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* Certain sections omitted and filed separately with the Commission
EXHIBIT 10.14
MARKETING SERVICES AGREEMENT
This MARKETING SERVICES AGREEMENT (this "AGREEMENT") is entered into as
of the 3rd day of February, 2000 (the "EFFECTIVE DATE") by and between
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ Inc., a Delaware corporation with offices at ▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ ("VARSITYBOOKS") and ▇▇▇▇▇▇ ▇▇▇, Inc. a
Delaware corporation with offices at 11600 ▇▇▇▇▇▇ Mae Drive, Reston, V.A. 20193
("▇▇▇▇▇▇ ▇▇▇").
WHEREAS, ▇▇▇▇▇▇ Mae provides educational loan products, educational
enterprise-related products (the "▇▇▇▇▇▇ ▇▇▇ PRODUCTS") and operates a Web site
located at the URL http:///▇▇▇.▇▇▇▇▇▇▇▇▇.▇▇▇ (the "▇▇▇▇▇▇ MAE WEB SITE") and
would like to expand its customer base by having access to the users of the
VarsityBooks Web Site (as defined below); and
WHEREAS, VarsityBooks maintains a Web site located at the URL
▇▇▇▇://▇▇▇.▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ (the "VARSITYBOOKS WEB SITE") through which it sells
and distributes college textbooks, general interest books and other products;
and
WHEREAS, VarsityBooks and ▇▇▇▇▇▇ ▇▇▇ would like to define an
arrangement whereby VarsityBooks will market the ▇▇▇▇▇▇ Mae Products to users of
the VarsityBooks Web Site. Specifically, VarsityBooks will provide ▇▇▇▇▇▇ ▇▇▇
with advertising space on the VarsityBooks Web Site and with other marketing
opportunities. ▇▇▇▇▇▇ Mae will pay VarsityBooks a monthly fee throughout the
duration of the Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties agree as follows:
1. DEFINITIONS
Capitalized terms used in this Agreement have the meanings given to
them below or as elsewhere defined in this Agreement. All definitions
will apply both to their singular or plural forms, as the context may
require. "DAYS" means calendar days, unless otherwise specified. All
references to "SECTION" are to Sections of this Agreement, unless
otherwise specified. "AGREEMENT" collectively means this Agreement and
all Exhibits hereto (which are hereby incorporated into this
Agreement), and all valid amendments to this Agreement. Headings are
intended only for reference purposes.
(A) "AFFILIATE" means, with respect to a party to this Agreement,
those entities controlled by, controlling, or under common
control with such party. For the purposes of this definition,
"CONTROL" (and its derivatives) will mean, with respect to
such an entity, having the legal, beneficial or equitable
ownership, directly or indirectly, of fifty percent (50%) or
more of the capital stock (or other ownership interest, if the
entity is not a corporation) of such entity ordinarily having
voting rights, or otherwise having a right to appoint at least
half of the directors (or analogous officers) of such entity.
(B) "CONFIDENTIAL INFORMATION" has the meaning given in Section
9(A).
(C) "CORPORATE TRANSACTION" means (A) any consolidation or merger
of the Corporation with or into any other corporation or other
entity, other than any
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merger or consolidation resulting in the holders of the
capital stock of the Corporation entitled to vote for the
election of directors holding a majority of the capital stock
of the surviving or resulting corporation or other entity
entitled to vote for the election of directors, (B) any person
or entity (including any affiliates thereof) becoming the
holder of a majority of the capital stock of the Corporation
entitled to vote for the election of directors, or (C) any
sale or other disposition by the Corporation of all or
substantially all of its assets or capital stock.
(D) "EQUITY OFFERING" means an equity offering resulting in net
proceeds to the Corporation in excess of ten million dollars
($10,000,000) which occurs prior to the IPO Date.
(E) "INTELLECTUAL PROPERTY RIGHTS" means any and all worldwide
rights, title and interest in intellectual property (including
without limitation, all patents, patent registrations,
copyrights, moral rights, trademarks, trade names, service
marks, service names, trade secrets, know-how or other similar
rights arising or enforceable under U.S. law, foreign law, or
international treaty regime).
(F) "IPO DATE" means the date on which the Corporation closes the
initial public offering of its Common Stock.
(G) "▇▇▇▇▇▇ ▇▇▇ CONTENT" means content provided by ▇▇▇▇▇▇ Mae to
VarsityBooks for use in accordance with this Agreement.
(H) "▇▇▇▇▇▇ ▇▇▇ SOLUTIONS" means a division of ▇▇▇▇▇▇ Mae that
provides business processing, technical and software solutions
to higher education.
(I) "▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇" means the names, trademarks, service marks,
trade names, service names, logos, symbols, and other product
or service designations currently held by ▇▇▇▇▇▇ Mae and all
▇▇▇▇▇▇ ▇▇▇ domain names and hyperlink icons, to the extent set
forth in Exhibit B.
(J) "▇▇▇▇▇▇ MAE WEB SITE(S)" means the internet web site(s) owned,
managed, or controlled by ▇▇▇▇▇▇ ▇▇▇ and its Affiliates,
including, without limitation, all information, materials,
features, products, services, advertisements, promotions,
links, pointers, technology and software, in any format or
medium, made available or embodied therein (except for any
VarsityBooks Marks).
(K) "TERM" has the meaning given in Section 4(A).
