Internet Services Suite Agreement - Wired Digital Inc., Lycos Inc. and Nettaxi Online Communities Inc.


                        INTERNET SERVICES SUITE AGREEMENT     THIS  INTERNET  SERVICES SUITE AGREEMENT (this "Agreement") is entered into                                                     ---------as  of May 5,1999 (the "Effective Date") between WIRED DIGITAL, INC., a Delaware                        --------------corporation  ("Wired"),  LYCOS,  INC.,  a  Delaware  corporation  ("Lycos"), and               -----                                                -----NETTAXI  ONLINE  COMMUNITIES,  INC.,  a  Delaware  corporation.  ("Nettaxi").                                                                   -------                                    Recitals                                    --------     A.     Wired  is  the  owner  or  licensee  of  certain  Web-based services(collectively,  the"Wired  Services"),  which  are  accessible  through  the URLwww.hotbot.com  (the  "HotBot  Site");     B.     Lycos  is  the  owner  or licensee of certain Web-based personalizedstart  page  services(the  "Lycos  Start  Pages"), which are accessible through the URL www.lycos.com(the"Lycos  Site");     C.     Nettaxi  maintains  a site on the Internet at http://www.nettaxi.com(the  "Nettaxi  Site"),  and  desires  to make the Wired Services and co-brandedversions  of  the  Lycos  Start  Pages  available  to users of the Nettaxi Site;     D.     Wired  and  Lycos  are willing to co-brand and/or operate certain oftheir  respectiveServices  on  behalf  of  Nettaxi,  pursuant  to  the  terms  hereof;     NOW,  THEREFORE,  for  good  and  valuable  consideration,  the receipt andsufficiency  of  which  are hereby acknowledged, Wired, Lycos and Nettaxi herebyagree  as  follows:                                      Terms                                      -----SECTION  1.     DEFINITIONS.     1.1     "Advertising  Rights"  means all advertising or promotional rights,              -------------------includingwithout  limitation  banner  advertisements,  "pop-up"  windows,  surveys  andsponsorships.     1.2     "HotBot  Personal Search Tool" means Wired's Web-based customizable              ----------------------------search  panelincorporating  the  HotBot  Search  functionality, as the same may be updated ormodified  from  time  to  time  in  Wired's  sole  discretion.     1.3     "HotBot  Search"  means  Wired's  Web-based  search engine service,              --------------currently  commercially  referred  to  as  HotBot, as the same may be updated ormodified  from  time  to  time  in  Wired's  sole  discretion.     1.4     "Lycos  Brand  Features"  means  Lycos'  name,  logo  and  other              ----------------------trademarks, trade names and service names that Lycos uses from time to time withrespect  to  Lycos'  services  offered  on Web Sites owned or operated by Lycos.     1.5     "Lycos  Start Pages" means Lycos' Web-based personalized start page              ------------------that  incorporates  certain of the Lycos Services, as the same may be updated ormodified  from  time  to  time  in  Lycos'  sole  discretion.     1.6     "Nettaxi  Brand  Features"  means  Nettaxi's name and logo and such              ------------------------other  trademarks,  trade names, service names and trade dress that Nettaxi usesfrom  time  to  time  with  respect  to  the  Nettaxi  Site.     1.7     "Referral" takes place when a user clicks on a hyperlink or uses an              --------HTML  tool  to connect to the following Wired Services: Wired Content and HotBotSearch,  at  the  redirect  URLs  designated by Wired and as measured by Wired'sserver  logs.     1.8     "Wired  Brand  Features"  means  Wired's  name,  logo  and  other              ----------------------trademarks, trade names and service names that Wired uses from time to time withrespect  to  Wired's  services  offered on Web Sites owned or operated by Wired.     1.9     "Wired  Content"  means  Wired's  Web-based  news,  information and              --------------entertainment  services,  as  well  as  the  e-mail newsletter versions of theseservices,  including  Wired  News  (http://www.wired.com),      Webmonkey(http://www.webmonkey.com),      and        Suck  (http://www.suck.com),  as maybe  update  or  modified  from  time  to  time  in  Wired's  sole  discretion.SECTION  2.     NETTAXI  START  PAGES  DEVELOPMENT  AND  MAINTENANCE.     2.1     Development  of Nettaxi Start Pages.     Lycos shall use reasonable             -----------------------------------commercial efforts to develop, within thirty (30) days after the Effective Date,the  following  service  for  use  exclusively  by users of the Nettaxi Site andaccessible  from  the  Nettaxi  Site:  a co-branded version of Lycos Start Pages("Nettaxi  Start Pages") which shall contain a Nettaxi-branded links box, HotBotSearch or Lycos Search functionality, and other standard features of Lycos StartPages.  Nettaxi's  sole  remedy  for Lycos' breach of the first sentence of thisSection  2.1  shall  be termination of this Agreement in accordance with Section11.2(a),  and  Nettaxi  shall  not  be  entitled to any other legal or equitablerelief  of  any  kind  in  connection  therewith.     2.2     Branding  and  User  Interface.             ------------------------------          (a)     Branding.     The  Nettaxi  Start  Pages shall be branded in a                  --------manner  substantially  similar  to the example(s) set forth in Exhibit B hereto.All Nettaxi Start Pages shall display appropriate intellectual property legends,including  but not limited to copyright notice and trademark references. Subjectto the foregoing provisions of this Section 2.2(a), the parties shall agree uponthe  prominence  and  location  of  all  displays of the Nettaxi Brand Features,theLycos Brand Features on the Nettaxi Start Pages; provided that the Lycos nameshall be above the fold and prominently displayed on all co-branded pages. Lycosshall  not  be  obligated to co-brand those pages containing content which Lycoshas  branded  with  a  third  party,  which Lycos is prohibited from co-brandingpursuant  to  another  Lycos  agreement,  which  Lycos  is technically unable toco-brand,  and  that  are  commercially  unreasonable  for  Lycos  to  co-brand.          (b)     User Interface.     The user interface for Nettaxi Start Pages                  --------------shall  be substantially similar to the user interfaces of the Lycos Start Pages,which  Lycos  may  modify  from  time  to  time  in  its  sole  discretion.     2.3     Hosting/Traffic.     Nettaxi  Start Pages shall be hosted by Lycos.             ---------------The  Nettaxi  Start  Pages  shall  be  served  from  Lycos  sub-domains  (e.g.,www.lycos.com/partners/nettaxi).  As  between  the  parties,  only  Lycos  shallreceive  credit  for  all unique visitor traffic and page views generated by theNettaxi  Start  Pages. As such, the parties agree to assist each other in takingany  steps  that  may  be  required  to obtain or perfect the rights of Lycos toreceive  credit  from Relevant Knowledge/Media Metrix (or any other organizationreasonably  designated  by  Lycos that is reasonably deemed to be, recognized inthe  Internet  industry  as a reliable authority for tracking unique visitors orpage  views)  for  all  unique  visitor traffic and pages views generated by theNettaxi  Start  Pages.     2.4     Sale  of Advertising Rights.     Lycos shall have the sole right to             ---------------------------sell  Advertising  Rights  on  the  Nettaxi  Start  Pages.     2.5     Customer  Service.     Lycos  shall include an email link on one or             -----------------more  of  the  Nettaxi Start Pages to Lycos' customer service staff. Lycos shalluse  reasonable  commercial efforts to respond to all customer service inquiriespromptly  after  receipt.SECTION  3.     MARKETING  AND  PROMOTIONS.     3.1     Marketing  Activities.     Throughout  the  Term of this Agreement,             ---------------------Nettaxi  shall  use  reasonable  commercial  efforts to market HotBot Search andWired  Content  in  order  to maximize the nunber of Nettaxi Site users visitingthese  sites,  including without limitation, direct email campaigns, advertisingand  promotions  on  the  Nettaxi  Site  and  targeted  activities  by  Nettaxi.Immediately  upon  Lycos'  launch  of the Nettaxi Start Pages, Nettaxi shall usereasonable commercial efforts to market Nettaxi Start Pages in order to maximizethe  number  of  users of the Nettaxi Start Pages, including without limitation,direct  email  campaigns,  advertising  and  promotions  on the Nettaxi Site andtargeted  activities  by  Nettaxi.  The parties shall review Nettaxi's marketingactivities  on  a  quarterly basis in order to assess performance and agree uponadditional activities, if necessary, in order to increase usage of Nettaxi StartPages.     3.2     Promotional  Placements.     During  the  Term  of  this Agreement,             -----------------------Nettaxi shall provide promotional placements for Wired and Lycos as set forth inthis  Section  3.2. Wired and Lycos shall provide Nettaxi with electronic copiesof  the  artwork  for the appropriate Wired and Lycos icons, logos, search boxesand links to be displayed on the Nettaxi Site in connection with the promotionalplacements  described  below.  