DISTRIBUTION AND
CROSS PROMOTION AGREEMENT
This DISTRIBUTION AND CROSS PROMOTION AGREEMENT ("Agreement"), by and
between MICROSOFT CORPORATION ("Microsoft"), a Washington corporation with its
principal offices at One Microsoft Way, Redmond, WA 98052, WEBTV NETWORKS, INC.
("WebTV"), a California corporation and a wholly-owned subsidiary of the
Microsoft Corporation, 1250 Charleston Avenue, Mt. View, CA 94043, MSNBC
INTERACTIVE NEWS, L.L.C. ("MSNBC"), a Delaware limited liability company, with
its principal office at One Microsoft Way, Redmond, WA 98052-6399; and WEBMD,
INC. ("WebMD"), a Georgia corporation with its principal offices at 400 The
Lenox Building, 3399 Peachtree Road NE Atlanta, Georgia 30326 is made and
entered into as of the later of the two signature dates ("Execution Date")
below and shall be effective as of May 6, 1999 (the "Effective Date").
RECITALS
WHEREAS, WebMD owns and operates a network of sites on the World Wide
Web currently titled "WebMD," with a home page currently located at
http://www.webmd.com, which site is devoted to providing individuals,
healthcare providers, and others with a comprehensive range of
healthcare-related information and services;
WHEREAS, the WebMD Site is currently divided into a freely accessible
section aimed at individuals seeking healthcare information for themselves and
family members, and a subscription-based section containing healthcare
information and services targeted at physicians;
WHEREAS, Microsoft owns and operates a network of Web sites currently
titled "MSN," with a home page currently located at http://www.msn.com, which
network includes a variety of topic-specific offerings;
WHEREAS, the parties desire to develop a new topic-specific offering
for MSN, WebTV and MSNBC on health-related issues incorporating content from
the WebMD Consumer Site (as defined below);
WHEREAS, the parties further desire to provide various links between
pages located on the MSN, WebTV, and MSNBC health channels and other MSN,
WebTV, and MSNBC sites and pages, to pages located on the WebMD Site (including
without limitation the Medical Professionals Section (as defined below)), and
vice versa;
WHEREAS, the parties further desire to set forth the terms under which
Microsoft will sponsor a fixed number of membership subscriptions to the
Medical Professionals Section of the WebMD Site, and WebMD will share certain
revenues generated by the Medical Professionals Section of the WebMD Site; and
WHEREAS, the parties also desire to promote certain of each other's
products and services and a broad technology platform for providing healthcare
related information and services.
NOW, THEREFORE, in consideration of the mutual promises set forth
herein, the parties hereby agree as follows:
1. DEFINITIONS
1.1 "MSN HEALTH SECTION" shall mean internet web pages containing
health-related information and services for consumers which is to be located at
http://www.health.msn.com or such other similar or replacement universal
resource locator ("URL") which Microsoft may determine from time to time in its
sole discretion. The MSN Health Section may be titled the "MSN Health Channel"
or such other name as Microsoft may in its sole discretion determine.
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THE OMITTED PORTIONS.
1.2 "SPECIFICATIONS" shall mean the content specifications
("Content Specifications") and the technical specifications ("Technical
Specifications") for the Health Channel attached hereto as Exhibits A-1 and
A-2, respectively, and any modifications thereto that are made in accordance
with Section 2.1 below. With respect to the WebTV Health Channel and the MSNBC
Health Section, as discussed in Section 3.1 below, the Specifications shall
mean the relevant provisions of Exhibits A-1 and A-2 (as identified in Section
3.1), together with any other Specifications provided by WebTV and MSNBC,
respectively.
1.3 "NETWORK FRAMEWORK" shall mean the page formatting
requirements provided in the SDK, and the In Service Promotion Box, whether or
not included in such SDK. The Network Framework shall also include all
necessary coding for ad-serving, whether or not included in the SDK.
1.4 "MSN.COM SOFTWARE DEVELOPMENT KIT" OR "SDK" shall mean the
software development kit provided by Microsoft to WebMD and other licensed MSN
web site developers containing the Network Framework and other information and
materials necessary for WebMD and such other developers to distribute their
content within MSN, including all revisions, upgrades, updates, and new
versions of such SDK. This definition shall include similar SDKs provided by
WebTV and/or MSNBC for the WebTV Health Channel and MSNBC Health Section,
respectively, as discussed in Section 3.1 below.
1.5 "IN SERVICE PROMOTION BOX" shall mean the promotional box
featured on each page within MSN that contains a rotating promotional link to
other content within MSN. An example of the current In Service Promotion Box is
attached hereto as Exhibit B.
1.6 "USER INFORMATION" shall mean both Aggregate Information and
Personal Information pertaining to an end user ("User").
1.7 "AGGREGATE INFORMATION" shall mean information that describes
the habits, usage patterns and/or demographics of Users as a group but does not
indicate the identity of any particular User, and information about an
individual User presented in a form distinguishable from information relating
to other Users but not in a form that enables the recipient to personally
identify any User.
1.8 "PERSONAL INFORMATION" shall mean information about a User
permitting such User to be specifically identified and may include, but not be
limited to (i) User name, (ii) User email or postal address, and the (iii)
User's personally identifying transaction data. In no event, however, shall
Personal information include confidential health care information regulated by
federal or state law.
1.9 "MSN YELLOW PAGES" shall mean that section of the MSN Site
(currently contained within and served by MSN Sidewalk) that provides end users
with a directory listing of certain contact and business information (e.g.,
addresses, phone numbers) for certain companies, and professionals, including
without limitation physicians, pharmacies, nutrition centers, other healthcare
related businesses, etc.
1.10 "ADVERTISING" shall mean advertising, promotions,
sponsorships, ecommerce distribution opportunities and all other revenue
generating placements and services ("Advertising").
1.11 "MICROSOFT TECHNOLOGY PLATFORM" shall mean those Microsoft
technologies that are recommended pursuant to the MCS Agreement (as defined in
Section 4 below), which may include one or more of the following technologies:
Microsoft BackOffice and any of its components, Windows NT Server, SQL Server,
Commerce Server, Site Server, Microsoft Windows Media Player, Microsoft
Internet Explorer, MSN Messenger Service, Microsoft Outlook and Outlook Express
for an email client or other such appropriate Microsoft email technology
(except as prevented by existing contracts as of the Execution Date), including
any updates and upgrades thereto released during the term.
1.12 "MICROSOFT REVENUE" shall mean all recognized net revenue
(i.e., gross revenue less any direct product costs, as applicable) earned and
billed during the Term of this Agreement, (i) that is received by Microsoft
from (a) Advertising on the MSN Health Section including any and all localized
versions of the MSN Health
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THE OMITTED PORTIONS.
Section for which WebMD is providing a Localized Health Channel pursuant to
Section 2.3 below, (b) transactions or placements in the health shopping area
of MSN Shopping (based on the proportion of traffic coming from the MSN Health
Section) and (c) Advertising placed/sold by Microsoft on the WebMD Site as
provided in this Agreement; (ii) that is received by MSNBC from Advertising on
the MSNBC Health Section including any and all localized versions of the MSNBC
for which WebMD is providing localized healthcare related information for
consumers pursuant to Section 2.3 below; and (iii) that is received by WebTV
from Advertising on a WebTV Health Channel. In the case of contracts that
include elements outside the MSN Health Section, MSNBC Health Section, and/or
WebTV Health Channel, Microsoft Revenue shall include the share of revenue
received by Microsoft that is attributable to the relevant MSN Health Section,
MSNBC Health Section, and/or WebTV Health Channel.
1.13 "WEBMD CONSUMER SITE" shall mean that part of the WebMD Web
site currently located at the URL http://www.webmd.com or any successor site(s)
thereof which is directed at a consumer market.
1.14 "WEBMD SITE" shall mean the WebMD Web site currently located
at the URL http://www.webmd.com or any successor site(s) thereof, including but
not limited to the WebMD Consumer Site, the Medical Professionals Section, any
and all Localized WebMD Sites (as defined in Section 2.3(c)(ii) below).
1.15 "MEDICAL PROFESSIONALS SECTION" shall mean that part of the
WebMD Site currently located at the URL http://www.webmd.com or any successor
site(s) thereof that targets medical professionals, including without
limitation the Non-Health Related Section and the Health Related Section. As of
the Effective Date, the Medical Professionals Section targets medical
physicians, but the Medical Professionals Section shall also include comparable
WebMD Site pages targeted at other specific sectors of the professional medical
community (e.g., nurses, dentists).
1.16 "MSN SITE" shall mean all web sites in the msn.com domain.
1.17 "HOUSE ADVERTISING INVENTORY" shall mean the specific amount
of regular advertising inventory on the MSN Site, or on the Link Exchange
network of sites, for which Microsoft owns or controls the advertising
inventory, that is specifically set aside by Microsoft to promote
topic-specific areas and other features of the MSN Site, and all inventory
specially created for this purpose. For example, as of the Effective Date,
House Advertising Inventory includes the In Service Promotion Box, blue banner
at the top of the MSN Site home page, and the "Today on MSN" module. As of the
Effective Date, Microsoft estimates that House Advertising Inventory comprises
approximately 10% of the total advertising inventory on the MSN Site and on the
Link Exchange network of sites, for which Microsoft owns or controls the
advertising inventory. The parties acknowledge and agree, however, that such
percentage may increase or decrease during the Term of this Agreement, and that
Microsoft is not bound to maintain the House Advertising Inventory at any
particular percentage of the total advertising inventory.
1.18 "NON-HEALTH RELATED SECTION" shall mean that part(s) of the
Medical Professionals Section designed to present to End User Members offers,
services and information, currently of a non-health-related type, which part
(a) is currently called "My Desk" and previously was called "the Lounge," but
may be called by other names during the course of this Agreement, and (b) may
include multiple parts of the Medical Professionals Section without limitation.
1.19 "HEALTH RELATED SECTION" shall mean that part(s) of the
Medical Professionals Section designed to present to End User Members
health-related resource and reference materials, offers, services and
information, which part (a) is currently called the "Health Related Section,"
but may be called by other names during the course of this Agreement, and (b)
may include multiple parts of the Medical Professionals Section without
limitation.
1.20 "HEALTH CHANNEL" shall mean internet web pages containing
health-related information and services for consumers, which Health Channel is
to be developed and managed between the parties pursuant to the terms of this
Agreement, and shall at all times during the Term provide the content for
approximately eighty percent (80%) of the sections on the MSN Health Section,
subject to the following: such percentage may be increased at any time by
Microsoft in its sole discretion but may only be decreased by mutual agreement
of the parties. International versions of the Health Channel that are
authorized under Section 2.3 of this Agreement may appear
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THE OMITTED PORTIONS.
within different URLs and names than those contained in the definition of the
MSN Health Section, as determined by Microsoft in its sole discretion.
1.21 "YEAR" shall mean a twelve month period. For purposes of this
Agreement, Year 1 shall mean the twelve month period commencing on the
Effective Date, Year 2 shall mean the twelve month period commencing on the
first year anniversary of the Effective Date, Year 3 shall mean the twelve
month period commencing on the second anniversary of the Effective Date, and so
on.
1.22 "WEBMD BASIC MEMBERSHIPS" means any subscription entered into
by a registered End User Member to access the Medical Professionals Section.
The term "WebMD Basic Memberships" does not include any subscription offerings
that do not include access to the Medical Professionals Section.
1.23 "WEBMD MEMBERSHIP MONTH" means one month of a WebMD Basic
Membership entered into by an End User Member.
1.24 "MICROSOFT-SPONSORED WEBMD MEMBERSHIPS" means each WebMD
Membership Month that Microsoft sponsors pursuant to the terms of this
Agreement. Microsoft-sponsored WebMD Memberships shall not include any WebMD
Membership Months under a WebMD Membership that has been cancelled, terminated,
or remained inactive during any four months period of the membership.
1.25 "BASE MEMBERSHIP FEE" shall mean the lesser of (i) $29.95 per
month or (ii) the lowest rate that WebMD offers WebMD Memberships to any other
third party (including without limitation to other third party sponsors) during
the Term of this Agreement.
1.26 "END USER MEMBERS" means end users who access the Medical
Professionals Section of the WebMD Site.
1.27 "WEBMD ADVERTISING/SPONSORSHIP REVENUES" means all recognized
revenue earned and billed during the Term of this Agreement that is received by
WebMD from advertising, promotions, sponsorships and any other
revenue-generating placements or services, excluding Upsell Revenues and
excluding E-Commerce Revenues, on the Medical Professionals Section of the
WebMD Site and on any third party branded and/or co-branded versions of the
Medical Professionals Section or any successor site(s).
1.28 "WEBMD UPSELL REVENUES" means all recognized net revenue
(i.e., gross revenue less any direct product costs other than costs of
distribution) earned and billed during the Term of this Agreement, excluding
E-Commerce Revenue, (a) that is received by WebMD from the sale of WebMD Basic
Memberships for the Medical Professionals Section of the WebMD Site and for any
third party branded and/or co-branded versions of the Medical Professionals
Section or any successor site(s), excluding the Base Membership Fee, and (b)
that is received by WebMD from the sale of WebMD offerings or WebMD services
that are not provided as part of the WebMD Basic Membership such as for
example, WebMD OnCall, Virtual Receptionist Minutes, Transcription Services,
and any other value-added services excluded from the WebMD Basic Membership for
the Medical Professionals Section of the WebMD Site and for any third party
branded and/or co-branded versions of the Medical Professionals Section or any
successor site(s).
1.29 "WEBMD E-COMMERCE REVENUES" means all recognized net revenue
(i.e., gross revenue less any direct product costs other than costs of
distribution) earned and billed during the Term of this Agreement that is
received by WebMD from electronic commerce distribution opportunities and
electronic commerce service offerings on the Medical Professionals Section of
the WebMD Site and on any third party branded and/or co-branded versions of the
Medical Professionals Section or any successor site(s). WebMD E-Commerce
Revenues include, without limitation, revenues generated from EDI transactions,
communication of lab results, medical records, and clinical reports, as well as
sales of medical supplies, pharmaceuticals and nutraceuticals.
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THE OMITTED PORTIONS.
2. HEALTH CHANNEL REQUIREMENTS AND RELATIONSHIP WITH MSN HEALTH SECTION
2.1 DEVELOPMENT AND MAINTENANCE. WebMD shall develop, maintain,
and host the Health Channel and the home page of the MSN Health Section in
accordance with this Section 2 and the Specifications. Further, WebMD's
development, maintenance, hosting, servicing, support and all other activities
with respect to the Health Channel (including without limitation those versions
of the Health Channel provided to WebTV and MSNBC) and the home page of the MSN
Health Section, and the content, materials, features, technology or services
included therein or associated therewith, shall at all times be equal or
superior to that (a) of the WebMD Site, (b) to that received from WebMD by
other WebMD co-branded channels, and (c) to that received by any third party to
whom WebMD provides similar content, materials, features, technology or
services.
(A) LAUNCH. The parties agree to cooperate in good faith
to create a "transition page" that will be available within
forty-eight (48) hours following the Effective Date so that users may
access the WebMD Site from the MSN Site. WebMD agrees to launch (i.e.
make available to the public) the Health Channel no later than the
earlier of July 1, 1999 or the launch of any other health-related
content, features or services on behalf of any third party (except
content provided to Lycos pursuant to a contract in effect as of the
Execution Date), and that upon such launch each page in the first two
levels of the Health Channel shall incorporate the Network Frameworks
in accordance with the Technical Specifications. WebMD further agrees
that within seventy five (75) days following the Effective Date and
thereafter during the Term of this Agreement, all pages on all levels
within the Health Channel shall incorporate the Network Frameworks in
accordance with the Technical Specifications and shall otherwise
comply with the Specifications.
(B) MODIFYING THE SPECIFICATIONS. The Content
Specifications may be modified by mutual agreement of the parties,
which agreement shall not be unreasonably withheld by any party. WebMD
shall implement any such modifications pursuant to a schedule agreed
upon by the parties. The parties agree to review the Content
Specifications at least quarterly to assess the quality and
competitiveness of and overall strategy for the Health Channel. The
first such review shall occur within thirty (30) days following the
Effective Date. The Technical Specifications may be modified pursuant
to Exhibit A-2 and otherwise by mutual agreement of the parties, which
agreement shall not be unreasonably withheld by any party.
(C) MICROSOFT OVERSIGHT AND CONTENT.
(I) Microsoft has the right, in its sole
discretion, to require WebMD to remove content from the
Health Channel. In the event that Microsoft determines in its
sole discretion that the presence of certain content on the
Health Channel poses an immediate concern, WebMD shall remove
such content within twenty-four hours of Microsoft's written
request. Where Microsoft does not consider content to pose an
immediate concern, but nonetheless determines, in its sole
discretion, that content should be removed, WebMD shall
remove such content within such longer period of time as
Microsoft reasonably determines is appropriate.
(II) Microsoft may request that WebMD cover certain
topics, content, features, events or other areas or material
on the Health Channel. If Microsoft makes such a request in
writing, WebMD shall respond within ten (10) business days
whether WebMD desires to provide such content, features,
events or other areas or material. If WebMD agrees to provide
such topics, content, features, events or other areas or
material, WebMD shall incorporate such topics, content,
features, events or other areas or material into the Health
Channel as soon as commercially reasonable following such
agreement but in no event within more than forty-five (45)
days from the time it agrees to provide such topics, content,
features, events or other areas or material. If WebMD
declines to provide the topics, content, features, events or
other areas or material or fails to provide it within the
requisite amount of time, then Microsoft shall be free to
provide the topics, content, features, events or other areas
or material (either directly or through a third party), and
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WebMD shall cooperate with Microsoft to incorporate such
topics, content, features, events or other areas or material
into the Health Channel within ten (10) business days of
Microsoft's providing the topics, content, features, events
or other areas or material to WebMD for incorporation or such
other reasonable period of time as the parties mutually
agree. In addition to the foregoing, WebMD shall incorporate
any legal or other notices onto the Health Channel that
Microsoft in its sole discretion considers necessary, within
twenty-four (24) hours of Microsoft's written request. The
parties shall meet on a regular basis, but in no event less
frequently than once each calendar quarter to discuss the
Health Channel and the WebMD Site, provided that the first
such meeting shall take place no later than twenty (20)
business days from the Execution Date, and further provided
that in addition to any other obligations it has to
Microsoft, WebMD shall use reasonable efforts to incorporate
into the Health Channel any topics, content, features, events
or other areas or material etc. that Microsoft suggests
during such meetings according to the same schedule as is set
forth above in this Section.
(III) Recognizing the importance of maintaining the
strength, market presence, integrity and positive user
experience of the Health Channel, WebMD will consult with
Microsoft before removing or modifying any material topics,
content, features, events or other areas or material on the
Health Channel.
(IV) Further, subject to the terms of this
Agreement, including but not limited to this Section 2.1 and
the Dispute Mechanism set out in Exhibit A-1(2), if WebMD has
included a section for a particular topic as part of the
Health Channel, then Microsoft shall not include a section
covering the same topic in the non-Health Channel portion of
the MSN Health Section. In addition, if Microsoft has
included a section for a particular topic in the non-Health
Channel portion of the MSN Health Section then, subject to
any contracts in existence between Microsoft and any third
party concerning the provision of such section or any part
thereof, in the event that WebMD later proposes providing a
section for such topic as part of the Health Channel,
Microsoft and WebMD shall use commercially reasonable efforts
to combine Microsoft's existing section and WebMD's proposed
section so that they are offered as one, or alternatively if
mutually agreed between the parties replace Microsoft's
section with WebMD's section. Finally, at Microsoft's request
and discretion, WebMD may provide content, features,
technology, or services, etc. to Microsoft for inclusion in
the non-Health Channel Section of the MSN Health Section in a
way that distinguishes it from those included in the Health
Channel.
(D) ADVERTISING/REVENUE GENERATION SPACE. The Health
Channel shall include Advertising space as specified in the
Specifications and/or Network Frameworks. In addition, WebMD shall
accommodate all requests from Microsoft for additional Advertising
space on the Health Channel to support the goal of revenue
maximization, and shall implement such requests as soon as reasonable.
(E) MSNBC CONTENT. WebMD shall include that health news
and editorial that is provided to WebMD by MSNBC, on all versions of
the Health Channel. Unless otherwise specified by MSNBC and Microsoft,
MSNBC shall be the sole provider of health news and editorial that is
provided on the Health Channel.