2. VARSITYBOOKS OBLIGATIONS
(A) VarsityBooks will provide ▇▇▇▇▇▇ Mae with a Rate Card,
attached as Exhibit C (the "Rate Card"), which specifies the
cost of marketing services with ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ except that
for the first year of this agreement ▇▇▇▇▇▇ ▇▇▇ selects the
Sole Sponsorship of the VarsityScholars Vertical at a fixed
price of * dollars. In the event ▇▇▇▇▇▇ Mae selects
the Sole Sponsorship of the VarsityScholars Vertical in year 2
of this Agreement, and assuming VarsityBooks continues its
VarsityScholars Vertical, the fixed price shall
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remain at *. VarsityBooks shall have the right to
update prices, available services and any other information
reflected on the Rate Card, at its discretion, twice each
year. ▇▇▇▇▇▇ ▇▇▇ will order any and all marketing services in
accordance with Sections 2(B) and (D) below, and will provide
payment for any such services ordered in accordance with
Section 5 below.
(B) Throughout the term of this Agreement, ▇▇▇▇▇▇ Mae will receive
a preferred partner discount of * off the price of marketing
services presented as part of any VarsityBooks Rate Card. Such
discount will not apply to the sponsorship of any
VarsityBooks' vertical or the use of the VarsityBooks campus
rep program. Notwithstanding the foregoing, ▇▇▇▇▇▇ ▇▇▇ will
receive a * discount on any banner ads purchased pursuant to
this Agreement.
(C) VarsityBooks will provide ▇▇▇▇▇▇ Mae the option of
participating in various new marketing opportunities as they
arise.
(D) For the purposes of implementing specific deliverables, ▇▇▇▇▇▇
Mae and VarsityBooks will execute mutually agreeable service
orders (the "Ad Insertion Orders") that will specify those
marketing services which will be executed on ▇▇▇▇▇▇ Mae's
behalf by VarsityBooks. The Ad Insertion Orders will become
attachments to this Agreement and will be executed on the
following schedule:
Ad Insertion Order Date Period Covered
----------------------- ---------------
1/31/2000 2/1/2000 - 6/31/2000
6/15/2000 7/1/2000 - 12/31/2000
12/15/2000 1/1/2001 - 6/31/2001
6/15/2001 7/1/2001 - 1/31/2002
3. LICENSES
(A) During the term of this Agreement ▇▇▇▇▇▇ Mae grants to
VarsityBooks a non-exclusive, worldwide, royalty-free, fully
paid-up, non-transferable license to use the ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
solely as contemplated by this Agreement on, or in developing,
supporting and maintaining, the hyperlinks and other
promotional media contemplated by this Agreement in the
ordinary course of business, including without limitation, as
applicable, the rights to use, copy, display, distribute, and
create and use derivative works based on the ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇.
Any ▇▇▇▇▇▇ ▇▇▇ Content incorporated into derivative works so
created shall be the property of ▇▇▇▇▇▇ Mae. Notwithstanding
the foregoing, the form of any use of any ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇
which is viewable by the public or any user of the
VarsityBooks Web Site must be approved by ▇▇▇▇▇▇ Mae in
advance either in writing or through the procedures set forth
in this Agreement. Any other use of any ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ is
prohibited unless ▇▇▇▇▇▇ Mae gives its prior written consent
to
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each such use. Upon the expiration or termination of this
Agreement, VarsityBooks will cease using the ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
except as ▇▇▇▇▇▇ Mae agrees in writing.
(B) VarsityBooks will not adopt or use in any manner any name,
▇▇▇▇, symbol, logo, icon, design, copyright or company,
product or service name or designation not currently in use
and which is confusingly similar to any ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇, or
which constitutes a translation thereof, without ▇▇▇▇▇▇ Mae's
prior written consent. VarsityBooks will not register anywhere
in the world, directly or indirectly, any ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ or
any other name, ▇▇▇▇, symbol, logo, icon, design, copyright or
company, product or service name or designation not currently
in use and which is confusingly similar thereto or which
constitutes a translation thereof.
(C) VarsityBooks agrees that in connection with its use of the
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ it will display symbols and notices clearly
and sufficiently indicating the trademark status and ownership
of ▇▇▇▇▇▇ Mae's Marks in accordance with applicable trademark
law and practice.
(D) Each party retains all rights, title and interest in and to
its intellectual property except for those licenses and rights
expressly granted by this Agreement.
(E) VarsityBooks acknowledges that its use of licensed materials
in breach of the scope of the grant of license it is receiving
under Section 3(A) or 3(B) above, as applicable, or its breach
of Section 3(C) or 3(D) above, as applicable, will cause
▇▇▇▇▇▇ ▇▇▇ irreparable injury for which monetary damages will
not make ▇▇▇▇▇▇ Mae whole. Accordingly, in addition to all
other available remedies and notwithstanding Section 14
hereof, ▇▇▇▇▇▇ ▇▇▇ will be entitled to equitable or injunctive
relief as and where it deems fit in the event of an actual,
threatened or attempted breach by VarsityBooks of any such
provision.
4. TERM; TERMINATION
(A) The term of this Agreement will commence on February 1, 2000
and end two (2) years thereafter (the "TERM"). At the end of
the Term, this Agreement may be renewed upon mutual agreement
of the parties.
(B) In addition to the parties' termination rights set forth
elsewhere in this Agreement, ▇▇▇▇▇▇ Mae may terminate this
Agreement in the event of a Corporate Transaction prior to the
earlier of (a) the IPO Date or (b) the closing of an Equity
Offering.