Nettaxi  shall be responsible for programming andintegrating  the  search  box,  icons,  logos  and  links into the Nettaxi Site:          (a)     Nettaxi  shall  integrate  links  to  Wired Content and to theNettaxi  Start  Pages,in  a  substantially similar manner to the specifications and "look and feel" ofthe  examples set forth on Exhibit B. The links to the Nettaxi Start Pages shallbe  displayed  on  every  page  of  the  Nettaxi  Site  produced  by  Nettaxi.          (b)    Nettaxi shall prominently offer the HotBot Personal Search Tooland  theNettaxi  Start  Pages to every visitor and to every new registered member on theNettaxi  Site.  Nettaxi  shall integrate the HotBot Personal Search Tool in "TheNettaxi  Citizen  Page  Builder"  process.  For  those users of the Nettaxi Sitebuilding  pages  using  Nettaxi  FTP  services, Nettaxi shall promote the HotBotPersonal  Search  Tool  in  the "Other Nettaxi Help" and "Resources"pages of theNettaxi  Site.  The  HotBot Personal Search Tool shall be the only search enginetool  made  available  to Nettaxi home-page builders. Nettaxi shall redirect allusers  of  the  Nettaxi  Site  who  conduct searches through the HotBot PersonalSearch  Tool  or  who  select  the  Wired  and  Lycos  links  to  the URL of theappropriate  service.          (c)     Nettaxi  shall integrate the following links to Wired Content:(i)  Webmonkeyin  the  "Homepage  Utils/HTML Resources" section of the Nettaxi Site, currentlylocated  at http://www.nettaxi.com/help/resources.html; (ii) Wired News and Suckin  all  relevant  topic  sections of the Nettaxi Site, at Nettaxi's discretion;(iii)  Wired  Content  newsletter  subscriptions in all relevant sections of theNettaxi  Site,  at  Nettaxi's  discretion.     3.3     Referral  Guarantee.     During the Term of this Agreement, Nettaxi             -------------------guarantees  that Nettaxi's promotional placements for the HotBot Personal SearchTool  and  Wired  Content  shall  result in not less than I 00,000 Referrals permonth. For purposes of determining whether Nettaxi has performed on its Referralguarantee,  the  Referral  tally  shall  begin  at zero at the beginning of eachcontract  quarter.          (a)     If  Nettaxi  fails  to achieve the guaranteed level of 300,000Referrals  in  aparticular  quarter,  Wired's obligation to make such quarter's Referral Payment(as  described below in Section 5.3) shall be deferred until the due date of thenext  quarterly  payment.          (b)     If  Nettaxi  fails  to achieve the guaranteed level of 300,000Referrals  for  two  consecutive  contract  quarters,  the  payment per thousandReferrals  quoted  in  Section  5.1(a)  shall  be  decreased  to  $5  CPM.     3.4     Additional  Marketing  Provisions.     The  additional  marketing             ---------------------------------provisions  set  forth  in  Exhibit  A  are  incorporated  herein.SECTION  4.     OWNERSHIP  AND  LICENSE.     4.1     Ownership.     Nettaxi acknowledges and agrees that, as between the             ---------parties,  Lycos owns all title to, and all ownership rights in the Nettaxi StartPages,  including  without  limitation the underlying software but excluding theNettaxi-brand  element  of the Lycos.com domain name for Nettaxi Start Pages andthe  Nettaxi  Brand  Features,  which  are  the  sole  property  of  Nettaxi.Under  no  circumstances  shall  any  part  of Nettaxi Start Pages be physicallytransferred  to  Nettaxi  or  shall  Nettaxi  be  entitled  to  a license to theunderlying  software.     4.2     Nettaxi  License Grant.     Nettaxi hereby grants Lycos, during the             ----------------------Term  (as  defined  below)  of  this  Agreement,  a  worldwide,  royalty-free,nonexclusive  license  (with  no  right  to  sublicense)  to  use, reproduce anddistribute  the  Nettaxi Brand Features on the Nettaxi Start Pages in accordancewith  this  Agreement  and  Nettaxi's  guidelines  for  use of the Nettaxi BrandFeatures,  which  guidelines  Nettaxi may change from time to time upon at leastthirty  (30)  days'  prior  written  notice  to  Lycos.     4.3     Lycos  License  Grant.     Lycos hereby grants Nettaxi a worldwide,             ---------------------royalty-free,  nonexclusive  license  (with  no  right to sublicense) to use theLycos Brand Features in connection with the marketing and promotion of Lycos andthe  Nettaxi Start Pages in accordance with this Agreement and Lycos' guidelinesfor use of the Lycos Brand Features, which guidelines Lycos may change from timeto  time,  upon  at  least  thirty  (30)  days' prior written notice to Nettaxi.     4.4     Wired  License  Grant.     Wired hereby grants Nettaxi a worldwide,             ---------------------royalty-free,  nonexclusive  license  (with  no  right to sublicense) to use theWired  Brand  Features  in connection with the marketing and promotion of Wired,the  HotBot  Search  and the Wired Content in accordance with this Agreement andWired's  guidelines  for use of the Wired Brand Features, which guidelines Wiredmay  change  from  time  to  time  upon at least thirty (30) days' prior writtennotice  to  Nettaxi.     4.5     No  Other  Rights.     Except  as  expressly  provided  above,  theparties retain all title to, and all rights in, their respective Brand Features.SECTION  5.     PAYMENT  TERMS.     5.1     Wired  Services  Referral Payments.    Nettaxi shall be entitled to             ----------------------------------payment  for  Referrals  throughout  the  Term,  as  follows          a.     For every Referral between 1 and 300,000 Referrals per contractquarter               during the Term, Wired shall pay Nettaxi $0.010 per Referral ($10CPM),                    unless Nettaxi fails to achieve the guaranteed level of300,000  Referrals for               two consecutive contract quarters, in whichcase  the  payment per thousand               Referrals shall be decreased to $5CPM,  as  described  in  Section  3.3(b)                    above.          b.     For  every Referral between 300,001 and 1,500,000 Referrals percontract               quarter  during  the  Term,  Wired  shall  pay Nettaxi $0.015 perReferral  ($15                    CPM).          c.     For  every  Referral over 1,500,000 per contract quarter duringthe                         Term,Wired shall pay Nettaxi $0.02 per Referral ($20CPM).     5.2     Nettaxi  Start Pages Advertising Revenue Share.     Lycos shall pay             ----------------------------------------------Nettaxi  the  amounts  set  forth  in  Exhibit A with respect to Net AdvertisingRevenue  for  the  Nettaxi  Start  Pages  received  by Lycos during the relevantperiod.  For the purposes of this Agreement, "Net Advertising Revenue" means theactual  amounts  received for the sale of Advertising Rights targeted to NettaxiStart  Pages, less applicable sales or use taxes, direct costs of collection andthird  party  and  internal  sales  commissions paid, which commissions shall bedeemed  to  be  20%  of  actual  amounts  received.     5.3     Payment Timing; Reporting.     Except as provided in Section 3.3(a)             -------------------------above, within thirty (30) days following the conclusion of each contract quarterduring  the  Term  (the  "Payment  Schedule"),  Wired shall calculate and pay toNettaxi  the amounts described in Section 5.1 and 5.2 for the preceding contractquarter. Referral volumes shall be tracked by Wired and reported to Nettaxi witheach  payment.     5.4     No Artificial Inflating of Referral Numbers.     Nettaxi shall not,             -------------------------------------------nor  shall it permit or encourage others to, engage in behavior that would causeReferrals  other than by bona fide users who are not employees or contractors ofNettaxi.  Without  limiting the foregoing, Nettaxi shall not: (i) use, or permitto  be  used, robots that would cause Referrals, or (ii) compensate employees orcontractors  for  manually  causing  Referrals.     5.5     Other  Revenue  Opportunities.     Lycos  and  Nettaxi  shall  work             -----------------------------together  to  develop  additional  revenue  opportunities  related  to  NettaxiServices.  Allocation  of  any  such  revenues shall be agreed on a case-by-casebasis.     5.6     Taxes.     All fees and payments stated herein exclude, and Nettaxi             -----shall  pay,  any sales, use, property, license, value added, withholding, exciseor  similar tax, federal, state or local, related to the Parties' performance oftheir  obligations  or  exercise  of  their  rights under this Agreement and anyrelated  duties,  tariffs, imposts and similar charges, exclusive of taxes basedon  Wired's  net  income.     5.7     Inspection  Rights.     