2.2 BRANDING. The Health Channel shall include a joint credit
immediately below the Network Framework header but otherwise at the top of the
page, on all Web pages included within the Health Channel, which credit shall
read Health Channel "by WebMD" or such other word or words as are mutually
approved by the parties, and shall be at least as prominent as the Microsoft
branding appearing in the Network Framework header. All use of Microsoft's
names, brands (including without limitation MSN) or logo(s) as may be
authorized by Microsoft under this Agreement shall be in accordance with the
trademark License granted in Section 11 of this Agreement and/or the Logo
Guidelines (attached as Exhibit D), as appropriate.
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2.3 INTERNATIONAL DISTRIBUTION OF THE HEALTH CHANNEL.
(A) NEW MARKETS PROVIDED BY WEBMD.
(I) In the event that WebMD seeks to create
localized health-related content for consumers, for a topic
specific, front page offering on local MSN portals
("Localized Health Channel") in a given market, WebMD shall
submit written notice ("New Market Notice") of same to the
appropriate Microsoft contact, as designated by Microsoft,
which New Market Notice shall include a detailed description
of WebMD's plans for such market. The market identified in
such WebMD notice shall be deemed a "Targeted Market."
Microsoft agrees that, subject to (A) the terms of contracts
existing as of the Execution Date, (B) the provisions of this
Section 2.3, and/or (C) a determination by Microsoft that the
proposal described in the New Market Notice is not
commercially reasonable for the given market (but in no
event, however, shall Microsoft's determination be based on
whether Microsoft could obtain greater consideration from a
party other than WebMD for a localized health channel, and
further in no event shall Microsoft require WebMD to make any
additional payments with regard to providing a Localized
Health Channel for such Targeted Market), WebMD will become
the provider of a Localized Health Channel on the MSN portal
for such Targeted Market. Subject to and not including any
content provided under the terms of any contracts existing as
of the date of the New Market Notice, the Localized Health
Channel shall at all times provide the content for
approximately eighty percent (80%) of the sections on any
localized MSN Health Section for a Targeted Market provided
that such percentage may be increased at any time by
Microsoft in its sole discretion but may only be decreased by
mutual agreement of the parties. Microsoft shall notify WebMD
within ten (10) business days of the New Market Notice if
WebMD's proposal is rejected. WebMD shall only submit New
Market Notices within sixty (60) days of the Effective Date
or during the first week of any calendar quarter during the
Term, provided that WebMD may not submit any New Market
Notices during the last six months of the Term.
(II) Once approved, if WebMD fails to make the
localized content for any Targeted Market available for
incorporation onto the relevant MSN portal within a
reasonable period of time following but in no event more than
six months of the New Market Notice (which deadline may be
extended by mutual agreement of the parties), such Targeted
Market shall be removed from the Targeted Market list, the
foregoing restriction in sub-Section 2.3(a)(i) above on
Microsoft shall no longer apply and WebMD may not deliver
another New Market Notice with respect to such market.
(III) For all intents and purposes under this
Agreement, any Localized Health Channels provided by WebMD
hereunder shall be deemed included in the definition of and
considered part of the Health Channel under this Agreement,
and the parties rights and obligations with respect to such
Localized Health Channels shall be the same as they are with
regard to the Health Channel, provided that Sections 3.6,
3.7, and 3.8 of this Agreement shall only apply with regard
to Localized Health Channels if and when a localized version
of the relevant Microsoft technology or property is
available, and if the criteria set forth in the relevant
sections are satisfied.
(B) RIGHT OF FIRST REFUSAL. Subject to the terms of
contracts existing as of the Execution Date, in the event that (i)
Microsoft desires to create a Localized Health Channel as part of a
localized MSN Health Section for a particular market, other than a
current Targeted Market; or (ii) a third party offers Microsoft the
opportunity to obtain a Localized Health Channel in a market other
than a current Targeted Market; then Microsoft will so notify WebMD in
writing ("MS Market Notice") and provide WebMD with the opportunity to
provide such Localized Health Channel (on at least the same terms and
conditions as offered by the third party for category (ii)). WebMD
will respond affirmatively or negatively to such MS Market Notice
within ten (10) business days of receipt thereof. If WebMD agrees to
provide such content, then (x) WebMD shall make such localized content
available for incorporation as a Localized Health Channel onto the
relevant MSN portal within the time frame set forth in the MS Market
Notice, but not less than forty-five (45) days from the date of the MS
Market Notice and (y) subject to contracts
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existing as of the Effective Date, the Localized Health Channel shall
at all times provide the content for approximately eighty percent
(80%) of the sections on any localized MSN Health Section, provided
that such percentage may be increased at any time by Microsoft in its
sole discretion but may only be decreased by mutual agreement of the
parties. If WebMD declines an opportunity to provide localized content
under this Section 2.3(b) or fails to provide it within the time frame
set forth in the MS Market Notice, then Microsoft may itself or
through third parties develop such a Localized Health Channel for the
MSN portal in the relevant market ("MS Market"), in which case WebMD
may not deliver a New Market Notice with respect to such market and
Microsoft is not required to provide any further MS Market Notice with
respect to such Market. Notwithstanding the foregoing, the definition
of "Microsoft Revenues" shall be extended to include corresponding
revenues derived from such Localized Health Channel.
(C) INTERNATIONAL BUSINESS DEVELOPMENT AND LOCALIZATION
SUPPORT.
(I) Microsoft agrees to use reasonable efforts to
support WebMD's expansion of its online services into
international markets by providing consultation within the
market and making introductions within the market to local
contacts where relevant. Further, Microsoft will assign a
business development manager located in mutually agreed upon
markets to have, at a minimum, quarterly meetings in the
market with WebMD personnel, to provide to WebMD certain
standard reports developed by Microsoft regarding the market
and the local MSN portal (which reports shall be treated as
Microsoft or WebMD Confidential Information, as appropriate,
in accordance with Section 10 below), and to make
introductions to local contacts in particular markets where
Microsoft has such contacts.
(II) Microsoft agrees to use reasonable efforts to
support WebMD's expansion of its online services into
international markets ("Localized WebMD Sites") by providing
reasonable consultation on localization strategy and
techniques to the level that Microsoft reasonably believes is
reasonably necessary for WebMD to reasonably make available
to end users localized language sites in Germany, France, the
United Kingdom and Switzerland by the one (1) year
anniversary of the Effective Date; provided that Microsoft
shall in no way be responsible for WebMD's failure to make
such sites available within the specified time.
(D) NON-LOCALIZED INTERNATIONAL CONTENT. Microsoft will
work with WebMD during the first 30 days following the Effective Date
to discuss opportunities for offering worldwide non-localized Health
Channel content as part of a potential international front page
offering on the topic of health on existing international MSN portals
("Worldwide Non-Local Offering"), as relevant and appropriate, and
subject to the approval of the local portal programming managers which
such approval shall not be unreasonably withheld. Any such
international health topic area shall be non-exclusive and shall not
be considered part of the Health Channel for the purposes of this
Agreement, nor will the markets in which it may be offered be deemed a
Targeted Market. The definition of "Microsoft Revenue" shall be
extended to include corresponding revenues derived from such Worldwide
Non-Local Offering. Without limiting the non-exclusivity with respect
to any specific market described above, provided that the parties are
offering a Worldwide Non-Local Offering under this Section within one
hundred eighty (180) days of the Execution Date, then, subject to any
agreements in effect as of the Execution Date, Microsoft shall not
enter into any other agreements with third parties for a Worldwide
Non-Local Offering.
(E) INTEGRATION. WebMD acknowledges that the international
MSN Web Sites are run on different platforms and with different tools
than the United States version. When WebMD does create a Localized
Health Channel and/or Worldwide Non-local Offering for a given market
in accordance with this Section 2.3, such content shall be integrated
into the local MSN portal in accordance with the requirements for the
local MSN portal.
(F) CHANNEL PROMOTION. In the event that WebMD creates
Localized Health Channels pursuant to this Section 2.3, Microsoft
agrees to promote such Channels in the same manner as it promotes
other front page links on the relevant local MSN portal, and WebMD
agrees to promote the Localized Health Channel on its localized WebMD
Consumer Site in the relevant market in the same fashion as it
promotes the Health Channel on the WebMD Consumer Site in the United
States. In addition, Microsoft
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shall promote health-related Web events in each Localized Health
Channel to the extent and a number of times, if at all, that Microsoft
reasonably determines are appropriate for each market. The content of
such health-related Web events shall be provided by WebMD and subject
to Microsoft's approval, in its sole discretion.
(G) EXPRESSLY EXCLUDED MARKETS. Notwithstanding any other
provision in this Agreement, in no event shall any rights or
obligations under this Agreement apply to Australia, New Zealand, or
Papua New Guinea.
2.4 INTEGRATION/CROSS PROMOTION/ADVERTISING REQUIREMENTS.
(A) STANDARD INTEGRATION INTO MSN AND BASIC PROMOTION.
Microsoft shall offer the MSN Health Section as a front page link on
the MSN.com home page. As a front page link, the MSN Health Section
will be promoted on the MSN Site in a manner equivalent to all other
major topic specific offerings. This promotion may include without
limitation, for as long as any front page link receives such
promotion:
(I) providing a front page link to the MSN Health
Section on the MSN.com home page.
(II) displaying the MSN Health Section at the bottom
of Network Framework as one of the MSN services, for as long
as such listings include all front page links in the Network
Framework.
(III) receiving general cross-linking across the MSN
Health Section (including the Health Channel pages on a
pro-rata basis with all other pages in the MSN Health
Section) and other MSN front page links.
(IV) the Health Channel receiving an average of 2%
of the House Advertising Inventory in (with the specific type
of inventory to be in Microsoft's discretion), which shall in
all cases include no less than 125,000,000 impressions per
year, together with equal opportunity for the Health Channel
to participate in other advertising elements in the House
Advertising Inventory that are provided to all other front
page links, subject to Microsoft's standard selection
processes. WebMD will present to Microsoft (a) WebMD's
proposed advertisements to be placed in the Health Channel's
portion of the House Advertising Inventory specified herein,
and (b) WebMD's proposed promotional priorities for the
Health Channel and WebMD's proposed specific wording for such
promotions. Notwithstanding the foregoing, Microsoft reserves
final editorial discretion and approval over the
advertisements and promotions for the Health Channel
including those placed under this sub-Section (iv).
(V) equal opportunity for the MSN Health Section to
participate in all limited-time editorial packages on the MSN
Site offered to other front page links. From time to time,
Microsoft shall develop a certain topical theme ("Editorial
Package") such as, by way of an example, "Technology,"
"Holiday," "Resolutions 99," and "Love Month," during which
time WebMD shall be given the opportunity to submit Health
Channel content relevant to the Editorial Package. Should
Microsoft, at its discretion, decide to accept the submitted
Health Channel content with the Editorial Package, it will
promote the Health Channel's content associated with the
Editorial Package.
(VI) inclusion of a MSN Health Section content
module as a personalization option on the "personalize page"
in the current version of MSN, for so long as such feature
exists and beginning when Microsoft next has a reasonable
opportunity to modify the personalization platform in such
fashion in its sole discretion.
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(VII) in the next version of MSN Search, prioritized
inclusion of promotion and links to the MSN Health Section in
health-related searches, to the extent other front page links
are offered such prioritization.
(B) ADDITIONAL PROMOTIONAL PROGRAMS. In addition to the
basic promotion described above, Microsoft shall provide the Health
Channel with the following additional promotional opportunities:
(I) ADDITIONAL ADVERTISING INVENTORY. Microsoft
agrees to provide the Health Channel with an additional
average of 2% of the House Advertising Inventory (for a total
of at least an average of 4%) (with the specific type of
inventory to be in Microsoft's discretion), which shall in
all cases include no less than 125,000,000 impressions per
year. WebMD will present to Microsoft WebMD's proposed
advertisements to be placed in the Health Channel's portion
of the House Advertising Inventory specified herein.
Notwithstanding the foregoing, Microsoft reserves final
editorial discretion and approval over the advertisements for
the Health Channel including those placed under this
sub-Section (i).
(II) PROMOTION OF HEALTH RELATED WEB EVENTS.
Microsoft agrees to promote to users of Windows Media Player
at least one Health Channel-related Web event per month
during the Term of this Agreement through the MSN Web Events
front page link and across other MSN front page links, for as
long as a MSN Web Events front page link exists. The amount
and nature of such promotion shall be at Microsoft's
discretion.
(III) ADDITIONAL INTEGRATION WITH OTHER MSN
CHANNELS. Microsoft will endeavor to provide the Health
Channel with specific distribution opportunities with certain
MSN channels such as, by way of example, "Women Central,"
"Travel," and "Sports." The final nature of such distribution
opportunities for the Health Channel, if at all, will be
subject to discussion and final approval of Microsoft.
(IV) SHOPPING AREA FOR HEALTH CHANNEL. Microsoft
agrees to provide a link from the health shopping area of the
MSN Shopping area to the MSN Health Section.
(C) RELATIONSHIP OF HEALTH CHANNEL TO OTHER PARTS OF THE
MSN HEALTH SECTION. For purposes of this Section 2.4, the Health
Channel shall be treated equal to or better than any other third
party, non-Microsoft affiliate, provider of content for the MSN Health
Section.
(D) MICROSOFT'S ADVERTISING ON THE WEBMD SITE. WebMD shall
provide Microsoft with access to sufficient Advertising space on the
WebMD Site as is commercially reasonably necessary to permit Microsoft
to meet each of its Guarantees (e.g., First Year Guarantee, Section
Year Guarantee, Third Year Guarantee, etc.) as set forth in Section
12.2 below and the unlimited right to place Advertising in such
Advertising space on the WebMD Site. During the thirty (30) days
following the Execution Date the parties shall mutually agree on how
to manage the available Advertising inventory on the WebMD Site and on
the rates for such space, which rates shall be commercially
reasonable. Microsoft will not be permitted to make placements of
health care related Advertising on the WebMD Site without WebMD's
express approval. All revenue generated from such placements shall be
considered Microsoft Revenue. WebMD shall at a minimum include an
amount of Advertising space on the WebMD Site that is equal to or
greater than that provided on the Health Channel and shall accommodate
all requests from Microsoft for additional Advertising space on the
WebMD Site. Notwithstanding the foregoing, in no event shall WebMD be
required to create new categories of Advertising space under this
Section.
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2.5 RESTRICTIONS.
(A) ON WEBMD. WebMD agrees not to provide any health-
related content, features, services, technology, etc. to * or any *
affiliated companies, including without limitation * or *, for
distribution on the Internet, without Microsoft's prior written
consent, except that WebMD may, pursuant to an agreement in effect
between WebMD and * as of the Execution Date, provide up to three page
levels of co-branded, health-related content to * for distribution on
the Internet. Further, in the event that WebMD enters into an agreement
with any other third party to provide health-related content for
distribution on the Internet, WebMD agrees to provide Microsoft with
thirty (30) days prior written notice before the launch of such
health-related content on the Internet, and WebMD shall not offer such
third parties health-related content that has not also been previously
or concurrently made available to the Health Channel.
(B) ON MICROSOFT. Microsoft agrees that, except with
regard to content provided by MSNBC and content provided by Microsoft
or third parties pursuant to this Agreement, including Sections 2.1
and 2.3 above and Sections 3.3 and 3.5 below, WebMD shall be the sole
provider of health-related information on the Health Channel.
2.6 USER INFORMATION.
(A) OWNERSHIP/USE. Microsoft and WebMD shall jointly own
any and all User Information (i) collected by WEBMD from Users of the
Health Channel as well as Users of the WebMD Consumer Site whose use
of the WebMD Site originated on the Health Channel or any MSN Site,
(ii) relating to End User Members with Microsoft-sponsored WebMD
Memberships, and (iii) relating to End User Members who receive WebMD
Memberships through Microsoft or Microsoft distribution partners, and
WebMD shall provide such User Information to Microsoft on a monthly
basis in such format as reasonably requested by Microsoft. Likewise,
Microsoft shall provide any User Information it collects on the Health
Channel to WebMD on a monthly basis in such format as is reasonably
requested by WebMD. WebMD may use the User Information during the Term
of this Agreement solely for the purpose of fulfilling the product or
service for which the information was collected, provided, however,
that such information shall be treated in the same fashion as
Confidential Information pursuant to Section 10 below and
specifically, without limitation, shall not be provided to any third
party nor used on behalf of any third party, including but not limited
to, for promoting or advertising any third party, without Microsoft's
prior written consent. Notwithstanding the foregoing, Microsoft hereby
approves WebMD using and providing to third parties Aggregate
Information to be used in research projects. Any other use of the User
Information during the Term by WebMD shall be by mutual agreement of
the parties. Upon termination of this Agreement, each party may retain
the User Information collected pursuant to this Agreement and no party
shall restrict the other's use in any way and WebMD shall provide to
Microsoft all User Information pertaining to the MSN Users of the
WebMD Health Communities (as defined in Section 3.7 below), provided
that WebMD may not provide such User Information to any third party
nor use such User Information on behalf of any third party, including
but not limited to, for promoting or advertising any third party,
without Microsoft's prior written consent. For the avoidance of doubt,
except where the parties jointly use the User Information, each party
shall be responsible for ensuring that its own use of the User
Information complies with all User consent requirements, including but
not limited to as provided in Section 2.6(b) below.
(B) CONSENT. In addition to the foregoing, any collection,
disclosure or use of Personal Information by WebMD shall be subject to
the Users' consent, and the business practices and User privacy
policies of the site from which it is collected (e.g., the Health
Channel, an MSN Site, WebMD Consumer Site or Medical Professionals
Section). The business practices and policies of each such site shall
permit, as their default, WebMD to grant Microsoft the rights required
by this Section 2.6, unless the User specifically requests otherwise,
and in all cases shall comply with any applicable laws governing the
collection, dissemination and use thereof. "Consent" as used in this
Agreement shall mean the approval of an adult, and in the case of
minor children, the approval of the child's parent or legal guardian.
WebMD and Microsoft shall mutually agree on the Health Channel user
interface for the collection of Personal Information. Microsoft shall
determine the privacy policy for the Health Channel.
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3. OTHER MICROSOFT RELATED PROPERTIES
3.1 WEBTV/MSNBC.
(A) WEBTV
(I) WEBTV HEALTH CHANNEL. WebMD shall develop,
maintain, and host the health channel for WebTV ("WebTV
Health Channel"). Subject to any inconsistencies with the
provisions of this Section 3.1(a) (in which case the terms of
this Section 3.1(a) shall control) and subject to agreements
in effect as of the Execution Date, the following Sections of
this Agreement shall apply to WebTV and WebMD with regard to
such WebTV Health Channel: Sections 2.1, 2.6, 3.5, 9, 10,
11.1(c)-(d), 11.2(a)-(b), 12.9, 13, 14.6, 15, 16, 18, Exhibit
A-1 paragraphs (A)(3)-(5) and (C), and Exhibit A-2.
(II) WEBTV. As part of meeting their obligations
under Section 3.1(a) above, WebMD and WebTV shall meet during
the first ninety days after the Effective Date ("WebTV
Exploratory Period") to discuss in good faith the specific
processes and requirements for development, maintenance, and
hosting by WebMD of a WebTV Health Channel. If the parties
fail to come to agreement during the WebTV Exploratory
Period, then no party shall have any further obligation to
the other with regard to a WebTV Health Channel.
(III) MINIMUM CONTENT REQUIREMENTS. If WebMD creates
a WebTV Health Channel by agreement with WebTV pursuant to
Section 3.1(a)(i) and (ii) above, all content, materials,
features, technology, services, etc. included by WebMD within
the WebTV Health Channel (a) shall be the sole responsibility
of WebMD and shall be developed and maintained in accordance
with Section B of Exhibit A-1, (b) shall be relevant to the
topic and particular section of the WebTV Health Channel in
which they are included, (c) shall be of high quality in all
ways, including with respect to editorial content and volume,
as determined by comparison to other sources of similar
information available on the Internet and in no event shall
the WebTV Health Channel contain a smaller volume of pages as
the WebMD Consumer Site or Health Channel contains, unless
approved or requested byWebTV, (d) shall be comparable or
superior to the health related content available on the top
five (5) ranked (by Media Metrix or such other industry
standard as is available for the platform provided by WebTV)
Internet portal/network sites available on the platform
provided by WebTV with respect to at a minimum the following
factors: (i) substance, quality, volume, (ii) breadth and
depth of content, (iii) tools and functionality, (iv)
personalization, (v) appeal and ease of use of user
interface, (e) shall be regularly updated by WebMD so as to
meet the requirements of sub-sections (b), (c) and (d) above
and end-users preferences, and (f) subject to the foregoing
requirements in (a)-(e), shall be the same or substantially
similar as (i.e., in substance, a mirror of) the materials
available to end users accessing the WebMD Consumer Site at
any time during the Term of this Agreement. With respect to
this subsection 3.1(a), WebTV shall have the right and
obligation to invoke the Dispute Mechanism set forth in
Exhibit A-1(2).
