change
the appearance and/or style of the Co-Marketer Marks or add or subtract from the
list in Exhibit C, provided that, unless required earlier by a court order or to
avoid potential infringement liability, E*TRADE shall have fourteen (14) days'
notice to implement any such changes. E*TRADE hereby acknowledges and agrees
that, (i) the Co-Marketer Marks are owned solely and exclusively by Co-Marketer,
(ii) except as set forth herein, E*TRADE has no rights, title or interest in or
to the Co-Marketer Marks and (iii) all use of the Co-Marketer Marks by E*TRADE
shall inure to the benefit of Co-Marketer. E*TRADE agrees not to apply for
registration of the Co-Marketer Marks (or any ▇▇▇▇ confusingly similar thereto)
anywhere in the world. E*TRADE agrees that it shall not engage, participate or
otherwise become involved in any activity or course of action that diminishes
and/or tarnishes the image and/or reputation of any Co-Marketer ▇▇▇▇.
d. Use and Display of Co-Marketer Marks. E*TRADE acknowledges and
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agrees that the presentation and image of the Co-Marketer Marks should be
uniform and consistent with respect to all services, activities and products
associated with the Co-Marketer Marks. Accordingly, E*TRADE agrees to use the
Co-Marketer Marks solely in the manner which Co-Marketer shall specify from time
to time in Co-Marketer's sole discretion. All usage by E*TRADE of the Co-
Marketer Marks shall include the appropriate trademark symbol and shall be in
the following form, as appropriate: [Co-Marketer ▇▇▇▇](R) or [Co-Marketer
▇▇▇▇](TM). All literature and materials printed, distributed or electronically
transmitted by E*TRADE and containing the Co-Marketer Marks shall include the
following notice:
[Co-Marketer ▇▇▇▇] is a [registered] trademark of
Co-Marketer Corporation
4. Payment; Reports; Audit Rights.
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a. Payment and Reports. Subject to the terms and conditions of
this Agreement, all payments made under this agreement shall be made in
accordance with terms specified in Exhibit D attached hereto.
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b. Audit Rights. All records relating to payment obligations
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hereunder, and inspection and audits thereof, shall be kept and made available
in accordance with terms specified in Exhibit D.
5. Ownership. Each party or their respective licensors and third
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party information and content providers retain all rights, title and interest in
and to all of the information, content, data, designs, materials and all
copyrights, patent rights trademark rights and other proprietary rights thereto
provided by it pursuant to this Agreement. Except as expressly provided herein,
no other right or license with respect to any copyrights, patent rights,
trademark rights or other proprietary rights is granted under this Agreement.
All rights not expressly granted hereunder by a party are expressly reserved to
such party and its licensors and information and content providers.
6. Term and Termination.
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a. This Agreement shall commence on the Effective Date and shall
remain in full force and effect (unless terminated earlier as provided below)
for an initial term of one (1) year which shall be renewed automatically for
additional one (1) year periods unless either party provides written notice
ninety (90) days before the end of the then current term (collectively, the
"Term"). Either party may terminate this Agreement at any time without cause by
providing ninety (90) days' written notice to the other party.
b. This Agreement may be terminated by a party for cause
immediately by written notice upon the occurrence of any of the following
events:
i) If the other ceases to do business, or otherwise
terminates its business operations, except as a result of an assignment
permitted under Section 13.a below; or
ii) If the other shall fail to promptly secure or renew any
license, registration, permit, authorization or approval or exemption therefrom
for the conduct of its business in the manner contemplated by this Agreement or
if any such license, registration, permit, authorization or approval is revoked
or suspended and not reinstated within sixty (60) days; or
iii) If the other materially breaches any material provision
of this Agreement and fails to cure substantially such breach within thirty (30)
days of written notice describing the breach; or
iv) Effective immediately and without notice if the other
becomes insolvent or seeks protection under any bankruptcy, receivership, trust
deed, creditors arrangement, composition or comparable proceeding, or if any
such proceeding is instituted against the other (and not dismissed within ninety
(90) days).
c. Survival. Sections 4.b and 5 through and including 12, any
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accrued payment obligations and, except as otherwise expressly provided herein,
any right of action for breach of this Agreement prior to termination shall
survive any termination of this Agreement.