Each  party shall maintain accurate records             ------------------with  respect  to the calculation of all payments due under this Agreement. Eachparty  shall  have the right, at its expense (except as provided below) to auditthe  other party's books and records for the purpose of verifying such payments.Such  audits  shall  be  made not more than twice per year, on not less than ten(10)  days written notice, during regular business hours, by auditors reasonablyacceptable  to the party being audited. If the auditor's figures reflect recordshigher  than  those-reported  by  the  party being audited, then the party beingaudited  shall  pay  the difference. If the auditor's figures vary more than 10%from  the  figures  provided  by  the  party being audited, then the party beingaudited  shall  also  pay  the  reasonable  cost  of  the  audit.SECTION  6.     EXCLUSIVITY.     During  the  Term,  Wired  and  Lycos  will  be  the exclusive providers ofInternet  search, navigation, directory services, personal start pages, personalhome  pages  and  email  services  onthe Nettaxi Site (including any successor sites); provided that Wired and Lyrcosare  not  obligatedto  provide  any  such  additional  services  not provided for in this Agreementunless  it  expressly  agrees to do so in writing. Nettaxi shall not display anyreference  to  any  competitor  of  Wired or Lycos on the Nettaxi Site. The term"competitor"  is  defined  as:  Yahoo, Northern Lights, Excite/AtHome, InfoSeek,Snap,  Cnet, Planet Direct, AltaVista, GeoCities, LookSmart, MetaCrawler, MiningCompany,  GoTo  and  Go Network, or other competitor as Wired may designate onceper  contract  quarter.SECTION  7.     DISCLAIMER  OF  WARRANTIES.     HOTBOT  SEARCH,  WIRED  CONTENT  AND  NETTAXI  START  PAGES, ALL UNDERLYINGSOFTWARE  AND  ALL  DATA CONTAINED THEREIN ARE PROVIDED"AS IS."' WIRED AND LYCOSDISCLAIM  ALL  WARRANTIES,  EXPRESS  OR  IMPLIED,WITH  RESPECT TO SUCH SERVICES,INCLUDING  WITHOUT  LIMITATION, ANY WARRANTY OF ACCURACY OR RELIABILITY OF DATA,NONINFRINGEMENT,  MERCHANTABILITY, FITNESS FOR A PARTICULAR USE, OR ARISING FROMTHE  COURSE  OF  DEALING  BETWEEN  THE  PARTIES  OR  USAGE  OF  TRADE.SECTION  8.     CONFIDENTIAL  INFORMATION.     8.1     Definition.     "Confidential  Information"  means confidential and             ----------       -------------------------proprietary  information  which  relates  to the parties' business, products andservices,  including but not limited to data, trade secrets, discoveries, ideas,concepts,  know-how,  techniques,  software, business activities and operations,reports,  studies  and  other  technical and business information and, under thecircumstances  of  disclosure,  would be deemed confidential or proprietary by areasonable  business  person.  Notwithstanding  the  foregoing,  ConfidentialInformation shall not include any information which is (a) information which hasbecome  publicly  available  without  breach hereunder by the receiving party oranother  person,  (b) information which was rightfully received by the receivingparty  from  a  source not under obligation of confidentiality to the disclosingparty,  (c)  information in the possession of the receiving party, in written orother  recorded  form,  prior  to  disclosure  by  the  disclosing  party,  (d)information  which  is  developed  by  the  receiving  party  independent of anyinformation  disclosed hereunder, and (e) information which the disclosing partyhas  approved in writing for release by the receiving party without restriction.     8.2     No  Disclosure.     Each  party  agrees  that  it  will  keep  in             --------------confidence  all Confidential Information of the other party and that it will notdirectly  or  indirectly disclose to any third party or use for its own benefit,or  use for any purpose other than the performance of its obligations under thisAgreement,  any  Confidential Information it receives from the other party. Eachparty  agrees  to  use reasonable care to protect the other party's ConfidentialInformation,  and  in  no event less than the same degree of care to protect theother  party's  Confidential  Information as it would employ with respect to itsown information of like importance which it does not desire to have published ordisseminated.  Notwithstanding  the  foregoing, either party hereto may discloseany  Confidential  Information  hereunder  to  such  party's attorneys and otherrepresentatives,  if  required  to  do  so  under  law or in a judicial or othergovernmental  investigation  or  proceeding,  provided  the other party has beengiven  prior notice and the disclosing party has sought all available safeguardsagainst widespread dissemination prior to such disclosure, or any court or othertribunal of competent jurisdiction as reasonably required to resolve any disputebetween  the  parties  hereto.     8.3     Remedies.     The  parties  each  agree  that  any  breach  of this             --------Section  8  would  cause  irreparable  harm  or  injury  to  the  other  partysignificantly  in  excess  of the value received by such other party pursuant tothis  Agreement,  and  that  such  other party shall be entitled to declaratory,injunctive  or  other  equitable  relief,  in  addition  to  any  other legal orequitable  remedies  it  may  have,  for  any  such  breach.     8.4     Return  of  Confidential Information.    Each party shall return or             ------------------------------------destroy  all  Confidential  Information  promptly  upon the request of the otherparty  or  upon  termination  of  this  Agreement.SECTION  9.     LIMITATION  OF  LIABILITY.     NOTWITHSTANDING  ANYTHING  IN THIS AGREEMENT TO THE CONTRARYAND EXCEPT WITHRESPECT  TO  OBLIGATIONS  TO  PAY  MONEY  UNDER  SECTION  5  AND  THE  INDEMNITYOBLIGATIONS  UNDER  SECTION  10,  UNDER  NO  CIRCUMSTANCES SHALL EITHER PARTY BELIABLE  TO  THE OTHER PARTY WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENTUNDER  ANY  CONTRACT,  NEGLIGENCE,  STRICT LIABILITY OR OTHER LEGAL OR EQUITABLETHEORY  FOR  (A)  ANY  INDIRECT, INCIDENTAL, CONSEQUENTIAL, PUNITIVE, SPECIAL OREXEMPLARY DAMAGES (INCLUDING, WITHOUT LIMITATION, LOSS OF REVENUE OR GOODWILL ORANTICIPATED  PROFITS  OR  LOST BUSINESS), EVEN IF SUCH PARTY HAS BEEN ADVISED OFTHE  POSSIBILITY  OF  SUCH DAMAGES; OR (B) THE COST OF PROCUREMENT OF SUBSTITUTESERVICES,TECHNOLOGY,  DATA  OR  CONTENT.SECTION  10.     INDEMNIFICATION.     10.1     By  Wired.     Wired,  at its own expense, shall indemnify, defend              ---------and  hold  harmless  Nettaxi,  and  its  officers,  directors,  employees,representatives  and  agents,  and  each of them, against any third party claim,demand,  suit,  action, or other proceeding brought against such person, and alldamages,  awards,  settlements,  liabilities, losses, costs and expenses relatedthereto  (including  without limitation attorneys' fees) to the extent that suchclaim,  suit,  action  or  other proceeding is based an or arises from any claimthat  (a)  the  underlying  source  code  or object code for the HotBot PersonalSearch Tool infringes any copyright or U.S. patent or (b) any of the Wired BrandFeatures  infringes  any  valid  copyright  or  trademark.     10.2     By  Lycos     Lycos,  at  its own expense, shall indemnify, defend              ---------and  hold  harmless  Nettaxi,  and  its  officers,  directors,  employees,representatives  and  agents,  and  each of them, against any third party claim,demand,  suit,  action, or other proceeding brought against such person, and alldamages,  awards,  settlements,  liabilities, losses, costs and expenses relatedthereto  (including  without limitation attorneys' fees) to the extent that suchclaim,  suit,  action  or  other proceeding is based on or arises from any claimthat  (a)  the  underlying,  source  code or object code for Nettaxi Start Pagesinfringes  any  copyright  or  U.S.  patent  (b) any of the Lycos Brand Featuresinfringes  any  valid  copyright  or  trademark.     10.3     By  Nettaxi.     Nettaxi,  at  its  own  expense, shall indemnify,              -----------defend  and  hold  harmless  Lycos  and  Wired,  and  their respective officers,directors,  employees, representatives and agents, and each of them, against anythird  party  claim,  suit,  action,  or  other  proceeding brought against suchperson,  and  all  damages,  awards, settlements, liabilities, losses, costs andexpenses  related  thereto (including without limitation attorneys' fees) to theextent  that  such claim, suit, action or other proceeding is based on or arisesfrom  (a)  any  claim  that any of the Nettaxi Brand Features infringe any validcopyright  or  trademark  or  (b)  operation  of  the  Nettaxi  Site.     10.4     Procedure.     All  indemnification obligations under this Section              ---------10  shall  be  subject  to the following requirements: (a) the indemnified partyshall  provide  the  indemnifying party with prompt written notice of any claim;(b)  the  indemnified  party  shall  permit the indemnifying party to assume andcontrol  the  defense  of  any  action (unless, in the opinion of counsel of theindemnified  party,  such  assumption  would  result  in  a material conflict ofinterest);  and (c) the indemnified party shall not enter into any settlement orcompromise  of any claim without the indemnifying party's prior written consent.In  addition,  the indemnified party may, at its own expense, participate in itsdefense  of  any  claim.SECTION  11.    TERMINATION.     11.1     Term.     