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EXHIBIT 10.6
TRADEMARK LICENSE AGREEMENT
DATED
SEPTEMBER 13, 1999
BY AND BETWEEN
SNAP! LLC
AND
VALUEVISION INTERNATIONAL, INC.
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[EXECUTION COPY]
TRADEMARK LICENSE AGREEMENT
This Trademark LICENSE AGREEMENT (the "Agreement") dated as of
September 13, 1999 by and between Snap! L.L.C., a Delaware limited liability
company ("Snap"), and ValueVision International, Inc., a Minnesota corporation
("VV").
RECITALS:
WHEREAS, Snap is the owner of certain trademarks, service marks and
tradenames, which have been used by Snap to promote its Internet portal and
various online services;
WHEREAS, Snap has filed an intent to use application for the service
mark "SNAPTV" (the "Exclusive Mark") and is the owner of the URL
http://www.snaptv.com (the "URL");
WHEREAS, VV operates a 24 hour/7 day television program service,
consisting primarily of home shopping and transactional television, which may
include the presentation of products and services for sale as well as product
information (the "Television Home Shopping Service") presently known as
"ValueVision Television" to multichannel video programming distributors for
distribution, exhibition and transmission by Television, which the parties wish
to rebrand using the Exclusive Mark;
WHEREAS, VV intends to develop, own and operate an Internet website for
Commerce Opportunities (the "Online Home Shopping Service") which carries some
or all of the same products advertised on the Television Home Shopping Service
which will be branded exclusively using the Exclusive Mark, and will be operated
exclusively at the URL;
WHEREAS, Snap desires to grant, and VV desires to obtain, a license to
use the Exclusive Mark, the URL, and Snap trademarks, service marks, tradenames
and logos set forth in Schedule 1 hereto (such Snap trademarks, service marks
and tradenames being referred to as the "Non-Exclusive Marks") for VV's
Television Home Shopping Service distributed, exhibited and transmitted by
Television and for the operation of the Online Home Shopping Service, subject to
the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing premises and the
agreements and covenants herein set forth and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties do hereby agree as follows:
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AGREEMENT:
SECTION 1. DEFINITIONS
1.1 Certain Definitions. As used in this Agreement, the following terms
shall have the following meanings:
(a) Advertising. Communications designed to raise consumer or trade
awareness and disseminated by any means of advertising, marketing, publicity,
promotion, or identification, whether on a paid basis or free of charge,
including, without limitation: (i) magazines, newspapers, point of purchase,
outdoor and transit billboards, standees, speaker podiums, packaging, and direct
mail materials; (ii) commercials, public relations materials, publicity
materials and press kits and other print materials; (iii) building and other
signage; (iv) Television,- radio and other multi-channel video programming
sources and audio, video and other outlets; (v) Computer Services and any other
global, national or local computer networks, including public and private
networks; (vi) theatre; (vii) home video; (viii) any on-air graphics, including
but not limited to channel identification, interstitial elements, including all
suitable artwork, music, logos and any other audio or visual works or materials
used in connection therewith, regardless of the form, format or medium in which
they are created, stored or embodied; and (ix) any other medium or vehicle used
for advertisement, publicity or promotion now known or hereafter created.
(b) Affiliate. With respect to any Person, any Person, directly or
indirectly, Controlling, Controlled by or under common Control with such first
Person.
(c) Business Day. Any calendar day other than a Saturday or a
Sunday , or a day on which the commercial banks in New York City, New York are
required or authorized by law to be closed.
(d) Change of Control. 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; (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, other than in the case of any of the
foregoing subsections (i)-(iv), the party acquiring control is General Electric
Company, National Broadcasting Company, Inc., NBC Internet, Inc. or any of their
respective Affiliates.
(e) Commerce Opportunity. Any opportunity for Users or Television
viewers to engage in a commerce, purchase, trade, exchange, or sale transaction,
including, purchase, trade, exchange or sale opportunities for goods and
services, content purchase opportunities, registration or membership sign-up
opportunities, and for-fee or subscription-based content or services.
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(f) Computer Service. Any service or network primarily intended to
deliver programs, content, or other information, to computer terminals or
similar devices, including the Internet and any other packet-switched networks.
(g) Contract. Any agreement, contract, commitment, indenture, lease,
license, instrument, note, bond, security, agreement in principle, letter of
intent, undertaking, promise, covenant, arrangement or understanding, whether
written or oral.
(h) Control. Having the power to direct the affairs of a Person by
reason of any of the following: (A) having the power to elect or appoint,
through ownership, membership or otherwise, either directly or indirectly, a
majority of the governing body of such Person, (B) owning or controlling the
right to vote a majority number of the shares of voting stock or other voting
interest of such Person, or (C) having the right to direct the general
management of the affairs of such Person by contract or otherwise.
(i) Design Standards. Parameters for the use and exploitation of the
Exclusive Mark as developed by Snap and attached hereto as Schedule 1.1(i), as
updated from time to time; provided that any such updates shall apply to Snap's
use of the Exclusive Mark and shall apply, to the extent applicable, to Snap's
use of the Non-Exclusive Marks.
(j) Governmental Authority. Any government, any governmental entity,
department, commission, board, agency or instrumentality, and any court,
tribunal or judicial or arbitral body, whether federal, state, local or foreign.
(k) Gross Revenues. All fees, charges, and other amounts received by
VV or its agents in connection with any Commerce Opportunity on the Online Home
Shopping Service, less shipping and handling, gift wrapping, fraud, taxes
(sales, use, excise and other taxes), third party sales commissions and amounts
actually paid or credited for returns, exchanges, and chargebacks, but without
any other adjustments of any kind.
(l) Interactive Agreement. The Interactive Promotion Agreement,
dated as of date hereof by and between Snap and VV pursuant to which VV shall
operate an Online Home Shopping Service at the URL.
(m) Interactive Delivery. 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 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
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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 audio and/or visual recordings of seven 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).
(n) Launch Date. The date on which VV commences operation of the
Television Home Shopping Service branded, advertised and identified by the
Exclusive Mark and the Online Home Shopping Service functions properly and is
made accessible to Users in non-beta (test) version.
(o) Licensed Advertising. Advertising created or developed, or
caused to be created or developed by or on behalf of VV or any authorized third
party, that bears the Exclusive Mark or any Non-Exclusive Mark and is approved
or deemed approved by Snap in accordance with Section 3.4 and the other
provisions of this Agreement, unless and until the approval is withdrawn or the
license to use any such Licensed Advertising is terminated. Each item of
Licensed Advertising shall be an item of Licensed Advertising only during the
period from the date such item of Licensed Advertising is approved or deemed
approved by Snap until, if applicable, the approval is terminated, and
thereafter during any period such approval is reinstated and remains in effect.
(p) Lien. (i) Any security agreement, financing statement,
conditional sale or other title retention agreement; (ii) any lease, consignment
or bailment given for security purposes; and (iii) any lien, charge, limitation,
restrictive agreement, mortgage, pledge, option, encumbrance, adverse possessory
interest, constructive trust or other trust, claim, attachment, exception to or
defect in title or other ownership interest (including reservations, rights of
entry, possibilities of reverter, encroachments, easements, rights of way,
restrictive covenants, leases and licenses) of any kind, which conditionally or
unconditionally: (a) creates or confers, or purports to create or confer, an
interest in property to secure payment or performance of a liability, obligation
or claim, or which retains or reserves or purports to retain or reserve such an
interest for such purpose; (b) grants to any Person the right to purchase or
otherwise acquire, or obligates any Person to sell or otherwise dispose of, or
otherwise results in any Person acquiring, any property or interest therein; (c)
restricts the transfer of, or the exercise of any rights or the enjoyment of any
benefits arising by reason of ownership of, any property; or (d) otherwise
constitutes, or upon the occurrence of any event or with notice or lapse of time
or both would constitute, an interest or a purported charge or claim against
property, whether arising pursuant to any Requirement of Law, any Contract or
otherwise.