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Furthermore, upon termination or expiration of this Agreement, the licenses and
obligations in Sections 2 and 3 shall cease.
d. Obligations After Termination or Expiration. Upon the expiration
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or termination of this Agreement for any reason:
i) Except as otherwise specified in clause (ii) below, each
party will promptly cease using and destroy or return to the other party all
promotional and advertising materials that bear the Marks of the other party and
all Confidential Information of such other party; and
ii) Co-Marketer and E*TRADE will continue to deliver the Co-
Marketer and E*TRADE Services, respectively, to their customers until the
expirations or terminations of their respective subscription agreements with Co-
Marketer and E*TRADE.
7. Warranty Disclaimer. NEITHER PARTY MAKES ANY WARRANTIES TO ANY PERSON
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OR ENTITY WITH RESPECT TO ANY INFORMATION, CONTENT OR OTHER MATERIALS PROVIDED
OR MADE AVAILABLE BY IT HEREUNDER AND DISCLAIMS ALL EXPRESS OR IMPLIED
WARRANTIES, INCLUDING WITHOUT LIMITATION WARRANTIES OR MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE.
8. Indemnification. Each party (the "Indemnitor") shall defend or settle
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at its expense a claim or suit against the other party (the "Indemnitee"), its
sublicensees, distributors, and end users arising out of or in connection with
an assertion that the information, content or other materials or services
provided or made available by the Indemnitor or the use thereof as specifically
authorized by the Indemnitor, infringe any copyright or trademark rights of any
third party, or are a misappropriation of any third party's trade secret, or
contain any libelous, defamatory, disparaging, pornographic or obscene
materials. The Indemnitor shall indemnify and hold harmless the Indemnitee
against and from damages, costs, and reasonable attorneys' fees, if any,
incurred in defending and/or resolving such suit; provided that (a) the
Indemnitor is promptly notified in writing of such claim or suit, (b) the
Indemnitor shall have the sole control of the defense and/or settlement thereof,
(c) the Indemnitee furnishes to the Indemnitor, on request, information
available to the Indemnitee for such defense, and (d) the Indemnitee cooperates
in any defense and/or settlement thereof as long as the Indemnitor pays all of
the Indemnitee's reasonable out of pocket expenses and attorneys' fees. The
Indemnitee shall not admit any such claim without prior consent of the
Indemnitor.
Co-Marketer agrees to indemnify E*TRADE for any third party claim,
(including without limitation any Self-Regulatory Organization, state, or
federal regulatory or securities claims) arising out of the Co-Marketer Services
or out of a breach of any provision of this Agreement by Co-Marketer, its
Partners, affiliates and their employees, including but not limited to any
distribution of promotional or advertising materials not approved in advance by
E*TRADE under Section 2.b. of this Agreement.
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E*TRADE agrees to indemnify Co-Marketer for any third party claim,
(including without limitation any Self-Regulatory Organization, state, or
federal regulatory or securities claims) arising out of the use or distribution
by Co-Marketer, its Partners, affiliates and employees of any promotional or
advertising materials approved by E*TRADE only to the extent that these
materials relate directly to the E*TRADE Services.
9. Limited Liability. EXCEPT AS OTHERWISE PROVIDED BELOW, AND
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NOTWITHSTANDING ANYTHING ELSE IN THIS AGREEMENT OR OTHERWISE, NEITHER PARTY
SHALL BE LIABLE OR OBLIGATED UNDER ANY SECTION OF THIS AGREEMENT OR UNDER
CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY FOR
ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST PROFITS OR COST OF PROCUREMENT
OF SUBSTITUTE GOODS OR SERVICES. THE LIMITATIONS IN THIS SECTION 9 SHALL NOT
APPLY TO ANY BREACH OF SECTION 10.