This  Agreement  shall  have  an initial term of two (2)              ----years  from  the  Effective  Date  and  shall automatically renew for successiveone-year  terms  unless (a) either party provides the other party written noticeof  non-renewal  at  least  thirty (30) days prior to the expiration of the thencurrent  term  or  (b)  terminated  earlier in accordance with Section 11.2. Theinitial  term  and  all  renewal  terms  are  collectively  referred  to in thisAgreement  as  the  "Term."     11.2     Early  Termination.              ------------------     (a)    Termination  Conditions.    This  Agreement may be terminated (i) by            -----------------------any  Partyimmediately  upon  written  notice if the other party (A) becomes insolvent; (B)files  a  petition  in bankruptcy; or (C) makes an assignment for the benefit ofits  creditors; (ii) by any Party at such time as Wired or Lycos ceases offeringany  of the above-described services to third parties; or (iii) by any Party forany  reason  or  no  reason  upon  ninety  (90)  days  prior  written  notice,     (b)    Non-Exclusive Remedy.    Except as explicitly set forth elsewhere in            --------------------thisAgreement, the foregoing rights of termination shall be in addition to any otherlegal  or  equitable  remedies  that  the  terminating  party  may  have.     11.3     Survival  of  Certain  Provisions.    The provisions of Sections I              ---------------------------------(Definitions),  4.1  (Ownership),  4.3  (No  Other  Rights),  7  (Disclaimer  ofWarranties),  8  (Confidential  Information),9  (Limitation  of Liability), 10 (Indemnification), 12 (General Provisions) andthis  Section  11.3, as well as any accrued payment obligations under Section 5,shall  survive  any  termination  of  this  Agreement.SECTION  12.     GENERAL  PROVISIONS.     12.1     Entire Agreement.    This Agreement, including the Exhibit hereto,              ----------------represents  the entire agreement between the parties with respect to the subjectmatter  hereof  and  thereof  and  shall  supersede  all  prior  agreements  andcommunications  of  the  parties,  oral  or  written.     12.2     Amendment  and  Waiver.    No  amendment  to any provision of this              ----------------------Agreement  shall  be  effective unless in writing and signed by all parties. Thewaiver  by  either  party  of  a  breach  or  a default of any provision of thisAgreement  by  the  other  party  shall  not  be  construed  as  a waiver of anysucceeding  breach  of  the  same or any other provision, nor shall any delay oromssion  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 ofany  right,  power  or  privilege  by  such  party.     12.3     Choice  of  Law  and Forum.    This Agreement, its interpretation,              --------------------------performance  or  any  breach thereof, shall be construed in accordance with, andall questions with respect thereto shall be determined by, the laws of the Stateof  California  applicable  to contracts entered into and wholly to be performedwithin  said  state.  The parties hereby consent to the personal jurisdiction ofCalifornia,  acknowledge  that  venue is proper in any state or Federal court inthe California, agrees that any action related to this Agreement must be broughtin  a  state  or  Federal  court in the California, and waive any objection suchparty  has  or  may  have  in  the  future with respect to any of the foregoing.     12.4     Legal Fees.    The prevailing party in any legal action brought by              ----------one party against the other and arising out of this Agreement shall be entitled,in  addition  to any other rights and remedies it may have, to reimbursement forits  expenses,  including  court  and  arbitration  costs, as well as reasonableattorneys'  fees.     12.5     Successors  and  Assigns.    Neither party shall assign its rights              ------------------------or  obligations  under  this  Agreement without the prior written consent of theother  party,  provided  that  Wired  and Lycos shall be permitted to assign itsrights  and obligations to an acquiring or successor entity in connection with amerger,  a  sale of Wired's or Lycos' business or a sale of all or substantiallyall  of  Wired's  or  Lycos'  assets. All terms and provisions of this Agreementshall  be  binding upon and inure to the benefit of the parties hereto and theirrespective  permitted  transferees,  successors  and  assigns.     12.6     Notices.    All  notices,  requests,  consents  and  other              -------communications  which  are  required or permitted hereunder shall be in writing,and shall be delivered by registered U.S. mail, postage prepaid (effective three(3)  days  after  mailing)  or  sent  by  facsimile  or  electronic mail, with aconfirmation  copy  simultaneously sent by U.S. mail, postage prepaid (effectiveupon  transmission),  at  the  addresses set forth on the signature page hereto.Notice  of  change  of  address  shall  be  given  in  the  same manner as othercommunications.     12.7     Severability.    If  any provision of this Agreement is held to be              ------------invalid, illegal or unenforceable for any reason, such invalidity, illegality orunenforceability  shall  not  affect any other provisions of this Agreement, andthis  Agreement  shall be construed as if such invalid, illegal or unenforceableprovision  had  never  been  contained  herein.     12.8     Good  Faith.   The parties agree to act in good faith with respect              -----------to  each  provision  of  this  Agreement  and any dispute that may arise relatedhereto.     12.9     Headings.    The  section headings contained in this Agreement are              --------included for convenience only, and shall not limit or otherwise affect the termsof  this  Agreement.     12.10     Counterparts.    This  Agreement  may  be  executed  in  two               ------------counterparts, both of which taken together shall constitute a single instrument.Execution  and  delivery  of  this  Agreement  may  be  evidenced  by  facsimiletransmission.         This  Internet  Services  Suite  Agreement has been executed by the partieseffective  as  of  the  Effective  Date.WIRED  DIGITAL,  INC.                            LYCOS, TNC.By:    /s/  Elizabeth  Vandendike                By:   /s/ Thomas E. GuilfordName:  Elizabeth  Vandendike                     Name:     Thomas  E.GuilfordTitle: President                                 Title:    VP  Finance/Admin.Address:                                         Address:Wired  Digital,  Inc.                            Lycos,  Inc.Attn.:  General  Counsel                         400-2  Totten  Pond  Road660 Third  Street, 4h  Floor                     Waltham,  MA  02154San Francisco, CA  94107                         Tel.: (781) 370-2700Tel.: (415) 276-8400                             Fax:  (781) 370-2800Fax:  (415) 276-8499                             Attn.:  General  Counsel               Reviewed  By          WIRED  DIGITAL  LEGAL               Initial  /s/  CPNETTAXIBy:     /s/  Dean  RositanoName:   Dean  RositanoTitle:  PresidentAddress:2165 S. Bascom  Ave.        Campbell, CA  95008Attn.:Tel.:  (408) 879-9880Fax:   (408) 879-9907Email: DEAN@NETTAXI.COM                                    EXHIBIT A                                    ---------1.   ADDITIONAL MARKETING PROVISIONS     A.   HOTBOT BANNER ADVERTISEMENTS:          i.  Throughout  the Term,  Nettaxi  shall serve  1,000,000  "468 x 60"     banner   impressions  per  month   promoting   Nettaxi  Start  Pages  on  a     "run-of-site"  basis across the Nettaxi Site, which creative materials will     be  furnished  by Lycos and  modified  by Lycos from time to time at Lycos'     sole discretion.          ii.  Throughout  the Term,  Nettaxi shall serve  1,000,000  "468 x 60"     banner impressions per month promoting the HotBot Personal Search Tool on a     "run-of-site"  basis across the Nettaxi Site, which creative materials will     be  furnished  by Wired and  modified by Wired from time to time at Wired's     sole discretion.     B.  9-MAIL  PROMOTIONS:  At least  once per  contract  quarter of the Term,     Nettaxi shall deliver a direct e-mail to each of Nettaxi's registered users     containing a marketing  message written by Wired and/or Lycos regarding new     features in the Wired and Lycos  services.  Such e-mails  shall not contain     any other promotional elements.2.   NET ADVERTISING REVENUE          Lycos shall pay Nettaxi  according  to the Payment  Schedule an amount     equal to  forty  percent  (40%) of Net  Advertising  Revenue  derived  from     Nettaxi Start Pages.  If Nettaxi fails to deliver the  guaranteed  level of     Referrals  during two  consecutive  contract  quarters during the Term, the     percentage of Net  Advertising  Revenue used in the Formula for computation     of Nettaxi quarterly  payment shall decrease to thirty-five  percent (35%),     as described above in Section 3.3(b).     
/Business Operations/Services AgreementsLycos Inc.Nettaxi Inc.2009-10-18/operations/services//content/hippo/files/default.www/content/contract/contract/L/Lycos-Inc-/1445
447Encoding Quotation - Emusic.com Inc. and Encoding.com Inc.

