Agreement - Lycos-Bertelsmann GmbH. and Cyberian Outpost Inc.


                                   AGREEMENT
                                   ---------


     This Agreement dated as of 25th March, 1998 (the 'Agreement Date'), is made
by and between Lycos-Bertelsmann GmbH., a German Corporation with a principal 
place of business at Carl-Bertelsmann-Strasse. 161L, Postfach 310, D-33311, 
Gutersloh, Germany, ('Lycos-Bertelsmann'), and Cyberian Outpost, Inc. a US 
company with a principal place of business at 27 North Main Street, PO Box 636, 
Kent, Connecticut, USA ('Cyberian Outpost')

     The effective date of this agreement is the 7th April 1998 and this 
agreement runs through 6th April 1999


                                   Recitals
                                   --------

     A.   Lycos-Bertelsmann is the owner or licensee of certain Web services 
(collectively, the 'Lycos-Bertelsmann Services'), which are accessible through 
the URLs www.lycos.co.uk, www.lycos.de, www.lycos.it, www.lycos.fr, 
         ---------------  ------------  ------------  ------------ 
www.lycos.es, www.lycos.nl, (together with all localized adaptations operated
------------  ------------
by Lycos-Bertelsmann' subsidiaries, joint ventures and licensees around the 
world, the 'Lycos-Bertelsmann Site'):

     B.   Cyberian Outpost, Inc. The operator of a Web site accessible through
the URL www.outpost.com, (the Cyberian Outpost site) that provides an on-line 
        ---------------
computer hardware and software retail service over the Internet.

     C.   Cyberian Outpost, Inc. desires to provide links from the 
Lycos-Bertelsmann Site and/or various Lycos-Bertelsmann Services to a co-branded
version of the Cyberian Outpost Site in order to increase traffic to the 
Cyberian Outpost site

     NOW, THEREFORE, for good and valuable consideration, receipt and 
sufficiency of which are hereby acknowledge, Lycos-Bertelsmann and Cyberian 
Outpost, Inc. hereby agree as follows:


 


 
                                     Terms
                                     -----

          1/   Lycos-Bertelsmann' Obligations:
               ------------------------------

          
          Lycos-Bertelsmann will provide a fixed permanent test link on the 
          European Home Pages, along the lines of 'Click Here to buy 
          Hardware/Software' or 'On-line Computer Store-click here', to be 
          prominently placed and agreed between the parties

          Lycos-Bertelsmann will provide Cyberian Outpost with relevant KITI 
          words; e.g. PC.Drive.Software, Hardware, Peripherals etc. to be 
          provided by Cyberian Outpost [XX XXXXX XXXXXXX]

          Fixed permanent .GIF test link in the 'Technology WebGuide' linking to
          the co-branded Cyberian site.

          Fixed permanent .GIF text link in the 'Shopping WebGuide' in each 
          country where that service exists and subsequently in new 'Shopping 
          WebGuides' as they become available from time to time

          2/   Cyberian Outpost, Inc.'s obligations:
               -------------------------------------

     A.   Cyberian Outpost, Inc. will make a one off Exclusive License Fee
          payment of [XXXXXXX] to Lycos-Bertelsmann GmbH & Co KG payable within
          30 days of signature of this agreement, which represents [XXXXXXXXX]
          per month of this agreement

     B.   Cyberian Outpost, Inc. will make further payments of [XXXXXX] at 30
          day intervals, the first to be received 60 days from the signature of
          this agreement, with subsequent payments due at 30 day intervals
          thereafter and for the duration of the agreement, and to total
          [XXXXXXXX]

C.        Cyberian Outpost, Inc. will, in addition, pay to Lycos-Bertelsmann
          [XX] of net revenue from sales generated at Cyberian Outpost from each
          user session referred to Cyberian Outpost from the Lycos-Bertelsmann
          links, as described in this document, once Cyberian Outpost has earned
          back its monthly slotting fee of [XXXXXXX]. Thus, Cyberian Outpost
          will pay Lycos-Bertelsmann [XX] of all net product sales that exceed
          [XXXXXXXX] each month from user sessions coming directly to Cyberian
          Outpost from Lycos-Bertelsmann links. (The figure of [XXXXXXXX]
          represents earning back our slotting fee at the rate of [XX])