(C) In addition to the parties' termination rights set forth
elsewhere in this Agreement, either party may terminate this
Agreement:
(1) at any time during the Term, upon at least thirty
(30) days' prior written notice to the other party if
such other party materially breaches this Agreement
or any of the representations and warranties
hereunder and fails to cure such material breach
within such thirty (30) days;
(2) immediately upon written notice to the other party,
if such other party: (a) ceases to conduct business
in the normal course; (b) makes an assignment for the
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benefit of creditors; (c) is liquidated or otherwise
dissolved; or (d) becomes insolvent, is adjudicated
bankrupt, or a receiver, trustee or custodian is
appointed for it.
(D) Upon the termination or expiration of this Agreement for any
reason:
(1) the licenses conferred in Section 3 will cease;
(2) each party will comply with the requirements of
Section 9(F);
(3) ▇▇▇▇▇▇ ▇▇▇ will pay all amounts properly due and
payable to VarsityBooks pursuant to Section 6(B), up
until the effective date of such termination or
expiration (prorated on a daily basis); and
(4) neither party will have any further liability or
obligation to the other party, except as otherwise
expressly provided in this Agreement (including
without limitation Section 4(D) below).
(E) Any provision of this Agreement that imposes or contemplates
continuing obligations on a party will survive the expiration
or termination of this Agreement for any reason.
5. COSTS AND PAYMENT
(A) Unless otherwise expressly provided in this Agreement, each
party will be responsible for all costs and expenses that it
incurs in performing its obligations hereunder.
(B) For each Ad Insertion Order executed by ▇▇▇▇▇▇ Mae and
VarsityBooks, ▇▇▇▇▇▇ ▇▇▇ shall be entitled to order marketing
services from VarsityBooks in an amount equal to (A) TWO
MILLION DOLLARS ($2,000,000) (the "Aggregate Order Maximum");
MINUS (B) any amounts ordered by ▇▇▇▇▇▇ Mae on prior Ad
Insertion Orders. Once the aggregate amount of all services
ordered by ▇▇▇▇▇▇ ▇▇▇ on Ad Insertion Orders reaches the
Aggregate Order Maximum, ▇▇▇▇▇▇ Mae may not execute any
additional Ad Insertion Orders under this Agreement. Pricing
of services ordered by ▇▇▇▇▇▇ ▇▇▇ on any Ad Insertion Order
will be calculated in accordance with Section 2 above.
(C) In consideration for the marketing services and advertising
space provided to ▇▇▇▇▇▇ Mae and the rights granted hereunder,
▇▇▇▇▇▇ ▇▇▇ will pay VarsityBooks the amounts set forth in
Exhibit A.
6. REPRESENTATIONS AND WARRANTIES
(A) Each party represents that it has the full right and authority
to enter into and to perform its obligations under this
Agreement, and the execution and delivery of this Agreement by
it, and the performance of its obligations hereunder, have
been duly authorized by all requisite corporate actions on its
part, and this Agreement has been duly executed and delivered
by it.
(B) Each party warrants that:
(1) The execution or implementation of this Agreement by
such party, and the
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exercise or performance of any rights or obligations
hereunder, will not contravene any provision of its
organizational documents, or to its knowledge violate
or conflict with any agreement or binding obligation
to which it is a party.
(2) Except as otherwise expressly authorized by this
Agreement, such party will not take any action or
make any statement, representation, or warranty
regarding the other party, its products or services
(including the products and services of third parties
which the other party promotes, markets, resells or
distributes) which is not previously authorized in
writing by the other party.
(3) all obligations owed to third parties with respect to
the activities contemplated to be undertaken by
either party pursuant to this Agreement are or will
be fully satisfied by such party, and the other party
will have no obligations with respect thereto;
The sole and exclusive remedy of the other party, and the sole and
exclusive liability and obligations of the warranting party, for breach of any
of the warranties set forth in Section 6(A) or 6(B) hereof will be as provided
under Section 7(a) or 7(B) below, as applicable. Notwithstanding the foregoing,
both parties shall have the right to seek injunctive relief for any breach under
this Agreement.
(C) Each party covenants that:
(1) it will comply with all applicable federal, state and
local laws in the performance of its obligations
hereunder; and
(2) it will not distribute any unwanted or unsolicited
bulk, junk or spam e-mail.
(D) VarsityBooks warrants to ▇▇▇▇▇▇ Mae that it will not knowingly
allow either those pages of the VarsityBooks Web Site which
reference ▇▇▇▇▇▇ ▇▇▇ or which display any name or ▇▇▇▇ of
▇▇▇▇▇▇ ▇▇▇, or any VarsityBooks Marks used by ▇▇▇▇▇▇ Mae, nor
the operation, display or use of any of the foregoing as
contemplated by this Agreement, nor the content, goods and
services offered through the VarsityBooks Web Site to (a)
constitute, or contain material that would constitute, libel,
defamation or slander; (b) constitute, or contain material
that would constitute, an invasion of privacy or a violation
of the rights to publicity of any third party; (c) infringe
upon the Intellectual Property Rights of any third party; (d)
violate any law, statute, ordinance or regulation or promote
illegal activities; (e) constitute or contain or promote
obscene materials; (f) promote violence; (g) promote
discrimination based on race, sex, religion, nationality,
disability, sexual orientation, or age; (h) constitute or
contain content which is defamatory, trade libelous,
unlawfully threatening or unlawfully harassing; (i) sell or
otherwise market fraudulent materials; or (j) include "▇▇▇▇▇▇
Mae" or variations or misspellings thereof in their domain
names or in metatags or other tools designed to mislead users
or search engines.