(B) MSNBC
(I) MSNBC HEALTH CHANNEL. MSNBC shall develop,
maintain, host and--except as specifically set out in this
Agreement--in all ways have sole discretion and control over
all aspects of that section of the MSNBC Web site (currently
located at http://www.msnbc.com or such other URL as MSNBC
shall determine in its sole discretion) or any successor
site(s) thereof ("MSNBC Site") dedicated to providing health
related information and services for consumers ("MSNBC Health
Section") including but not limited to its content, features,
technologies, services, etc., its appropriate frameworks and
Specifications (including content Specifications and
technical Specifications). Subject to any inconsistencies
with the provisions of this Section 3.1(b) (in which case the
terms of this Section 3.1(b) shall control) and subject to
agreements in effect as
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of the Execution Date, the following Sections of this
Agreement shall apply to MSNBC and WebMD with regard to such
MSNBC Health Section: Sections 2.1; 2.3(a), (b), (e), and
(g); 2.6, 3.5, 9, 10, 11.1(c), 11.2(a)-(b), 12.9, 13, 14.6,
15, 16, 18, Exhibit A-1 paragraphs (A)(3)-(5) and (C), and
Exhibit A-2.
(II) Subject to contracts in existence as of the
Execution Date, WebMD shall be the primary provider of health
care related information other than (A) news and editorial,
(B) content from NBC News and MSNBC cable, and (C) wire and
WSJ/Dow Jones services on the MSNBC Health Section.
(III) Notwithstanding sub-Section 3.1(b)(ii) above,
MSNBC shall create a special WebMD section (the "MSNBC Health
Channel") of the MSNBC Health Section and MSNBC shall have
the sole discretion to include or not include any content,
features, technologies, services, etc. provided by WebMD on
the MSNBC Health Channel.
(IV) Without limiting or modifying in any way
sub-Section 3.1(b)(ii) above, with respect to contracts in
existence as of the execution Date between MSNBC and third
parties for the provision of healthcare related information
to MSNBC for the MSNBC Health Channel, at the natural
termination or expiration of each such contract (which shall
be determined under such contracts and as between MSNBC and
WebMD in MSNBC's sole discretion), MSNBC shall use
commercially reasonable efforts to replace such third party
healthcare related information with healthcare related
information provided by WebMD. For the avoidance of doubt,
content, features, and anything in those areas specified in
sub-Section 3.1(b)(ii)(A)-(C) above are not subject to
replacement by WebMD content.
(V) WebMD will provide such support as is required
to assist MSNBC in incorporating the MSNBC Health Channel or
links thereto into the MSNBC Health Section, including but
not limited to incorporating such MSNBC frameworks or
Advertising space as may be required to include WebMD's
healthcare related information in the MSNBC Health Channel.
(VI) MSNBC may request that WebMD cover certain
topics, content, features, events or other areas or material
for inclusion in the MSNBC Health Channel. If MSNBC makes
such a request in writing, WebMD shall respond within ten
(10) business days whether WebMD desires to provide such
content, features, events or other areas or material. If
WebMD agrees to provide such topics, content, features,
events or other areas or material, WebMD shall provide such
topics, content, features, events or other areas or material
for incorporation into the MSNBC Health Channel as soon as
commercially reasonable following such agreement but in no
event within more than forty-five (45) days from the time it
agrees to provide such topics, content, features, events or
other areas or material. If WebMD declines to provide the
topics, content, features, events or other areas or material
or fails to provide it within the requisite amount of time,
then MSNBC shall be free to provide the topics, content,
features, events or other areas or material (either directly
or through a third party). In addition to the foregoing,
WebMD shall incorporate any legal or other notices onto all
or any part that WebMD provides for the MSNBC Health Channel
that MSNBC in its sole discretion considers necessary, within
twenty-four (24) hours of MSNBC's written request. The
parties shall meet on a regular basis, but in no event less
frequently than once each calendar quarter to discuss the
MSNBC Health Section, the MSNBC Health Channel and the WebMD
Site, provided that the first such meeting shall take place
no later than sixty (60) business days from the Execution
Date, and further provided that in addition to any other
obligations it has to MSNBC, WebMD shall use reasonable
efforts to provide to MSNBC for incorporation into the MSNBC
Health Channel any topics, content, features, events or other
areas or material etc. that MSNBC suggests during such
meetings according to the same schedule as is set forth above
in this Section.
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(VII) MINIMUM CONTENT REQUIREMENTS. All content,
materials, features, technology, services, etc. provided by
WebMD for the MSNBC Health Channel or the WebMD section of
the MSNBC Health Channel (a) shall be the sole responsibility
of WebMD and shall be developed and maintained in accordance
with Section B of Exhibit A-1, (b) shall be relevant to the
topic and particular section of the MSNBC Health Channel in
which they are included, (c) shall be of high quality in all
ways, including with respect to editorial content and volume,
as determined by comparison to other sources of similar
information available on the Internet and in no event shall
the MSNBC Health Channel have access to a smaller volume of
pages as the WebMD Consumer Site or Health Channel contains,
unless approved or requested by Microsoft or NBC, (d) shall
be comparable or superior to the health related content
available on the top five (5) ranked (by Media Metrix)
Internet portal/network sites with respect to at a minimum
the following factors: (i) substance, quality, volume, (ii)
breadth and depth of content, (iii) tools and functionality,
(iv) personalization, (v) appeal and ease of use of user
interface, (e) shall be regularly updated by WebMD so as to
meet the requirements of sub-sections (b), (c) and (d) above
and end-users preferences, and (f) subject to the foregoing
requirements in (a)-(e), that available for MSNBC to
incorporate into the MSNBC Health Channel shall be the same
or substantially similar as (i.e., in substance, a mirror of)
the materials available to end users accessing the WebMD
Consumer Site at any time during the Term of this Agreement.
With respect to sub-Sections (c) and (d) above of this
sub-Section (vii), MSNBC shall have the right and obligation
to invoke the Dispute Mechanism set forth in Exhibit A-1(2).
(VIII) BRANDING AND PROMOTION. Subject to contracts
in existence as of the Execution Date, (A) MSNBC shall
include on each page of the MSNBC Health Channel a WebMD
credit as reasonably mutually determined by the parties, and
on every page of the MSNBC Health Channel WebMD will receive
branding above the fold in a mutually agreeable position,
such branding element shall link to an appropriate page in
the MSN Health Section, (B) MSNBC shall include a link to the
MSNBC Health Section on the front page of the MSNBC Site and
each other page of the MSNBC Site that includes links to the
other topic specific front page links, (C) MSNBC shall
include a secondary-level navigation link to the MSN Health
Section on each page of the MSNBC Site, (D) on each page of
the MSNBC Health Channel, MSNBC shall include a link to that
part of the MSN Health Section covering the relevant
information as on the MSNBC Health Section page, and (E)
MSNBC shall provide the MSNBC Health Channel with a rotation
of at least one promotion on the front page of the MSNBC Site
each day subject to MSNBC's sole editorial discretion to
feature other news, information, events, etc., for example to
accommodate news cycles and breaking news events.
(IX) TERM. Notwithstanding any other provision of
this Agreement, the term of this Agreement solely with
respect to the MSNBC Health Channel shall expire three (3)
years following the Effective Date, unless earlier terminated
as provided under Section 13 below.
3.2 INTERNET ACCESS. Subject to WebMD's contractual obligations
to Compuserve as of the Execution Date, WebMD agrees that Microsoft's MSN
Internet Access ("MSN IA") shall be the sole internet access service
advertised, promoted and/or distributed by WebMD, including on the WebMD Site,
and including, but not limited to with respect to narrow band, broadband or
otherwise, provided that the parties shall consult and may agree on alternative
broadband providers. Within thirty (30) days following the Effective Date,
WebMD shall deliver to Microsoft a marketing plan ("MSN IA Marketing Plan")
containing WebMD's general proposal for advertising, promoting and/or
distributing MSN Internet Access during the first six months of the Term of
this Agreement. Two months in advance of the following six month period and of
each remaining six month period thereafter during the Term of the Agreement,
WebMD shall present to Microsoft an update to the MSN IA Marketing Plan to
cover the subsequent six months. The MSN IA Marketing Plan shall be subject to
Microsoft's approval, which approval shall not be unreasonably withheld, and
shall include at least one promotional event each quarter. Microsoft and WebMD
will mutually determine which parts of the MSN IA Plan and each updated MSN IA
Plan will be implemented in what time frame, what changes, if any, will be made
to the proposed programs during each six month period and which party will be
responsible for what aspects of each program. The parties shall work together
to create and
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distribute the elements for all such promotions with WebMD creating,
maintaining, hosting and distributing those materials necessary to implement
such promotion, and Microsoft providing the Internet Access package offer,
fulfilling the offers as set forth herein and maintaining the customer service
relationship. Microsoft commits to include the following as part of the
Internet Access package offered to WebMD users subscribing to MSN IA as a
result of one of the programs agreed on pursuant to this Section 3.2:
(A) Unlimited monthly Internet access according to MSN's
standard terms and conditions at a price to be determined by Microsoft
in its sole discretion, provided that Microsoft currently intends to
charge WebMD participants in the approved MSN IA programs described
herein no more than the standard consumer pricing;
(B) Default home page is the current standard default
available from MSN, provided that Microsoft agrees to provide a
co-branded or redirect to the WebMD home page by no later than
September, 1999; and
(C) Multiple email accounts including an MSN email account
and unlimited Hotmail accounts.
Microsoft shall provide co-branded marketing sign-up packages to all WebMD
participants in the approved MSN IA programs described herein, including CD's,
mailing and packaging materials. Such marketing sign-up packages will be
provided at Microsoft's expense for the first 1,000,000 marketing sign-up
packages and postage costs for up to 500,000 marketing sign-up packages.
Expenses for providing additional marketing sign-up packages and postage costs
shall be borne by WebMD. With respect to User Information, the provisions of
Section 2.6 above and Section 11.4 below shall apply. In the event that
Microsoft intends in its sole discretion to stop offering MSN IA, Microsoft
shall give WebMD at least ninety (90) days' advance written notice of its
intention, and WebMD shall immediately stop offering any MSN IA programs and no
party shall have any further obligations under this Section 3.2.
3.3 HEALTH CHANNEL DIRECTORY. The only health care-related
directory(ies) included on the Health Channel shall be those health
care-related directory(ies) designated by Microsoft from time to time during
the Term in its sole discretion, which may include, without limitation: (a)
Microsoft's health care-related directory (currently part of the MSN Yellow
Pages) as it exists from time to time during the Term or any part or successor
thereof; (b) WebMD's health care-related directory as it exists from time to
time during the Term or any part or successor thereof; (c) any health
care-related directory provided by some third party; or (d) any combination of
(a), (b) and (c) immediately above. The parties agree that Microsoft may, in
its discretion, create a combined health care-related directory for the Health
Channel that incorporates WebMD's health care-related directory listings. In
the event that Microsoft elects to create such a combined directory, the
parties shall work together in good faith to do so. WebMD shall include the
health care-related directory(ies) designated by Microsoft in the Health
Channel.
3.4 OTHER MICROSOFT PROPERTIES. Except as prevented by any
contracts between WebMD and third parties existing as of the Execution Date,
WebMD agrees that Microsoft and its affiliates shall be the sole providers of
third party content, features, services, etc. for the WebMD Site (including
specifically without limitation the Non-Health Related Section and the Health
Related Section), in all areas for which Microsoft or its affiliates owns or
controls such content, features or services, etc.; such content, features and
services, etc. shall at a minimum include travel (e.g., Microsoft Expedia),
automotive (e.g., Carpoint), real estate (e.g., Home Advisor), money, investing
and finance (e.g., Money, Investor), entertainment and directories (e.g.
Sidewalk including but not limited to MSN Yellow Pages), reference (e.g.,
Encarta), movies (e.g., Sidewalk), news (e.g., MSNBC); provided that WebMD may
elect in its sole discretion not to provide content, features or services for
any area. The foregoing shall exclude, however, solely with regard to the
Health Related Section of the Medical Professional Section, any Microsoft
content, features, or services that are predominantly health care related,
unless mutually agreed upon by the parties. In the event that WebMD makes
available to end users any non-web-based email technology, whether through the
distribution of work stations or otherwise, Microsoft shall be the sole
provider of such technology for such distribution and shall provide such
technology under standard terms and conditions for such distribution; provided
that such Microsoft technology be Microsoft Outlook or such other Microsoft
technology designated by Microsoft. Without limitation, being the "sole
provider" means that WebMD shall not place, distribute, advertise, market, link
to, refer to or otherwise include the content, features or services, etc. of
any party other than Microsoft.
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THE OMITTED PORTIONS.
3.5 MSN MODULE.
(A) WebMD shall include a module for MSN ("MSN Module")
either above the fold of a 640 x 480 screen size resolution with a
standard browser configuration, or on the second screen (of a 640 x
480 screen size resolution with a standard browser configuration), on
each page of the WebMD Site, which MSN Module shall be in a form
determined by Microsoft in its sole discretion. The MSN Module may be
modified from time to time as determined by Microsoft in its sole
discretion and WebMD shall replace any existing MSN Module with any
such updated MSN Module within a reasonable time following Microsoft's
notice of such modifications. The MSN Module may at a minimum include
a "Go to MSN" logo link, two (2) rotating text links from a pool of
five (5) text links, and a single promotional text link, which text
links will be mutually determined by Microsoft and WebMD. An example
of what the MSN Module may look like appears in the mock-up attached
hereto as Exhibit C. The MSN Module and any modification thereto shall
be subject to Microsoft's written approval. WebMD's placement and use
of the "Go to MSN" logo link shall be in accordance with the Logo
Guidelines attached hereto as Exhibit D.
(B) The only search service(s) included on the Health
Channel shall be the search service(s) designated by Microsoft from
time to time during the Term in its sole discretion, which may
include, without limitation: (i) Microsoft's MSN Web Search as it
exists from time to time during the Term or any part or successor
thereof; (ii) WebMD's search service and technology as it exists from
time to time during the Term or any part or successor thereof; (iii)
any search service or technology provided by some third party; or (iv)
any combination of (i), (ii) and (iii) immediately above. At
Microsoft's sole discretion, Microsoft may create a combined search
service for the Health Channel that incorporates WebMD's search
services. In the event that Microsoft elects to create such a combined
service, the parties shall work together in good faith to do so. At
Microsoft's request, WebMD shall provide Microsoft with database
mapping from technical disease names to common names for use in MSN
Web Search. WebMD shall include the search service designated by
Microsoft in the Health Channel.
3.6 MICROSOFT ONLINE ID PROGRAM. WebMD agrees to test, evaluate,
and use, take sign ups for and accept the Ids for Microsoft's proprietary
authentication service ("Passport") on both the Health Channel and the WebMD
Site, and all of WebMD's existing profiling and authentication mechanisms will
also take sign ups for and accept the Ids for Passport. WebMD shall use
Passport in accordance with the terms of the Microsoft Online ID Evaluation
Program Agreement attached hereto as Exhibit E and such further standard terms
and conditions that are offered in addition to or as a replacement for those
currently contained in such agreement. The parties acknowledge and agree that
WebMD may accept other authentication mechanisms on the WebMD Site. WebMD
agrees, however, that Passport will be the only authentication mechanism
distributed (i.e., take sign ups) on the Health Channel and WebMD Consumer Site
other than WebMD's proprietary authentication mechanisms. WebMD's obligations
under this Section 3.6 shall extend to any localized WebMD Consumer Site, to
the extent that a localized version of Passport is available for the relevant
market.
3.7 MSN COMMUNITIES. Microsoft agrees to migrate, as soon as
commercially feasible, users of the current Microsoft owned and moderated
health-related communities found within Microsoft's MSN Web Communities
channel, over to the WebMD health-related communities on the WebMD Site ("WebMD
Health Communities") provided that, for the avoidance of doubt, no party shall
have any obligations hereunder with respect to user-created communities in the
MSN Web Communities channel. WebMD shall create and manage only one section
devoted to health-related communities which shall be the WebMD Health
Communities and all health-related communities created and/or managed by WebMD
shall be part of the WebMD Health Communities. At all times during the Term the
WebMD Health Communities shall have no less than eighty (80) distinct
communities by the end of Year 1. Microsoft shall promote, as soon as
commercially feasible as determined by Microsoft in its sole discretion, the
WebMD Health Community from its MSN Web Communities channel by providing, among
other things, hypertext address links, equally prominent promotion with other
Microsoft-owned and moderated communities. WebMD agrees to promote non-health
related Microsoft-owned and moderated MSN Web Communities on the WebMD Site and
the Health Channel in a manner such that promotion of such communities shall be
as prominent and in all places as any promotion of any other comparable
non-health related communities, and otherwise where appropriate with the
content and context, on the WebMD Site and Health Channel respectively.
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THE OMITTED PORTIONS.
At a minimum, WebMD shall include on each page of the WebMD Health Communities
area a text link to the MSN Web Communities channel, the text of which shall be
mutually agreed upon. WebMD agrees that, as soon as commercially feasible, the
Health Channel Community shall be available to end users in a read-only format
as well as a participatory format, and that any Health Channel users who desire
to only read files in the Health Channel Community shall not be required to
formally join the Health Channel Community by filling out a user questionnaire.
WebMD shall incorporate the Network Frameworks on each WebMD Health
Communities' page served to users that originate from the Health Channel in
accordance with the SDK and the WebMD Health Communities shall otherwise be
presented to end users so that it resembles and functions like the non-health
related communities found within Microsoft's MSN Web Communities channel. For
purposes of clarity, the Health Channel shall include the WebMD Health
Communities. The provisions of this Section 3.7 shall apply to any localized
WebMD Consumer Site, to the extent that local MSN Web Communities are available
for the relevant market, and subject to the approval of the local MSN portal
manager. WebMD shall develop, maintain, and host those things necessary and
reasonably requested by Microsoft to implement the foregoing.
3.8 OTHER MICROSOFT INTERNET SERVICES. Except as prevented by any
contracts between WebMD and third parties existing as of the Execution Date,
upon notice from Microsoft that any such service or technology is available for
distribution, WebMD agrees, as soon as commercially feasible, to prominently
implement on the WebMD Site, and prominently provide end users with access from
the WebMD Site to, each Microsoft Internet service and technology that is
available on the MSN Site, including, but not limited to, MSN Web Search,
Microsoft Chat, MSN Messenger Service, Hotmail, a Microsoft business,
e-commerce, communication service and technology, which includes a common
format and process for exchanging products, business information, promotional
information and other business data over the Internet, and a Microsoft web
hosting service and technology, which includes software and tools that enable
web site creation and hosting, and all other Microsoft Internet services not
otherwise specifically addressed in other Sections of this Agreement that are
available on the MSN Site ("Other Microsoft Internet Services") pursuant to
Microsoft's standard user interface and distribution terms. To such end,
Microsoft shall provide WebMD with such materials, technology and support as it
routinely provides to other third parties distributing such technologies. In
the event that WebMD offers Other Microsoft Internet Services on the WebMD Site
in accordance with the foregoing, WebMD shall not promote any competing
technology on the WebMD Site, other than during a commercially reasonable
transition period for discontinuing any such promotion. WebMD's obligations
under this Section 3.8 are subject to WebMD's contractual obligations existing
as of the Effective Date, and shall extend to any localized WebMD Consumer
Site, to the extent that a localized version of the Other Microsoft Internet
Services is available for the relevant market. WebMD shall develop, maintain,
and host that which is necessary and reasonably requested by Microsoft to
implement the services and technologies specified in this Section 3.8. Upon
mutual agreement, the parties shall work together and with appropriate third
parties to create appropriate industry standards.
4. USE/PROMOTION OF MICROSOFT TECHNOLOGY PLATFORM
4.1 USE OF THE MICROSOFT TECHNOLOGY PLATFORM. WebMD agrees, at
WebMD's expense, to make Microsoft technology, including the Microsoft
Technology Platform, WebMD's primary technology platform for developing,
staging, operating and maintaining both the front and back ends of the Health
Channel and the WebMD Site in accordance with this Section 4.
4.2 MCS CONSULTING AGREEMENT. In conjunction with its obligations
in Section 4.1 above, WebMD agrees to convert, at WebMD's expense and within
one year of the Effective Date, any current operating systems and other
technology identified pursuant to the MCS review described herein used in
developing, staging, operating, and maintaining the WebMD Site over to a
PC-based platform that uses relevant Microsoft technology, including the
Microsoft Technology Platform products. Such conversion shall be sufficiently
comprehensive so that the majority of WebMD's systems shall utilize Microsoft
technology, including the Microsoft Technology Platform products, and will
consist of an architectural review of existing systems, and the development and
implementation of a transition plan in conjunction with Microsoft Consulting
Services ("MCS") as further set forth in the MCS agreement and work order
("Work Order") attached hereto as Exhibit F (collectively "MCS Agreement").