     C.   Cyberian Outpost will also provide:

          Appropriate wording for Home Page text link

          Appropriate KITI keywords and wording for the link out to the CYBERIAN
          OUTPOST site from KITI searches [XXXXXXXXXXXXXX]

          Appropriate runners to appear within the Technology WebGuide (Brand 
          Awareness and clik-thru generators)
 
        3/      Term and Exclusivity:
                --------------------

        The term ('Term') of this agreement shall commence on the Effective Date
and continue for one year unless terminated earlier as provided below

        Cyberian Outpost is the exclusive On-line computer hardware and software
for the period of the agreement in all areas other than Shopping, where Cyberian
Outpost will be the Premiere Computer Retailer, defaulted as the front store in 
the Computer areas of the Lycos-Bertelsmann 'Shopping WebGuides'.

        This exclusivity to apply with regard to the companies outlined at Annex
A to this agreement

        4/      Guaranteed Impressions:
                ----------------------

   Lycos-Bertelsmann guarantee [xxxxxx] Impressions across their pan-European
sites over the period of the contract

        5/      Marks: Lycos-Bertelsmann hereby grants to Cyberian Outpost the 
                -----
non-exclusive, non-transferable right to use the Lycos-Bertelsmann Marks solely 
for the purposes of co-branding specified in this Agreement. Cyberian Outpost 
hereby grants Lycos-Bertelsmann the non-exclusive, non-transferable right to use
the Cyberian Outpost Marks solely for the purposes specified in this Agreement. 
Except as expressly stated herein, neither party shall make any other use of the
other party's marks. Upon request of either party, the other party shall provide
appropriate attribution of the use of the requesting party's marks. (E.g., 'Go 
Get It /R/ is a registered service mark of Lycos-Bertelsmann, Inc. All Rights 
Reserved.').

        6/      Representations and Warranties: Each party hereby represents and
                ------------------------------
warrants as follows:

                a.      Corporate Power. Such party is duly organized and 
                        ---------------
validly existing under the laws of the state of its incorporation and has full 
corporate power and authority to enter into this Agreement and to carry out the 
provisions hereof.

                b.      Due Authorization. Such party is duly authorized to 
                        -----------------
execute and deliver this Agreement and to perform its obligations hereunder.

                c.      Binding Agreement. This Agreement is a legal and valid 
                        -----------------
obligation binding upon it and enforceable with its terms. The execution, 
delivery and performance of this Agreement by such party does not conflict with 
any agreement, instrument or understanding, oral or written, to which it is a 
party or by which it may be bound, nor violate any law or regulation of any 
court, government body or administrative or other agency having jurisdiction 
over it.

                d.      Intellectual Property Rights. Such party has the full 
                        ----------------------------
and exclusive right to grant or otherwise permit the other party to access the 
Cyberian Outpost Site content and to use the trademarks, logos and trade names 
as set forth on this Agreement, and that it is aware of no claims by any third 
parties adverse to any of such property rights.

        The representations and warranties and covenants in this Section 5 are 
continuous in nature and shall be deemed to have been given by each party at
execution of this Agreement and at each stage of performance hereunder. These 
representations, warranties and covenants shall survive termination or 
expiration of this Agreement.


                                       3
 

7/   Limitation of Warranty. EXCEPT AS EXPRESSLY WARRANTED IN SECTION 5 ABOVE, 
     ----------------------
EACH PARTY EXPRESSLY DISCLAIMS ANY FURTHER WARRANTIES, EITHER EXPRESS OR 
IMPLIED, INCLUDING BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF 
MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE.