(E) ▇▇▇▇▇▇ ▇▇▇ warrants to VarsityBooks that it will not knowingly
allow either the ▇▇▇▇▇▇ Mae Web Site (or those pages of the
▇▇▇▇▇▇ ▇▇▇ Web Site(s) which reference VarsityBooks or which
display any name or ▇▇▇▇ of VarsityBooks), nor any ▇▇▇▇▇▇ ▇▇▇
Content or ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ used by VarsityBooks, nor the
operation, display or use of any of the foregoing as
contemplated by this Agreement nor the content, goods and
services offered through the ▇▇▇▇▇▇ ▇▇▇ Web Site, to: (a)
constitute, or contain material
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that would constitute, libel, defamation or slander; (b)
constitute, or contain material that would constitute, an
invasion of privacy or a violation of the rights to publicity
of any third party; (c) infringe upon the Intellectual
Property Rights of any third party; (d) violate any law,
statute, ordinance or regulation or promote illegal
activities; (e) constitute or contain or promote obscene
materials; (f) promote violence; (g) promote discrimination
based on race, sex, religion, nationality, disability, sexual
orientation, or age; (h) constitute or contain content which
is defamatory, trade libelous, unlawfully threatening or
unlawfully harassing; (i) sell or otherwise market fraudulent
materials; or (j) include "VarsityBooks" or variations or
misspellings thereof in their domain names or in metatags or
other tools designed to mislead users or search engines.
(F) Notwithstanding the foregoing, neither VarsityBooks nor ▇▇▇▇▇▇
Mae shall be liable for the content, goods, and/or services
provided by or available through third party Web sites made
available by hyperlinks on the Web sites of either
VarsityBooks or ▇▇▇▇▇▇ ▇▇▇.
(G) EXCEPT FOR THE WARRANTIES IN THIS SECTION 6, NEITHER PARTY
MAKES ANY AND EACH PARTY SPECIFICALLY DISCLAIMS ALL OTHER
WARRANTIES, EXPRESS OR IMPLIED, OR REPRESENTATIONS WITH
RESPECT TO THE PROGRAM CONTEMPLATED BY THIS AGREEMENT OR ANY
PRODUCTS OR SERVICES SOLD HEREUNDER, INCLUDING, BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, AND ANY IMPLIED WARRANTIES
ARISING FROM STATUTE, COURSE OF DEALING, COURSE OF PERFORMANCE
OR USAGE OF TRADE.
(H) Neither party to this agreement makes any representation that
the operation of its Web site will be uninterrupted or
error-free, and neither party will be liable for the
consequences of any such interruptions or errors.
7. INDEMNIFICATION
(A) BY ▇▇▇▇▇▇ MAE. ▇▇▇▇▇▇ ▇▇▇ will indemnify, defend and hold
harmless VarsityBooks and its affiliates, directors, officers
and employees from and against any and all damages, losses,
liabilities, expenses, and costs (including, without
limitation, reasonable attorneys' fees) resulting or arising
from a third party claim alleging facts that would constitute
a breach by ▇▇▇▇▇▇ Mae of a warranty it is giving under
Section 6 above or a breach of an obligation of ▇▇▇▇▇▇ ▇▇▇
under Section 19 below.
(B) BY VARSITYBOOKS. VarsityBooks will indemnify, defend and hold
harmless ▇▇▇▇▇▇ Mae and its affiliates, directors, officers
and employees from and against any and all damages, losses,
liabilities, expenses, and costs (including, without
limitation, reasonable attorneys' fees) resulting or arising
from a third party claim alleging facts that would constitute
a breach by VarsityBooks of a warranty it is giving under this
Section 6 above or a breach of an obligation of VarsityBooks
in Section 19 below.
(C) In connection with any claim or action described in this
section, the Party seeking indemnification (a) will give the
Indemnifying Party prompt written notice of the indemnifiable
claim, including the basis on which indemnification is being
asserted and
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copies of all relevant pleadings, demands and other papers
relating to the action and in possession of the Indemnified
Party (b) will cooperate with the Indemnifying Party (at the
Indemnifying Party's expense) in connection with the defense
and settlement of the claim, and (c) will permit the
Indemnifying Party to control the defense and settlement of
the claim including the selection of counsel, provided that
the Indemnifying Party may not settle the claim without the
Indemnified Party's prior written consent (which will not be
unreasonably withheld). Further, the Indemnifying Party will
apprise the Indemnified Party of its progress in handling the
claim and permit the Indemnified Party to have its own counsel
in attendance at all proceedings and substantive negotiations
relating to such claim at Indemnified Party's cost and
expense.
8. LIMITATION OF LIABILITY: EXCEPT FOR EACH PARTY'S OBLIGATIONS SET FORTH
IN SECTION 7, IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER
PARTY OR ANY THIRD PARTY FOR ANY SPECIAL, EXEMPLARY, PUNITIVE,
CONSEQUENTIAL, INDIRECT OR INCIDENTAL DAMAGES, INCLUDING WITHOUT
LIMITATION LOST PROFITS, EVEN IF ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES. EXCEPT FOR EACH PARTY'S OBLIGATIONS SET FORTH IN SECTION 7,
EACH PARTY WILL BE LIABLE TO THE OTHER PARTY SOLELY FOR DIRECT MONEY
DAMAGES. SHOULD ▇▇▇▇▇▇ ▇▇▇ BECOME ENTITLED TO BRING CLAIM AGAINST
VARSITYBOOKS UNDER THIS AGREEMENT, VARSITYBOOKS' TOTAL, AGGREGATE
LIABILITY FOR ALL CLAIMS, REGARDLESS OF THE CAUSE OF ACTION (WHETHER IN
CONTRACT, TORT OR OTHERWISE), AT ANY TIME WILL NOT EXCEED AN AMOUNT
EQUAL TO: (A) THE $2 MILLION AMOUNT PAYABLE BY ▇▇▇▇▇▇ MAE TO
VARSITYBOOKS UNDER THIS AGREEMENT AS OF THE DATE OF THE INSTANT CLAIM;
MINUS (B) THE TOTAL AMOUNT OF DAMAGES PAID BY VARSITYBOOKS TO ▇▇▇▇▇▇
MAE FOR ALL PREVIOUS CLAIMS OF ▇▇▇▇▇▇ ▇▇▇ UNDER THIS AGREEMENT,
EXCEPTING ANY AMOUNTS PAID BY VARSITYBOOKS PURSUANT TO SECTION 7.