(q) NBC. National Broadcasting Company, Inc., a Delaware
corporation.
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(r) NBC Competitor. A Person, division or operation in which NBC
does not have direct or indirect ownership of 5% or more and whose primary
business is the distribution of broad-based audio and/or visual content for
viewing through Television, other than on the Internet and whether on one or
more channels, across several types of content, such as: comedies, dramas, talk
shows, news, sports, movies and children's programming 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
Corporation, News Corporation/Fox, Viacom (UPN), Time Warner (WB), Paxson and
USA Network.
(s) NBCi Competitor. A Person whose primary business is (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 "NBCi Competitor " 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, MSN, 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, Homestead, TalkCity,
FortuneCity and theglobe.com. e-Commerce Services include, as of the date
hereof, Buy.com, Xoom and Onsale.
(t) Person. Any individual, corporation, limited liability company,
general or limited partnership, joint venture, association, joint stock company,
trust, unincorporated business or organization, government or agency or
political subdivision thereof, or other entity, whether acting in an individual,
fiduciary or other capacity.
(u) Requirement of Law. Any foreign, federal, state and local law,
rule, regulation, injunction, standard, code, limitation, restriction,
condition, prohibition, notice, demand or other requirement, determination,
decision, order or ruling of a court or other Governmental Authority or an
arbitrator, applicable to or binding upon a Person, any of its property or any
business conducted by it or to which such Person, any of its property or any
business conducted by it is subject.
(v) Standards and Practices. 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; NBC's
current Broadcast Standards and Practices are as annexed hereto in Schedule
1.1(v).
(w) Television. Any transmission of video and audio signals of two
minutes or more to individual or multiple television receivers by all means of
technology, whether now
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existing or hereafter developed, including, without limitation, cable, wire or
fiber of any material, superstation, cable television, master antenna ("MATV"),
satellite master antenna ("SMATV"), multi-channel multi-point distribution
services ("MMDS") or microwave system, or direct-to-home ("DTH") or direct
broadcast satellite ("DBS") services, or digital terrestrial service; UHF or VHF
television or LPTV broadcast station so that such signals are receivable by the
public without charge by means of standard, roof-top or built-in television
antennas; provided, however, that the term "Television" expressly shall not
include: (i) any so-called "pay-per-view", "video on demand" or "video dialtone"
network or service whereby a per program fee is paid by the viewer for the right
to select a particular program for exhibition or whereby a fee is paid by the
viewer for the right to select one or more programs for exhibition; (ii) any
retransmission of an original broadcast of materials exhibited by any Television
after 24 hours of the original exhibition; and (iii) Interactive Delivery.
(x) Territory. United States of America and its possessions and
territories. Should VV obtain the rights and satisfy the regulatory requirements
for VV's Television Home Shopping Service to be distributed in Canada and decide
to pursue such distribution, then VV and Snap will negotiate in good faith the
terms for application of this Agreement to Canada and its possessions and
territories.
(y) User. Any end user of the World Wide Web part of the Internet.
(z) Vertical Internet Business. 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 (e.g., CBS Marketwatch), an Internet
service that provides community services limited to certain topics (e.g., Launch
Media, a music community) or that is limited to certain groups (e.g., iVillage,
a women's community) or an Internet service that markets and sells a limited
type or category of product or service (e.g., consumer electronics --
Egghead.com or mail - Mail.com).
1.2 General Rules of Interpretation. Whenever the context requires, any
pronoun shall include the corresponding masculine, feminine and neuter forms.
The words "include", "includes" and "including" shall be deemed to be followed
by the phrase "without limitation." All references to "party" and "parties"
shall be deemed references to the parties of this Agreement unless the context
shall otherwise require. Unless otherwise expressly provided herein or unless
the context shall otherwise require, any provision of this Agreement using an
undefined term in connection with the production, co-production, distribution,
exhibition, broadcast, transmission or other activity related to television
programming shall have the meaning customarily ascribed to such term in the
television industry in the Territory.
SECTION 2. GRANT OF LICENSE AND USE OF THE EXCLUSIVE MARK AND THE NON-EXCLUSIVE
MARKS
2.1 Grant of Exclusive License for Television Home Shopping Service.
Subject to the terms and conditions contained herein and for the Term specified
herein, Snap hereby grants to VV, and VV hereby accepts from Snap, an exclusive,
non-transferable license to use the Exclusive Mark and the URL in the Territory:
(a) in connection with the operation, distribution,
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exhibition and transmission of a Television Home Shopping Service by means of
Television and Commerce Opportunities by means of Television; and (b) in
conjunction with Licensed Advertising distributed by VV to advertise such
Television Home Shopping Service, consistent with the terms and conditions
hereof.
2.2 Grant of Exclusive License for Online Home Shopping Service.
Subject to the terms and conditions contained herein, Snap hereby grants to VV,
and VV hereby accepts from Snap, an exclusive, non-transferable license to use
the Exclusive Mark and the URL: (a) in connection with the development,
operation, distribution, exhibition and transmission of an Online Home Shopping
Service at the URL pursuant to the Interactive Agreement, the Interactive
Delivery of audio and/or video excerpts of the Television Home Shopping Service
described in Section 2.1 hereof and the transmission and streaming of the
Television Home Shopping Service described in Section 2.1 hereof, or excerpts
thereof, by any Computer Service; and (b) in conjunction with Licensed
Advertising distributed by VV to advertise such Online Home Shopping Service,
consistent with the terms and conditions hereof.
2.3 Grant of Non-Exclusive License for Television Home Shopping Service
and a Single Retail Store.
(a) Subject to the terms and conditions contained herein, Snap
hereby grants to VV, and VV hereby accepts from Snap, a non-exclusive,
non-transferable license to use the Non-Exclusive Marks: (i) in connection with
the operation, distribution, exhibition and transmission of a Television Home
Shopping Service by means of Television, and (ii) in conjunction with Licensed
Advertising distributed by VV to advertise such Television Home Shopping
Service, consistent with the terms and conditions hereof.
(b) Subject to the terms and conditions contained herein, Snap
hereby grants to VV, and VV hereby accepts from Snap, a non-exclusive,
non-transferable license to the Exclusive Mark in connection with the operation
of a single retail "bricks and mortar" outlet store located at or near VV's
corporate headquarters.
2.4 Grant of Non-Exclusive License for Online Home Shopping Service.
Subject to the terms and conditions contained herein, Snap hereby grants to VV,
and VV hereby accepts from Snap, an non-exclusive, non-transferable license to
use the Non-Exclusive Marks: (a) in connection with the development, operation
distribution, exhibition and transmission of an Online Home Shopping Service at
the URL pursuant to the Interactive Agreement, the Interactive Delivery of audio
and/or video excerpts of the Television Home Shopping Service described in
Section 2.1 hereof and the transmission and streaming of the Television Home
Shopping Service described in Section 2.1 hereof, or excerpts thereof, by any
Computer Service; and (b) in conjunction with Licensed Advertising distributed
by VV to advertise such Online Home Shopping Service, consistent with the terms
and conditions hereof.