     8/   Indemnification.
          ---------------

          a.     Cyberian Outpost Indemnity. Cyberian Outpost will at all times 
                 --------------------------      
     indemnify and hold harmless Lycos-Bertelsmann and its officers, directors,
     shareholders, employees, accountants, attorneys, agents, successors and
     assigns from and against any and all third party claims, damages,
     liabilities, costs and expenses, including reasonable legal fees and
     expenses, arising out of or related to any breach of any warranty,
     representation, covenant or agreement made by Cyberian Outpost in this
     Agreement. Lycos-Bertelsmann shall give Cyberian Outpost prompt written
     notice of any claim, action or demand for which indemnity is claimed.
     Cyberian Outpost shall have the right, but not the obligation, to control
     the defense and/or settlement of any claim in which it is named as a party.
     Lycos-Bertlesmann shall have the right to participate in any defense of a
     claim by Cyberian Outpost with counsel of Lycos-Bertelsmann' choice at
     Lycos-Bertlesmann' own expense. The foregoing indemnity is conditioned
     upon: prompt written notice by Lycos-Bertelsmann to Cyberian Outpost of any
     claim, action or demand for which indemnity is claimed; complete control of
     the defense and settlement thereof by Cyberian Outpost; and such reasonable
     cooperation by Lycos-Bertelsmann in the defense as Cyberian Outpost may
     request.

          b.     Lycos-Bertelsmann Indemnity. Lycos-Bertelsmann will at all 
                 ---------------------------
     times defend, indemnify and hold harmless Cyberian Outpost and its
     officers, directors, shareholders, employees, accountants, attorneys,
     agents, successors and assigns from and against any and all third party
     claims, damages, liabilities, costs and expenses, including reasonable
     legal fees and expenses, arising out of or related to any breach of any
     warranty, representation, covenant or agreement made by Lycos-Bertelsmann
     in this Agreement. Cyberian Outpost shall give Lycos-Bertelsmann prompt
     written notice of any claim, action or demand for which indemnity is
     claimed. Lycos-Bertelsmann shall have the right, but not the obligation, to
     control the defense and/or settlement of any claim in which it is named as
     a party. Cyberian Outpost shall have the right to participate in any
     defense of a claim by Lycos-Bertelsmann with counsel defense of Cyberian
     Outpost chose at its own expense. The foregoing indemnity is conditioned
     upon; prompt written notice by Cyberian Outpost to Lycos-Bertlesmann of any
     claim, action or demand for which indemnity is claimed; complete control of
     the defense and settlement thereof by Lycos-Bertelsmann; and such
     reasonable cooperation by Cyberian Outpost in the defense of Lycos-
     Bertlesmann may request.

9/   Confidentiality Press Releases.
     ------------------------------

          a.     Non-Disclosure Agreement. The parties agree and acknowledge 
                 ------------------------
                 that, as a result of negotiating, entering into and performing
                 this Agreement, each party has and will have access to certain
                 of the other party's Confidential Information (as defined
                 below). Each party also understands and agrees that misuse
                 and/or disclosure of that information could adversely affect
                 the other party's business. Accordingly, the parties agree
                 that, during the Term of this Agreement and thereafter, each
                 party shall use and reproduce the other party's Confidential
                 Information only for purposes of this Agreement and only to the
                 extent necessary for such purpose and shall restrict
                 disclosure of the other party's Confidential Information to
                 its employees, consultants or independent contractors with a
                 need to know and shall not disclose the other party's
                 Confidential Information to any third party without the prior
                 written approval of the other party. Notwithstanding the
                 foregoing, it shall not be a breach of this Agreement for
                 either party to disclose Confidential Information of the other
                 party if required to do so under law or in a judicial or other
                 governmental investigation or proceeding, provided the other
                 party has been given prior notice and the disclosing party has
                 sought all available safeguards against widespread
                 dissemination prior to such disclosure.


 

            b.   Confidential Information Defined. As used in this Agreement, 
                 --------------------------------
the term 'Confidential Information' refers to: (i) the terms and conditions of 
this Agreement: (ii) each party's trade secrets, business plans, strategies, 
methods and/or practices: and (iii) other information relating to either party 
that is not generally known to the public, including information about either 
party's personnel, products, customers, marketing strategies, services or future
business plans. Notwithstanding the foregoing, the term 'Confidential 
Information' specifically excludes (A) information that is now in public domain 
or subsequently enters the public domain by publication or otherwise through no 
action or fault of the other party; (B) information that is known to either 
party without restriction, prior to receipt from the other party under this 
Agreement, from its own independent sources a evidenced by such party's written
records, and which was not acquired, directly or indirectly, from the other 
party: (C) information that either party receives from any third party 
reasonably known by such receiving party to have a legal right to transmit such 
information, and not under any obligation to keep such information confidential;
and (D) information independently developed by either party's employees provided
that either party can show that those same employees or agents had no access to 
the Confidential Information received hereunder.