9. "CONFIDENTIAL INFORMATION" means all information relating to the
Agreement, or received by a party (the "RECEIVING PARTY") from the
other party (the "FURNISHING PARTY") in the course of performing under
the Agreement, which is or should reasonably be understood to be
confidential or proprietary to the Furnishing Party (including
confidential information disclosed by the Furnishing Party which
relates to or is owned by its licensors, suppliers, partners,
contractors and agents), in whatever form (whether tangible,
intangible, electronic, oral or otherwise), including without
limitation the terms of this Agreement, technical processes and
formulas, source codes, product designs, sales, cost and other
unpublished financial information, customer information, product and
business plans, projections and marketing data.
(A) The Receiving Party acknowledges and agrees that any and all
Confidential Information received by it under this Agreement
hereunder is of a confidential, proprietary and/or trade
secret nature to the Furnishing Party (or its licensors,
suppliers, partners, contractors and agents) and that the
Furnishing Party (or its licensors, suppliers, partners,
contractors and agents) owns all Intellectual Property Rights
in such Confidential Information.
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(B) The Receiving Party: (1) will protect Confidential Information
received hereunder from unauthorized use and disclosure with
at least the same degree of care that it utilizes with respect
to its own similar proprietary information, but in no event
less than a reasonable standard of care and use same solely
and exclusively in connection with the implementation or
enforcement of this Agreement; (2) except as contemplated by
this Agreement, may not directly or indirectly disclose,
publish, copy, duplicate onto, convey through, or store on any
medium such Confidential Information without the Furnishing
Party's prior written consent; and (3) will ensure that all
copyright, trademark and other proprietary notices affixed to
or displayed on such Confidential Information will not be
removed or modified and will be reproduced on any copies
thereof. The Receiving Party will promptly inform the
Furnishing Party of any actual or suspected breach of this
Section 9 by it (including its contractors and agents) upon
becoming aware of such actual or suspected breach.
(C) The confidentiality provisions of this Section 9 will not
apply to any information that the Receiving Party can show:
(1) is or subsequently becomes publicly available without
breach of any obligation owed to the Furnishing Party; (2) was
known to the Receiving Party prior to the Furnishing Party's
disclosure of such information to the Receiving Party; (3)
became known to the Receiving Party from a source other than
the Furnishing Party, and without breach of an obligation of
confidentiality owed to the Furnishing Party; (4) is
independently developed by the Receiving Party without
reference to the Furnishing Party's Confidential Information;
or (5) is used by the Receiving Party in order to enforce any
of its rights, claims or defenses under, or as otherwise
contemplated in, this Agreement.
(D) Nothing in this Agreement will be deemed to prevent the
Receiving Party from disclosing any Confidential Information
received hereunder pursuant to any applicable law, regulation
or court order, including, without limitation, the Securities
Act of 1933 and the Securities Exchange Act of 1934, provided
that such disclosure will be limited to the minimum acceptable
level of disclosure and that such Receiving Party will
immediately notify the Furnishing Party of the imminent
disclosure and minimize or prevent such disclosure to the
maximum extent allowed under applicable law, regulation or
court order.
(E) Immediately upon the earlier of the Furnishing Party's request
or the termination or expiration of this Agreement for any
reason, the Receiving Party will: (1) stop using all
Confidential Information of the other party then in its
possession not under a valid license; (2) erase or destroy all
such Confidential Information residing in any computer memory
or data storage apparatus; and (3) destroy or return to the
Furnishing Party (in the Furnishing Party's discretion) all
such Confidential Information in tangible form.
(F) The Receiving Party acknowledges that its breach of this
Section 9 will cause the Furnishing Party (or its licensors)
irreparable injury for which monetary damages will not make
the other party whole. Accordingly, in addition to all other
available remedies and notwithstanding Sections 8 or 14
hereof, the Furnishing Party (or its licensors) will be
entitled to equitable or injunctive relief as and where it
deems fit in the event of an actual, attempted or threatened
breach of any obligation of the Receiving Party (including its
contractors and agents) under this Section 9.
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(G) The obligations of confidentiality and limitation of use,
disclosure, and access set forth herein shall survive the
termination of this Agreement for a period of five years from
the date of such termination.
10. PUBLICITY
The parties will issue mutually agreeable joint news releases from time
to time as the parties deem appropriate.