10. Confidential Information.
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a. Each party ("Receiving Party") agrees to keep confidential
and not disclose or use except in performance of its obligations under this
Agreement, confidential or proprietary information related to the other party's
("Disclosing Party") technology or business that the Receiving Party learns in
connection with this Agreement and any other information received from the
other, including without limitation, to the extent previously, currently or
subsequently disclosed to the Receiving Party hereunder or otherwise:
information relating to products or technology of the Disclosing Party or the
properties, composition, structure, use or processing thereof, or systems
therefor, or to the Disclosing Party's business (including, without limitation,
computer programs, code, algorithms, schematics, data, know-how, processes,
ideas, inventions (whether patentable or not), names and expertise of employees
and consultants, all information relating to customers and customer transactions
and other technical, business, financial, customer and product development
plans, forecasts, strategies and information), all of the foregoing,
"Confidential Information"). Neither party shall disclose the terms of this
Agreement to any third party without the prior written consent of the other
party. Each party shall use reasonable precautions to protect the other's
Confidential Information and employ at least those precautions that such party
employs to protect its own confidential or proprietary information.
"Confidential Information" shall not include information the Receiving Party can
document (a) is in or (through no improper action or inaction by the Receiving
Party or any affiliate, agent or employee) enters the public domain (and is
readily available without substantial effort), or (b) was rightfully in the
Receiving Party's possession or known by it prior to receipt from the Disclosing
Party, or (c) was rightfully disclosed to the Receiving Party by another person
without restriction, or (d) was independently developed by the Receiving Party
by persons without access to such information and without use of any
Confidential Information of the Disclosing Party. Each party, with prior written
notice to the Disclosing Party, may disclose such Confidential Information to
the minimum extent possible that is required to be disclosed to a governmental
entity or agency in connection with seeking any governmental or regulatory
approval, or pursuant to the lawful requirement or request of a governmental
entity or agency, provided that reasonable measures
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are taken to guard against further disclosure, including without limitation,
seeking appropriate confidential treatment or a protective order, or assisting
the other party to do so.
b. The Receiving Party acknowledges and agrees that due to the
unique nature of the Disclosing Party's Confidential Information, there can be
no adequate remedy at law for any breach of its obligations hereunder, that any
such breach may allow the Receiving Party or third parties to unfairly compete
with the Disclosing Party resulting in irreparable harm to the Disclosing Party,
and therefore, that upon any such breach or any threat thereof, the Disclosing
Party shall be entitled to appropriate equitable relief in addition to whatever
remedies it might have at law and to be indemnified by the Receiving Party from
any loss or harm, including, without limitation, lost profits and attorney's
fees, in connection with any breach or enforcement of the Receiving Party's
obligations hereunder or the unauthorized use or release of any such
Confidential Information. The Receiving Party will notify the Disclosing Party
in writing immediately upon the occurrence of any such unauthorized release or
other breach. Any breach of this Section 10 will constitute a material breach of
this Agreement.
11. Relationship of Parties. The parties hereto expressly understand
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and agree that each party is an independent contractor in the performance of
each and every part of this Agreement, is solely responsible for all of its
employees and agents and its labor costs and expenses arising in connection
therewith. Neither party nor its agents or employees are the representatives of
the other party for any purpose and neither party has the power or authority as
agent, employee or any other capacity to represent, act for, bind or otherwise
create or assume any obligation on behalf of the other party for any purpose
whatsoever.
12. Notices. Notices under this Agreement shall be sufficient only if
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personally delivered, delivered by a major commercial rapid delivery courier
service or mailed, postage or charges prepaid, by certified or registered mail,
return receipt requested to a party at its addresses set forth on the first page
above or as amended by notice pursuant to this Section. If not received sooner,
notice by mail shall be deemed received five (5) days after deposit in the U.S.
mails.