WebMD agrees to engage MCS pursuant to the MCS Agreement to assist WebMD in
conducting the architectural review, developing a transition plan, and
implementing such transition plan. This conversion shall include integration of
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Microsoft products that contain substantively similar functionality as the
following combination of products: Internet Information Server, Site Server,
SQL Server, Windows NT Server, and Microsoft's messaging technologies,
including updates and upgrades thereto. WebMD and Microsoft agree to commence
the architectural review as more fully described in the Work Order, within
forty five (45) days of the Effective Date and to complete the architectural
review within forty five (45) days of commencement. Based on the outcome of the
architectural review, the parties shall agree within one additional week on a
transition schedule ("Transition Schedule"), which shall include at a minimum
an agreed upon additional MCS work order ("Transition Schedule Work Order")
detailing the parties' responsibilities under the Transition Schedule. The
transition shall be completed no later than 360 days following the Effective
Date, unless the parties agree otherwise in the Transition Schedule. In the
event that any delays caused by MCS result in a delay in any deadline or
schedule described herein, such deadline or schedule shall be revised to take
into account the MCS-caused delays.
4.3 PROMOTION OF MICROSOFT TECHNOLOGY PLATFORM. WebMD agrees
that, once the conversion process described in Section 4.2 above has been
completed, Microsoft may reference the WebMD Site in promotional and marketing
materials as a showcase or reference site for Microsoft technology used by
WebMD. Further, WebMD agrees to prominently promote the Microsoft technology,
including the Microsoft Technology Platform products, used by WebMD by
prominently mentioning such products in WebMD marketing materials including
those aimed at physicians and consumers, including without limitation in press
releases, sales literature, and promotional brochures. Prior to the completion
of the conversion process described in Section 4.2 above, WebMD agrees to
prominently promote the Microsoft technology, including the Microsoft
Technology Platform products, as preferred by WebMD by prominently mentioning
such products in WebMD marketing materials including those aimed at physicians
and consumers, including without limitation in press releases, sales
literature, and promotional brochures.
4.4 MCS CONSULTANT EXPENSE. Notwithstanding anything to the
contrary in Section 4.1 and 4.2 above and the attached MCS Agreement, its
attached Work Order or any subsequent Work Order, in exchange for all amounts
paid to Microsoft by WebMD for Microsoft Consulting Services under Section 4.1
and 4.2, the MCS Agreement and all Work Orders, Microsoft shall provide over
the Term of the Agreement Advertising, marketing and/or promotional programs
for content and/or services on the WebMD Site by Microsoft or any party
referred by Microsoft in a total value of no less than the amount, matched
dollar for dollar, of the payments made by WebMD for MCS Consulting Services up
to two million five hundred thousand dollars ($2,500,000). For the avoidance of
doubt, WebMD will be responsible for all reasonable travel and associated
expenses incurred in the delivery of all MCS services, including, but not
limited to, the consultant hours and additional consultant hours specified
above.
4.5 WEBMD ADOPTION AND PROMOTION OF MICROSOFT TECHNOLOGIES. WebMD
shall adopt, and Microsoft and WebMD will work together to promote and
establish, Microsoft's interoperability framework for healthcare ("MICROSOFT
HEALTHCARE INTEROPERABILITY FRAMEWORK"). The Microsoft Healthcare
Interoperability Framework is a multilevel standard designed to provide
interoperability between applications and systems across desktops PCs, servers,
networks, and legacy systems in the healthcare industry. The Microsoft
Healthcare Interoperability Framework includes the Active X for Healthcare
standard and BizTalk (which together include components of COM, DCOM, COM+, and
XML or other enhancements).
4.6 ELECTRONIC COMMERCE PLATFORMS. Over an agreed-upon period of
time, Microsoft will use reasonable efforts to facilitate dialog among other
key industry partners on the development of multiple electronic commerce
platforms that bridge Physicians, Hospitals, Payors, Employers and Suppliers
and the integration of such platforms with the Medical Professionals Section's
functionality.
4.7 DISTRIBUTED APPLICATIONS. Microsoft will use reasonable
efforts to encourage its major ISV alliance partners to develop key distributed
applications based on Microsoft technologies that would operate in conjunction
with the functionality and content of the WebMD Site, including the development
of distributed applications that would reside within the employer domain and
that would provide enhanced positioning to WebMD as an intranet-based offering.
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THE OMITTED PORTIONS.
4.8 BILLING INITIATIVES. Microsoft will use reasonable efforts to
explore the development of an electronic EOB delivery system for implementation
on the Medical Professionals Section, based on available technology.
5. MARKETING/HEALTHCARE TECHNOLOGY AREA
WebMD agrees, for the term of this Agreement, to incorporate a
"Healthcare Technology" section into the Medical Professionals Section no more
than two levels down from the top level page of the Medical Professionals
Section, that provides tips and background information about Microsoft
technology and exclusively promotes Microsoft technologies and Microsoft
authorized independent software vendors. The Healthcare Technology section
shall be located above-the-fold (at a screen resolution of 640 x 480 with a
standard browser configuration) wherever placed. Further, WebMD agrees to
prominently integrate links to the Healthcare Technology section from other
parts of the WebMD Site where technology in the healthcare industry is
discussed. The content, layout and presentation of the Healthcare Technology
section shall be determined by Microsoft, provided that WebMD shall have the
right to approve such content, layout and presentation, which approval shall
not be unreasonably withheld.
6. SALES OBLIGATIONS
6.1 HEALTH CHANNEL ADVERTISING. Microsoft shall be solely
responsible for selling and managing all Advertising on the Health Channel.
Microsoft and WebMD will meet regularly to discuss sales strategies for selling
Advertising to hospitals, HMOs, clinics, pharmaceutical companies, medical
device companies, medical/surgical supply companies, life sciences companies,
pharmacies, and health insurance companies.
6.2 CO-MARKETING COMMITMENT. Microsoft shall itself, or shall
ensure that the Authorized Transferees (as defined in the Master Agreement
entered into as of April 10, 1999 between the parties) or other third parties ,
provide, during the period beginning on the Effective Date and ending on the
second year anniversary of the Effective Date, a combined total value of no
less than fifty million dollars ($50,000,000), and WebMD shall provide a total
of no less than the same amount matched dollar for dollar, on Advertising,
marketing and/or promotional programs for content and/or services reflecting
the combined brands of WebMD and the other parties' contributing money to each
such program and approved in advance by all of the parties' contributing money
to each such program. For example, such programs may be co-presented by WebMD
and MSN, or Web MD and Microsoft, or WebMD and Authorized Transferees, or WebMD
and a Microsoft independent software vendor ("ISV"), or WebMD, MSN and an
Authorized Transferee, etc. All such programs shall be presented in offline
(i.e., not on the Internet) arenas, e.g., on air, trade shows, print medium,
etc., or online as mutually agreed between the parties. The parties agree that
fifty percent (50%) of the amounts spent under this Section shall be devoted to
demand-generation marketing campaigns for those specific Microsoft distribution
partners identified by Microsoft.
7. MICROSOFT-SPONSORED WEBMD MEMBERSHIPS
7.1 GENERAL. Microsoft agrees to sponsor up to five (5) million
WebMD Membership Months during the Term of this Agreement, including without
limitation two hundred and fifty thousand (250,0000) WebMD Memberships in
calendar year 1999 and seven hundred and fifty thousand (750,0000) WebMD
Memberships in calendar year 2000, pursuant to the terms and conditions set
forth in this Section 7. As used herein, the term "sponsor" means that
Microsoft will pay WebMD the Base Membership Fee for each such WebMD
Membership, in accordance with Section 12.4 below. If, at any time during the
Term of this Agreement, however, WebMD no longer implements a subscription
revenue model, or ceases to engage in product upsell or ecommerce transactions,
Microsoft and WebMD will make a commensurate modification to the obligation set
forth in this Section 7.1, which modification shall take into consideration the
loss of these revenue streams and Microsoft's ability to recoup amounts paid
hereunder, provided that in no circumstances shall Microsoft's obligation set
forth in this Section 7.1 be increased beyond the five (5) million WebMD
Membership Months contemplated herein.
7.2 DISTRIBUTION PLAN. The parties agree to cooperate in good
faith to develop a mutually agreed upon plan for promoting, offering, and
distributing the Microsoft-sponsored WebMD Memberships ("DISTRIBUTION PLAN").
Notwithstanding Section 7.1, no Microsoft-sponsored WebMD Memberships shall be
offered under this
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THE OMITTED PORTIONS.
Agreement until the parties have agreed upon the Distribution Plan. The
Distribution Plan will include, among other elements, the following:
(A) estimates of the number of Microsoft-sponsored WebMD
Memberships to be in effect on a quarterly basis during the Term of
this Agreement, and steps to be taken by WebMD to promote active usage
of the Medical Professionals Section by End User Members and potential
End User Members;
(B) in any given year during the first three years of the
Term (including without limitation the calendar year 2000), no more
than one million (1,000,000) Microsoft-sponsored WebMD Memberships
shall be provided;
(C) all promotions and offerings of Microsoft-sponsored
WebMD Memberships shall require a minimum twelve (12) month
subscription;
(D) if an End User Member with a Microsoft-sponsored WebMD
Membership fails to access the Medical Professionals Section at least
once every four (4) months, then such End User Member's WebMD
Membership shall no longer qualify as a Microsoft-sponsored WebMD
Membership and Microsoft shall no longer be required to sponsor such
End User Member's Membership even if WebMD allows the End User Member
to continue to access the Medical Professionals Section;
(E) Microsoft shall be entitled to offer Microsoft-
sponsored WebMD Memberships, directly or indirectly through third
parties, to End User Members; and
(F) for each End User Member of a Microsoft-sponsored WebMD
Membership, a plan for WebMD to devote at least fifty dollars ($50) on
training on the use of the Medical Professionals Section.
7.3 WARRANT AGREEMENT. Notwithstanding the foregoing, in the
event that the agreement regarding the issuance of certain warrants from WebMD
to Microsoft (which agreement is under final negotiation by the parties as of
May 3, 1999) ("WARRANT AGREEMENT") is not executed by the parties within ten
(10) days of the execution of this Agreement, then, at Microsoft's option, the
provisions of this Section 7 and the provisions in Section 12.4 shall be null
and void and neither party shall have any further obligation or liability under
such Sections.
8. MICROSOFT TRAINING AND PROMOTION OF WEBMD SERVICE
8.1 INTERNAL MICROSOFT TRAINING. Microsoft shall use reasonable
efforts to promote the functionality offered by the Medical
Professionals Section of the WebMD Site to those portions of
Microsoft's sales and marketing force that specifically target
healthcare customers or Microsoft independent software vendors that
create software specifically designed for healthcare customers using
Microsoft products.
8.2 MARKETING PLAN. The parties agree to cooperate in good faith
to develop a mutually agreed upon plan for promoting the WebMD Site
and related services ("MARKETING PLAN"). The Marketing Plan will
include, among other elements, the following:
(A) Microsoft will use reasonable efforts to jointly call,
with WebMD's sales force, Microsoft's fifty (50) largest enterprise
customers (by headcount), as appropriate, for the purposes of
promoting a WebMD/MSN solution as an intranet application, as soon as
practicable given product development and planning considerations;
(B) Microsoft will include, at no charge to WebMD, WebMD
banners, as approved by Microsoft, in the printed version of the
Medical Industry Directory and feature WebMD on the
www.microsoft.com/industry/health web site, subject to Microsoft's
standard terms, policies and editorial considerations applicable to
third party banners and features;
(C) Microsoft will use reasonable efforts to assist WebMD
in submitting editorial content to the editors of Windows in
Healthcare magazine; and
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THE OMITTED PORTIONS.
(D) Microsoft and WebMD, together with such other
Microsoft healthcare channel partners as Microsoft and WebMD mutually
agree upon, will commit to have joint booth space at mutually
acceptable strategic Microsoft Partner Pavilions at selected
healthcare tradeshows sponsored by Microsoft or where Microsoft has a
significant presence. Examples of potential tradeshows include HIMSS,
NMHCC, MGMA, and the Windows on Healthcare Conference.
9. PROPRIETARY RIGHTS
The parties agree that except as expressly licensed to WebMD in this
Agreement or a separate license agreement, Microsoft, WebTV, and MSNBC,
respectively, shall retain all right, title, and interest in any and all
materials delivered by Microsoft, WebTV and MSNBC to WebMD pursuant to this
Agreement. The parties further agree that except as expressly licensed to
Microsoft, WebTV, and MSNBC in this Agreement or a separate license agreement,
WebMD and/or its suppliers shall retain all right, title and interest in and to
the WebMD Content (as defined in Section 14.1 below). No party shall have any
rights to any materials, content, feature or technology, etc. provided by the
other party hereunder except as specifically provided in this Agreement and
shall not alter, modify, copy, edit, format, translate, create derivative works
of or otherwise use any materials, content, feature or technology, etc.
provided by the other party except as explicitly provided herein or approved in
advance in writing by the other party. If any parties agree to jointly develop
any content, materials, services, technology, features or otherwise, ownership
of such development shall be detailed in a separate agreement prior to the
start of any development.
10. CONFIDENTIALITY
10.1 Microsoft, WebTV, MSNBC, and WebTV acknowledge and agree that
the terms and conditions of the Microsoft Corporation Non-Disclosure Agreement
dated as of even date herewith ("NDA"), attached hereto as Exhibit H, are
incorporated into this Agreement and that all of the terms of this Agreement
(including but not limited to its existence) and all discussions and
negotiations related thereto are considered Confidential Information as defined
in the NDA. In the event that any of the incorporated terms of the NDA are
inconsistent with or conflict with this Agreement, then the terms of this
Agreement shall control.
10.2 Each Party may disclose the terms and conditions of this
Agreement to its employees, affiliates and its immediate legal and financial
consultants on a need to know basis as required in the ordinary course of that
Party's business, provided that such employees, affiliates and/or legal and/or
financial consultants agree in writing in advance of disclosure to be bound by
this Section 11, and may disclose Confidential Information as required by
government or judicial order, provided each Party gives the other Party prompt
notice of such order and complies with any protective order (or equivalent)
imposed on such disclosure. Further, the parties acknowledge that this
Agreement, or portions thereof, may be required under applicable law to be
disclosed, as part of or an exhibit to a party's required public disclosure
documents. If any party is advised by its legal counsel that such disclosure is
required, it will notify the other in writing and the parties will jointly seek
confidential treatment of this Agreement to the maximum extent reasonably
possible, in documents approved by both parties and filed with the applicable
governmental or regulatory authorities. The parties may disclose Aggregate
Information subject to any User-initiated or other prohibition contemplated
under Section 2.6. The parties may disclose any Personal Information as
permitted by the User to whom it pertains, subject to Section 2.6.
10.3 Each Party acknowledges that monetary damages may not be a
sufficient remedy for unauthorized disclosure or use of Confidential
Information and that each Party may seek, without waiving any other rights or
remedies, such injunctive or equitable relief as may be deemed proper by a
court of competent jurisdiction.
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11. LICENSES
11.1 BY MICROSOFT/MSNBC.
(A) TRADEMARK LICENSE.
(I) Microsoft hereby grants to WebMD a
non-exclusive, non-transferable, personal license to use the
Microsoft MSN logos as provided by Microsoft under this
Agreement for use as part of the Network Frameworks header
and footer (the "MSN Logos"), and any other Microsoft
trademark or logo as may be provided by written notice from
Microsoft for use under this Agreement (the Microsoft
Marks"), solely in connection with the Health Channel and in
accordance with the terms of this Agreement, including the
use specifications in Exhibit G. Except as provided in this
Trademark License, this Agreement does not grant WebMD any
right, title, interest, or license in or to any of
Microsoft's names, logos, trade dress, designs, or other
trademarks. Unless otherwise provided herein or agreed upon
by the parties, WebMD's use shall be mutually approved in
advance.
(II) WebMD acknowledges, as between WebMD and
Microsoft, Microsoft's sole ownership of the MSN Logos and
Microsoft Marks worldwide and all associated goodwill.
WebMD's use of the MSN Logos and Microsoft Marks, as between
the parties, shall inure solely to the benefit of Microsoft.
WebMD hereby assigns and shall assign in the future to
Microsoft all rights it may acquire by operation of law or
otherwise in the MSN Logos and Microsoft Marks, including all
applications or registrations therefore, along with the
goodwill associated therewith.
(III) WebMD shall fully correct and remedy any
deficiencies in its use of the MSN Logos, Microsoft Marks
and/or the quality of the Health Channel where the MSN Logos
or Microsoft Marks appear, upon reasonable notice from
Microsoft.
(IV) Microsoft shall have the sole right to and in
its sole discretion may commence, prosecute or defend, and
control any action concerning the MSN Logos or Microsoft
Marks. WebMD shall not during the Term of this Agreement
contest the validity of, by act or omission jeopardize, or
take any action inconsistent with, Microsoft's rights or
goodwill in the MSN Logos or Microsoft Marks in any country,
including attempted registration of the MSN Logos or
Microsoft Marks, or use or attempted registration of any mark
confusingly similar thereto.
(B) DISTRIBUTION OF THE MSN INTERNET TECHNOLOGIES.
Microsoft grants to WebMD a limited, non-exclusive, non-transferable,
royalty-free license to use, copy, execute, display, perform, and
distribute the object code version of the client software ("Client
Software"), if any, for each MSN Internet Service solely to provide
such Client Software to end-users in conjunction with such end user's
use of each respective MSN Internet Service from within the Health
Channel and WebMD Site; provided that any inconsistency between this
Section 11.1(b) and any license grant specifically contained in any
Exhibit or any documentation provided with any Client Software shall
be resolved in favor of such Exhibit or documentation. The following
restrictions apply to the license granted in the preceding paragraph:
(I) WebMD shall not use the Client Software for any
purpose other than as set forth in this Agreement.
(II) WebMD shall not rent, lease, sell, sublicense,
assign, or otherwise transfer the Client Software.
(III) WebMD may not reverse engineer, decompile or
disassemble any Client Software or any components thereof.
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(IV) WebMD may not distribute any Client Software on
a stand-alone basis, e.g., other than in conjunction with the
Health Channel and/or the WebMD Site.
(V) WebMD shall maintain and not alter or remove
any copyright, trademark, and other protective notices
contained in the Client Software.
(VI) WebMD's distribution of the Client Software
shall be pursuant to a license agreement that shall include:
(A) a license grant with a statement of ownership consistent
with the terms of this Agreement; (B) a prohibition against
reverse engineering, decompiling and disassembly of code; (C)
a disclaimer of all express and implied warranties and
conditions; (D) a disclaimer of direct, indirect,
consequential, incidental, or special damages on behalf of
WebMD's suppliers; (D) the U.S. Government restricted rights
clause as provided herein and (E) a prohibition against
further redistribution of the Client Software by end users.
All rights not expressly granted herein are reserved by
Microsoft. Microsoft and its suppliers shall retain title and all
ownership rights to the Client Software.
(C) DISTRIBUTION OF MSNBC CONTENT. MSNBC licenses to WebMD
solely such rights as are necessary for WebMD to incorporate the MSNBC
content into, and use MSNBC content as part of the Health Channel
pursuant to Section 2.1(e) above, and solely in accordance with
MSNBC's specific instructions with regard to any specific content. All
rights not expressly granted herein are reserved by MSNBC. MSNBC and
its suppliers shall retain title and all ownership rights to the MSNBC
content.
(D) WEBTV TRADEMARK LICENSE. In accordance with the
development, hosting, and maintenance of a WebTV Health Channel
pursuant to Section 3.1(a) above, WebTV and WebMD shall enter into a
separate agreement regarding any use by WebMD of any WebTV trademarks
on or in association with such WebTV Health Channel, as the parties
may mutually agree.
11.2 BY WEBMD.
(A) TRADEMARK LICENSE.
(I) WebMD hereby grants to Microsoft, MSNBC, and WebTV
a non-exclusive, non-transferable, personal license to use
the WebMD logos (the "WebMD Logos") attached hereto as
Exhibit I, and any other WebMD trademark or logo as may be
provided by written notice from WebMD for use under this
Agreement (the "WebMD Marks"), solely in connection with the
Health Channel, WebTV Health Channel, MSNBC Health Section,
and Microsoft's distribution of WebMD Offerings and in
accordance with the terms of this Agreement. Except as
provided in this Trademark License, this Agreement does not
grant Microsoft any right, title, interest, or license in or
to any of WebMD's names, logos, trade dress, designs, or
other trademarks. Unless otherwise provided herein or agreed
upon by the parties, Microsoft's use shall be mutually
approved in advance.