2.5 Authority to Sublicense. Only VV is granted the license to use the
Exclusive Mark by Snap, under the authority provided herein. VV shall have no
right to grant, and shall not grant, to any other Person, including any
Affiliate thereof, any license, sublicense or right to use, or otherwise
authorize the use of the Exclusive Mark for any purpose whatsoever; provided,
however, that VV is hereby granted the right to license or permit (without the
right to sublicense): (i) the use of the Exclusive Mark by third parties in
connection with Licensed Advertising of the Television Home Shopping Service or
the Online Home Shopping Service
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developed by or for VV; and (ii) cable system operators and other operators of
Television that distribute, exhibit, transmit or retransmit VV's Television Home
Shopping Service to display, transmit and exhibit (A) the Exclusive Mark or the
Non-Exclusive Marks without any changes or alterations thereto, for the purpose
of Advertising the Home Shopping Service alone or in conjunction with other
television program services, consistent with the terms and conditions hereof and
the policies set forth in the Standards and Practices, and (B) the Exclusive
Mark in any program guide or other channel listing containing VV's Television
Home Shopping Service. Such licenses shall be in writing, approved by
appropriate legal counsel acting for Snap in advance of such use and as
protective of the Exclusive Mark and the Non-Exclusive Marks as this Agreement.
VV shall notify Snap sufficiently in advance of the granting of any such license
(or any generic type thereof) to provide Snap a full opportunity to exercise its
rights of approval in a deliberate manner. Following such notification, should
Snap request a full review of any such proposed license, VV shall not purport to
grant any such license to use the Exclusive Mark without the prior written
consent of Snap, and any such purported grant made without such consent shall
have no effect and shall be null and void from their inception. Notwithstanding
the foregoing, VV may provide Snap, for its full review and approval, with a
form of sublicense agreement which shall be as protective of the Exclusive Mark
and the Non-Exclusive Marks as this Agreement; following Snap's written approval
of such form (and prior to Snap's revocation of such approval), VV may grant
sublicenses to third parties using such form without any further approval by
Snap; provided that, promptly after the grant of any such sublicense, VV
provides Snap with a complete executed copy of such sublicense.
2.6 Exclusivity.
(a) Restrictions on Use of Mark by Snap. Notwithstanding any other
provision in this Agreement to the contrary, Snap shall not use or exploit, or
license any Person, including, without limitation, Snap and its Affiliates, to
use or exploit the Exclusive Mark in connection with (i) the operation,
distribution, exhibition or transmission of: (A) a Television Home Shopping
Service by means of Television in the Territory during the Term or any Commerce
Opportunity by means of Television in the Territory or (B) an Online Home
Shopping Service in the Territory (ie, at a universal resource locator allocated
only to entities in the Territory) during the Term, except as set forth in this
Agreement or (ii) the operation of a single retail "bricks and mortar" outlet
store located at or near VV's corporate headquarters.
(b) Uses Permitted to Snap. Notwithstanding any other provision in
this Agreement to the contrary, Snap and its Affiliates shall have the right to
(i) distribute, transmit, exhibit and use the Exclusive Mark, by any means or
media, in conjunction with Advertising of Snap or Snap's own products and
services; (ii) use the Non-Exclusive Marks to produce, develop, transmit,
distribute, sublicense and exhibit online or interactive programming in
connection with Computer Services, Commerce Opportunities or e-commerce or
online home shopping services; (iii) use the Non-Exclusive Marks and the
Exclusive Mark, for Advertising of VV's Television Home Shopping Service or
Online Home Shopping Service in consultation with VV; (iv) use the Non-Exclusive
Marks in conjunction with other online services, "brick and mortar" retail
services, and television programming; (v) use the Non-Exclusive Marks or the
Exclusive Mark, for non-Commerce Opportunities, including, without limitation,
interactive Television and (vi) for all purposes outside the Territory.
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(c) Except as expressly set forth in this Agreement, all rights
granted herein by Snap to VV with respect to the Exclusive Mark are
non-exclusive.
2.7 Conditions of VV's Use.
(a) VV agrees that its Television Home Shopping Services during the
Term in the Territory shall consist of at least one 24 hour/7 day television
programming service branded using the Exclusive Mark (and on an exclusive basis
no later than June 1, 2000), and that the URL shall be the exclusive Internet
sales outlet for VV's Television Home Shopping Service(s) and other Commerce
Opportunities offered by VV by means of Television in the Territory.
(b) VV and its direct and indirect Subsidiaries will not (i)
authorize or permit NBC Competitors or NBCi Competitors (other than Snap, NBC
Internet, Inc. and their respective direct and indirect Subsidiaries) to
co-brand any of its properties, products or services with the Exclusive Mark or
any Non-Exclusive Mark, (ii) Control or operate a Portal Service or a Community
Service, (iii) Control or operate an e-Commerce Service that competes in scope
and range with Xoom.com, Inc.'s e-Commerce Service as of the Effective Date ,
other than in connection with this Agreement and the Interactive Agreement, or
(iv) invest in, purchase or loan money to an NBCi Competitor.
(c) Except as expressly set forth in Section 2.7(d) hereof, nothing
contained herein shall permit VV to use the Non-Exclusive Marks, or the
Exclusive Mark, or any other words, terms or designs which but for this
Agreement VV would not be permitted to use as, or as part of, a corporate name
or business name, in any filing or recordation with a Governmental Authority or
in executing any Contract without the prior written approval of Snap.
(d) VV shall have the right to use the Exclusive Mark in a trade
name or trade dress and can include the Exclusive Mark in any filing or
recordation with a Governmental Authority, only to the extent: (i) such filing
or recordation with such Governmental Authority requires VV to disclose or
otherwise use such trade name or trade dress; and (ii) such use does not assign,
transfer or otherwise convey to VV any rights or title to, or interest in the
Exclusive Mark.
2.8 Reservation of Rights to the Exclusive Mark and the Non-Exclusive
Marks.
(a) As between Snap and VV, all rights in and to any of the
Exclusive Mark and the Non-Exclusive Marks not expressly licensed to VV
hereunder are expressly reserved to Snap, including without limitation, (i) the
right to use the Exclusive Mark for any purpose whatsoever outside the Territory
and, within the Territory, in conjunction with other online services, "brick and
mortar" retail services (other than the retail store described in Section 2.3(b)
hereof), and television programming not providing Television Home Shopping
Services or Commerce Opportunities and (ii) the right to use any Non-Exclusive
Mark for any purpose whatsoever, whether within or outside the Territory. As
between Snap and VV, all rights in and to all other trademarks, service marks,
trade names, trading styles and fictitious business names of Snap, or any of its
Affiliates, regardless of whether the Exclusive Mark or the Non-Exclusive Marks
are a part thereof, are reserved to Snap and its Affiliates.
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(b) As between the parties, VV shall retain all rights in and to all
trademarks, service marks, trade names, trading styles and fictitious business
names of VV, or any of its Affiliates, which do not contain or otherwise
incorporate the Exclusive Mark, the URL or any Non-Exclusive Mark, in whole or
in part.
2.9 Mandatory Use of the Exclusive Mark During the Term and in the
Territory.