13. Related Services.
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a. ***
b. ***
*** Omitted pursuant to a request for confidential treatment and filed
separately with the Commission.
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c. Co-Marketer Employee E*TRADE Accounts. Co-Marketer will
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promote E*TRADE as the exclusive on-line financial services provider to its
employees. E*TRADE will design a special promotion for Co-Marketer employees to
encourage them to open E*TRADE accounts.
14. Miscellaneous.
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a. Prohibition Against Assignment. Neither this Agreement nor
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any rights, licenses or obligations hereunder, may be assigned by either party
without the prior written approval of the non-assigning party. Notwithstanding
the foregoing, either party may assign this Agreement to any acquiror of all or
of substantially all of such party's equity securities, assets or business
relating to the subject matter of this Agreement. Any attempted assignment in
violation of this Section will be void and without effect. Subject to the
foregoing, this Agreement will benefit and bind the parties' successors and
assigns.
b. Applicable Law; Attorneys' Fees. This Agreement shall be
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governed by and construed in accordance with the laws of the State of California
without reference to conflict of law principles thereof. In any action to
enforce this Agreement the prevailing party will be entitled to costs and
attorneys' fees.
c. Entire Agreement. This Agreement constitutes the entire
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agreement between the parties with respect to the subject matter hereof and
supersedes all prior discussions, documents, agreements and prior course of
dealing, and shall not be effective until signed by both parties.
d. Amendment and Waiver. Except as otherwise expressly provided
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herein, any provision of this Agreement may be amended or modified and the
observance of any provision of this Agreement may be waived (either generally or
any particular instance and either retroactively or prospectively) only with the
written consent of the parties. The failure of either party to enforce its
rights under this Agreement at any time for any period shall not be construed as
a waiver of such rights.
e. Severability. In the event that any of the provisions of this
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Agreement shall be held by a court or other tribunal of competent jurisdiction
to be unenforceable, such provisions shall be limited or eliminated to the
minimum extent necessary so that this Agreement shall otherwise remain in full
force and effect and enforceable.
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f. Publicity. Any press releases in connection with this
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Agreement shall be subject to the prior written mutual approval of the parties.
g. Counterparts. This Agreement may be executed in counterparts,
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each of which shall be deemed an original, but both of which together shall
constitute one and the same instrument.
h. Third Party Beneficiaries. E*TRADE's and Co-Marketer's third
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party licensors and information providers are intended beneficiaries of this
Agreement. All such third parties shall be bound by the terms of this Agreement
including without limitation Paragraph 2(b) hereto to the maximum extent
possible.
i. Headings. Headings and captions are for convenience only and
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are not to be used in the interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date. All signed copies of this Agreement shall be deemed originals.
CO-MARKETER: WebMD, Inc.
By: /s/ K. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name: K. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
Title: Chief Financial Officer
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E*TRADE GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: SVP, Corporate Development and
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New Ventures
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EXHIBIT A
Co-Marketer's Promotional and Advertising Obligations
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Pursuant to Section 2.a of the Agreement, Co-Marketer agrees to
advertise and promote the E*TRADE Services on the Co-Marketer Sites as specified
in this Exhibit. Co-Marketer shall use materials and content (including,
without limitation, active hyperlinking URLs) provided by and/or approved in
advance and before first use, by E*TRADE for advertisement and promotion of the
E*TRADE Services on the Co-Marketer Sites. E*TRADE shall be the exclusive
provider of brokerage services and investment related products (specifically
excluding banking and insurance products and services), electronic or otherwise,
promoted on the Co-Marketer Sites.
1) Co-Marketer - E*TRADE Offer: E*TRADE will purchase subscriptions
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to the Co-Marketer Services from Co-Marketer in Subscription Blocks (as provided
in Exhibit D, hereto) which subscriptions Co-Marketer will promote and advertise
in accordance with all provisions of this Agreement on behalf of E*TRADE free of
charge to any person approved by E*TRADE for a new account pursuant to E*TRADE's
standard terms.