(II) Microsoft, WebTV and MSNBC acknowledge, as
between Microsoft, WebTV, MSNBC and WebMD only, WebMD's sole
ownership of the WebMD Logos and WebMD Marks worldwide and
all associated goodwill. Microsoft's, WebTV's, and MSNBC's
use of the WebMD Logos and WebMD Marks, as between the
parties, shall inure solely to the benefit of WebMD.
Microsoft, WebTV and MSNBC hereby assign and shall assign in
the future to WebMD all rights they may acquire by operation
of law or otherwise in the WebMD Logos and WebMD Marks,
including all applications or registrations therefore, along
with the goodwill associated therewith.
(III) Microsoft, WebTV, and MSNBC shall fully
correct and remedy any deficiencies in their respective use
of the WebMD Logos and WebMD Marks and/or the quality of the
Health Channel, WebTV Health Channel, or MSNBC Health Channel
(respectively) or co-branded
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
offerings that incorporate all or portions of the Healthcare
Professionals Section (with regard to Microsoft) where the
WebMD Logos and/or WebMD Marks appear, upon reasonable notice
from WebMD.
(IV) WebMD shall have the sole right to and in its
sole discretion may commence, prosecute or defend, and
control any action concerning the WebMD Logos and WebMD
Marks. Neither Microsoft, WebTV or MSNBC shall during the
Term of this Agreement contest the validity of, by act or
omission jeopardize, or take any action inconsistent with,
WebMD's rights or goodwill in the WebMD Logos or WebMD Marks
in any country, including attempted registration of the WebMD
Logos or WebMD Marks, or use or attempted registration of any
mark confusingly similar thereto.
(B) DISTRIBUTION OF THE HEALTH CHANNEL. Except as
prevented by any contracts between WebMD and third parties existing as
of the Execution Date, WebMD licenses to Microsoft, MSNBC and WebTV
all such rights as are necessary to permit each of them, on a
worldwide basis, to use, copy, modify (subject to the terms of this
Agreement), translate, execute, display, perform, distribute,
transmit, broadcast in any fashion, through any means, to any party,
as part of the MSN Site, WebTV, the MSNBC Site or other similar
Microsoft, WebTV or MSNBC offering (e.g., on a portable device), the
Health Channel, including, but not limited to all content, features,
technologies, materials, components, branding, and other parts thereof
and including but not limited to by way of Microsoft, WebTV, and/or
MSNBC hosting the Health Channel on servers owned or designated by
Microsoft, WebTV, and/or MSNBC. For avoidance of doubt, Microsoft
Revenue shall include recognized net revenue earned and billed during
the Term of this Agreement that is received by Microsoft, WebTV and
MSNBC from Advertising on similar Microsoft, WebTV or MSNBC offerings
(as referenced above) that incorporate the Health Channel pursuant to
the terms of this Section 11.2(b). Notwithstanding the foregoing,
within thirty (30) days of the Execution Date, WebMD shall provide
Microsoft, MSNBC and WebTV with a list of all content, features,
technologies, materials, components, branding, and other parts on the
WebMD Site and Health Channel for which WebMD, pursuant to agreements
in effect as of the Execution Date, cannot provide the foregoing
rights ("Excluded Content"). WebMD shall use best efforts to, within
one year of the Execution Date, either obtain comparable replacement
content for such Excluded Content, or to otherwise obtain the
necessary rights so that WebMD can grant Microsoft, MSNBC and WebTV
the foregoing rights to such Excluded Content.
(C) DISTRIBUTION OF MEDICAL PROFESSIONALS SECTION. During
the Term of this Agreement, WebMD shall not, directly or indirectly,
license, or agree to provide a WebMD Offering (as defined below) (i)
to or in conjunction with any of the companies listed in Exhibit J-1,
or (ii) that contain branding or co-branding promoting or highlighting
the company(ies) listed in Exhibit J-1. During the Term of this
Agreement, if WebMD, directly or indirectly, licenses, or agrees to
provide a WebMD Offering (i) to or in conjunction with any of the
companies listed in Exhibit J-2 or (ii) that contain branding or
co-branding promoting or highlighting the company(ies) in Exhibit J-2,
then WebMD shall inform and allow Microsoft to propose the
incorporation of Microsoft's products and services in such WebMD
Offering. WebMD shall keep Microsoft reasonably informed regarding all
WebMD Offerings planned or under development. For the purposes of this
Agreement, "WEBMD OFFERING" mean any co-branded or third party-branded
Internet, intranet, broadcast or other electronic offering of
health-related content, features, services, or technology that
incorporates all or portions of the Medical Professionals Section. In
addition, WebMD hereby licenses to Microsoft all such rights as are
necessary to permit Microsoft to use, copy, execute, display, perform,
distribute, transmit, and/or broadcast in any fashion, through any
means, to any party, WebMD Offerings, including upon mutual agreement
of the parties, distribution by Microsoft or its licensees hosting
such WebMD Offerings on servers owned or designated by Microsoft or
its licensees.
12. PAYMENTS
In addition to payments required elsewhere in this Agreement and under
the MCS Agreement, WebMD agrees to pay Microsoft the amounts set forth in this
Section 12.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
12.1 ADVANCE PAYMENT FROM WEBMD TO MICROSOFT.
(A) YEARS 1 TO 5. In consideration for the rights granted
hereunder, WebMD hereby agrees to pay Microsoft the following non-refundable
yearly sums to be paid in equal quarterly installments within each Year, with
the first installment due on the Effective Date (or the appropriate anniversary
thereof) and subsequent installments due each ninety days thereafter for the
remainder of the Term until paid:
(I) In Year 1: a total of Twenty Nine Million
Dollars ($29,000,000) ("First Year Fee") in Seven Million Two Hundred
Fifty Thousand Dollar ($7,250,000) installments;
(II) In Year 2: a total of Thirty One Million Five
Hundred Thousand Dollars ($31,500,000) ("Second Year Fee") in Seven
Million Eight Hundred Seventy Five Thousand Dollar ($7,875,000)
installments;
(III) In Year 3: a total of Thirty Four Million
Dollars ($34,000,000) ("Third Year Fee") in Eight Million Five Hundred
Thousand Dollar ($8,500,000) installments;
(IV) In Year 4: a total of Thirty Two Million Five
Hundred Thousand Dollars ($32,500,000) ("Fourth Year Fee") in Eight
Million One Hundred Twenty Five Thousand Dollar ($8,125,000)
installments;
(V) In Year 5: a total of Thirty Five Million
Dollars ($35,000,000) ("Fifth Year Fee") in Eight Million Seven
Hundred Fifty Thousand Dollar ($8,750,000) installments.
(VI) Notwithstanding the foregoing, in the event an
agreement providing for an investment by Microsoft of a minimum of One
Hundred Million Dollars ($100,000,000) in WebMD ("Investment
Agreement") is not executed by the parties on the Execution Date of
this Agreement, then, at WebMD's option, the first and second
installments due under this Section 12.1(a), will be due on the
earlier of the occurrence of any of the following:
(1) The execution by the parties of the
Investment Agreement; or
(2) WebMD's closing of an initial offering to
the public of its common stock pursuant
to a registration statement effective
under the Securities Act of 1933, as
amended ("IPO") or the closing of any
other private or public financing by
WebMD; or
(3) Any transaction under which there is a
change in control of WebMD, excluding the
acquisition of WebMD by Healtheon
Corporation but otherwise including
without limitation (a) a merger or any
other combination of WebMD with another
party where the shareholders of WebMD
prior to such merger or combination own
less than sixty-five percent (65%) of the
merged or combined entity after such
merger or combination; (b) any
transaction or series of transactions
whereby a third party acquires direct or
indirect power to control the management
and policies of WebMD, as applicable,
whether through the acquisition of voting
securities, by contract, or otherwise;
(c) the sale or other transfer of any
part of the WebMD Site or any other
substantial portion of WebMD assets
(whether in a single transaction or
series of transactions), subject to
Section 18.3 below.
If WebMD delays payment of the first and second installments in
accordance with this Section 12.1(a)(vi), then Microsoft may in its
discretion delay payment of the First Year Guarantee and Second Year
Guarantee (as defined below) for an equal period.
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THE OMITTED PORTIONS.
(B) ADVANCE PAYMENT FOR EXTENDED TERM/PAYMENTS FROM
MICROSOFT. In the event that Microsoft elects to extend this Agreement pursuant
to Section 13.2 below, WebMD hereby agrees to pay Microsoft the following
non-refundable yearly sums to be paid in equal quarterly installments within
each Year, with the first installment due on the appropriate anniversary of the
Effective Date and subsequent installments due each ninety days thereafter for
the remainder of the Extended Term until paid:
(I) In Year 6: a total of Thirty Seven Million Five
Hundred Thousand Dollars ($37,500,000) ("Sixth Year Fee"), in Nine
Million Three Hundred Seventy Five Thousand Dollar ($9,375,000)
installments;
(II) In Year 7: a total of Forty Million Dollars
($40,000,000) ("Seventh Year Fee"), in Ten Million Dollar
($10,000,000) installments.
12.2 MICROSOFT REPORTS AND ADDITIONAL PAYMENTS. Within forty five
(45) days following the end of each quarter of each Year (or as may be
otherwise mutually agreed between the parties to satisfy WebMD's SEC reporting
requirements), Microsoft will submit to WebMD a written report detailing
Microsoft's Revenues for the preceding fiscal quarter ("Microsoft Revenue
Reports"). In consideration for the rights granted by WebMD in the Warrant
Agreement, Microsoft agrees to make the payments described below, which
payments shall be submitted contemporaneously with the Microsoft Revenue Report
for the last quarter of each Year, as appropriate.
(A) PAYMENTS BY MICROSOFT TO WEBMD IN YEARS 1 TO 5.
(I) During Year 1 of this Agreement, Microsoft
agrees to pay WebMD one hundred percent (100%) of the
Microsoft Revenues, until such time as WebMD has received a
total amount equal to the First Year Fee, at which time
Microsoft agrees to pay WebMD fifty percent (50%) of the
Microsoft Revenues as detailed in the Year 1 Revenue Reports
for the remainder of Year 1; provided that if WebMD's portion
of the Microsoft Revenues in Year 1 is less than Twenty Two
Million Five Hundred Thousand Dollars ($22,500,000) ("First
Year Guarantee"), Microsoft will provide WebMD with the
positive difference between the First Year Guarantee and
WebMD's portion of the Microsoft Revenues;
(II) During Year 2 of this Agreement, Microsoft
agrees to pay WebMD one hundred percent (100%) of the
Microsoft Revenues, until such time as WebMD has received a
total amount equal to the Second Year Fee, at which time
Microsoft agrees to pay WebMD fifty percent (50%) of the
Microsoft Revenues as detailed in the Year 2 Revenue Reports
for the remainder of Year 2; provided that if WebMD's portion
of the Microsoft Revenues in Year 2 is less than Twenty Two
Million Five Hundred Thousand Dollars ($22,500,000) ("Second
Year Guarantee"), Microsoft will provide WebMD with the
positive difference between the Second Year Guarantee and
WebMD's portion of the Microsoft Revenues;
(III) During the Year 3 of this Agreement, Microsoft
agrees to pay WebMD one hundred percent (100%) of the
Microsoft Revenues, until such time as WebMD has received a
total amount equal to the Third Year Fee, at which time
Microsoft agrees to pay WebMD fifty percent (50%) of the
Microsoft Revenues as detailed in the Year 3 Revenue Reports
for the remainder of Year 3; provided that if WebMD's portion
of the Microsoft Revenues in Year 3 is less than Twenty
Million Dollars ($20,000,000) ("Third Year Guarantee"),
Microsoft will provide WebMD with the positive difference
between the Third Year Guarantee and WebMD's portion of the
Microsoft Revenues;
(IV) During the Year 4 of this Agreement, Microsoft
agrees to pay WebMD one hundred percent (100%) of the
Microsoft Revenues, until such time as WebMD has received a
total amount equal to the Fourth Year Fee, at which time
Microsoft agrees to pay WebMD fifty percent (50%) of the
Microsoft Revenues as detailed in the Year 4 Revenue Reports
for the remainder of Year 4; provided that if WebMD's portion
of the Microsoft Revenues in Year 4 is less than Seventeen
Million Five Hundred Thousand Dollars ($17,500,000) ("Fourth
Year
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Guarantee"), Microsoft will provide WebMD with the positive
difference between the Fourth Year Guarantee and WebMD's
portion of the Microsoft Revenues;
(V) During the Year 5 of this Agreement, Microsoft
agrees to pay WebMD one hundred percent (100%) of the
Microsoft Revenues, until such time as WebMD has received a
total amount equal to the Fifth Year Fee, at which time
Microsoft agrees to pay WebMD fifty percent (50%) of the
Microsoft Revenues as detailed in the Year 5 Revenue Reports
for the remainder of Year 5; provided that if WebMD's portion
of the Microsoft Revenues in Year 5 is less than Seven
Million Five Hundred Thousand ($17,500,000) ("Fifth Year
Guarantee"), Microsoft will provide WebMD with the positive
difference between the Fifth Year Guarantee and WebMD's
portion of the Microsoft Revenues.
(B) PAYMENTS BY MICROSOFT TO WEBMD IN THE EXTEND TERM.
During Year 6, if any, of the Term of this Agreement, Microsoft agrees
to pay WebMD one hundred percent (100%) of the Microsoft Revenues until
such time as WebMD has received a total amount equal to the Sixth Year
Fee, at which time Microsoft agrees to pay WebMD fifty percent (50%) of
the Microsoft Revenue as detailed in the Year 6 Revenue Reports for
the remainder of Year 6. During Year 7, if any, of the Term of this
Agreement, Microsoft agrees to pay WebMD one hundred percent (100%) of
the Microsoft Revenues until such time as WebMD has received a total
amount equal to the Seventh Year Fee, at which time Microsoft agrees to
pay WebMD fifty percent (50%) of the Microsoft Revenue as detailed in
the Year 7 Revenue Report for the remainder of Year 7.
12.3 WEBMD ADDITIONAL PAYMENTS. WebMD agrees to make the following
additional payments, which payments shall be submitted within forty five (45)
days following the end of the last quarter of each Year, as appropriate: During
the each Year of the Term of this Agreement, WebMD agrees to pay Microsoft a
sales commission of twenty five percent (25%) of all amounts paid to WebMD by
Microsoft under Section 12.2(a) above up to the applicable yearly guarantee
(i.e., in Year 1 the First Year Guarantee, in Year 2 the Second Year Guarantee,
etc.).
12.4 PAYMENTS FOR MICROSOFT SPONSORSHIP COMMITMENT
(A) WEBMD REPORTS AND INVOICE. On a quarterly basis, WebMD
shall provide Microsoft with a report ("WEBMD QUARTERLY REPORT") that
contains the following information, in accordance with any reporting
forms that may be provided by Microsoft:
(i) the number of Microsoft-sponsored WebMD
Memberships during the just-completed quarter
(including initial date of registration, End User
Member location, and identity of party(ies) that
assisted in the distribution of the End User
Member's Microsoft-sponsored WebMD Membership);
(ii) the amount payable by Microsoft based upon (i) the
total number of Microsoft-sponsored WebMD
Memberships during the just-completed quarter and
(ii) the Base Membership Fee;
(iii) the total number of Microsoft-sponsored WebMD
Memberships sponsored by Microsoft since the
Effective Date; and
(iv) the amount of Promotional Payments due from WebMD
to Microsoft in accordance with Section 12.4(b)
below.
WebMD shall send the WebMD Quarterly Reports and corresponding
invoices to Microsoft no later than thirty days following the end of
each fiscal quarter.
(B) PAYMENT BY MICROSOFT. Microsoft agrees to pay invoices
properly submitted in accordance with this Section 12.4 within forty
five (45) days after Microsoft's receipt of the same.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
12.5 DISTRIBUTION PAYMENTS BY WEBMD. To facilitate distribution of
WebMD Memberships by Microsoft, WebMD agrees to pay Microsoft or Microsoft's
designee $5 for each WebMD Membership Month that Microsoft sponsors hereunder
("DISTRIBUTION Payments"). Such payments shall be due, with regard to the
Microsoft-sponsored WebMD Memberships in effect during a given quarter, thirty
(30) days after issuance of the WebMD Quarterly Report for such quarter.
Following written notice by Microsoft, WebMD shall direct all or some of the
Distribution Payments due hereunder to third parties designated by Microsoft.
12.6 REVENUE SHARING FOR MEDICAL PROFESSIONALS SECTION.
(A) WEBMD ADVERTISING/SPONSORSHIP REVENUES. WebMD will pay
Microsoft fifty percent (50%) of all WebMD Advertising/Sponsorship
Revenues pertaining to or derived from the Microsoft-sponsored WebMD
Memberships and DuPont-sponsored WebMD memberships until such time as
Microsoft has recouped, through the payments contemplated by this
Section 12.6(a), all amounts paid by Microsoft to WebMD for
Microsoft-sponsored WebMD Memberships provided under this Agreement,
at which point WebMD will pay Microsoft twenty five percent (25%) of
all WebMD Advertising/Sponsorship Revenues pertaining to or derived
from the Microsoft-sponsored WebMD Memberships and DuPont-sponsored
WebMD memberships for the remainder of the Term of this Agreement. If
WebMD agrees to pay any third party a greater percentage of WebMD
Advertising/Sponsorship Revenues than the then-current percentage of
WebMD Advertising/Sponsorship Revenues to be paid to Microsoft
hereunder, the percentage of WebMD Advertising/Sponsorship Revenues to
be paid to Microsoft hereunder shall automatically be increased to
equal the highest percentage of WebMD Advertising/Sponsorship Revenues
to be paid to any third party.
(B) WEBMD UPSELL REVENUES. WebMD will pay Microsoft
fifteen percent (15.0%) of all WebMD Upsell Revenues pertaining to or
derived from the Microsoft-sponsored WebMD Memberships and
DuPont-sponsored WebMD memberships, during the Term of this Agreement.
If WebMD agrees to pay any third party a greater percentage of WebMD
Upsell Revenues than the percentage of WebMD Upsell Revenues to be
paid to Microsoft hereunder, then the percentage of WebMD Upsell
Revenues to be paid to Microsoft hereunder shall automatically be
increased to equal the highest percentage of WebMD Upsell Revenues to
be paid to any third party.
(C) WEBMD E-COMMERCE REVENUES. WebMD will pay Microsoft
fifteen percent (15.0%) of all WebMD E-Commerce Revenues pertaining to
or derived from the Microsoft-sponsored WebMD Memberships and
DuPont-sponsored WebMD memberships, during the Term of this Agreement.
If WebMD agrees to pay any third party a greater percentage of WebMD
E-Commerce Revenues than the percentage of WebMD E-Commerce Revenues
to be paid to Microsoft hereunder, then the percentage of WebMD
E-Commerce Revenues to be paid to Microsoft hereunder shall
automatically be increased to equal the highest percentage of WebMD
E-Commerce Revenues to be paid to any third party.
(D) CALCULATION AND PAYMENTS. On a quarterly basis, WebMD
shall provide Microsoft with a written statement together with payment
for the amounts shown thereby to be due to Microsoft under this
Section 12.6. Such statement shall be in a format approved by
Microsoft that details, at a minimum, (i) the aggregate WebMD
Advertising/Sponsorship Revenues, WebMD Upsell Revenues, and WebMD
E-Commerce Revenues for the just completed quarter; (ii) Microsoft's
allocated portion of such revenues; and (iii) such other information
as Microsoft deems necessary to determine the amounts payable to
Microsoft under this Section 12.6
12.7 GENERAL. Receipt or acceptance by the parties of any reports
furnished pursuant to this Agreement or any sums paid hereunder shall not
preclude such party from questioning the correctness thereof at any time, up to
six (6) months after receipt of the report or payment, and in the event that
any mistake is discovered in any such report or payment, and the party making
the mistake is apprised of it, such party shall immediately rectify the
mistake.
12.8 AUDITS.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
(A) BY WEBMD. During the Term of this Agreement, Microsoft
agrees to keep all usual and proper records and books of account and
all usual and proper entries and other documentation relating to
Microsoft Revenue and all payments to be made by Microsoft hereunder.
During the Term and for a period of six (6) months following the
expiration or termination of this Agreement, WebMD shall have the
right to cause an audit and/or inspection to be made of such records
of Microsoft in order to verify statements issued by Microsoft and
Microsoft's compliance with the terms of this Agreement. Any such
audit shall be conducted by an independent certified public accountant
selected by WebMD (other than on a contingent fee basis) and
reasonably acceptable to Microsoft. Any audit and/or inspection shall
be conducted during regular business hours at Microsoft's facilities
upon at least thirty (30) days prior written notice. Such audits shall
be made no more often than once every twelve (12) months.