(a) Television Home Shopping Service. Subject to compliance with the
Standards and Practices and the other terms and conditions hereof, VV shall have
the right to use, and following the Launch Date shall use, exclusively and
predominantly, the Exclusive Mark for the branding, Advertising and identifying
of VV's Television Home Shopping Service as it is distributed, exhibited and
transmitted on Television during the Term and in the Territory. VV shall promote
the URL on its Television Home Shopping Service in substantially the same amount
as VV's 1-800 (or similar) telephone number. VV agrees that it shall commence
the use of the Exclusive Mark on its Television Home Shopping Service and Online
Home Shopping Service as soon as practicable following the Effective Date and
that the Launch Date shall be no later than June 1, 2000.
(b) Online Home Shopping Service. Subject to compliance with the
Standards and Practices and the other terms and conditions hereof, VV shall have
the right to use, and following the Launch Date shall use, exclusively and
predominantly, the Exclusive Mark for the branding, Advertising and identifying
of VV's Online Home Shopping Service as it is developed, implemented,
distributed exhibited and transmitted by any Computer Service during the Term
and shall operate such Online Home Shopping Service exclusively at the URL;
provided, however, that with respect to third party merchandise sold on the
Television Home Shopping Service, VV shall use commercially reasonable efforts
to always promote the URL or an alternate Non-Exclusive Mark URL for any on air
promotion that leads a User to a website, with such obligation dependant on
Snap's delivery of an appropriate, easily memorable Non-Exclusive Mark URL
(e.g., Snap.com\victoria for Victoria's Secret) for each third party merchant.
(c) Advertising. Subject to compliance with the Standards and
Practices and the other terms and conditions hereof, VV shall have the right to
use, and following the Launch Date shall use, exclusively and predominantly, the
Exclusive Mark, on all of the Advertising produced, distributed or otherwise
used by VV for the Advertising of VV's Television Home Shopping Service and
Online Home Shopping Service, subject to pre-approval or automatic approval by
Snap pursuant to Section 3.4 and the other terms and conditions hereof.
(d) Removal. Notwithstanding anything contained herein to the
contrary, during the Term and in the Territory, VV shall not remove the
Exclusive Mark from its Television Home Shopping Service or Online Home Shopping
Service and the Licensed Advertising approved or deemed approved by Snap, as the
case may be, except as required pursuant to Section 7.3 or 7.4 hereof.
2.10 Permissive Use of the Exclusive Mark. Subject to compliance with
the Standards and Practices and the other terms and conditions hereof, VV shall
have the right, but not the obligation, to create and develop, or cause to be
created and developed, Licensed Advertising
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and corporate communications materials, such as stationary, business cards,
building signage (interior and exterior) and trade materials for use in
connection with the distribution, exhibition or transmission of its Television
Home Shopping Service and Online Home Shopping Service featuring the Exclusive
Mark. The Licensed Advertising shall be created, developed and produced by or
under the control of VV, with the guidance and input of Snap, at VVs sole cost
and expense, subject to the terms and conditions contained herein, including
Section 3.4 hereof.
SECTION 3. QUALITY CONTROL
3.1 Maintenance of Quality Television Home Shopping Services. VV agrees
to maintain the quality of its Television Home Shopping Service at a level that
is at least commensurate with the services as offered by VV today. VV and Snap
agree that the parties shall work together to develop a cohesive marketing and
advertising strategy consistent with the Interactive Agreement, and that Snap
shall be involved in the development of Licensed Advertising for VV's Television
Home Shopping Service and Online Home Shopping Service.
3.2 Correction of Non-Compliant Uses. VV shall comply with the Standards
and Practices, the Design Standards and any other guidelines reasonably provided
by Snap, and shall correct any deficiencies in the use of the Exclusive Mark or
any Non-Exclusive Mark upon notice from Snap, within a reasonable period that
shall not exceed thirty days.
3.3 Quality Standards for Online Home Shopping Services In connection
with the development, implementation, operation and transmittal of the Online
Home Shopping Service, the following standards shall be met or exceeded:
(a) Operations. The Online Home Shopping Service (i) will be
operational and fully functional in all material respects (i.e. capable of
displaying information and conducting transactions as contemplated in the
ordinary course of business) at least 99% of the time during any 30 day period;
(ii) the average time required to start displaying the HTML for text and
graphics on a page of the Online Home Shopping Service after a link from any
site shall not exceed a daily average of five seconds, the average time required
to deliver an entire page of the Online Home Shopping Service over the open
Internet shall not exceed a daily average of six seconds, where VV may assume
standard fractional T1 connectivity from the desktop to the Internet and the
average time required to start displaying, or to deliver an entire page of, the
HTML for any audio or video on a page of the Online Home Shopping Service after
a link from any site shall not exceed the daily average for audio or video for
Portal Services over the open Internet; (iii) VV shall provide to users on the
Online Home Shopping Service at least the same level of service as is offered to
Users on Snap.com; and (iv) VV shall use reasonable commercial efforts to notify
Snap at least three (3) days in advance of planned outage periods for system
maintenance, etc.
(b) Online Policies and Customer Support. The Online Home Shopping
Service (i) will comply with Snap's security and privacy policy standards for
online commerce; and (ii) VV shall provide commercially reasonable maintenance
and technical support to all end users, with prompt response times defined as:
electronic mail: eight (8) hours; telephone: M-Fri 8AM-7PM P.S.T.; and Pager
response to technical support inquiries from Snap: 120 Minutes.
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(c) Quality of Content. The Online Home Shopping Service will offer
products and services featured on the Television Home Shopping Service, as well
as other products and services and links to various resources. All products or
services offered on, and all content contained on the Online Home Shopping
Services shall (i) be of a quality at least equal to the products, services and
content available on Snap; (ii) shall comply with the Standards and Practices;
(iii) not contain defamatory or libelous material or material which discloses
private or personal matters concerning any person, without such person's
consent; (iv) not permit to appear or be uploaded any messages, data, images or
programs which are illegal, contain nudity or sexually explicit content or are,
by law, obscene, profane or pornographic; or (v) not permit to appear or be
uploaded any messages, data, images or programs that would knowingly or
intentionally (which includes imputed intent) violate the property rights of
others, including unauthorized copyrighted text, images or programs, trade
secrets or other confidential proprietary information, or trademarks or service
marks used in an infringing fashion.
Notwithstanding anything to the contrary contained in this Section
3.3, Snap shall have the right to update the quality standards contained in this
Section 3.3 from time to time to meet the average commercial quality standards
contained in Snap's other Internet transactions at that time, subject to VV's
approval (such approval not to be unreasonably withheld or delayed).
3.4 Licensed Advertising.
(a) New Advertising Approval Process. VV shall submit for Snap's
approval or disapproval following the procedures set forth in this Section
3.4(a), any uses of the Exclusive Mark or any Non-Exclusive Mark in connection
with "New Advertising," which for the purposes of this section shall mean new
Advertising campaigns, i.e. a series or group of advertisements or promotions
directed at either consumers or the trade, media kits that are new, new
electronic press kits, new sales presentations or templates for sales
presentations, and new collateral materials, i.e. trade gifts, sales sheets,
binders, folders, etc., connected with any new Advertising campaign.