Each such subscription to the Co-Marketer service shall include:
Unlimited local dialup Internet access (ISP account) which the
Subscriber may decline at the Subscriber's sole discretion
Customized Physician web-site, including links to patient education
information
Payor referrals, eligibility, and verification via electronic data
interchange (EDI)
Certified E-mail account (***/mo.)
Universal in-box (telephonic and web-based e-mail, voice-mail, and
faxing)
Continued Medical Education credits (CME)
Access to a comprehensive source of dynamic medical/healthcare content
Tools to manage the user's practice and improve the user's lifestyle
OTHER CO-MARKETER WEB SITES. Upon completion of this Agreement, and for forty-
five (45) days thereafter, Co-Marketer shall not engage in any conversations,
negotiations, or discussions of any kind with any third party securities broker
or dealer, other than E*TRADE, for purposes of promoting or otherwise including
such third party broker on Co-Marketer's consumer site (i.e. "Health and
Wellness Center") or any other web site owned or controlled by Co-Marketer. In
the event that E*TRADE and Co-Marketer fail to reach an agreement regarding such
site during this forty-five (45) day period, E*TRADE shall have a right of first
refusal for one (1) years for inclusion as securities broker-dealer service
provider on such site.
E*TRADE shall further have a right of first refusal for inclusion as securities
broker-dealer service provider on any site created, sponsored, or developed by
Co-Marketer, wherever located, intended for use by individuals and/or
organizations located outside of the United States.
***Omitted pursuant to a request for confidential treatment and filed separately
with the Commission.
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PROMOTION AND ADVERTISING. Co-Marketer shall use the payment described in
Paragraph 1 of Exhibit D hereto to fund a national media campaign, consisting of
print, radio, on-line and/or television advertising to promote the E*TRADE
Offer. Co-Marketer shall further use commercially reasonable efforts to promote
the E*TRADE Offer. Any such print, radio, on-line and/or televisions
advertising must be approved, in advance and before first use, by E*TRADE.
CO-MARKETER SERVICE LEVEL AGREEMENT: In performance of its obligations under
this Agreement Co-Marketer shall meet the requirements for service level
performance as set forth in Exhibit E attached hereto.
CO-BRANDED WEB PAGE:
Co-Marketer's promotional efforts and obligations regarding the Co-
Branded Site hereunder consist of the following:
1. Co-Marketer agrees to provide *** to E*TRADE all of the
medical/healthcare content for the "Destination E*TRADE" Site ("Co-
Branded Site"). The Co-Branded Site shall be a co-branded area
consisting of a co-branded first page, with the second through last
pages containing Co-Marketer content but always including a "Back to
E*TRADE" navigation button. *** All content on the second through last
page of the Co-Branded Site page and all advertising and sponsorship
and revenues thereof shall be owned exclusively by Co-Marketer.
2. Co-Marketer agrees to advertise and promote the E*TRADE Services
in the "Financial center" area of the Co-Marketer Sites as specified
in this Exhibit. Co-Marketer shall sponsor and promote E*TRADE as an
exclusive securities broker-dealer featured on the Co-Marketer Sites.
Co-Marketer shall use materials and content provided by and/or
approved, in advance and before first use, by E*TRADE for
advertisement and promotion of the Co-Branded Site, such advertising
to include (i) on-line banner ads on the Co-Marketer Sites with direct
links to the E*TRADE Site, (ii) prominent display of E*TRADE's name
and logos in the portal page and other pages and (iii) other
activities as specified in this Exhibit A. Co-Marketer shall not sell
advertising to, or otherwise promote, any other securities broker or
dealer on the Co-Branded Site.