(B) BY MICROSOFT. During the Term of this Agreement, WebMD
agrees to keep all usual and proper records and books of account and
all usual and proper entries and other documentation relating to the
WebMD Quarterly Reports and all user and other reports submitted or to
be submitted by WebMD hereunder. During the Term and for a period of
six (6) months following the expiration or termination of this
Agreement, Microsoft shall have the right to cause an audit and/or
inspection to be made of such records of WebMD in order to verify
statements issued by WebMD and WebMD's compliance with the terms of
this Agreement. Any such audit shall be conducted by an independent
certified public accountant selected by Microsoft (other than on a
contingent fee basis) and reasonably acceptable to WebMD. Any audit
and/or inspection shall be conducted during regular business hours at
WebMD's facilities upon at least thirty (30) days prior written
notice. Such audits shall be made no more often than once every twelve
(12) months.
12.9 COSTS. Except as expressly provided herein, all costs
incurred by any party in fulfilling any of its obligations under this Agreement
shall be borne by that party, without reimbursement from the other party.
13. TERM/DEFAULT/TERMINATION
13.1 TERM. This Agreement shall commence on the Effective Date and
continue, except as provided in Section 3.1(b)(ix) above, for a period of five
(5) years following the earlier of (a) the thirtieth day following the
Effective Date or (b) the date on which the transition page (referenced in
Section 2.1(a)) is publicly available, unless earlier terminated or extended as
provided in this Section 13 (the "Term").
13.2 RENEWAL. The Term of this Agreement can be extended by
Microsoft in its sole discretion for successive additional periods of one (1)
year each ("Extended Term") pursuant to the same terms and conditions set forth
herein. To exercise the foregoing renewal option, Microsoft shall provide WebMD
with written notice of same at least ninety (90) days prior to the expiration
of the original Term of this Agreement.
13.3 TERMINATION FOR CAUSE
(A) BY MICROSOFT/WEBMD. In addition to any other rights
and/or remedies that such party may have under the circumstances, all
of which are expressly reserved, and except as expressly provided in
Section 13.3(b) below, Microsoft and WebMD may terminate this
Agreement at any time if:
(I) the other party (i.e., Microsoft or WebMD) is
in material breach of any warranty, representation, term,
condition or covenant of this Agreement, other than those
contained in Section 10, and fails to cure that breach within
forty-five (45) days after written notice thereof; or
(II) The other party is in material breach of
Section 10; or
(III) the other party becomes insolvent or makes any
assignment for the benefit of creditors or similar transfer
evidencing insolvency; or suffers or permits the commencement
of any form of insolvency or receivership proceeding; or has
any petition under any bankruptcy law
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THE OMITTED PORTIONS.
filed against it, which petition is not dismissed within
sixty (60) days of such filing; or has a trustee or receiver
appointed for its business or assets or any part thereof.
(B) BY WEBTV, MSNBC, WEBMD.
(I) Notwithstanding any other provision of this
Agreement, and in addition to any other rights and/or
remedies that such party may have under the circumstances,
WebMD shall be entitled to terminate this Agreement solely
with respect to the WebTV Health Channel, at any time if
WebTV is in material breach of any warranty, representation,
term, condition or covenant made by WebTV under this
Agreement, other than those contained in Section 10, and
fails to cure that breach within forty-five (45) days after
written notice thereof, or is in material breach of Section
10. Further, WebMD shall be entitled to terminate this
Agreement solely with respect to the MSNBC Health Section, at
any time if MSNBC is in material breach of any warranty,
representation, term, condition or covenant made by MSNBC
under this Agreement, other than those contained in Section
10, and fails to cure that breach within forty-five (45) days
after written notice thereof, or is in material breach of
Section 10.
(II) Correspondingly, in addition to any other
rights and/or remedies that such party may have under the
circumstances, WebTV shall be entitled to terminate this
Agreement solely with respect to the WebTV Health Channel, at
any time if WebMD is in material breach of any warranty,
representation, term, condition or covenant made by WebMD
under this Agreement solely with regard to the WebTV Health
Channel, other than those contained in Section 10, and fails
to cure that breach within forty-five (45) days after written
notice thereof, or is in material breach of Section 10 (with
regard to WebTV confidential information), and neither MSNBC
nor Microsoft shall have a right of termination with regard
to any such breach. Further, in addition to any other rights
and/or remedies that such party may have under the
circumstances, MSNBC shall be entitled to terminate this
Agreement solely with respect to the MSNBC Health Section, at
any time if WebMD is in material breach of any warranty,
representation, term, condition or covenant made by WebMD
under this Agreement solely with regard to the MSNBC Health
Section, other than those contained in Section 10, and fails
to cure that breach within forty-five (45) days after written
notice thereof, or is in material breach of Section 10 (with
regard to MSNBC confidential information), and neither WebTV
nor Microsoft shall have a right of termination with regard
to any such breach. For purposes of clarification, nothing
herein shall limit Microsoft's right of termination under
Section 3.3(a) above with regard to any material breach by
WebMD that affects more than the WebTV Health Channel or the
MSNBC Health Section.
(C) SURVIVAL. Termination under Sections 13.3(a)(i)-(iii),
and 13(b) shall be effective immediately upon written notice. In the
event of termination hereunder, the following sections shall survive:
Section 2.6 (as appropriate as provided therein), the first sentence
of Section 4.3, Sections 9, 10, 12.8, 13.4, 14, 15, 18.2, 18.4, and
18.5.
13.4 EFFECT OF TERMINATION.
(A) Upon termination, and subject to Section 13.3(b) above,
each Party shall, at the other Party's direction, return or certify
destruction of Confidential Information of such other Party. No Party
shall be liable to the other for damages of any sort resulting solely
from terminating this Agreement in accordance with its terms. If
Microsoft terminates this Agreement pursuant to Section 13.3 on any
date that is more than ninety (90) days after the Effective Date, then
WebMD shall pay Microsoft all sums due and owing as of the date of
termination, and further shall pay Microsoft two additional quarterly
installments on the Advance Payments set forth in Section 12.1(a) or
12.1(b) (whichever section is applicable as of the date of
termination). If WebMD terminates this Agreement pursuant to Section
13.3 on any date that is more than ninety (90) days after the
Effective Date, then Microsoft shall pay WebMD all sums due and owing
as of the date of termination, and further shall pay WebMD an amount
equal to two times the average amount
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
of Microsoft Revenue paid to WebMD under Section 12.2 above over the
two quarters immediately preceding the quarter in which the
termination occurs (i.e., [(Microsoft Revenue 1st Preceding Quarter +
Microsoft Revenue for 2nd Preceding Quarter) / 2] x 2).
(B) Upon expiration or termination of this Agreement, each
party shall provide reasonable assistance to the other for such
reasonable time and upon such terms and conditions as shall be
mutually agreed upon in order to assure an orderly transition and wind
down in such a manner as shall minimize disruption to the Users. The
goal of the parties is to ensure a smooth and seamless transition for
the user to maintain a high level of customer satisfaction. Subject to
the foregoing, following expiration or termination of this Agreement,
WebMD shall immediately provide Microsoft, WebTV, and MSNBC with all
User Information WebMD collected prior to the expiration and
termination which WebMD is required to provide under Sections 2.6 and
3.1(a) and (b) above. To the extent such rights have been or are
obtained from User and subject to Section 2.6, each party may retain
and continue to use all User Information in its possession following
the expiration or termination of the Agreement.
14. WARRANTIES AND INDEMNIFICATION.
14.1 WEBMD WARRANTIES. WebMD warrants and represents that: (i) it
has sufficient authority to enter into this Agreement and to grant the rights
set forth herein; (ii) it has not previously and will not grant any rights to
any third party that are inconsistent with the rights granted to Microsoft,
MSNBC and/or WebTV herein; (iii) all materials delivered by WebMD to Microsoft
and/or included in the Health Channel pursuant to this Agreement, excluding
content provided by Microsoft (directly or through a third party) or MSNBC and
used in accordance with their instructions ("WebMD Content") are owned or
licensed by WebMD and do not infringe the copyrights, trademarks, service marks
or any other personal or proprietary right of any third party; (iv) to the best
of WebMD's knowledge after reasonable inquiry, the WebMD Site and Health
Channel and all actions occurring on the WebMD Site and Health Channel are in
compliance with all applicable laws, including, but not limited to laws
governing confidential health care information (i.e., the Health Insurance
Portability and Accountability Act of 1996 (HIPAA)); and (v) the Health Channel
and all WebMD Content contained therein comply with the Specifications; (vi)
WebMD will not upload or permit any upload of any messages, data, images or
programs, excluding those provided to WebMD by Microsoft and uploaded in
accordance with all Microsoft's directions, to the Health Channel or any
Microsoft property or equipment, that would violate the property rights of
others, including unauthorized copyrighted text, images, programs or trade
secrets or other confidential and/or proprietary information, or trademarks or
service marks used in an infringing fashion; (vii) the WebMD Content, to the
best of WebMD's knowledge after reasonable inquiry, is factually accurate and
does not contain any information, instruction or formula that might be
injurious to anyone's physical well-being, and that it does not, and its use by
Microsoft as permitted in this Agreement will not, defame or disparage any
third party; (viii) WebMD shall be a member in good standing in the TRUSToE
privacy program by the earlier of the Effective Date or the availability of the
transition page described in Section 2.1(a) above, and shall remain such or be
a member in good standing of another industry-recognized online privacy
organization during the Term, WebMD shall adhere to information gathering,
dissemination, privacy protection and other practices specified in the TRUSToE
license agreement available at http://www.truste.org, as such agreement may be
amended from time to time or such other organization's license, and with
respect to the Health Channel, WebMD's policy program shall be consistent with
the privacy policy displayed to end-users as part of the template; and (ix)
WebMD has the right to include all parts, including but not limited to content,
materials and services, and excluding Advertising, of the WebMD Consumer Site
in the Health Channel and the right to grant to Microsoft all rights granted by
WebMD to Microsoft under this Agreement, subject only to contracts in existence
as of the Execution Date which create the limitations set forth in Exhibit __
hereto.
14.2 MICROSOFT, MSNBC AND WEBTV WARRANTIES. Microsoft warrants and
represents that: (i) it has sufficient authority to enter into this Agreement,
(ii) all materials delivered by Microsoft to WebMD pursuant to this Agreement
(excluding any trademarks and logos) do not infringe the copyrights,
trademarks, service marks or any other personal or proprietary right of any
third party; (iii) to the best of its knowledge after reasonable inquiry, MSN
and all actions occurring on the foregoing are in compliance with all
applicable laws; and (iv) Microsoft is a member in good standing in the TRUSToE
privacy program, and shall remain such or be a member in good standing of
another industry-recognized online privacy organization during the Term of this
Agreement, and Microsoft shall adhere to information gathering, dissemination,
privacy protection and other practices specified in the TRUSToE
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
license agreement available at http://www.truste.org, as such agreement may be
amended from time to time or such other organization's license. MSNBC warrants
and represents that it has sufficient authority to enter into this Agreement.
WebTV warrants and represents that it has sufficient authority to enter into
this Agreement.
14.3 INDEMNIFICATION BY WEBMD. WebMD will indemnify Microsoft,
MSNBC and WebTV from and against any loss, claim, liability, damage, action or
cause of action (including, without limitation, reasonable attorneys' fees)
brought against Microsoft by a third party and arising from or related to (a)
the WebMD Content; (b) any materials or data provided by WebMD or at WebMD's
direction to Microsoft; (c) any act or omission which if true would be a breach
by WebMD of this Agreement; (d) any claim that the WebMD Site or Health
Channel, or any action occurring on the WebMD Site or Health Channel, violates
any applicable laws; (e) any claim that WebMD Content on the Health Channel is
not factually accurate or contains information, instructions or formulas that
are injurious to person's physical well-being, or defame or disparage a third
party; (f) any information subject to HIPAA regulation or (g) the Medical
Professionals Section; provided that Microsoft cooperates as set forth in
Section 14.5. Microsoft reserves the right to immediately discontinue the
placement of the Health Channel or to otherwise require the removal of any
portion of the Health Channel and/or any links to the WebMD Site as provided in
this Agreement, pending the satisfactory resolution of such matter, in the
event that Microsoft receives a claim from a third party which alleges that the
Health Channel, or any part thereof, or a section of the WebMD Site directly
linked to by Microsoft or any portion thereof or any materials delivered
hereunder: (a) violates any applicable laws, and/or (b) infringes the
copyrights, trademarks, service marks or any other proprietary right of any
third party; provided that Microsoft in good faith believes that such
allegation has merit and provided that Microsoft may only discontinue or remove
the relevant portion of the Health Channel or links impacted by or referenced
in the claim.
14.4 INDEMNIFICATION BY MICROSOFT. Microsoft will indemnify WebMD
from and against any loss, claim, liability, damage, action or cause of action
(including, without limitation, reasonable attorneys' fees) brought against
WebMD by a third party and arising from or related to any material contained
within the Network Framework, any materials provided by Microsoft to WebMD, or
any breach by Microsoft of the foregoing warranties, provided that WebMD
cooperates as set forth in Section 14.5. WebMD reserves the right to
immediately replace the relevant content from the Health Channel as provided in
this Agreement, pending the satisfactory resolution of such matter, in the
event that WebMD receives a claim from a third party which alleges that the
Health Channel or any portion thereof or any materials delivered hereunder: (a)
violates any applicable laws, and/or (b) infringes the copyrights, trademarks,
service marks or any other proprietary right of any third party; provided that
WebMD in good faith believes that such allegation has merit.
14.5 INDEMNIFICATION PROCESS. If any action shall be brought
against a Party (the "Claimant") in respect to which indemnity may be sought
from the another Party (the "Indemnifying Party") pursuant to the provisions of
this Section, the Claimant shall promptly notify the Indemnifying Party in
writing, specifying the nature of the action and the total monetary amount
sought or other such relief as is sought therein. The Claimant shall cooperate
with the Indemnifying Party at the Indemnifying Party's expense in all
reasonable respects in connection with the defense of any such action. The
Indemnifying Party may upon written notice to Claimant undertake to control and
conduct all proceedings or negotiations in connection therewith, assume and
control the defense thereof, and if it so undertakes, it shall also undertake
all other required steps or proceedings to settle or defend any such action,
including the employment of counsel which shall be reasonably satisfactory to
Claimant, and payment of all reasonably incurred expenses. Claimant shall have
the right to employ separate counsel to provide input into the defense, at
Claimant's own cost. The Indemnifying Party shall reimburse Claimant upon
demand for any payments made or loss suffered by it at any time after the date
of tender, based upon the judgment of any court of competent jurisdiction or
pursuant to a bona fide compromise or settlement of claims, demands, or
actions, in respect to any damages to which the foregoing relates. The
Indemnifying Party shall not settle any claim or action under this Section 14.5
on Claimant's behalf without first obtaining Claimant's written permission,
which permission shall not be unreasonably withheld.
14.6 PRODUCTS OR SERVICES DELIVERED UNDER THE TERMS OF THIS
AGREEMENT SHALL BE SUBJECT TO THE TERMS OF THE LIMITED WARRANTY STATEMENT, IF
ANY, SPECIFIED BY THE DELIVERING PARTY FOR THE SPECIFIC PRODUCT OR SERVICE.
CERTAIN SOFTWARE
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
PRODUCTS MAY BE PROVIDED TO THE OTHER PARTY "AS IS" WITHOUT WARRANTY OR
CONDITION OF ANY KIND, IF SO DESIGNATED BY THE LICENSOR. FOR SUCH PRODUCTS, THE
ENTIRE RISK AS TO THE RESULTS AND PERFORMANCE OF SUCH SOFTWARE IS ASSUMED BY
THE RECEIVING PARTY AND ITS CUSTOMERS AND SUBLICENSEES, IF ANY. THE WARRANTIES
SET FORTH IN SECTIONS 14.1, 14.2, AND THIS SECTION 14.6 ARE THE ONLY WARRANTIES
MADE BY THE PARTIES. EACH PARTY DISCLAIMS ANY AND ALL OTHER WARRANTIES OR
REPRESENTATION EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED
WARRANTIES OF MERCHANTABILITY, TITLE, AND FITNESS FOR A PARTICULAR PURPOSE. NO
PARTY WARRANTS THAT ACCESS TO OR USE OF THE SITES OR CHANNELS WILL BE
UNINTERRUPTED OR ERROR-FREE, OR THAT ANY SOFTWARE OR SERVICES WILL MEET ANY
PARTICULAR CRITERIA OF PERFORMANCE OR QUALITY. WITHOUT LIMITING THE GENERALITY
OF THE FOREGOING, WEBMD EXPRESSLY ACKNOWLEDGES AND AGREES THAT, EXCEPT AS
EXPRESSLY PROVIDED HEREIN, MICROSOFT HAS NOT MADE ANY EXPRESS OR IMPLIED
REPRESENTATIONS, ASSURANCES AND/OR WARRANTIES REGARDING THE NUMBER OF CLICK
THROUGHS OR WEBMD SITE WEB PAGE VIEWS WHICH MAY BE GENERATED BY THE PLACEMENT
OF LINKS HEREUNDER AND THAT WEBMD HAS NOT RELIED ON ANY STATEMENTS BY MICROSOFT
OR ANY THIRD PARTIES IN RELATION THERETO IN ENTERING INTO THIS AGREEMENT.
15. LIMITATION OF LIABILITIES
NO PARTY SHALL BE LIABLE TO THE OTHER FOR ANY INDIRECT, INCIDENTAL,
CONSEQUENTIAL, PUNITIVE OR SPECIAL DAMAGES, ARISING OUT OF OR RELATED TO THIS
AGREEMENT INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF BUSINESS PROFITS,
BUSINESS INTERRUPTION, LOSS OF BUSINESS INFORMATION, AND THE LIKE, EVEN IF SUCH
PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THIS SECTION SHALL
NOT APPLY TO ANY PARTY'S (A) ABILITY TO OBTAIN INJUNCTIVE OR OTHER EQUITABLE
RELIEF; (B) OBLIGATIONS UNDER SECTION 10 OR THE NDA; AND (C) INDEMNIFICATION
OBLIGATIONS UNDER SECTION 14.
16. NON-EXCLUSIVITY; PRESS RELEASES
16.1 Except as specifically stated herein, nothing in this Agreement
will be construed as restricting any Party's ability to acquire, license,
develop, manufacture or distribute for itself, or have others acquire, license,
develop, manufacture or distribute for itself, content, software, news, sites,
search services, search results or the like, which is the same or similar to
that contemplated by this Agreement, or to market, promote and distribute same
in addition to that contemplated by this Agreement.
16.2 No party will issue any press release or make any public
announcement(s) relating in any way whatsoever to this Agreement or the
relationship established by this Agreement without the express prior written
consent of the other party, which consent shall not be unreasonably withheld.
However, the parties acknowledge that this Agreement, or portions thereof, may
be required under applicable law to be disclosed, as part of or an exhibit to a
party's required public disclosure documents. If any party is advised by its
legal counsel that such disclosure is required, it will notify the other in
writing and the parties will jointly seek confidential treatment of this
Agreement to the maximum extent reasonably possible, in documents approved by
both parties and filed with the applicable governmental or regulatory
authorities.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
17. INSURANCE
17.1 Effective with the inception and throughout the Term of this
Agreement, WebMD shall procure and maintain the following insurance coverage.
Such insurance shall be in a form and with insurers reasonably acceptable to
Microsoft, and shall comply with the following minimum requirements: Commercial
General Liability Insurance of the Occurrence Form with policy limits of not
less Three Million Dollars ($3,000,000) combined single limit each occurrence
for Bodily Injury and Property Damage combined, and Two Million Dollars
($2,000,000) Personal and Advertising Injury Limit; and
17.2 WebMD shall procure and maintain the following insurance
coverage. Such insurance shall be in a form and with insurers reasonably
acceptable to Microsoft, and shall comply with the following minimum
requirements: Errors & Omissions Liability / Professional Liability Insurance
with policy limits of not less than Four Million Dollars ($4,000,000) each
claim with a deductible of not more than $50,000.00. Such insurance shall
include coverage for infringement of proprietary rights of any third party,
including without limitation copyright and trademark infringement as related to
WebMD's performance under this Agreement. The Errors & Omissions Liability /
Professional Liability Insurance retroactive coverage date will be no later
than the Effective Date of this Agreement. Upon expiration or termination of
this Agreement, WebMD will maintain an extended reporting period providing that
the claims first made and reported to the insurance WebMD within one year after
the end of this Agreement will be deemed to have been made during the policy
period.