Note: Portions of this exhibit indicated by "[*]" are subject to a confidential 
treatment request, and have been omitted from this exhibit. Complete, unredacted
copies of this exhibit have been filed with the Securities and Exchange 
Commission as part of this company's confidential treatment request.

[LOGO OF ENCODING.COM]

[*]
Emusic.com, Inc.

Encoding.com would like to validate our strong desire to have a strategic and
long-term relationship with Emusic.com by delivering what we believe to be a
very compelling proposal. The below proposal is intended to encompass all of
Emusic's encoding for a period of [*] and is designed with a full partnership in
mind. Please note that the pricing you are being offered here is confidential to
E-music and the terms herein should not be disclosed to any third party.

The terms of this agreement are good until the last day of June 1999.

You will notice in the pricing section that we have given you [*] prices for the
encoding of [*] CDs initially and all ongoing volumes for a period of [*].

Also pricing for Windows Media encoding has been added here as well at a very
reasonable rate.

                             Encoding Requirements

Please review this document carefully and let me know if there are sections that
are unclear or if we are missing some pressing details.
 
The following are your requirements, as we understand them.

.  Support for the highest quality encoding from [*] format into [*] formats.
   Encoding of [*] CDs into [*] formats, [*].  Possible support for [*].
.  [*] files will be encoded using the [*].
.  [*] samples will be encoded into [*].
.  [*] samples will be captured [*] seconds into a song unless otherwise
   requested. [*].
.  Scanning of cover art into at least [*] formats.  [*] at a frame size to be
   determined.
.  Receive media from labels and generate an electronic package slip for E-
   music.com for rectification purposes.
.  Tracking of all media that is shipped to encoding.com without a packing slip
   by our internal tracking number, UOC and album title.
.  Data entry for all [*] CDs to be used for meta data entry, naming, and cross
   reference to web site.
.  Deliveries of media back to E-music.com [*].
.  Require dedicated capacity in the encoding.com lab in an ongoing capacity for
   projects that can not yield the normal 2-4 week lead-time.

[*] Confidential Treatment Request

Quotation valid through June 1999


E-Music.com                       6/30/99                 Confidential Quotation


           Digitization & Encoding Services; Data Work, and Scanning
                                        
Encoding

encoding.com is in a phase in our company culture where the partnerships we make
are as important as anything. By this we are prepared to jump into this
partnership with both feet and offer you the same strategic pricing for your
initial encoding project as all ongoing encoding work.