            c.   Press Releases. Lycos-Bertelsmann and Cyberian Outpost may
                 --------------
jointly prepare press releases concerning the existence of this Agreement and
the terms hereof. Otherwise, no public statements concerning the existence or
terms of this Agreement shall be made or released to any medium except with the
prior approval of Lycos-Bertelsmann and Cyberian Outpost or as acquired by law,
except where such information is already clearly in the public domain or the 
subject of existing jointly approved press releases.


10/   Termination. Either party may terminate this Agreement if (a) the other 
      -----------
party files a petition for bankruptcy or is adjudicated bankrupt; (b) petition 
in bankruptcy is filed against other party and such petition is not dismissed 
within sixty (60) days of the filing date: (c) the other party becomes insolvent
or makes an assignment for the benefit of its creditors pursuant to any 
bankruptcy law: (d) a receiver is appointed for the other party or its business:
(e) upon the occurrence of a material breach by the other party if such breach 
within thirty (30) days after written notice is received by the breaching party 
identifying the matter constituting the material breach; (f) upon thirty (30) 
days written notice if the other party's service [or product], viewed as a 
whole, ceases to be competitive with substantially similar services then being 
offered by third parties. However, if within 120 days of the agreement date, 
Lycos-Bertelsmann exercises the right to terminate the agreement under this 
clause, 10/(f), Lycos-Bertelsmann must give 60 days notice to Cyberian Outpost
and agrees to waive any further payments from Cyberian Outpost. Equally, should 
Cyberian Outpost exercise this clause. 10(f), then they shall give 60 days 
notice to Lycos-Bertelsmann and remain liable for subsequent monthly guaranteed 
payments falling due under the terms of this agreement within the 60 day notice 
period: (g) by mutual consent of the parties

      11/   Force Majeure. In the event that either party is prevented from 
            -------------
performing, or is unable to perform, any of its obligations under this Agreement
due to any cause beyond the reasonable control of the party invoking this 
provision, the affected party's performance shall be excused and the time for 
performance shall be extended for the period of delay or inability to perform 
due to such occurrence.

      12/   Relationship of Parties. Cyberian Outpost and Lycos-Bertelsmann are 
            -----------------------
independent contractors under this Agreement, and nothing herein shall be 
construed to create a partnership, joint venture or agency relationship between 
Cyberian Outpost and Lycos-Bertelsmann. Neither party has authority to enter 
into agreements of any kind on behalf of the other.

      13/   Assignment Binding Effect. Neither Lycos-Bertelsmann and Cyberian
            -------------------------
Outpost may assign this Agreement or any other rights or delegate of its duties 
under this Agreement without the prior written consent of the other.


                                       5

 
       14/  Choice of Law and Forum. This Agreement, its interpretation, 
            -----------------------
performance or any breach thereof, shall be construed in accordance with, and 
all questions with respect thereto shall be determined by, the laws of the 
Commonwealth of Massachusetts applicable to contracts entered into and wholly to
be performed within said state. Cyberian Outpost hereby consents to the personal
jurisdiction of the Commonwealth of Massachusetts, acknowledges that venue is
proper in any state or Federal court in the Commonwealth of Massachusetts,
agrees that any action related to this Agreement must be brought in a state or
Federal court in the Commonwealth of Massachusetts, and waives any objection
Cyberian Outpost has or may have in the future with respect to any of the
foregoing.

       15/  Good Faith. The parties agree to act in good faith with respect to 
            ----------
each of this Agreement and any dispute that may arise related hereto.

       16/  Additional Documents/Information. The parties agree to sign and/or 
            --------------------------------
provide such additional documents and/or information as may reasonably be 
required to carry out the intent of this Agreement and to effectuate its 
purposes.

       17/  Counterparts. This Agreement may be executed in multiple
            ------------
counterparts, each of which shall be deemed top be an original, but all of which
together shall constitute one and the same instrument.