11. NOTICE
(A) Any notice or other communication required or permitted to be
made or given by either party pursuant to this Agreement will
be in writing, and will be deemed to have been duly given: (i)
three (3) business days after the date of mailing if sent by
certified U.S. mail, postage prepaid, with return receipt
requested; (ii) when transmitted if sent by facsimile,
provided a confirmation of transmission is produced by the
sending machine and a copy of such facsimile is promptly sent
by another means specified in this section; or (iii) when
delivered if delivered personally or sent by express courier
service. All notices will be sent to the other party at its
address as set forth below or at such other address as such
party will have specified in writing:
In the case of VarsityBooks: In the case of ▇▇▇▇▇▇ ▇▇▇:
VARSITYBOOKS ▇▇▇▇▇▇ MAE, INC.
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇, SVP/CFO Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, VP
Phone: ▇▇▇-▇▇▇-▇▇▇▇ Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇.▇▇▇.▇▇▇▇ Fax: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to: With a copy to:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, VP and Deputy
Phone: ▇▇▇-▇▇▇-▇▇▇▇ General Counsel
Fax: ▇▇▇-▇▇▇-▇▇▇▇ Phone: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
12. WAIVER
No failure or delay by either party in exercising any right, power or
remedy will operate as a waiver of such right, power or remedy, and no
waiver will be effective unless it is in writing and signed by the
waiving party. If either party waives any right, power or remedy, such
waiver will
10
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not waive any successive or other right, power or remedy the party may
have under this Agreement.
13. SEVERABILITY
If any part of this Agreement is determined to be illegal, invalid,
unenforceable, or otherwise contrary to law by an arbitrator under
Section 15 or a court of competent jurisdiction, the remainder of the
Agreement will remain in full force and effect, and the parties will
substitute an enforceable provision that, to the maximum extent
possible in accordance with applicable law, preserves the original
intentions and economic positions of the parties.
14. GOVERNING LAW; DISPUTE RESOLUTION
This Agreement will for all purposes be governed, interpreted,
construed, and enforced solely and exclusively in accordance with the
laws of the State of Delaware except for any provisions of Delaware law
which would require or permit the application of the substantive law of
another jurisdiction.
In discussions and activities relating to this Agreement, VarsityBooks
and ▇▇▇▇▇▇ Mae will cooperate in good faith to accomplish the
objectives specified in this Agreement. If any dispute arises relating
to either Party's rights or obligations under this Agreement,
VarsityBooks and ▇▇▇▇▇▇ ▇▇▇ will use good faith efforts to resolve the
matter in accordance with this Section 14
Within ten (10) business days following the written request of either
Party (which will describe the nature of the dispute and other relevant
information), the Parties' managers who are responsible for the
VarsityBooks/▇▇▇▇▇▇ Mae relationship will meet to resolve the dispute
at a mutually convenient time and place. If the relationship managers
are unable to resolve the dispute within two (2) business days
following their initial meeting, they will refer the matter to the
Parties' divisional executives who are responsible for the
administration of this Agreement; along with a written statement (or
statements) describing the nature of the dispute and other relevant
information.
Within five (5) business days following the referral of the matter to
the Parties' divisional executives, the divisional executives will meet
to resolve the dispute at a mutually convenient time and place.
Additional representatives of the parties may be present at the
meeting. All negotiations pursuant to this Section will be confidential
and treated as compromise and settlement negotiations for purposes of
the Federal Rules of Evidence and State Rules of Evidence. Any
resolution reached under this Section will be reduced to writing and
signed by the Parties. During a dispute resolution conducted under this
Section, the Parties will diligently perform all obligations hereunder
that are not directly related to the dispute. If the divisional
executives are unable to resolve the dispute within ten (10) business
days following their initial meeting, the controversy or claim will be
resolved through binding arbitration (excepting disputes relating to
issues of proprietary rights, including, but not limited to
intellectual property and confidentiality) conducted in accordance with
the commercial arbitration rules of the American Arbitration
Association then in effect, except to the extent that such rules are
inconsistent with the provisions set forth herein. If VarsityBooks
initiates arbitration, the arbitration proceedings will be held in
Fairfax County, Virginia and if ▇▇▇▇▇▇ ▇▇▇ initiates arbitration, the
arbitration proceedings will be held in the District of Columbia. The
arbitration
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will be held in the District of Columbia. The arbitration will be held
before a single arbitrator. The Federal Rules of Evidence will apply in
toto. In no event will the arbitrator have the authority to make any
award that provides for punitive or exemplary damages. Any decision
rendered by the arbitrator will be binding, final and conclusive upon
both parties, and a judgment thereon may be entered in, and enforced
by, any court having jurisdiction over the party against which an award
is entered or the location of such party's assets and the parties
hereby irrevocably waive any objections to the jurisdiction of such
court based on any ground, including without limitation, improper venue
or forum nor conveniens. The prevailing party in any claim action,
arbitration or other proceeding arising under or in connection with the
implementation of enforcement of this Agreement will be entitled to
recover from the other party all attorneys' fees incurred in connection
therewith.
Nothing in this section shall be deemed to prohibit or restrict either
party from seeking injunctive relief or other interim or provisional
relief pending resolution of the dispute through such voluntary dispute
resolution procedures set forth herein.
15. ENTIRE AGREEMENT; MODIFICATION
This Agreement (including any and all exhibits attached hereto)
constitutes the sole, final and entire agreement of the parties and
supersedes and terminates all previous agreements, oral or written,
between the parties with respect to the subject matter hereof. All
amendments or modifications to this Agreement must be in writing and
signed by an officer of each party.