Please find below a brief description of the two opportunities available to you.

Pricing Short: Please also see contingencies below.

Straight customer/client relationship.
     -----------------------------------------------------------------
                         Encoding- MP3 and RA     Scanning     Data
     -----------------------------------------------------------------
       Initial [*]CDs              [*]               [*]        [*]
     -----------------------------------------------------------------
       1-year ongoing              [*]               [*]        [*]
     -----------------------------------------------------------------

Earn out opportunity: with the below opportunity you can save upwards of [*] off
the initial encoding project for a [*] royalty on all online sales of media we
encoded for a period of [*].

     -----------------------------------------------------------------
                         Encoding- MP3 and RA     Scanning     Data
     -----------------------------------------------------------------
       Initial [*] CDs             [*]               [*]        [*]
     -----------------------------------------------------------------
       1-year ongoing              [*]               [*]        [*]
     -----------------------------------------------------------------

We are not concerned with which option you choose, but we did want to give you a
way to defer your pricing even more if appropriate.

Initial [*]CDs (material):

The following are conditions of this very strategic pricing for your initial [*]
CDs.

.  Work order is executed and a PO generated for the initial amount by June 30th
   1999.
.  Jointly Sponsored press release announcing project and partnership
.  Minimum annual commitment of [*] CDs for a period of 1-year. This will be
   dedicated capacity that will be priority access for E-Music.
.  Link exchange where appropriate
.  Possible other promotional or marketing events
.  [*] downloads for all encoding.com employees for a period of 6-months.

Specifics:

Set-up per CD:                      [*]
Database integration:               [*]
Material Warehousing
     6 months from 1st shipment     [*]
Encoding cost per track/song
     [*] file:                      [*]
[*]                                 [*]

Total for [*] Tracks:               [*]
[*] tracks per CD on average

We will work with you over the next week to put in place a delivery schedule for
this deployment.

*If not executed by June 30th 1999 the price of [*] will apply for per track
encoding.

[*] Confidential Treatment Request

Quotation valid through June 1999

 
E-Music.com                       6/30/99                 Confidential Quotation


Data Entry

Encoding.com has put in place a very robust data entry process and management
software. Over the past year we have created custom databases for a number of
clients with similar needs as your own. The following is our understanding of
your data entry requirements and the pricing that we are able to offer to
implement these.  [*] The following are based on our ability to enter data for
[*] CDs per hour per data entry employee.

Please also note that we have looked in the past at the use of the [*] as a tool
for propagating meta fields in our clients databases. [*].

Caveat:   When encoding.com is given an electronic packing slip for the CDs we
are receiving the data entry costs associated with those CDs will be [*] per CD.

Fields to be captured:
[*]

Format for export:          [*]
Cost per CD:                [*]
Total Costs for [*] CDs:    [*]*

* this number will be less if [*]

Scans

Encoding.com has the ability to scan cover art for E-Music.com as part of our
normal fulfillment process. For this project we will capture [*] formats as
follows:
[*]

Costs per scan:         [*]
Costs for [*] scans:    [*]

List price is [*] and [*] additional format..


[*] Confidential Treatment Request

Quotation valid through June 1999

 
E-Music.com                       6/30/99                 Confidential Quotation


We will deliver the image files to you on CDR or DLT depending on your
requirements. Sometimes we have found that it is easier to manage the audio
files on CDR depending on your usage. We will work with you on this.

Fulfillment and Delivery

Fulfillment and delivery is how we return your media to you or to your hosting
provider.  The options here are via DAT, CDR, or FTP. We don't recommend FTP
because of timeliness for this amount of data.

DLT delivery media for [*] CDs worth of compressed media and cover art.

Approximately [*] of data to be delivered
[*] can fit on an individual DLT
[*] needed; @ [*] per DLT

Delivery Costs:        [*]
CDR Delivery:          [*]

We will work with your operations teams to put in place a structure for how we
deliver, store and retrieve media to and for E-music.

Summary:

We are very interested in working with you on this  project. We believe that we
are the only choice in the industry that can handle these volumes of audio
encoding. Please let me know what other information you need from me and I will
work to provide it. These prices are valid through June 1999.

Initial [*] CD encoding project

     ---------------------------------------------------------------------
       Item              Count                   Your Costs     Total
     ---------------------------------------------------------------------
       Encoding          [*] Songs into [*]      [*]            [*]
     ---------------------------------------------------------------------
                         [*] Encoding            [*]            [*]
     ---------------------------------------------------------------------
       Data Entry        [*] CDs ([*]fields)     [*]            [*]
     ---------------------------------------------------------------------
       Scans             [*]                     [*]            [*]
     ---------------------------------------------------------------------
       Delivery          [*] DLT                 [*]            [*]
     ---------------------------------------------------------------------
       CDR ongoing                               [*]
     --------------------------------------------------------------------- 
       Total Project                                            [*]
        Costs                                                          
     --------------------------------------------------------------------- 

1-year volume commitment: Additional Volume.

     --------------------------------------------------------------------- 
       Item               Count                  Your Costs     Total
     --------------------------------------------------------------------- 
       Encoding           [*] songs into [*]     [*]            [*]
     --------------------------------------------------------------------- 
                          [*] encoding           [*]            [*]
     --------------------------------------------------------------------- 
       Data Entry         [*] CDs ([*]fields)    [*]            [*]
     --------------------------------------------------------------------- 
       Scans              [*]                    [*]            [*]
     --------------------------------------------------------------------- 
       Delivery           [*] DLT                [*]            [*]
     --------------------------------------------------------------------- 
       CDR ongoing                               [*]
     --------------------------------------------------------------------- 
       Total Project                                            [*]
        Costs 
     --------------------------------------------------------------------- 


[*] Confidential Treatment Request

Quotation valid through June 1999

 
E-Music.com                       6/30/99                 Confidential Quotation


* Contingent on this work-order being signed by June 30th 1999. Otherwise the
ongoing pricing schedules will be applied.

Ongoing Work:

Contingent on the signing of this work agreement we will work with Emusic.com to
put in place a structure and a process for handling all mass ongoing encoding
work for Emusic.com as well as how we will reserve dedicated lab time. In
signing this document Emusic.com asserts its willingness to enter into an
agreement of this nature.

The following is the pricing that we are able to offer Emusic.com for this
ongoing work as stated earlier.

     --------------------------------------------------------------------- 
                         Encoding- MP3, RA,      Scanning       Data
                         and Windows Media
     --------------------------------------------------------------------- 
       [*] ongoing       [*]                     [*]            [*] per CD
     --------------------------------------------------------------------- 

Ongoing volumes are estimated at [*] tracks [*].


Terms and Conditions

The primary terms of our agreement require that you guarantee to have the rights
to the content and we agree not to use the content for other purposes without
your approval. We require a [*] deposit on all contracted work. The balance will
be invoiced monthly against the past months work.

1.  CONTROLLING TERMS.  Pricing is valid until June 31st 1999 and are valid for
a period of one year from the execution of this document. The terms and
conditions of sale contained herein shall apply to all provisions of encoding
services and related services by encoding.com, Inc. ("encoding.com") and to all
purchase orders or other offers accepted by encoding.com related thereto
(collectively, the "Service").  These terms and conditions may in some instances
conflict with or add to some of the terms and conditions affixed to the purchase
order or the procurement document issued by the Customer.  In such case, the
terms and conditions contained herein shall govern exclusively and ACCEPTANCE OF
CUSTOMER'S ORDER IS EXPRESSLY CONDITIONED UPON CUSTOMER'S ACCEPTANCE OF THE
TERMS AND CONDITIONS CONTAINED HEREIN irrespective of whether the Customer
accepts these conditions by oral or written acknowledgment, by implication or by
acceptance of or payment for the provision of the Service ordered hereunder
based on the content, materials and/or elements (collectively, the "Content")
provided to encoding.com by Customer.