(i) Materials to be Submitted. VV shall submit for Snap's
approval or disapproval, the following (all proposals, materials and information
submitted to Snap pursuant to this Section 3.4(b) shall be collectively referred
to as the "Materials"):
(A) if the particular artwork, music or film to be used in
the Advertising has not yet been completed, the rough cut, the final cut and the
final script, as and when they become available, of such Advertising, and if
such Advertising has been completed, a VHS copy of such Advertising and the
final script thereof;
(B) proofs or other representations of any such
Advertising, including, as applicable or available, scripts, story boards,
television and radio commercials, print advertisements, publicity releases,
promotional materials and other materials, specifications or information; and
(C) any other materials, specifications or information as
Snap may reasonably request to verify compliance with the standards and
specifications required
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hereunder and the representations, warranties, covenants and agreements of VV
hereunder, which VV has in its possession or can obtain without unreasonable
expense or effort.
(ii) Approval. To the extent practicable, VV and Snap shall
agree on a schedule by which Snap shall review and approve or disapprove, which
approval or disapproval shall not be unreasonably withheld or given (it being
understood that it shall be unreasonable for Snap to withhold approval of New
Advertising that complies with the Design Standards and the Standards and
Practices and also follows the branding and themes of Snap's then-current
advertising campaign), the Materials submitted by VV to Snap in connection with
Advertising as required by this Section 3.4; provided, however, that Snap shall
advise VV of Snap's approval or disapproval of any Advertising no later than
five (5) Business Days following Snap's receipt of the Materials. If Snap
approves any Advertising, such Advertising shall become Licensed Advertising,
subject to VV's compliance with the terms and conditions of this Agreement. Snap
shall designate, from time to time, an adequate number of representatives who
shall have full authority to approve or disapprove, on behalf of Snap, all
Advertising submitted by VV to Snap for approval pursuant to this section.
(iii) Deemed Approval. If Snap fails to approve or disapprove
the Materials within the time period set forth above, the Advertising, shall be
deemed approved by Snap, provided that VV's uses of such Advertising are
consistent with the proposed uses of the Materials (i.e., media and audience)
and comply with the terms and conditions hereof, including the Design Standards
and the Standards and Practices.
(b) Automatic Approval. If VV or an authorized third party desires
to use the Exclusive Mark in connection with Advertising (other than New
Advertising) which complies with the Design Standards and the Standards and
Practices and also follows the branding and themes of either (x) Snap's
then-current advertising campaign or (y) VV's then most-recent New Advertising
approved or deemed approved by Snap, then such Advertising shall be deemed
Licensed Advertising without the need to submit Materials to Snap.
(c) Duration of Approval. Once Licensed Advertising is approved (or
deemed approved, as applicable), VV may repeatedly use such Licensed Advertising
without the need for further approvals, unless such approval is revoked by Snap
which revocation, unless required pursuant to Sections 7.3, shall not be
retroactive and shall not be effective until ten (10) Business Days after VV
receives written notice of the revocation.
(d) Specifications. Notwithstanding anything contained herein to the
contrary, Licensed Advertising shall comply with, and be produced in accordance
with, the standards adopted by Snap for its own Advertising, following Snap's
written notification to VV from time to time.
(e) Samples of Licensed Advertising. Upon Snap's written request
from time to time, VV, at its sole cost and expense, deliver within five (5)
Business Days to Snap a reasonable number of true, correct and complete samples
of any requested Licensed Advertising, in the form in which such Licensed
Advertising is most commonly distributed; provided, however, that VV shall
deliver such samples to Snap within three (3) Business Days of receipt of
written notice from Snap if such written notice states that Snap reasonably
believes that such
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Licensed Advertising does not comply with the terms and conditions of this
Agreement, the Design Standards, the Standards and Practices, the Interactive
Agreement or a Requirement of Law.
(f) Representations, Warranties, Covenants and Agreements.
(i) VV shall obtain all reasonably necessary documentation,
consents, approvals and permissions of the performers, labor organizations,
rights holders and all other Persons whose consent, approval or permission is
required for the Licensed Advertising to be exploited as provided in this
Agreement prior to using such Licensed Advertising in conjunction with or for
advertising the Television Home Shopping Service or Online Home Shopping
Service. Without limitation of the foregoing, VV shall provide Snap, upon Snap's
reasonable request from time to time with copies of any documentation obtained
or acquired by VV pursuant hereto.
(ii) Unless the parties agree otherwise, to the extent VV, its
Affiliates or permitted distributors or sublicensees acquire by operation of law
or otherwise, any rights, or title to, or interests in any Non-Exclusive Mark or
the Exclusive Mark, or any trademark, service mark, tradename or logo that
includes the word "Snap", VV shall automatically assign, and hereby
automatically assigns all such rights relating to such Non-Exclusive Mark, the
Exclusive Mark or any trademark, service mark, tradename or logo that includes
the word "Snap" to Snap. Upon Snap's request from time to time, VV shall execute
any documents, transfers, assignments, recordations or filings to effectuate the
intent of this provision.
(iii) Notwithstanding anything contained in this Agreement to
the contrary, (A) VV shall have no right to seek, and shall not seek, any
registration or intellectual property or proprietary rights in any Licensed
Advertising that bears the Exclusive Mark or any Non-Exclusive Mark, in whole or
in part; and (B) Snap shall have the right to seek registration and intellectual
property and proprietary rights in any Licensed Advertising that bears the
Exclusive Mark or any Non-Exclusive Mark, in whole or in part.
(iv) VV shall have no right to seek, and shall not seek, any
registration or license of any universal resource locator or high-level domain
name including the letters "Snap" anywhere in the world, including, for example,
"SnapShopping.com", "AsSeenOnSnapTV.com", "SnapTV.co.uk", "Snap.co.uk", etc. VV
shall assign all such universal resource locators or high-level domain names
that it has registered prior to the date hereof, including those locators or
domain names listed in Schedule 3.4 hereof, to Snap as soon as practicable
following the date hereof, and Snap shall reimburse VV for all out-of-pocket
costs paid by VV to Network Solutions in respect of such registrations. To the
extent that VV desires to have any such universal resource locator or high-level
domain name registered, VV may enter into good faith negotiations with Snap
concerning such registration or license and the allocation of costs and revenues
arising or derived from such registration or license.
(v) Upon Snap's request from time to time, VV shall take all
reasonable steps to assist Snap to register or protect any Licensed Advertising
which incorporate the Exclusive Mark or any Non-Exclusive Mark, pursuant to the
copyright, trademark, and other applicable laws and regulations.
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3.5 General.
(a) VV acknowledges and agrees that the rights and licenses granted
by Snap to VV herein are expressly conditioned upon VV's continued adherence to
the terms and conditions of this Agreement, including: (i) the Standards and
Practices, Design Standards and the other standards and specifications contained
herein; and (ii) VV's representations, warranties, covenants and agreements
contained herein.
(b) VV acknowledges that from time to time, Snap may alter the
appearance of the Non-Exclusive Marks, and agrees to change the Exclusive Mark
to conform to the then-current appearance of the Non-Exclusive Marks, as they
may be altered from time to time. Snap undertakes that it shall provide VV with
reasonable notice of such changes so that VV can implement any changes required
to ensure that the branding of VV's Television Home Shopping Services and Online
Home Shopping Service remain consistent with the branding of Snap; provided,
however, that to the extent VV has already paid for or committed to pay for any
Licensed Advertising incorporating the Exclusive Mark prior to Snap's change, VV
shall be entitled to utilize such Licensed Advertising for a reasonably limited
period to be agreed on by Snap and VV.