3. The Co-Branded Site shall be located on a Co-Marketer server with
direct http "hot" links from the "Financial Center" area of the Co-
Marketer Sites. The parties shall mutually agree upon links, as
appropriate, from the Co-Branded Site to additional information or
applications located on the Co-Marketer Sites.
***Omitted pursuant to a request for confidential treatment and filed separately
with the Commission.
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4. Co-Marketer shall not sell any advertising to any third party on
the Co-Branded Site on terms more favorable to such third party than
those offered to or being paid by E*TRADE without first offering such
terms to E*TRADE. In all advertisements and other references in the
"Financial Center" or similar area of the Co-Marketer Sites, E*TRADE
will be featured with no less prominence than that provided to any
other third party.
5. Co-Marketer agrees to use only such materials and content
(including, without limitation, active hyperlinking URLs) provided by
and/or approved, in advance and before first use, by E*TRADE for
advertisements and promotion of the E*TRADE Services on the Co-
Marketer Sites. E*TRADE shall be the exclusive provider of broker-
dealer services and investment related products (specifically
excluding banking and insurance products and services), electronic or
otherwise, promoted on the Co-Marketer Sites.
6. Co-Marketer and the Co-Branded Site shall meet the requirements
for service level performance as set forth in Exhibit E attached
hereto.
7. E*TRADE may, in its sole discretion, grant to its international
affiliates the right to hyperlink to the Co-Branded Site.
YEAR 2000 COMPLIANCE. Co-Marketer represents and warrants that the Co-Marketer
Sites, the Co-Branded Site, and Co-Marketer Services (including, without
limitation, with respect to the specific promotions below) are Year 2000
Compliant. For purposes of this Agreement, "Year 2000 Compliant" shall mean
that the Co-Marketer Sites and Co-Marketer Services will not be materially
affected by any inability to (i) completely and accurately address, present,
produce, store and calculate data involving dates beginning with January 1,
2000, and will not produce abnormally ending or incorrect results involving such
dates as used in any forward or regression date based function; or (ii) function
in a such a way that all "date" related functionalities and data fields include
the indication of century and millennium, and will perform calculations which
involve a four-digit year field. Notwithstanding the foregoing, this Year 2000
warranty shall not apply to the extent that any services or software are used or
interfaced with other software, data or operating systems, which are not Year
2000 compliant.
E*TRADE'S OBLIGATIONS
---------------------
Pursuant to Section 2.a of the Agreement, E*TRADE agrees to advertise and
promote the E*TRADE and Co-Marketer Services as specified in this Exhibit.
PROMOTION AND ADVERTISING. E*TRADE shall promote Co-Marketer membership to
E*TRADE's subscriber base, via the following promotion: any E*TRADE customer
that signs up for one (1) year of Co-Marketer membership at the best commercial
rate available at the time of enrollment (specifically excluding special and
promotional offers not available generally to all Co-Marketer subscribers) shall
receive *** from E*TRADE during that year.
***Omitted pursuant to a request for confidential treatment and filed separately
with the Commission.
12
E*TRADE further agrees to advertise the E*TRADE/Co-Marketer relationship by
including Co-Marketer in a portion of E*TRADE's future planned media buys and
through on-line banner advertisement, using materials and content provided by
and/or approved in advance by Co-Marketer.
E*TRADE will design and prepare *** (***) Fulfillment Kits for use solely in
connection with this Agreement as soon as is commercially reasonable after the
Effective Date. The parties shall use good faith efforts to reach agreement
regarding the provision of additional Fulfillment Kits.
YEAR 2000 COMPLIANCE. E*TRADE represents and warrants that the E*TRADE Site and
E*TRADE Services (including, without limitation, with respect to the specific
promotions above) are Year 2000 Compliant. For purposes of this Agreement,
"Year 2000 Compliant" shall mean that the E*TRADE Site and E*TRADE Services will
not be materially affected by any inability to (i) completely and accurately
address, present, produce, store and calculate data involving dates beginning
with January 1, 2000, and will not produce abnormally ending or incorrect
results involving such dates as used in any forward or regression date based
function; or (ii) function in a such a way that all "date" related
functionalities and date fields include the indication of century and
millennium, and will perform calculations which involve a four-digit year field.