       18/  No Waiver. The waiver by either party of a breach or a default of 
            ---------
any provision of this Agreement by the other party shall not be construed as a 
waiver of any succeeding breach of the same or any other provision, nor shall 
any delay or omission on the part of either party to exercise or avail itself
of any right, power, or privilege that it has, or may have hereunder, operate as
a waiver of any right, power or privilege by such party.

       19/  Successors and Assigns. This Agreement shall be binding upon and 
            ----------------------
inure to the benefit of the parties hereto and their respective heirs, 
successors and assigns.

       20/  Severability. Each provision of this Agreement shall be severable 
            ------------ 
from every other provision of this Agreement for the purpose of determining the 
legal enforceability of any specific provision.

       21/  Notices. All notice required to be given under this Agreement must 
            -------
be given in writing and delivered either in hand, by certified mail, return 
receipt requested, postage pre-paid, or by Federal Express or other recognized 
overnight delivery service, all delivery charges pre-paid, and addressed:


                If to Lycos-Bertelsmann:       Lycos-Bertelsmann-Bertelsmann 
                                               GmbH & Co KG 
                                               Carl-Bertelsmann-Strasse. 161L
                                               Postfach 315. D-33311 Gutersloh. 
                                               Germany
                                               Fax No.: (449) 5241 8061655
                                               Attention: Controller

                With a copy to : Managing Director
                                               Lycos-Bertelsmann-Bertelsmann 
                                               GmbH & Co KG 
                                               18-21 Cavaye Place
                                               London SW10 PG
                                               Fax No: 0171 594 4444


                                       6


 


If to Cyberian Outpost:




With a copy to:




22/         Entire Agreement. This Agreement contains the entire understanding 
            ----------------
of the parties hereto with respect to the transactions and matters contemplated
hereby, supersede all previous agreements between Lycos-Bertelsmann and Cyberian
Outpost concerning the subject matter, and cannot be amended except by writing
signed by both parties. No party hereto has relied on any statement,
representation or promise of any other party or with any other officer, agent,
employee or attorney for the other party in executing this Agreement except as
expressly stated herein.

23/         Limitations of Liability. UNDER NO CIRCUMSTANCES SHALL EITHER PARTY
            ------------------------
BE LIABLE TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR
EXEMPLARY DAMAGES (EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES), ARISING FROM ANY PROVISION OF THIS AGREEMENT (INCLUDING SUCH
DAMAGES INCURRED BY THIRD PARTIES), SUCH AS, BUT NOT LIMITED TO, LOSS OF REVENUE
OR ANTICIPATED PROFITS OR LOST BUSINESS. IN NO EVENT SHALL EITHER PARTY BE
LIABLE FOR DAMAGES IN EXCESS OF THE AMOUNT RECEIVED BY THE OTHER PARTY UNDER
THIS AGREEMENT, PROVIDED THAT THIS SECTION DOES NOT LIMIT EITHER PARTY'S
LIABILITY TO THE OTHER FOR (A) WILLFUL AND MALICIOUS MISCONDUCT; (B) DIRECT
DAMAGES TO REAL OR TANGIBLE PERSONAL PROPERTY; (C) BODILY INJURY OR DEATH CAUSED
BY NEGLIGENCE; OR (D) INDEMNIFICATION OBLIGATIONS HEREUNDER.

IN WITNESS WHEREOF, the parties have duly executed and delivered this Agreement
as of the ate set forth above.

Cyberian Outpost. Inc.                           Lycos-Bertelsmann-Bertelsmann


By: /s/ Darryl Peck                      By: /s/ Richard G. Spinks
   -----------------------------            -------------------------------
Name: Darryl Peck                        Name: Richard G. Spinks

Title: President & CEO                   Title: Business Development Director
Date:                                    Date: 25/3/98
 


                                    ANNEX A



[xxxxxx]

[xxxxxx]

CDW (Computer Discount Warehouse)

[xxxxxx]

CompUSA

[xxxxxx]

Creative Computer

Egghead

[xxxxxx]

[xxxxxx]

[xxxxxx]

Insight

[xxxxxx]

MicroCenter     

Micro Warehouse

[xxxxxx]

[xxxxxx]

PC Connection

[xxxxxx]

[xxxxxx]