(c) VV shall, at all times, in accordance with the Standards and
Practices, the Design Standards and any requests by Snap: (i) make appropriate
use of the trademark and service mark symbols in conjunction with the use of the
Exclusive Mark and the Non-Exclusive Marks, including the use of the letters
"TM" or "SM", or the designation"(R)" to the extent applicable; and (ii)
indicate appropriation of the Exclusive Mark and the Non-Exclusive Marks by
Snap.
(d) To the extent applicable, VV shall at all times include in the
Television Home Shopping Service, the Online Home Shopping Service and all of
the Licensed Advertising, an appropriate copyright notice, in the form provided
and in the manner required by Snap as the owner of the copyright in the
Exclusive Mark and the Non-Exclusive Marks.
(e) VV shall not produce, manufacture, use, distribute or exhibit
anyLicensed Advertising, or any other materials bearing the Exclusive Mark or
any Non-Exclusive Mark, except as expressly permitted in this Agreement, without
Snap's prior written approval.
(f) Except as expressly permitted in the Standards and Procedures or
Section 3 hereof, no changes may be made by VV to the Licensed Advertising,
including modifications, edits or other changes thereto, without Snap's prior
written approval.
(g) VV shall operate its Television Home Shopping Service and Online
Home Shopping Service and shall use the Exclusive Marks and the Non-Exclusive
Marks in compliance with the Standards and Practices, the guidelines of the
Direct Marketing Association as well as any applicable Requirement of Law or
regulations of any applicable jurisdiction.
(h) VV shall use the approved Licensed Advertising solely in a
manner consistent with the proposed uses of the Materials submitted for approval
to Snap.
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(i) Any work done by VV in creating, manufacturing, promoting,
distributing, transmitting or exhibiting the Licensed Advertising shall be done
entirely at VV's own risk and expense.
(j) All documents, contracts, instruments, certificates, notices,
consents, affidavits, letters, telegrams, telexes, facsimiles, statements,
schedules and any other papers (collectively, "Documents") delivered by or on
behalf of VV to Snap in connection with any request for Snap's approval
hereunder shall be true and correct copies of the originals. VV shall use
commercially reasonable efforts to cause all responses to Document requests
furnished by or on behalf of VV to Snap pursuant to this Agreement to be
complete in all material respects, and VV shall notify Snap in writing if any
such response is not complete in all material respects.
(k) Notwithstanding any right of Snap to investigate the affairs of
VV or verify VV's compliance with the terms and conditions of this Agreement,
Snap has the right to rely exclusively and fully upon the representations,
warranties, covenants and agreements of VV contained in this Agreement and in
any Documents delivered by VV to Snap.
3.6 Association With Other Marks. Subject to the Standards and Practices
and the restrictions contained in Section 2.7(b) hereof, VV shall be permitted
to engage in co-promotions, tie-ins or similar arrangements with respect to the
Licensed Advertising and the Exclusive Mark (but not any Non-Exclusive Mark) and
to use the trademark, service mark, trade name or logo of any other Person on or
in connection with the Licensed Advertising or the Exclusive Mark (but not any
Non-Exclusive Mark) without Snap's prior written approval, and may use third
party trademarks, trade names or logos to identify the sponsor of a program on
the Television Home Shopping Service, provided, however, that any such use does
not create a composite mark with respect to the Exclusive Mark; and provided,
further, that notwithstanding anything to the contrary contained herein, any
such co-promotion, tie-in or similar arrangement does not involve any NBC
Competitor or NBCi Competitor and that the trademark, service mark, tradename or
logo of any NBC Competitor or NBCi Competitor is not used on or in connection
with the Licensed Advertising, the Exclusive Mark or any Non-Exclusive Mark.
Uses not in compliance with the Standards and Practices and the restrictions
contained in Section 2.7(b) or this Section 3.6 must be approved by Snap in
writing.
3.7 Restriction on Composite Marks. VV shall not use any new or
additional trademarks, service marks, tradenames, trading styles, or fictitious
business names in conjunction with the Exclusive Mark or any Non-Exclusive Mark
that create or result in any composite marks using the Exclusive Mark or any
Non-Exclusive Mark without the prior written approval (or deemed approval, in
accordance with the terms and conditions of Section 3.4 hereof) of Snap.
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SECTION 4. USE OF THE EXCLUSIVE MARK AND THE NON-EXCLUSIVE MARKS
4.1 Use of the Exclusive Mark. VV covenants and agrees that:
(a) it shall not use the Exclusive Mark or any Non-Exclusive Mark or
any variation on the Exclusive Mark or Non-Exclusive Mark in violation of the
terms of this Agreement, any applicable Requirement of Law, or the requirements
of the Standards and Practices;
(b) it shall not alter, mutilate, dilute, create derivative forms
of, or otherwise change the format of the Exclusive Mark or any Non-Exclusive
Mark in any way or for any purpose, except as expressly permitted herein;
(c) it shall not assign, transfer, permit any Lien against, or
otherwise encumber the Exclusive Mark or any Non-Exclusive Mark, or its rights
hereunder in any way, except as expressly permitted herein;
(d) it shall not use the Exclusive Mark or any Non-Exclusive Mark,
or any other materials contemplated by this Agreement in conjunction with any
activity, facility or publication which is in violation of any applicable
Requirement of Law or the Standards and Practices, or which holds Snap, or any
Affiliate thereof, up to potential embarrassment, contempt, scandal, or ridicule
or otherwise compromises the reputation, goodwill or value associated with the
Exclusive Mark or the Non-Exclusive Marks, provided, however, VV shall not be
deemed to be in breach of this Section 4.1(d) if Snap has approved, pursuant to
Section 3.4, the use of the Exclusive Mark of such Non-Exclusive Mark in
connection with any Licensed Advertising and VV has provided Snap all relevant
information and all samples requested in accordance herewith in connection with
such use as required herein;
(e) it shall not adopt or use, or encourage any Person to adopt or
use, any trademark, service mark, tradename, trading style, fictitious business
name, logo or design which, but for this Agreement, VV would not be permitted to
use, except as expressly permitted herein; and
(f) it shall ensure that the quality of the Licensed Advertising
manufactured, produced, created or distributed by or on behalf of VV are in
compliance with the Standards and Practices and will not in any way diminish the
Exclusive Mark or any Non-Exclusive Mark and the goodwill, value and reputation
pertaining thereto.
4.2 Ownership of the Exclusive Mark and the Non-Exclusive Mark.
(a) The Exclusive Mark and the Non-Exclusive Marks , together with
the value and goodwill of the business symbolized thereby, are and shall remain
the sole and exclusive property of Snap throughout the world.
(b) VV shall not at any time during or after the Term hereof:
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(i) challenge the title or any other rights of Snap or their
Affiliates, as the case may be, in or to the Exclusive Mark or any Non-Exclusive
Mark or any variations thereof or any parts or derivative works thereof;
(ii) contest the validity of the Exclusive Mark or any
Non-Exclusive Mark or any registrations or protection thereof held by Snap or
their designees, as the case maybe;
(iii) claim any rights, or title to, or interests in the
Exclusive Mark or any Non-Exclusive Mark or any variations thereof, or any parts
or derivative works thereof;
(iv) register or apply for registration or protection of the
Exclusive Mark or any Non-Exclusive Mark or any works containing or
incorporating Exclusive Mark or any Non-Exclusive Mark;
(c) Except for the rights granted herein, any and all uses of the
Exclusive Marks and the Non-Exclusive Marks shall inure exclusively to the
benefit of Snap; and
(d) Upon Snap's request from time to time, VV shall execute and
deliver to Snap any assignments, declarations, governmental filings or other
documents that Snap or deems to be reasonably necessary to protect Snap's rights
and title to, and interests in the Exclusive Marks or the Non-Exclusive Marks
and the intellectual property and proprietary rights related thereto.