Notwithstanding the foregoing, this Year 2000 warranty shall not apply to the
extent that any services or software are used or interfaced with other software,
data or operating systems, which are not Year 2000 compliant.
***Omitted pursuant to a request for confidential treatment and filed separately
with the Commission.
13
EXHIBIT B
---------
E*TRADE Marks
-------------
E*TRADE(R)
[E*TRADE logo]
14
EXHIBIT C
---------
Co-Marketer Marks
-----------------
WebMD(TM)
WebMD OnCall(TM)
[WebMD logo]
15
EXHIBIT D
---------
Payment Terms
-------------
By E*TRADE.
1. Initial Guaranteed Purchase. Subject to the terms and conditions
---------------------------
of this Agreement, on the Effective Date of this Agreement E*TRADE shall
purchase *** (***) subscriptions to the Co-Marketer service from Co-Marketer.
E*TRADE will pay Co-Marketer *** (***) for these subscriptions within thirty
(30) days of the Effective Date.
2. Subscription Blocks. Subject to the terms and conditions of this
-------------------
Agreement, Co-Marketer will offer to E*TRADE, for purchase at E*TRADE's sole
discretion, additional blocks of *** (***) subscriptions to the Co-Marketer
service ("Subscription Blocks") at the rate of *** (***) per Subscription Block.
E*TRADE may purchase additional Subscription Blocks from Co-Marketer singly or
in any combination at any time at E*TRADE's sole discretion by providing written
notice, including but not limited to notice by postal mail, or facsimile, to Co-
Marketer.
3. Payment Schedule. Payment for each successive purchase of
----------------
additional Subscription Blocks by E*TRADE shall be made within thirty (30) days
of E*TRADE's written notice to Co-Marketer of its intent to purchase any such
additional Subscription Blocks.
4. Renegotiation for ISP Usage. In the event that more than ***
---------------------------
(***) of all subscribers to the Co-Marketer service from the E*TRADE Offer
decline the internet access services as provided in Exhibit A hereto, the
parties agree to renegotiate in good faith the price of Subscription Blocks to
be paid by E*TRADE.
BY CO-MARKETER
For every E*TRADE account holder who opens a Co-Marketer subscription through
the efforts of E*TRADE, other than an account holder who opened a new account
with E*TRADE pursuant to this Agreement, Co-Marketer shall pay *** (***) to
E*TRADE within thirty (30) days of the receipt of the first payment from such
account holder by Co-Marketer.
Co-Marketer will reimburse E*TRADE's cost of *** (***) for the Fulfillment Kits
prepared by E*TRADE pursuant to Exhibit A hereto. E*TRADE may, in its sole
discretion, withhold this sum from the Initial Guaranteed Purchase described
herein as satisfaction of Co-Marketer's obligation hereunder. The parties shall
use good faith efforts to reach agreement regarding the provision of additional
Fulfillment Kits.
***Omitted pursuant to a request for confidential treatment and filed separately
with the Commission.
16
RECORDS AND AUDIT TERMS
-----------------------
Each party shall keep, maintain and preserve for at least three (3)
years following termination or expiration of the term of this Agreement or any
renewal(s) thereof, accurate records relating to such party's payment
obligations hereunder. Such records shall be maintained as confidential, but
shall be available for inspection and audit as provided herein. Each party
shall have the right at least once per calendar year to have an independent
public accountant, reasonably acceptable to the other party, examine such other
party's relevant books, records and accounts for the purpose of verifying the
accuracy of payments made to the other party as required under this Agreement.