2.  TERMS OF PAYMENT.  Payment must be made in US dollars and may be made in
cash, cashier's check, money order, travelers checks, check drawn on local bank
or Visa / MasterCard. All COD orders must be paid for and picked up Monday
through Friday between the hours of 9:00 AM and 5:00 PM. Credit terms are net 15
days. Interest at the maximum rate allowed by law will be charged on all
accounts not paid within 30 days unless previous arrangements have been made
with the encoding.com. ANY CLAIMS FOR ADJUSTMENT IN CONNECTION WITH AN INVOICE
MUST BE PRESENTED IN WRITING WITHIN 10 DAYS OF THE DATE OF THE INVOICE IN
QUESTION.

3.  PRICES; LIENS.  Prices for the Service are those shown on the face of this
acknowledgment, provided, however, that if such prices are based on the purchase
of a minimum quantity of Service and Customer fails to purchase such minimum
quantity, encoding.com has the right to collect from Customer the difference
between the price paid by Customer for the Service purchased and encoding.com's
standard price for such Service in quantity actually purchased by Customer.
encoding.com shall have a lien and security interest on tapes, CDs, files and
other property delivered by Customer to encoding.com and/or made by encoding.com
therefrom for the balance of any account due us by the Customer, including
collection and attorney's fees.  Customer hereby authorizes encoding.com to
execute and file, on Customer's behalf, a financing or other statement
evidencing this security interest.  When necessary, Customer agrees to execute
necessary documentation for perfecting such security interest.

4.  SHIPPING.  If encoding.com provides shipping and handling services for
Customer's materials, surcharges will apply.  Shipping and delivery dates are
approximate.  In no event, for any reason whether or not beyond encoding.com's
control, shall encoding.com be liable to Customer or any other party for any
losses, damages or liability for delay in delivery of shipped materials; nor
shall any delay in delivery of shipped materials constitute grounds for
cancellation of Customer's work order.

5.  DELIVERY.  The delivery dates set forth on this acknowledgment are
approximate only, and encoding.com is not liable for any damages to Customer,
nor shall encoding.com be in breach of its obligations to the Customer, because
of any delivery made within a reasonable time after the stated delivery date.
encoding.com may by written notice to Customer change any delivery date, and
such date shall become the agreed upon delivery date unless Customer objects to
such date in writing delivered to encoding.com within ten (10) days of receipt
of encoding.com's notice.  encoding.com shall not be liable for any late
delivery caused by the failure of the Customer to provide in a timely manner any
necessary information to affect such delivery.

6.  FORCE MAJEURE.  encoding.com is not liable for any failure to deliver, or
delay in the delivery of, any Service due to a cause beyond its control,
including but not limited to acts of God, fires, typhoons, earthquakes, labor
disputes, governmental actions or inability to obtain materials, components,
energy, encoding facilities, or transportation.  In the event of any such delay,
the data of delivery or performance hereunder shall be extended by a period
equal to the time lost by reason of such delay.  If encoding.com's production is
curtailed for any of the above reasons, encoding.com may allocate its production
among its various customers.  Such allocation shall be in a commercially fair
and reasonable manner.

7.  STORAGE. It is the Customer's responsibility to arrange for removal of
materials from encoding.com at the completion of each project.  At the
Customer's request, encoding.com will store tapes and Content for a maximum of
60 days.  encoding.com reserves the right to ship tapes and/or Content to the
Customer, freight collect, at the conclusion of the 60 day period or to charge a
storage fee or to otherwise dispose of the materials.

8.  RIGHT TO REFUSE SERVICE.  encoding.com reserves the right to refuse service
and/or process any Content which encoding.com, in its sole discretion, deems
unlawful, pornographic, degrading, likely to incite prejudice or passion or
otherwise inappropriate.

9.  CUSTOMER WARRANTIES.  Customer represents and warrants that (a) Customer has
sufficient rights in the Content to use it in the manner contemplated by this
acknowledgment, (b) the Content does not infringe upon or violate any patent,
copyright, trade secret, trademark or other intellectual property right of any
third party or any obscenity law or other applicable law, rule or regulation in
any jurisdiction in which the Content may be viewed or retrieved, (c)
encoding.com's 


[*] Confidential Treatment Request

Quotation valid through June 1999

 
E-Music.com                       6/30/99                 Confidential Quotation

 
provision of the Service and/or hosting of the Content hereunder
will not infringe upon or violate any patent, copyright, trade secret, trademark
or other intellectual property right of any third party, including but not
limited to any and all performance license rights, mechanical license rights,
synchronization license rights and rights under the Digital Performance Right in
Sound Recordings Act of 1995, or any obscenity law or other applicable law, rule
or regulation in any jurisdiction in which the Content can be viewed or
retrieved, and (d) the Content and encoding.com's provision of the Service on
behalf of Customer is not for any illegal, obscene, offensive or immoral
purpose.

10. ENCODING.COM LIMITED WARRANTY; LIMITED LIABILITY; EXCLUSION OF
CONSEQUENTIAL DAMAGES.  It is understood and agreed that the Customer's
materials are transported, received, processed, used and stored at Customer's
risk.  ENCODING.COM SHALL NOT BE LIABLE FOR ANY LOST PROFITS OR OTHER DAMAGES
CAUSED BY THE LOSS, DAMAGE OR DESTRUCTION OF MATERIALS BELONGING TO THE CUSTOMER
OR ANY OTHER PERSON WHILE IN TRANSIT OR POSSESSION OF ENCODING.COM UNLESS CAUSED
BY THE NEGLIGENCE OF ENCODING.COM IN WHICH EVENT, THE LIABILITY OF ENCODING.COM
SHALL BE LIMITED TO THE REPLACEMENT OF A SIMILAR QUANTITY OF BLANK TAPE OR
MAGNETIC OR OPTICAL MEDIA TO THE MATERIALS WHICH WERE LOST, DAMAGED OR
DESTROYED.  EXCEPT FOR SUCH REPLACEMENT, ENCODING.COM SHALL HAVE NO FURTHER
LIABILITY REGARDING THE LOSS, DAMAGE OR DESTRUCTION OF SUCH MATERIALS.
ENCODING.COM SHALL NOT BE LIABLE TO CUSTOMER OR ANY OTHER PERSON FOR ANY ACT OR
OMISSION OF ANY PERSON SELECTED BY ENCODING.COM TO PERFORM SERVICES OR FURNISH
MATERIALS TO CUSTOMER.  IF MATERIALS FURNISHED BY ENCODING.COM ARE FOUND TO BE
DEFECTIVE IN MANUFACTURE, ENCODING.COM SHALL REPLACE SUCH MATERIALS WITH A
SIMILAR QUANTITY OF BLANK TAPE, OR MAGNETIC OR OPTICAL MEDIA, PROVIDED THE
CUSTOMER NOTIFIES ENCODING.COM IN WRITING WITHIN THIRTY DAYS AFTER SHIPMENT OF
SUCH DEFECT.  EXCEPT FOR SUCH REPLACEMENT, ENCODING.COM SHALL HAVE NO FURTHER
LIABILITY IN CONNECTION WITH SUCH DEFECTIVE MATERIALS.  ENCODING.COM MAKES NO
WARRANTY, EXPRESSED OR IMPLIED WITH RESPECT TO THE MATERIALS OR SERVICES
PROVIDED IT ASSUMES NO RESPONSIBILITY FOR THE CHARACTER OR QUALITY OF MATERIALS
OR SERVICES PROVIDED BY IT.  ENCODING.COM EXPRESSLY DISCLAIMS ALL WARRANTIES
EXPRESSED OR IMPLIED, STATUTORY OR OTHERWISE, INCLUDING ANY IMPLIED WARRANTY OR
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. ALL WARRANTIES WITH RESPECT
TO THE SERVICE ARE STRICTLY LIMITED TO THOSE SET FORTH IN THIS ACKNOWLEDGMENT.
IN NO EVENT WILL ENCODING.COM BE LIABLE TO THE CUSTOMER FOR ANY CONSEQUENTIAL,
INDIRECT, SPECIAL, OR INCIDENTAL DAMAGES EVEN IF ENCODING.COM HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING THE FOREGOING, ENCODING.COM
MAKES NO REPRESENTATION OR WARRANTIES OF ANY TYPE WHATSOEVER REGARDING THE
HOSTING OF ANY CONTENT ON ITS NETWORK OR ANY SUBCONTRACTOR'S OR OTHER PARTY'S
NETWORK OR THE PERFORMANCE OR RELIABILITY OF ANY SUCH NETWORK, OR ANY CONNECTION
TO, TRANSMISSION OVER, RESULTS OF OR USE OF ANY NETWORK CONNECTION OR FACILITIES
PROVIDED (OR FAILED TO BE PROVIDED) UNDER THIS ACKNOWLEDGMENT AND ENCODING.COM
MAKES NO WARRANTY WHATSOEVER FOR PRODUCTS OR SERVICES NOT ACTUALLY PRODUCED OR
PROVIDED BY ENCODING.COM.