4.3 Infringement of the Exclusive Mark or the Non-Exclusive Marks. VV
shall promptly notify Snap 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 Exclusive Mark or any Non-Exclusive Mark
or any colorable imitation thereof of which VV becomes aware, in each case that
would result in a material diminution or impairment of Snap's rights in such
marks or content; it being understood that any infringement of the Exclusive
Mark or any Non-Exclusive Mark would result in a material diminution or
impairment of Snap's rights in such marks. Snap shall promptly notify VV 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 the
Exclusive Mark (but not any Non-Exclusive Mark) or any colorable imitation
thereof of which Snap becomes aware, in each case that would result in a
material diminution or impairment of VV's rights in such marks or content; it
being understood that any use of the Exclusive Mark for Commerce Opportunities
would result in a material diminution or impairment of VV's rights in the
Exclusive Mark. VV shall notify Snap promptly of any litigation or arbitration
instituted or threatened by any Person against VV involving the Exclusive Mark
or any Non-Exclusive Mark. Snap also shall notify VV promptly of any litigation
or arbitration instituted or threatened by any Person against Snap involving
VV's use of the Exclusive Mark. Snap shall have the sole right to decide whether
or not proceedings alleging infringement of the Exclusive Mark and/or the
Non-Exclusive Marks shall be brought against third parties and to control any
litigation or arbitration involving the Exclusive Mark and/or the Non-Exclusive
Marks. If Snap does not exercise its rights pursuant to the preceding sentence
with respect to VV's use of the Exclusive Mark, VV shall have the right to bring
such proceedings; provided, however, that Snap shall have the right to determine
and adopt (or, in the
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case of a proposal by VV or the alleged infringer, to approve) a settlement of
such matter in its reasonable discretion, except that Snap need not consent to
any settlement that (a) imposes any monetary or nonmonetary obligation on Snap
or (b) diminishes or adversely effects Snap's rights in or to the Exclusive
Mark. Subject to the preceding sentence, Snap shall have the sole right to
defend the Exclusive Mark and the Non-Exclusive Marks , at its expense, against
imitation, infringement or any claim of prior use.
SECTION 5. ROYALTIES
5.1 Royalty Rate. In consideration for the rights granted herein, VV will
pay Snap a royalty of two percent (2%) of Gross Revenue.
5.2. Statements and Payments. (a) VV shall deliver to Snap, within
forty-five (45) days after the end of each calendar quarter following the Launch
Date during the entire Term of this Agreement, a complete and accurate
statement, certified to be accurate by an officer of VV, showing the number,
description and gross sale price of all Commerce Opportunities distributed or
sold or otherwise exploited that generated Gross Revenues during the preceding
calendar quarter ("Reporting Period") together with any returns or other
chargebacks made (i) during such Reporting Period or (i) any preceding Reporting
Period that were not included in the statement for such preceding Reporting
Period. Such statements shall be furnished to Snap whether or not any Commerce
Opportunity occurred during the Reporting Period for which such statement is
due. VV shall pay to Snap within forty-five (45) days after the end of each
calendar quarter during the entire Term of this Agreement, all Royalties earned
under the terms hereof for the Reporting Period, less any returns or chargebacks
for any preceding Reporting Period for which Gross Revenues were already paid to
Snap. The receipt or acceptance by Snap of any statement or of any Royalty paid
hereunder shall not preclude Snap from questioning the correctness thereof at
any time, and in the event that any inconsistencies or mistakes are discovered
in connection therewith, they shall immediately be rectified and the appropriate
payment made by VV to Snap.
(b) Time is of the essence with respect to all payments to be made
hereunder by VV. Interest at a rate of the lesser of one and one-half percent (1
1/2%) per month, or the maximum rate allowed by law, shall accrue on any amount
due Snap hereunder from and after the date on which the payment is due until the
date of receipt of payment.
(c) All transactions under this Agreement, including without
limitation, all payments of royalties shall be with or made payable in the name
of Snap, or its designated assigns, if applicable.
5.3 Books and Records/Audit
(a) VV agrees to keep accurate books of account and records at its
principal place of business covering all transactions relating to the license
being granted herein. Snap or any duly authorized representative shall have the
right, at all reasonable hours of the day, to audit VV's books of account and
records and all other documents and material in the possession or under the
control of VV with respect to the subject matter and the terms of this Agreement
and to
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make copies and extracts thereof. In the event that any such audit reveals an
underpayment by VV, VV shall immediately remit payment to Snap in the amount of
such underpayment plus interest calculated at a rate of one and one-half (1
1/2%) per month, or the maximum rate allowed by law, compounded daily,
calculated from the date such payments were actually due until the date when
such payment is in fact actually made. Further, in the event that any such
underpayment is greater than five percent (5%) of the Royalties due for any
Reporting Period, VV shall reimburse Snap for the reasonable costs and expenses
of such audit.
(b) All books of account and records of VV covering all transactions
relating to the Online Home Shopping Service shall be retained by VV for at
least three (3) years after the expiration or termination of this Agreement, as
the case may be, for possible inspection and/or audit by Snap.
SECTION 6. INDEMNITY
6.1 Snap Indemnification Obligation. Subject to VV's material
compliance with the terms and conditions of this Agreement, Snap shall
indemnify, defend, and hold harmless VV and its respective successors and
assigns and the directors, officers, employees, and agents of each ("VV
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 VV Indemnified Group, to the extent arising
from any of the following: (i) any claim by a third party that VV's use or
exercise of the rights licensed or assigned herein infringes any third party's
rights; or (ii) any breach of Snap's representations, warranties, covenants or
agreements contained in this Agreement.
6.2 VV Indemnification Obligation. Subject to Snap's material compliance
with the terms and conditions of this Agreement, VV shall indemnify, defend, and
hold harmless Snap, its Affiliates and their respective successors and assigns
and the directors, officers, employees, and any agents of each ("Snap
Indemnified Group") from and against any Losses, asserted against, resulting to,
imposed upon, or incurred by a member of the Snap's Indemnified Group, to the
extent arising from any breach of VV's representations, warranties, covenants or
agreements contained in this Agreement.
6.3 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 6.1 or 6.2, 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 support, verify and defend against 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.
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6.4 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. 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.
Whether 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.
6.5 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, except in the case where Obligor
has not acknowledged liability hereunder.
SECTION 7. TERM AND TERMINATION
7.1 Term. The term of this Agreement will begin on the date hereof and
end on the tenth (10th) anniversary of the date hereof, unless otherwise
terminated in accordance with this Agreement.