Promptly upon execution of the Agreement, WebMD shall provide to
Microsoft proof evidencing full compliance with the insurance requirements set
forth herein. WebMD shall notify Microsoft in writing if WebMD's insurance
coverage is to be canceled or materially altered so as to not comply with the
requirements of this section with such notice to provided be no later than the
later of (i) at least thirty (30) days in advance of the cancellation or (ii)
twenty-four (24) hours after WebMD receives notice of the cancellation.
18. GENERAL PROVISIONS
18.1 INDEPENDENT CONTRACTORS. The Parties are independent
contractors with respect to each other, and nothing in this Agreement shall be
construed as creating an employer-employee relationship, a partnership, agency
relationship or a joint venture between the Parties.
18.2 GOVERNING LAW. This Agreement shall be governed by the laws of
the State of New York as though entered into by New York residents and to be
performed entirely within the State of New York. The parties consent to
exclusive jurisdiction and venue in the state and federal courts sitting in New
York. In any action or suit to enforce any right or remedy under this Agreement
or to interpret any provision of this Agreement, the prevailing Party shall be
entitled to recover its costs, including reasonable attorneys' fees.
18.3 ASSIGNMENT. No party may transfer, assign or sublicense this
Agreement, or any rights and/or obligations hereunder, whether by contract or
by operation of law, except with the express written consent of the other
parties, and any attempted transfer, assignment or sublicense by a party in
violation of this Section shall be void and shall constitute a material default
and breach of this Agreement. For purposes of this Agreement, an "transfer"
under this Section shall be deemed to include, without limitation, the
following: (a) a merger or any other combination of an entity with another
party where the shareholders of WebMD prior to such merger or combination own
less than sixty-five percent (65%) of the merged or combined entity after such
merger or combination; (b) any transaction or series of transactions whereby a
third party acquires direct or indirect power to control the management and
policies of WebMD or Microsoft, as applicable, whether through the acquisition
of voting securities, by contract, or otherwise; (c) the sale or other transfer
of any part of the business obligated or benefiting from this Agreement or any
other substantial portion of assets (whether in a single transaction or series
of transactions), or (d) the transfer of any rights or obligations in the
course of a liquidation or other similar reorganization of an entity. Subject
to the provisions of this Section, this Agreement shall be binding upon and
inure to the benefit of each party and their respective successors and assigns.
Any transfer, assignment or sublicense approved by a party will at a minimum
require that the party to which this Agreement, or any rights and/or
obligations hereunder, is transferred, assigned or sublicensed succeeds the
transferring, assigning, or sublicensing
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
party as to all obligations (including the obligations set forth in this
Section 18.3) of the transferring, assigning or sublicensing party.
18.4 CONSTRUCTION. In the event that any provision of this
Agreement conflicts with governing law or if any provision is held to be null,
void or otherwise ineffective or invalid by a court of competent jurisdiction,
(i) such provision shall be deemed to be restated to reflect as nearly as
possible the original intentions of the Parties in accordance with applicable
law, and (ii) the remaining terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect. This Agreement has been
negotiated by the Parties and their respective counsel and will be interpreted
fairly in accordance with its terms and without any strict construction in
favor of or against any party. The section headings used in this Agreement are
intended for convenience only and shall not be deemed to affect in any manner
the meaning or intent of this Agreement or any provision hereof.
18.5 NOTICES. All notices and requests in connection with this
Agreement shall be given in writing and shall be deemed given as of the day
they are received either by messenger, delivery service, or in the United
States of America mail, postage prepaid, certified or registered, return
receipt requested, and addressed as follows:
>TABLE>
>CAPTION>
To WebMD: To Microsoft:
>S> >C>
WebMD, Inc. Microsoft Corporation
400 The Lenox Building One Microsoft Way
3399 Peachtree Road NE Redmond, WA 98052-6399
Atlanta, Georgia 30326
Phone: 404.479.7600 Phone: 425.882.8080
Fax: 404.479.7603 Fax: 425.936.7329
Attention: General Counsel Attention: Senior Business Dev't Mgr./Finance
Copy to: Chief Financial Officer Copy to: Law & Corporate Affairs, US Legal
(not effective for notice purposes) Fax: 425.936.7409
>CAPTION>
To MSNBC: To WebTV:
-------- --------
>S> >C>
MSNBC WebTV Networks, Inc.
One Microsoft Way 1250 Charleston Avenue
Redmond, WA 98052 Mt. View, CA 94043
Attention: Dir. Business Dev't Attention: V.P. Network Media Group
Phone: 425.882.8080 Phone: 650.614.6012
Fax: 425.936.7329 Fax: 650.463.1529
Copy to: Microsoft Law & Copy to: Corporate Counsel
Corporate Affairs, US Legal Fax: 650.614.2782
Fax: 425.936.7409
>/TABLE>
or to such other address as a Party may designate pursuant to this notice
provision.
18.6 EXHIBITS. The following Exhibits are part of this Agreement
and are hereby incorporated by reference:
>TABLE>
>S> >C>
Exhibit A-1 Health Channel Content Specifications
Exhibit A-2 Health Channel Technical Specifications
Exhibit B In Service Promotion Box
Exhibit C MSN Module
Exhibit D Logo Guidelines
Exhibit E MS Online ID Evaluation Program
>/TABLE>
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
>TABLE>
>S> >C>
Exhibit F MCS Agreement and Work Order
Exhibit G Use Specifications for the MSN Logos
Exhibit H Non-Disclosure Agreement
Exhibit I WebMD Logos
Exhibit J-1 Medical Professionals Section List #1
Exhibit J-2 Medical Professionals Section List #2
>/TABLE>
18.7 ENTIRE AGREEMENT. This Agreement shall not be effective until
signed by both Parties. This Agreement constitutes the entire agreement between
the Parties with respect to the subject matter hereof and supersedes all prior
and contemporaneous agreements or communications. This Agreement shall not be
modified except by a written agreement dated subsequent to the date of this
Agreement and signed on behalf of WebMD and Microsoft by their respective duly
authorized representatives. No waiver of any breach of any provision of this
Agreement shall constitute a waiver of any prior, concurrent or subsequent
breach of the same or any other provisions hereof, and no waiver shall be
effective unless made in writing and signed by an authorized representative of
the waiving party.
[remainder of page intentionally left blank]
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
The parties have caused this Agreement to be executed by their duly
authorized representatives as of the Effective Date.
>TABLE>
>CAPTION>
MICROSOFT CORPORATION WEBMD, INC.
>S> >C>
By /s/ Laura Jennings By /s/ W. Michael Heekin
----------------------------------- --------------------------------------------
Name (Print) Laura Jennings Name (Print) W. Michael Heekin
--------------------------------- ------------------------------------------
Title Vice President Title Executive Vice President and Secretary
-------------------------------- -----------------------------------------
Date 6/4/99 Date 5/10/99
----------------------------------- ------------------------------------------
MSNBC INTERACTIVE NEWS, L.L.C WEBTV NETWORKS, INC.
(Signing solely with regard to Sections 2.1, (Signing solely with regard to Sections 2.1, 2.6, 3.5,
2.3(a), (b), (e), and (g), 2.6, 3.5, 9, 10, 11.1(c), 9, 10, 11.1(c)-(d), 11.2(a)-(b), 12.9, 13, 14.6, 15, 16, 18,
11.2(a)-(b), 12.9, 13, 14.6, 15, 16, 18, Exhibit A-1 paragraphs(A)(3)-(5)and (C), and Exhibit A-2
Exhibit A-1 paragraphs (A)(3)-(5) and (C), and
Exhibit A-2)
By /s/ John C. Nicol By /s/ Vce Poletto
-------------------------------- -------------------------------------------
Name (Print) John C. Nicol Name (Print) Vce Poletto
-------------------------------- -----------------------------------------
Title General Manager Title VP
-------------------------------- ---------------------------------------
Date 5/26/99 Date 6/1/99
-------------------------------- ----------------------------------------
>/TABLE>
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit A-1
Health Channel
Content Specifications
A. General Content Requirements:
1. Layout of the Health Channel and Home Page of the MSN Health Section:
WebMD shall ensure that the layout and presentation of materials within the
Health Channel, including the amount and placement of advertising and all other
space, will be consistent with the Network Frameworks and SDK as further
described in this Agreement and otherwise as mutually approved between the
parties. For the avoidance of doubt, all WebMD materials available to end users
whose access to such materials originates on the Health Channel or on any MSN
Site or page thereof shall be displayed to such end user in the Network
Framework. WebMD shall include, at a minimum, a 468 x 60 pixel banner space at
the top of every page so that it is visible above-the-fold at a screen
resolution of 640 x 480 with a standard browser configuration. Microsoft and
WebMD shall work together to determine the layout and presentation of the home
page of the MSN Health Section so that it is consistent with the layout and
presentation of the Health Channel and all other aspects of the MSN Health
Section, subject to Microsoft's final approval.
2. Content for the Health Channel: Except as otherwise specifically
provided in this Agreement, all content, materials, features, technology,
services, etc. included by WebMD within the Health Channel (a) shall be the
sole responsibility of WebMD and shall be developed and maintained in
accordance with Section B of this Exhibit A-1, (b) shall be relevant to the
topic and particular section of the Health Channel in which they are included,
(c) shall be of high quality in all ways, including with respect to editorial
content and volume, as determined by comparison to other sources of similar
information available on the Internet and in no event shall the Health Channel
contain a smaller volume of pages as the WebMD Consumer Site contains as of the
Effective Date of this Agreement, (d) shall be comparable or superior to the
health related content available on the top five (5) ranked (by Media Metrix)
Internet portal/network sites with respect to at a minimum the following
factors: (i) substance, quality, volume, (ii) breadth and depth of content,
(iii) tools and functionality, (iv) personalization, (v) appeal and ease of use
of user interface, (e) shall be updated by WebMD (A) regularly so as to meet
the requirements of sub-sections (b), (c) and (d) above and end-users
preferences, including as further described in this Exhibit A-1, and (B) daily
to keep the content new and interesting, and (f) subject to the foregoing
requirements in (a)-(e), the Health Channel shall be the same or substantially
similar as (i.e., in substance, a mirror of) that which is available to end
users accessing the WebMD Consumer Site at any time during the Term of this
Agreement. Without limitation, WebMD shall include in the Health Channel all
material and content contained in the WebMD Consumer Site, including, but not
limited to, all material and content provided to WebMD for the WebMD Consumer
Site by third parties subject to the following: (x) this requirement shall not
apply to material and content that may not be provided to WebMD as a result of
contracts in effect as of the Execution Date, (y) with respect to contracts
with third parties entered into after the Execution Date, WebMD shall obtain
all rights necessary to include such third parties material and content on the
Health Channel, and (z) with respect to material and content not included in
the Health Channel as a result of (x) above, WebMD shall secure and include
equivalent (e.g., those elements described in sub-Section (d) above) material
and content for the Health Channel. Dispute Mechanism: In the event that
Microsoft, MSNBC or WebTV reasonably believes that WebMD is in material breach
of sub-Sections (b) and/or (c) above with respect to the Health Channel or any
part(s) thereof, Microsoft will notify WebMD and WebMD shall notify Microsoft
within three (3) business days whether WebMD agrees or disagrees with
Microsoft, MSNBC or WebTV. If WebMD agrees with Microsoft, MSNBC or WebTV and
the parties mutually agree on what modifications shall be made, then WebMD
shall have forty five (45) days to make such modification and bring the Health
Channel or the relevant part(s) into compliance with such sub-sections. In the
event that WebMD disagrees with Microsoft, MSNBC or WebTV or the parties do not
mutually agree on what modifications should be made, the parties shall mutually
agree on an independent third party to review the Health Channel's, or such
part(s)'s, compliance with such sub-Sections. If such independent third party
determines that the Health Channel or any part does not meet the requirements
of such sub-Sections, Microsoft shall have the right to provide or obtain from
any other source replacement content, features, technology, services, etc. and
at Microsoft's, MSNBC's or WebTV's request as appropriate WebMD shall host such
replacement content, features, technology, services etc. as part of the Health
Channel. For the avoidance
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THE OMITTED PORTIONS.
of doubt, Microsoft, MSNBC and/or WebTV may opt to include such replacement
content, features, technology, services, etc. as part of the non-Health Channel
section of the MSN Health Section.
3. Disclaimer: WebMD shall ensure that the Health Channel shall include a
prominently placed welcome notice to all parties that enter the Health Channel
that includes the following (or such other disclaimer as may be provided by
Microsoft from time to time): "We hope that you find the materials in this
service to be a helpful source of information about health-related topics.
While we endeavor to keep this information accurate and current, you should
keep in mind that our information may contain errors or be incomplete in some
respects. Most importantly, information about health and medical matters should
not be confused with health or medical advice, which is ultimately an opinion
or recommendation as to the proper course of action based on the facts of your
specific circumstances. These materials cannot provide you with health or
medical advice: only your health care provider can do that. The information
contained in this web site is not a substitute for medical advice. Please
consult your health care provider before beginning any health related program."
4. References to the Channel: In creating the Health Channel from the
WebMD Consumer Site, WebMD shall (a) revise any references that are made in the
Health Channel to the WebMD Consumer Site to refer instead to the Health
Channel; and (b) obtain Microsoft's prior written approval for those and other
references made by WebMD to the Health Channel (e.g., on the Health Channel
itself or on the WebMD Site).
5. Links. WebMD shall not include any links from within the Health
Channel to the WebMD Site without Microsoft's prior written approval. WebMD
shall include links from the Health Channel to other MSN properties upon
request by Microsoft.
B. The WebMD Development Process
In general, the WebMD observes the development process, strategy, content,
features, and functionality set forth in this Subsection B with regard to the
WebMD Site, and WebMD shall observe the same development process, strategy,
content, features, and functionality with regard to the Health Channel except as
otherwise expressly provided in this Agreement.
Outline of process:
Marketing or user feature idea.
Research and testing of the proposed initiatives.
Design concepts and more testing.
Formal specifications & scheduling.
Implementation and testing.
Release.
Regular reviews & updates.
WebMD usually observes a 60 to 90 day formal schedule for updating our online
service with either new features or improvements that have gone through the
above process. Our list of prospective additions is usually longer than what
can be implemented on the next release. This allows WebMD to begin planning for
additional releases past the nearest one on the horizon.
A big component of how WebMD approaches new features is through market research
and testing. Given the competition for space in each release, it is essential
only those features which have been tested for user acceptance, etc. make it to
the release stage. This focus on testing also allows for flexibility in
scheduling new features. If a new feature set appears and needs to be moved up
the list because of encouraging test results, our development process allows
for the addition of the new item. Conversely, if a feature is planned but does
not test well, then the latitude exists to drop it and consider other things.
Overview
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For an individual, the complexity of consumer healthcare devolves into four
spheres: 1). Multiple roles; 2). The ongoing need for information from a
variety of sources on a wide array of subjects delivered on a customized basis;
3). The diminution of traditional sources and authorities (e.g. doctors and
nurses); 4). The corresponding rise of a feeling that, in self-defense, an
individual needs to assert themselves to get the best results.
At the household level the key decision-maker for consumer health is a woman
30's-50's who is dealing with a number of health issues both major and minor on
a weekly/monthly basis. Our perspective (driven by our experience as well as
research) on this person is that she acts as the primary actor for herself as
well as an intermediary for a circle of dependent actors (spouse, children,
parents, friends, etc.) who look to her for information.
Obviously, the use of the Internet to deliver healthcare experiences and
information to consumers could be a huge boon. In our opinion, this has not
happened yet. The typical approach has either been heavily content driven (put
a lot of content and references online) or community oriented (start a message
board). However, the simple question of what spectrum of information,
connections with other people, and services do healthcare consumers want and
need has not been addressed yet in an integrated fashion.
Summary of the Service
"There is a place where people come together to find information and discuss
important health issues with their family and community. A place to share
experiences with others and with informed professionals and to find resources"
"WebMD is that place."
WebMD's strategy will be to build a healthcare portal that is "the place to
be." The idea is that of a health place that is extremely targeted and
informative yet reassuring and comforting to a consumer. It signifies "home",
"trust", "stickiness", and a starting point for all healthcare interactions. It
also fits with the idea of a specific, personalized home page/health service
that builds over time since the strategy of personalization is to create a
barrier to exit for members.
The overall tone, look, and feel of the site will be designed to match the type
of traffic that will be hitting that particular part of the service. For
example, if someone is visiting the unregistered part of the service, and is
not a member, the look and feel will be geared to an upbeat, almost spritely
approach. It will not be quite as fluffy and Cosmopolitan-like as a Thrive, but
it will not be somber and depressing like some of the other more intense health
sites. Conversely, if it is someone who is going directly to a deeper tier area
(Breast cancer), they will be presented with a slightly more serious approach
than the generalized part of the service. For registered members, the
personalized home page will be very warm, approachable and homelike.
Within the WebMD service, the consumer health portal will have its own name,
positioning and branding and yet will link back and support the overall WebMD
branding.
The overall construction of the site will be comprised of 5 tiers. The
outermost tier (T1) represents our audience development tactics that will find
potential members of the service, attract them to the service (T2), register
them (T3-T5), and then keep them over time (T3-T5).
The T1 methods WebMD will use to attract audiences to the service will include
on-air calls to action (e.g., the CNN relationship); PR; relationships with
other offline aggregators (support groups, non-profits); selective purchases of
targeted portal banners; affiliations with other health oriented sites, USENET
groups, bulletin boards, etc.
Tiers 2-5 (T2-T5) represent the actual service itself. In general, the
construction of the service should be in such a way as to provide a landing pad
for the various types of traffic the service will receive and convert it into
active members. Secondly, the service should provide an easy point of entry for
returning existing members. Lastly, the goal of all four tiers (T2-T5) should
be to always obtain more information from the member so as to deliver a more
personalized service.
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T2 is the "general" part of the service. It does not require registration. It
casts the widest net for new members as the audience feeds it will receive will
be broadly distributed in their interests. It rewards visitors by providing a
variety of content and references (to quickly answer questions), quick search
capabilities of internal resources as well as selected parts of the internet
("The best health search on the planet"), teasers on events (a variety of chats
with experts and famous health care personalities), and access to locator
services (find a doctor, etc..). It invites people to join to receive more
information, periodic updates, personalized service, etc.
T3 is the registration-lite portion of the service. The goal will be to get
people to register (screen name, password, e-mail address) for a content or
news feed, message board(s), event(s) (chat, streaming video event), updates,
etc.. The approach is low-level and non-threatening. It should be seen as an
easy entry method to start a personalization dialog with subsequent
interactions and follow-up messaging. From an audience development standpoint,
there may be several hundred external T1 calls to action that immediately
direct people to T3 and bypass entry through T2. An example would be to market
a chat with the world's expert on HIV therapeutics through a spot on CNN, a
posting on an event board, and listings in newspaper and TV Guide. The call to
action would put the prospective members into the T3 part of the service (e.g.
the event) versus pushing them through T2.
T4 is registration heavy and probably has our hardest core, most active
members. They have arrived to this level by extensive use of personalization
and repeat usage of the service. They may have come in through T2, T3
migration, or directly through registration in one of many intensive,
specialized services. An example of a T2, T3 bypass strategy here would be
working with the American Diabetes Association (ADA) to provide a specialized
information and community service to their members. The members attracted
through this method would go directly to T4 diabetes.
T5 is a sub-section of T4 in that this could be a group that subscribes to or
pays for additional services and benefits.
In summary, the goal with the five tiers is to attract potential audiences and
have them become registered members. The tactics will be to provide multiple
points of entry that are best suited for the groups WebMD will be attracting.
Once someone has registered with the service, the goal then becomes
personalizing the service to increase retention and improve financial returns
through market research, targeted sponsorship, and e-commerce opportunities. Of
course, a consistent thread of thought running through this is a focus and
emphasis on privacy protection and trust.
Detailed Features & Functionality
Except as otherwise provided in this Agreement and subject to Microsoft's right
to reject any part thereof, WebMD will supply to Microsoft as part of the
Health Channel the Content, Community, Commerce, Services and Other
Transactions, Customization/Personalization, Metrics set out below, or its
equivalent, meaning at a minimum comparable or superior to in substance,
quality, volume, breadth and depth of content, tools and functionality,
personalization, appeal and ease of use of user interface, etc.. The source of
all content and materials contained Health Channel by WebMD (unless otherwise
requested by Microsoft) will be only from un-biased, non-corporate sources and
all such sources are subject to Microsoft's approval, provided that Microsoft
shall not unreasonably withhold approval of any un-biased, non-corporate
source.