11. INDEMNIFICATION BY CUSTOMER.  Customer agrees to defend, protect, indemnify
and hold encoding.com harmless from and against all claims of any kind, whether
based in contract, in tort (including negligence or strict liability), or
resulting from (a) services provided by encoding.com on behalf of Customer
hereunder, except for any damages arising exclusively out of any material breach
of this acknowledgment by encoding.com, (b) any use by encoding.com of any data
or files provided by Customer to encoding.com under this acknowledgment, (c) any
breach by Customer of this acknowledgment, including without limitation any
failure by Customer to observe or satisfy any terms or conditions of this
acknowledgment, (d) any violation of any applicable federal, state or local laws
with regard to the transmission and use of information and content, including
laws related to privacy, publicity, the Communications Decency Act of 1996,
arising out of the Customer Content, (e) any infringement of any United States
or other patent, trademark, copyright, trade secret or other intellectual
property right, including but not limited to any and all performance license
rights, mechanical license rights, synchronization license rights and rights
under the Digital Performance Right in Sound Recordings Act of 1995, relating to
the Content supplied by Customer to encoding.com or the Services provided
hereunder, or (f) otherwise for any losses, expenses, damages and liabilities,
direct, indirect, special or consequential which may arise out of Customer's
use, distribution or sale of goods or services covered hereby except those
caused solely by the sole gross negligence of encoding.com.

12. ACKNOWLEDGMENT.  Customer acknowledges that encoding.com, in its sole
discretion, may subcontract all or part of the hosting services to be provided
hereunder.  CUSTOMER FURTHER ACKNOWLEDGES THAT ENCODING.COM WILL HAVE NO
LIABILITY FOR THE FAILURE OF ANY NETWORK OR SERVER IN CONNECTION WITH THE
HOSTING OF ANY CONTENT.

13. ORDER CANCELLATION.  If an order for the Service is canceled, Customer must
pay for orders scheduled for delivery or performance within ninety (90) days of
encoding.com's receipt of cancellation notice.

14. MISCELLANEOUS.  Any waiver by encoding.com of any default by the Customer
hereunder shall not be deemed to be a continuing waiver of such default or a
waiver of any other default or of any of the terms and conditions of this
acknowledgment.  The terms and conditions of this acknowledgment may not be
superseded, modified, or amended except in a writing stating that it is a
modification and signed by an authorized representative of each party hereto,
provided, however, that encoding.com may modify the specifications of the
Service provided hereunder if the modification does not change the form, fit or
function of the Service.  This acknowledgment (not including any of the terms
and conditions of the Customer's purchase order or any similar document issued
by Customer), constitutes the entire agreement between the Customer and
encoding.com with regard to the Service listed on the face of this
acknowledgment, and expressly supersedes and replaces any prior or
contemporaneous agreements, written or oral, relating to such goods or services.
This acknowledgment is governed by, construed and enforced in accordance with
the laws of the State of Washington, without regard to conflict of laws
provisions.  Both parties agree that any litigation or arbitration between the
parties shall take place in King County, Washington, and both parties waive any
objection to personal jurisdiction or venue in any forum located in that county.
In any suit or action brought to enforce any term, condition or covenant of this
acknowledgment or to recover damages arising from any breach of the
acknowledgment, the losing party shall pay the prevailing party's reasonable
attorneys' fees and all other costs and expenses which may be incurred by the
prevailing party in any suit, action or in any reviews or appeals therefrom.


ACKNOWLEDGED AND AGREED:

E-music.com


By:   /s/ Joseph Howell
   ------------------------------------ 
Its:  Chief Financial Officer


[*] Confidential Treatment Request

Quotation valid through June 1999


 
E-Music.com                      6/30/99                  Confidential Quotation

 
                   Rider to encoding.com Terms and Conditions


The following changes will be applied to the attached encoding.com Terms and
Conditions.

1.   Payment terms:

Insert:  EMusic agrees to pay encoding.com [*] of the total project costs in
advance as called out by the contract.  encoding.com will invoice EMusic for [*]
of the total amount of this project in the amount of [*] immediately net 0 and
an additional [*] on the last billing cycle of September.

During the first [*] of the project, encoding.com will invoice EMusic normally
outside of this [*] down payment.  EMusic will pay these invoices per the terms
of the agreement. During the second [*] of the project the down payment that was
made by EMusic will be applied to encoding.com invoices.

2.   Data Entry Rider:

The attached form outlines in detail the fields that need to be captured by
encoding.com in the data entry portion of the encoding process. The fields that
are called out are also defined so each item is clear for all data entry people
across all CDs in the project.

Also-The data fields that are called out in the attached sheet are different
than the ones that were called out in the original proposal. Some of these are
different because of differences in how we defined a parameter and others
because new requirements became available. As such the new pricing will be as
follows but WILL NOT affect the total value of the contract;

Old Pricing per CD:  [*] per CD for data entry.
New Pricing per CD:  [*] per CD for data entry.

Pricing is based on an estimate of a [*] increase in the amount of time needed
to capture the meta information currently requested and a mark up of the old
price of [*].

Encoding.com and EMusic will review these prices and structure every [*] as
appropriate to ensure that significant costs are not being endured in either
direction.

    /s/ Al David                                    June 30, 1999 
--------------------------------------------------------------------------------
Signature Al David--Sr. Director, Operations        Date
(Minister of the Digital Bit)

Accepted by encoding.com

    /s/ Todd Hinders                                June 30, 1999 
--------------------------------------------------------------------------------
Todd Hinders--Minister of Entertainment             Date:


[*] Confidential Treatment Request

Quotation valid through June 1999