7.2 Grounds for Termination. The provisions of this Agreement may be
terminated as follows:
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(a) by either Snap or VV, upon any termination of the Interactive
Agreement, which termination will be effective as of the effective date of the
termination of the Interactive Agreement;
(b) by either VV or Snap, 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;
(c) by Snap, in the event of a Change of Control of VV;
(d) by VV, in the event of a Change of Control of Snap;
(e) by either party, in the event of any material breach by the
other party of this Agreement or any breach by such other party of any material
representation, warranty, covenant or agreement contained in this Agreement (it
being understood that the substantive quality controls contained in Sections 3
and 4 hereof are material covenants and agreements of VV); provided, however,
that if such breach is of such a nature that it can reasonably be cured within
30 days following written notice from the non-breaching party to the breaching
party of such breach, then such right of termination may not be exercised unless
such breach shall not have been cured within 30 days of the breaching party
receiving such written notice; or
(f) by Snap, in the event (x) of any breach by VV of any of the
substantive quality controls contained in Sections 3 and 4 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 7.2(e)
above, and (z) VV repeatedly breaches the substantive quality controls contained
in Sections 3 and 4 hereof following written notice from Snap to VV of such
breach and such breaches could dilute or otherwise render material harm to the
Exclusive Mark or any Non-Exclusive Mark, provided that Snap shall give written
notice of each instance of claimed breach on which Snap bases its claim of
termination under this subparagraph.
7.3 Termination of Rights and Obligations. Subject to Section 7.4 below,
upon termination of this Agreement for any reason, all rights and obligations of
both parties under this Agreement shall terminate. VV shall return to Snap all
master files, samples and exemplars received from Snap, and arrange to have such
materials destroyed.
7.4 Effects of Termination. Upon termination of this Agreement for any
reason VV shall take all reasonably necessary actions to eliminate the use of
the Exclusive Mark and the Non-Exclusive Marks upon the expiration of the term
of this Agreement and, in the event of any termination prior to such time, as
promptly as reasonably practical, but in no event later than one hundred eighty
(180) days after such early termination; provided, however, that in the event of
early termination of this Agreement by Snap in connection with Section 7.2(e) or
7.2(f), VV shall eliminate all use of the Exclusive Mark and the Non-Exclusive
Marks within ninety (90) days after such early termination; provided, further,
that during any such transition period, VV
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may cause the URL to automatically forward Users to VV's new Online Home
Shopping Service so long as such Online Home Shopping Service is not Controlled
by an NBCi Competitor.
SECTION 8. MISCELLANEOUS
8.1 Exclusion of Remedies; 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.
8.2 Successors and Assigns. Subject to the following sentences, 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 Snap may assign this Agreement to NBC Internet, Inc. or
any of its direct or indirect Subsidiaries in connection with the reorganization
of Snap and Xoom.com, Inc. provided that NBC Internet, Inc. or such Subsidiary
signs a counterpart to this Agreement and agrees to be bound by it. Any
purported assignment made in contravention of this Section 8.2 shall be null and
void from its inception.
8.3 Amendment; Waiver. This Agreement may be amended only by a written
instrument duly executed by Snap and VV. 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, 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.
8.4 Notices. All notices and other communications provided for hereunder
shall be in writing and delivered by hand or sent by first class mail or
overnight carrier or sent by facsimile (with such facsimile to be confirmed
promptly in writing sent by first class mail or overnight carrier), sent as
follows:
If to Snap, addressed to:
SNAP! LLC
One Beach Street
San Francisco, California 94133
Attention: Chief Financial Officer
Fax: 415-392-9088
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With a copy to:
National Broadcasting Company, Inc.
30 Rockefeller Plaza
New York, New York 10112
Attention: Trademark Counsel
Fax: (212) 664-
If to VV, addressed to:
ValueVision International, Inc.
6740 Shady Oak Road
Eden Prairie, Minnesota 55344-3433
Attention: General Counsel
Fax: (612) 947-0188
With a copy to:
Latham & Watkins
633 West Fifth Street
Suite 4000
Los Angeles, CA 90071
Attention: Michael W. Sturrock
Fax: (213) 891-8763
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 communications shall be deemed to have
been given or made when so delivered by hand or sent by facsimile or one
business day after being sent by an overnight carrier or three business days
after being sent by first class mail.
8.5 Entire Agreement. This Agreement, the Interactive Agreement, the
Warrant Purchase Agreement dated as of the date hereof among Snap, VV and
Xoom.com, Inc. 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.
8.6 Confidentiality. In connection with the activities contemplated by
this Agreement, each party may have access to confidential or proprietary
technical or business information of the other party disclosed during the Term,
including without limitation (i) proposals, ideas or research related to
possible new products or services; (ii) financial statements and other financial
information; (iii) any reporting information herein; (iv) any non-public
information; (v) any information marked as confidential; and (vi) the material
terms of this Agreement and the relationship between the parties (collectively,
"Confidential Information"). Each party will take reasonable precautions to
protect the confidentiality of the other party's Confidential Information, which
precautions will be at least equivalent to those taken by such party to protect
its own Confidential Information. Except as required by law or as necessary to
perform under
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this Agreement, neither party will knowingly disclose the Confidential
Information of the other party or use such Confidential Information for its own
benefit or for the benefit of any third party. Each party's obligations in this
Section with respect to any portion of the other party's Confidential
Information shall terminate when the party seeking to avoid its obligation under
such Section can document that: (i) it was in the public domain before, at or
subsequent to the time it was communicated to the receiving party ("Recipient")
by the disclosing party ("Discloser") through no fault of Recipient; (ii) it was
rightfully in Recipient's possession free of any obligation of confidence
before, at or subsequent to the time it was communicated to Recipient by
Discloser; (iii) it is or was developed by employees or agents of Recipient
independently of and without reference to any information communicated to
Recipient by Discloser; (iv) it was communicated by the Discloser to an
unaffiliated third party free of any obligation of confidence; or (v) the
communication was in response to a valid order by a court or other governmental
body, was otherwise required by law or was necessary to establish the rights of
either party under this Agreement.
8.7 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 entitled to specific performance of
the Section 7 hereof and interlocutory injunctions preventing misuse of the
Exclusive Mark or any Non-Exclusive Mark or any further violation of this
Agreement, in addition to any other remedy at law or in equity.
8.8 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.
8.9 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, to the exclusive jurisdiction of any state or federal
court sitting in the County of New York, 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 in such jurisdiction of any such suit, action or proceeding
and (ii) accepts, with regard to any such action or proceeding, the personal
jurisdiction of such New York 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.
8.10 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.
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8.11 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.
8.12 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.
VALUEVISION INTERNATIONAL, INC.
By: /s/ Gene McCaffery
---------------------------------
Name: Gene McCaffery
Title: Chief Executive Officer
SNAP! LLC
By: /s/ Edmond Sanctis
--------------------------------
Name: Edmond Sanctis
Title: Chief Operating Officer
[TRADEMARK LICENSE AGREEMENT]
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SCHEDULE 1
NON-EXCLUSIVE MARKS
Snap
[more to come]
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SCHEDULE 3.4
"SNAP" UNIVERSAL RESOURCE LOCATORS AND HIGH-LEVEL DOMAIN NAMES
snapcooks.com
snapbytes.com
snaptravels.com
snapwoman.com
snapticks.com
snaprocks.com
snaprolls.com
snapkids.com
snapman.com
snapdiamonds.com
getsnappedup.com
extremelysnapped.com
realsnappy.com
snap4rap.com
snapvalues.com
snapaway.com
snap4deals.com
snapglitters.com
snapdeals.com
snapzap.com
snap2zap.com
snaprap.com
snap2rap.com
1800snaptv.com
snap2buy.com
snap2get.com
snapfit.com
snapwellness.com
snapshape.com
snaptvbucks.com
looksnappy.com
snapgold.com
snapsilver.com
snaptreasures.com
snapjewelry.com
snapbaby.com
snapmagnets.com
1800getsnap.com
snapbuys.com
snapjewels.com
1800callsnap.com
snapdiet.com
feelsnappy.com