16. ASSIGNMENT
Neither party may assign, delegate or otherwise transfer this Agreement
or any rights or obligations arising under or in connection with this
Agreement without the prior written consent of the other party, which
consent will not be unreasonably withheld or delayed; provided,
however, that consent shall not be required (i) in connection with any
assignment by ▇▇▇▇▇▇ Mae to an Affiliate, or (ii) in connection with
any assignment by VarsityBooks to either CollegeOps LLC, a Delaware
limited liability company or to CollegeImpact Inc., a Delaware
corporation, both wholly-owned subsidiaries of VarsityBooks. Unless
otherwise provided in a writing signed by VarsityBooks and ▇▇▇▇▇▇ ▇▇▇,
any such assignment to CollegeOps LLC or CollegeImpact Inc. shall not
relieve VarsityBooks of any of its obligations hereunder. This
Agreement will be binding upon the parties' respective successors and
permitted assigns.
17. CUMULATIVE REMEDIES
Each party's remedies set forth in this Agreement will be cumulative
and not exclusive and will be available in addition to all other
remedies available by law or equity, except as otherwise expressly
provided in this Agreement.
18. FORCE MAJEURE
Neither party will be deemed in default of this Agreement to the extent
that performance of its obligations, or attempts to cure any breach,
are delayed or prevented by reason of any act of God or other force
majeure; provided that, such party immediately gives the other party
written notice thereof and undertakes commercially reasonable efforts
to circumvent the cause of the delay or minimize the extent of the
delay. In any such event, the time for performance or cure will be
12
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extended for a period equal to the duration of the delay, not to exceed
four (4) weeks. If the notifying party does not resume performance of
such obligations or cure such breach before the end of such four (4)
week period, the other party will be entitled to terminate this
Agreement immediately without any obligation or liability to the
delayed party for doing so.
19. COMPLIANCE WITH LAWS
(a) In implementing this Agreement, each party will comply with
all applicable laws and regulations and maintain in good
standing all required registrations, licenses and other
authorizations.
(b) SEC Filings. In connection with any registration of its
securities under the Securities Act of 1933, as amended, or
any public disclosure under the Securities Exchange Act of
1934, as amended, VarsityBooks shall (i) make timely written
objection to the public disclosure of information contained in
the Agreement that references ▇▇▇▇▇▇ Mae's * (the
"▇▇▇▇▇▇ ▇▇▇ Confidential Information") by following applicable
procedures, (ii) follow the procedures contained in 17 C.F.R.
Sec. 230.406, with respect to the ▇▇▇▇▇▇ Mae Confidential
Information, (iii) provide ▇▇▇▇▇▇ ▇▇▇ with an advance copy of
and reasonable opportunity, which at a minimum shall be one
day, to review and comment on VarsityBooks's confidential
treatment request and provide a copy of the relevant portion
of any response received from the SEC regarding such request.
20. INDEPENDENT CONTRACTORS.
The Parties to this Agreement are independent contractors. Neither
Party is an agent, representative or employee of the other Party.
Neither Party will have any right, power or authority to enter into any
agreement for or on behalf of, or incur any obligation or liability of,
or to otherwise bind, the other Party. This Agreement will not be
interpreted or construed to create an association agency, joint venture
or partnership between the Parties or to impose any liability
attributable to such a relationship upon either party.
21. HEADINGS.
The captions and headings used in this Agreement are inserted for
convenience only and will not affect the meaning or interpretation of
this Agreement.
22. COUNTERPARTS.
This Agreement may be executed in counterparts, each of which will be
deemed an original and all of which together will constitute one and
the same instrument.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective
Date.
▇▇▇▇▇▇ MAE, INC. ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ INC.
/s/ ▇▇▇▇▇▇ ▇▇▇, INC. /s/ ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ INC.
------------------------------- -----------------------------------
Signature Signature
------------------------------- -----------------------------------
Name Name
------------------------------- -----------------------------------
Title Title
------------------------------- -----------------------------------
Date Date
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EXHIBIT A
PAYMENT
▇▇▇▇▇▇ Mae agrees to pay to VarsityBooks an aggregate fee equal to TWO
MILLION DOLLARS AND NO CENTS ($2,000,000.00), payable in twenty four (24)
monthly installments of EIGHTY THREE THOUSAND THREE HUNDRED AND THIRTY THREE
DOLLARS AND THIRTY THREE CENTS ($83,333.33) beginning on February 29, 2000.
Payments must be made no later than 10 days after the last business day of each
month. Late payments will bear interest at the rate of one-and-one-half percent
(1.5%) per month or the highest monthly rate permitted by applicable law,
whichever is lower. VarsityBooks will also be entitled to recover its reasonable
collection costs, including attorneys' charges.
Exhibit A-1
16
EXHIBIT B
▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
1. U.S. FEDERALLY REGISTERED TRADEMARKS AND SERVICE MARKS
See page B-2 below.
2. COMMON LAW TRADEMARKS AND SERVICE MARKS - U.S. APPLICATIONS PENDING
NONE
3. COMMON LAW TRADEMARKS AND SERVICE MARKS
NONE
4. OTHER ▇▇▇▇▇▇ MAE CONTENT TO BE PROVIDED BY ▇▇▇▇▇▇ ▇▇▇
NONE
Exhibit B-1
17
[EDUCATION LEADS US. SALLIEMAE LOGO]
Exhibit B-2
18
EXHIBIT C
RATE CARD
(IN EFFECT JANUARY THROUGH JUNE 2000)
PRODUCT COST ▇▇▇▇▇▇ MAE Rate with
DISCOUNT Discount
Applied
------------------------------ ---------------------------- ----------------------- -------------------------
SOLE SPONSORSHIP OF SEE EXHIBIT D SEE EXHIBIT D SEE EXHIBIT D
VARSITYSCHOLARS VERTICAL (1
YEAR). *SEE EXHIBIT D FOR
DETAILS.