Each party acknowledges and agrees that such accountant shall not have access to
the books, records, and accounts relating to other products or services except
as such books, records and accounts also directly relate to the payments due
hereunder. Each audit will be conducted at the audited party's place of
business, or other place agreed to by Co-Marketer and E*TRADE, during the
audited party's normal business hours and with at least five (5) business days
prior written notice to the audited party. The auditing party shall pay the
fees and expenses of the auditor for the examination; provided that should any
examination disclose a shortfall in the excess of the greater of twenty-five
thousand dollars ($25,000) or five percent (5%) of the payments due the auditing
party for the period being audited, the audited party shall pay the reasonable
fees and expenses of the auditor for that examination. At least every two weeks
during the term of this Agreement, each party shall provide the other party with
such reports as reasonably requested in order to facilitate each party's
obligations under this agreement.
17
EXHIBIT E
---------
1. PERFORMANCE
a) Average less than *** response time for *** of requests. Measures server
response time only, not network transmission time.
b) Average *** up time. This would be exclusive of regularly scheduled
maintenance. Scheduled maintenance is defined as maintenance for which 48
hours advance notice has been given for the required down time.
c) Post an approved message in the event of a system outage.
2. MONITORING/REPORTING
a) Provide details on the method used to monitor performance times.
b) Provide weekly and monthly reporting which details server up time with the
following details per period:
. average response time
. actual daily response time detail
. average server up time
. actual daily server up time
This information will be emailed to the appropriate contact within the E*TRADE
Information Systems Division on Monday of each week for the previous week's
reports and the first working day of each month for the previous month's
reports.
3. ESCALATION PROCEDURES
a) Notify E*TRADE via the following email addresses in case of a service
outage:
. ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
. ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
b) Notify E*TRADE within *** of Co-Marketer's awareness of a service outage.
Status information to include:
. reason for the outage.
. ETA for service restored.
c) If E*TRADE experiences a service outage and has not been notified by email
by Co-Marketer, E*TRADE will contact the Senior System Administrator at Co-
Marketer by pager at (▇▇▇) ▇▇▇-▇▇▇▇ and will be given the information listed
in 3.b).
***Omitted pursuant to a request for confidential treatment and filed separately
with the Commission.
18
d) Continue to notify E*TRADE with updated status for the duration of the
outage.
e) Provide a post incident summary. This summary should include:
. the cause of the problem.
. method used to correct the problem.
. measures Co-marketer will take to prevent further occurrences.
4. BUSINESS RESUMPTION
a) Co-Marketer must prove the ability to switch processing from the primary
server to a hot backup server within ***. Testing of this procedure will be
conducted as requested by E*TRADE on a designated weekend by both Co-
Marketer and E*TRADE personnel.
b) Perform an analysis that documents all of the single points of failure in
the Co-Marketer - E*TRADE system. Include network components such as
routers, hardware and software components.
c) Eliminate all of the single points of failure within the Co-marketer domain
within *** months from the date of this document.
5. REVENUE IMPACT RECOUPMENT
a) In the event that Co-Marketer fails to meet the performance objectives
defined in Section 1.a), a penalty of *** will be due E*TRADE.
b) In the event that Co-Marketer fails to meet the performance objectives
defined in Section 1.b), Co-Marketer will credit E*TRADE a prorated amount
of the monthly service fee as compensation for the service outage. The
calculation for this credit will be as follows: The monthly fee as specified
in Exhibit D of this Agreement divided by 720 hours (30 days per month times
24 hours per day) times the total time of the outage.
c) In the event that Co-Marketer fails to meet the performance objectives
defined in Section 1.c), a penalty of *** will be due E*TRADE.
d) These penalties will be credited to the month's billing in which the
performance failure occurred.
e) Failure by Co-Marketer to meet these performance objectives for ***
consecutive months or *** out of *** months shall constitute a breach of
this Agreement and E*TRADE will have the right to terminate immediately
after providing written notice to Co-Marketer of such intent.
***Omitted pursuant to a request for confidential treatment and filed separately
with the Commission.
19