------------------------------ ---------------------------- ----------------------- -------------------------
Online banner ads * * *
------------------------------ ---------------------------- ----------------------- -------------------------
Fixed Position on * * *
Confirmation and Landing
Pages (thru June)
------------------------------ ---------------------------- ----------------------- -------------------------
Copy in e-mail confirmation * * *
----------------------------- ---------------------------- ----------------------- -------------------------
Copy in e-mail * * *
acknowledgement
------------------------------ ---------------------------- ----------------------- -------------------------
Premier Sponsorship of * * *
VarsityVentures (1 year)
------------------------------ ---------------------------- ----------------------- -------------------------
Newsletter sponsorship * * *
------------------------------ ---------------------------- ----------------------- -------------------------
Partnership Newsletter * * *
sponsorship
------------------------------ ---------------------------- ----------------------- -------------------------
Rep Newsletter sponsorship * * *
------------------------------ ---------------------------- ----------------------- -------------------------
Campus Survival Kit * * *
------------------------------ ---------------------------- ----------------------- -------------------------
Campus Goodie Bag * * *
------------------------------ ---------------------------- ----------------------- -------------------------
Premier Sponsorship of * *
▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ Site (thru
June)
------------------------------ ---------------------------- ----------------------- -------------------------
Sponsorship of Rep * -- *
Conference (per conference)
------------------------------ ---------------------------- ----------------------- -------------------------
Campus Rep Program * -- *
------------------------------ ---------------------------- ----------------------- -------------------------
Exhibit C-1
19
EXHIBIT D
SOLE SPONSORSHIP OF VARSITYSCHOLARS PROGRAM
Term: February 1, 2000 - January 31, 2001
Cost: $1 Million
Deliverables:
Sole Sponsorship: ▇▇▇▇▇▇ ▇▇▇ will be the sole sponsor of the
VarsityScholars Program under which ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ will provide
approximately $475,000 in merit-based scholarships to high school seniors,
college and graduate students over the course of the year. ▇▇▇▇▇▇ Mae will
receive premier branding on Program materials including the VarsityScholars
section of the ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ web site, promotional materials describing
and marketing the Program and in the Program's press releases and events as
described below:
o Fixed image on VARSITYBOOKS homepage
o Fixed position on the Scholarships landing page: an HTML
▇▇▇▇▇▇ ▇▇▇ image that will link to the ▇▇▇▇▇▇ Mae branded
splash page (described below). This image will highlight
▇▇▇▇▇▇ Mae's sponsorship of the Program. (see mock-up
attached)
o Fixed position on 1st Page of VarsityScholars section: a
permanent html ▇▇▇▇▇▇ Mae image that will link to the ▇▇▇▇▇▇
Mae branded splash page. This image will highlight ▇▇▇▇▇▇
Mae's sponsorship of the Program (see mock-up attached).
o Fixed, above fold banner on all subsequent VarsityScholars
pages: permanent image and text highlighting relevant
message about ▇▇▇▇▇▇ Mae which will be featured in
top-of-the-page banner space on all pages of the
VarsityScholars section (see mock-up attached).
o ▇▇▇▇▇▇ ▇▇▇ branded splash page developed by VARSITYBOOKS: an
html page developed by ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ for ▇▇▇▇▇▇ Mae which
will feature mutually-agreed upon content highlighting
▇▇▇▇▇▇ Mae's sponsorship of the Program and other relevant
▇▇▇▇▇▇ Mae content. The splash page may be updated at
regular intervals on a mutually-agreed upon schedule.
o Sponsorship of e-mail introducing program to entire
VARSITYBOOKS database: ▇▇▇▇▇▇ ▇▇▇ will receive prominent
branding and mention in the e-mail to be sent to the entire
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ database of high school and college
students (circulation: 200,000+ students) introducing the
Program and inviting applications.
o Sponsorship of e-mail thank you notes for each scholarship
application: ▇▇▇▇▇▇ Mae will receive prominent branding and
mention in the e-mail "thank you" sent to every person who
submits an application to the Program.
o Sponsorship and SM content/links in 6 e-mail newsletters to
entire VARSITYBOOKS database: ▇▇▇▇▇▇ ▇▇▇ will provide
content for 6 ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ e-mail newsletters, one of
which will promote the ▇▇▇▇▇▇ Mae*, in which ▇▇▇▇▇▇ ▇▇▇ may
D-1
20
highlight its sponsorship of the Program and other relevant
"pay for college" content (circulation: 200,000+ students).
Such content will be provided by ▇▇▇▇▇▇ Mae and approved by
VarsityBooks, such approval not to be unreasonably withheld.
o Presence in all VarsityScholars press releases/events and
estimated $2 million+ of promotional activities/events
surrounding the Program: ▇▇▇▇▇▇ ▇▇▇ will receive branding
and mention in all press releases regarding the Program.
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ intends to issue monthly releases heralding
the winners of the scholarships and will use its internal
and outside PR resources to promote and place the releases.
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ will also engage in additional
publicity-generating activities which may include press
conferences and other PR events to highlight the winners of
the scholarships and the Program; ▇▇▇▇▇▇ Mae will receive
branding and mention in all such events. In addition, ▇▇▇▇▇▇
Mae will receive placement in the estimated $2 million
dollars worth of promotional activities ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
intends to undertake to market the Program over the year
possibly including: advertising in over 1500 college
newspapers, advertising in other national media outlets and
promotional materials sent to U.S. high schools.
D-2