Content
>TABLE>
>CAPTION>
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Feature Release Tier Details
------------------ ----------------- -------------------------- ------------------------------------------------------
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News Current Tier 2: Home page Current Sources include Reuters Health News,
Healthscout, and proprietary news and features
created by WebMD, provided that subject to contracts
existing as of the Execution Date, MSNBC shall be
the sole provider of news for the Health Channel
unless otherwise approved by Microsoft
Current sources provide 50+ health news articles per
>/TABLE>
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>TABLE>
>CAPTION>
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day. Will have access to additional sources through CNN or
the equivalent, provided that subject to contracts existing
as of the Execution Date, MSNBC shall be the sole provider
of news for the Health Channel unless otherwise approved by
Microsoft.
------------------ ----------------- -------------------------- ------------------------------------------------------
Reference Current Tier 2: Home page Content acquired from multiple sources
Presented in various navigational schema: Health
Topics A-Z, Medical Encyclopedia, Self-Care Advisor,
Drug Reference, Etc.
DMK database has over 8,000 articles
SHN database has over 15,000 articles
Databases from Intelihealth and other providers
represent an additional 30,000 plus articles
Acquisition efforts continuous & on-going
------------------ ----------------- -------------------------- ------------------------------------------------------
General Search Current Tier 2: Home page, Provides non-integrated search of reference, news,
throughout service and chat events
------------------ ----------------- -------------------------- ------------------------------------------------------
Member's only Current Tier 3, Tier 4 - Provides all of General Search, plus searching of
search throughout message board posts, web
------------------ ----------------- -------------------------- ------------------------------------------------------
Integrated Possibly 3/12 All tiers throughout Allows user to search on any database of content
search release or later throughout the service as well as throughout the
rest of the internet. Results will lead to
invitation to join if registration is required for
certain content
------------------ ----------------- -------------------------- ------------------------------------------------------
Related Current Tier 3 and 4 throughout Allows user to get list of documents related in
Documents concept and content to any content currently being
(Librarian or viewed, including message board posts, chat
"Exemplar transcripts, etc.
searching")
------------------ ----------------- -------------------------- ------------------------------------------------------
Ask an Expert Current Tier 2 (read only), Tier These features are designed to add both personality
3 & 4: ability to ask and depth to the service. Currently utilized in
questions disease-specific categories, this will be enhanced
over time to include "celebrity" experts (e.g. Dr.
Ruth, Dr. Weil, equivalent others) and broaden its
appeal.
------------------ ----------------- -------------------------- ------------------------------------------------------
Wellness Some current Tier 2, with supporting Wellness information is a broad category to describe
content more slated for features and information provided to a "well" (vs. an ill)
release communities on Tier 3 consumer. It will included features, message boards,
through out and 4 and chats on fitness, sports, sexuality, nutrition, etc
1999
------------------ ----------------- -------------------------- ------------------------------------------------------
Natural Some current Tier 2, with supporting Natural medicine coverage could be considered a more subset
medicine more slated for features and of Wellness above, but many consumers both in the "well"
release communities on Tier 3 and in the "ill" population identify themselves with
through out and 4 natural or alternative or complementary therapies.
1999 Providing specific content navigation and community
features for this population will yield significant loyalty
and repeat usage
------------------ ----------------- -------------------------- ------------------------------------------------------
Community
------------------ ----------------- -------------------------- ------------------------------------------------------
Feature Release Tier Details
------------------ ----------------- -------------------------- ------------------------------------------------------
Topics covered Current and Tier 3 and 4 Currently manage 10 separate communities covering a
in community future total of 18 conditions.
>/TABLE>
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>TABLE>
>CAPTION>
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Community Slated to add 17 tier 3 and tier 4 communities in 3/99,
including: Allergies, Alzheimers, Back Pain, Cholesterol
Reducer, GI/Heartburn, HIV/AIDS, Hypertension, Impotence,
Menopause/HRT, Migraines, Multiple Sclerosis, Osteoporosis,
Otitis Media, Parkinsons, Schizophrenia, Smoking Cessation
After 3/99, adding significant number (100-140) of
community features for Tier 3 level, including sexuality,
natural medicine, sports medicine, fitness, etc.
------------------ ----------------- -------------------------- ------------------------------------------------------
Message Current Tier 3 and 4 throughout, Currently 30 disease-specific message boards moderated by
Boards eventual read-only WebMD staff Adding several hundred more message boards
access for Tier 2 during 1999 Message board technology includes search
capability, integration into "Librarian" function,
integration into complete WebMD personalization features
(see below), ability to list messages by author, and
linkages to other types of content.
------------------ ----------------- -------------------------- ------------------------------------------------------
24 hour chat Current Tier 3 and 4 throughout Currently run approximately 20 chat rooms using
rooms iChat, subject to WebMD's obligation hereunder to
use Microsoft Chat technologies. Chat rooms are
unmoderated and including Private room creation
functions.
------------------ ----------------- -------------------------- ------------------------------------------------------
Live chat events Current Tier 3 and 4 Currently host approximately 50 text-chat events per
month. Guests are experts from various geographies
and institutional affiliations.
Currently relationships in place with UCSF and OHSU
schools of nursing for chat guests. Managed by a
WebMD funded faculty position at UCSF. Academic
affiliates will grow substantially
Throughout 1999 WebMD will target "celebrity"
experts for live events
By end of 1999 will add up to 10 live audio/video
streaming events which shall be available using
Microsoft's Windows Media Player
------------------ ----------------- -------------------------- ------------------------------------------------------
Behavioral Currently in Tier 4 and Tier 5 Doing research with faculty at OHSU in running
health research phase, behavioral modification classes (smoking cessation,
interventions full roll out weight management, etc.) in an online environment
by end of 1999 First test was "Healthier Holidays Club" weight
control group that ran with 12 participants from
11/98 - 1/99. More programs in smoking cessation
etc. on the way.
------------------ ----------------- -------------------------- ------------------------------------------------------
Commerce, Services and Other Transactions
------------------ ----------------- -------------------------- ------------------------------------------------------
Feature Release Tier Details
------------------ ----------------- -------------------------- ------------------------------------------------------
Participation in Current Throughout Relationships in place with Amazon, Powells.com
affiliate Mechanism in place for future affiliate relationships
programs
------------------ ----------------- -------------------------- ------------------------------------------------------
Online drugstore Target Date: Throughout Either through partnerships with PlanetRx.com,
May 99, drugstore.com or equivalent others, or through
>/TABLE>
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>S> >C> >C> >C>
At the latest: proprietary developments with critical partners, WebMD will
October 31, 1999 provide a mechanism for purchasing any over the counter
item typically found in a drug store, as well as purchasing
prescription drugs and refilling existing prescriptions
online.
------------------ ----------------- -------------------------- ------------------------------------------------------
Home medical Target Date: Throughout Similar to drugstore applications, WebMD plans on
supplies May 99, At the exploring the market for home health products and
latest October offering purchasing opportunities to our members
31, 1999 through WebMD
------------------ ----------------- -------------------------- ------------------------------------------------------
Directories Target Date: Throughout Allow users to look up healthcare resources by type,
May 99, At the location, reputation etc.
latest, June Works for hospitals, MDs, alternative care providers
30, 1999 Possible source for additional revenue
------------------ ----------------- -------------------------- ------------------------------------------------------
View lab test Possibly by end Tier 4 & 5 Gives user the ability to request lab results,
results of 1999. Goal either through MD (who might need to be a WebMD
to complete no subscriber) or directly from lab.
later than 2000 Depends heavily on relationships with lab companies,
privacy issues, etc.
------------------ ----------------- -------------------------- ------------------------------------------------------
Scheduling with Possibly by end Tier 4 & 5 Tricky - requires access to doctor's scheduling
doctor, other of 1999 Goal to system, verification, etc.
practitioners complete no
later than 2000
------------------ ----------------- -------------------------- ------------------------------------------------------
Keep personal, Possibly by end Tier 4 & 5 This feature becomes particularly useful if the
family medical of 1999 Goal to online medical record is viable in the clinical
record complete no setting - which may take a while
later than 2000
------------------ ----------------- -------------------------- ------------------------------------------------------
Customization/Personalization
------------------ ----------------- -------------------------- ------------------------------------------------------
Feature Release Tier Details
------------------ ----------------- -------------------------- ------------------------------------------------------
My Desk Current Tier 4 & 5 Allows any registered user to build new desk drawers
and store articles in each drawer. The Librarian
functionality appears in the drawer to point to
related documents based on every article in the
drawer.
------------------ ----------------- -------------------------- ------------------------------------------------------
Suggested news Current Tier 4 & 5 At the beginning of each registered and profiled
member's WebMD session they are directed to
suggested news - headlines culled from today's news
feed that are most relevant to their particular
health profile
------------------ ----------------- -------------------------- ------------------------------------------------------
Suggested Current Tier 4 & 5 Similar to suggested news, registered/profiled
message board members are invited to join message board
threads discussions that are relevant to them
------------------ ----------------- -------------------------- ------------------------------------------------------
"Integrated" Summer 1999 Tier 4 & 5 Ability for one WebMD member to have multiple condition or
profiles treatment based profiles, and multiple "roles" (e.g.
diagnosed, concerned, caregiver, other) represented in one
membership. This will allow our primary target (women who
are primary healthcare decision-maker in household) to
manage health information and support for the multiple
individuals in their lives.
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>TABLE>
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Additional Throughout 1999 Tier 4 & 5 Alexandria allows WebMD to perform any comparison
applications of WebMD wishes - content to content, profile to
the WebMD content, profile to profile. This allows the
"Alexandria" addition of collaborative filtering, and other types
platform of personalization, automated group building or
information organization.
------------------ ----------------- -------------------------- ------------------------------------------------------
>/TABLE>
C. Metrics
1. Customer Satisfaction: WebMD's goal is that the WebMD Consumer Site will be
the third ranked health site by December 31, 1999, the second ranked consumer
health site by July 31, 2000, and the first ranked consumer health site by
December 31, 2000, as measured against the health sections of other Internet
portal sites and general consumer health sites on the Internet. WebMD will
monitor customer satisfaction under this paragraph 1 using quantitative
research reported every six months starting on the date that is six months from
the Effective Date, which research shall measure all important customer
metrics, including, but not limited to: awareness, image, satisfaction and
likelihood to actually use. WebMD will include additional customer metrics at
Microsoft's request, and no metric once measured may be removed without the
mutual agreement of the parties.
2. Pages Viewed. By December 31, 1999 the MSN Health Section will have an
average number of pages viewed per unique user per month that is equal to or
above the average number of pages viewed for health sections of other Internet
portal sites and other Internet health sites, as determined by Media Matrix (or
some other mutually agreed upon industry analyst). By mutual agreement this
metric may be changed for another measure of User involvement on the MSN Health
Section as compared to other health sites and sections on competitive networks
and the Internet.
3. Focus Group Research. WebMD will conduct focus group research once each 6
months of each Year and will conduct usability research prior to each release
(e.g., T1, T2, T3, etc.) of the Health Channel. WebMD will share the results of
this research with Microsoft, and WebMD and Microsoft will mutually agree to a
plan and schedule to implement findings from this research that are
commercially reasonable to implement to improve the offerings of the Health
Channel.
4. Failure to Meet Metrics. In the event that WebMD fails to meet any of the
obligations in the Metrics section of this Exhibit A-1, the parties shall meet
within twenty (20) business days of a notice from any party. At such meeting,
WebMD shall present a plan for compliance, including the timeframe therefore,
and Microsoft shall approve such plan or suggest an alternative plan. If the
parties fail to reach agreement on a plan for compliance (either as proposed by
WebMD or Microsoft), WebMD will have 120 days from the meeting to comply. If
WebMD fails to comply within such time frame (or within the timeframe of any
agreed upon plan for compliance), the Health Channel may be reduced by
Microsoft down to a minimum of 50% of the MSN Health Section at Microsoft's
discretion, and Microsoft will have the option to fill the non-Health Channel
sections of the MSN Health Section with any programming, content, or
partnerships that Microsoft considers appropriate in its sole discretion.
Notwithstanding the foregoing, nothing herein shall be deemed to limit any
remedy either party may have under this Agreement or otherwise.
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Exhibit A-2
Health Channel
Technical Specifications
Network Framework/In Service Promotion Requirements. WebMD shall incorporate
the Network Frameworks on each page within the Health Channel in accordance
with the MSN.COM Software Development Kit. Microsoft may modify the Network
Framework in its sole discretion, and WebMD shall implement such modifications
pursuant to the terms of the SDK within the same time frame as required for
other channels within the MSN Site. WebMD shall also comply with the style
guidelines and other applicable terms set forth in the MSN.COM SDK in creating
the Health Channel, and WebMD shall incorporate the In Service Promotion Box on
each page within the Health Channel in the manner provided by Microsoft. All
traffic will be redirected from health.msn.com (or such other URL(s) as may
ultimately be allocated to the Health Channel) to WebMD's servers where the
Health Channel's fully Frameworked pages will be served (as described above);
provided that Microsoft may opt in its discretion to host all or any part of
the Health Channel by giving WebMD thirty (30) days written notice of each
exercise of its option; and further provided that WebMD will provide all such
reasonable support and assistance as is necessary to enable Microsoft to so
host by the end of the thirty (30) day notice period or such other period as is
mutually agreed by the parties. Microsoft requires that WebMD maintain certain
minimum standards for connectivity and availability (these requirements may be
updated by Microsoft from time to time by written notice from Microsoft to
WebMD, and WebMD shall implement such modifications within 30 days following
such notice):
All pages of the Health Channel must begin loading quickly (within 5 seconds on
a 28.8bps modem measured as a rolling weekly average).
All pages of the Health Channel must be reachable/available 99.8% of the time,
subject to reasonable regularly scheduled maintenance of which Microsoft is
notified in writing on a monthly basis at least five (5) business days in
advance of each calendar month. Such notice shall include at a minimum all work
to be done and the estimated down time.
WebMD's servers must be capable of handling all traffic that the Health Channel
will send WebMD, and in any case no less than a minimum of 7 million page-views
per week as of the Effective Date and at all times during the Term, which such
number of page views shall increase (but not decrease without Microsoft's
approval) at a rate equal to that necessary to accommodate traffic resulting
from the increased traffic to the MSN Site on a month to month basis, and shall
at a minimum be no less than 14 million by the first day of Year 3 and 21
million by the first day of Year 5.
Domain Name. Microsoft will register and maintain domain names for the Health
Channel. WebMD will insure that the domain name specified by Microsoft is
displayed in the user's browser URL window when a user is accessing any part of
the Health Channel.
Statistical and Other Reporting.
WebMD agrees to provide page view, unique user reporting and other statistical
reporting for the Health Channel, as specified by Microsoft in writing from
time to time under this Agreement. Such information shall be recorded on a
calendar monthly basis. WebMD shall provide such information to Microsoft
within seven (7) days of the end of each calendar month. WebMD shall have 30
days to implement any changes in such reporting requirements. As an
alternative, WebMD agrees to incorporate Microsoft's WebStats technology on the
WebMD servers used to host the Health Channel for the purpose of statistical
tracking of users on the Health Channel. WebMD shall provide Microsoft with
monthly system maintenance schedule as provided in Section 1 of this Exhibit
A-2. WebMD shall provide Microsoft with a daily and also a weekly content
refresh schedule, which such schedule shall be provided in writing at least
forty-eight (48) hours in advance of the planned refresh time.
Browser Viewing. WebMD agrees that the Health Channel, as served by WebMD
servers, will be easily viewable on all popular browsers, including but not
limited to Internet Explorer, Netscape Navigator and WebTV. Also, users of
Windows, Macintosh, Linux and Unix systems should all be able to view pages
served by WebMD. (A complete list of required browser and platform support is
contained in the MSN SDK currently found at
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http://partner.msn.com). In no event will WebMD make any technology decision
that renders the content viewing experience of Internet Explorer users on the
Health Channel to be inferior to the viewing experience of users elsewhere on
the MSN Site.
Ad Server. WebMD shall comply with Microsoft's specifications to configure the
Health Channel to call the ad server(s) specified by Microsoft to display
Advertising provided by Microsoft under this Agreement.
Service and Support. WebMD will follow the procedures and provide the
information set forth below in the event of any site failure(s) or decline(s)
in performance. The parties shall work together to expand the procedures set
forth below within ninety (90) days of the Effective Date as reasonably
necessary to ensure that Microsoft is notified of all site failure(s) or
decline(s) in performance.
WebMD shall notify Microsoft within thirty (30) minutes of any site outages.
WebMD will send such notification to a an email address or alias and
phone/pager # designated by Microsoft. In the event of a system outage, WebMD
will post and serve to users attempting to reach the Health Channel a message
page in all ways mutually acceptable to both parties which such message page
will be posted within one (1) hour of WebMD discovering the outage and shall
remain in place until such outage has ceased. WebMD and Microsoft shall
mutually agree on a escalation process which shall include at a minimum
additional email, phone and pager contacts, as appropriate, for escalation of
site problems between the parties. During any site failure or decline in
performance, WebMD shall give Microsoft regular notification of the status of
the problem and the problem resolution activities until the situation has
ceased. The frequency of the notification will depend on the severity of the
problem with more regular notice being given for a more sever problem.
Following resolution of any site failure or decline in performance, WebMD will
provide Microsoft with reports detailing the fault or problem events on a
bi-weekly or monthly basis as determined by Microsoft in each situation.
Following the resolution of any site failure or decline in performance, WebMD
will provide Microsoft with a report(s) of all remedial actions taken and
preventive measures taken to avoid similar fault conditions or problems in the
future.
All bug fixes and site changes shall be completed within a reasonable
period of time under the circumstances of each situation and WebMD shall
provide Microsoft with a report of all material fixes and changes on a monthly
basis. WebMD shall provide Microsoft with all assistance needed by Microsoft to
provide end users with information about service, performance, bug fixes,
content updates and any other area concerning the Health Channel, including but
not limited to answers to frequently asked questions and service notices.
In the event that WebMD fails to meet any of the obligations in this Service
and Support section (including any expanded obligations) of this Exhibit A-2,
the parties shall meet within twenty (20) business days of a notice from any
party. At such meeting, WebMD shall present a plan for compliance with the
above service and support requirements (including any expanded obligations)
including the timeframe therefore and Microsoft shall approve such plan or
suggest an alternative plan. If the parties fail to reach agreement on an
alternative plan, WebMD shall have sixty (60) days from the meeting to comply
with the above service and support requirements (including any expanded
obligations); provided that if WebMD fails to comply, Microsoft shall be
released from its obligations to meet any and all Guarantees under Section 12.2
(e.g., the First Year Guarantee, Second Year Guarantee, Third Year Guarantee,
etc.) for the Year in which the failure first occurs.
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit B
In Service Promo
[GRAPHIC OMITTED]
Graphic shows screenshot of a current example of an in service promotion box to
be featured on each page within MSN's web site.
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit C
MSN Module
[GRAPHIC OMITTED]
Graphic shows an example of an MSN module which will include a "Go to MSN" logo
link.
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit D
Logo Guidelines
(for use of MSN link logos provided per Section 3 of the Agreement)
1. WebMD may display only the "Go to MSN" link logo, or other MSN link
logos, as provided by Microsoft from time to time under the Agreement
("Logos").
2. WebMD may only display the Logos on the WebMD Site as provided in the
Agreement, and not in any other manner. The Logos must always be active links
to the MSN Site at http://www.msn.com/.
3. GIF files for the Logos include the words "Go to MSN" or similar
wording, describing the significance of the Logos on the WebMD Site (i.e., the
Logos are links to MSN or references to MSN features, not endorsements of the
WebMD Site). WebMD may not remove or alter these, or any other element of the
Logos.
4. WebMD may only display the Logos on web pages that include the Network
Frameworks and must be placed at the bottom of such pages. WebMD's company name
or logo must appear at least as prominent as the Logos. WebMD may not display
the Logos in any manner that implies affiliation with, sponsorship,
endorsement, or license by Microsoft, except as contemplated in the Agreement.
5. Each Logo must appear by itself, with a minimum spacing (the height of
the Logo) around the Logo to separate it from other graphic or textual elements
on your page. The Logos may not be used as a feature or design element of any
other logo.
6. WebMD may not alter the Logos in any manner, including size,
proportions, colors, elements, etc., or animate, morph or otherwise distort its
perspective or two-dimensional appearance.
7. WebMD may not display the Logos on any site that disparages Microsoft
or its products or services, infringes any Microsoft intellectual property or
other rights, or violates any law of any jurisdiction.
8. These Logo Guidelines do not grant a license or any other right in
Microsoft's logos or trademarks. Microsoft reserves the right in its sole
discretion to terminate or modify permission to display the Logos at any time.
Microsoft reserves the right to take action against any use that does not
conform to these Logo Guidelines, infringes any Microsoft intellectual property
or other right, or violates other applicable law.
9. MICROSOFT DISCLAIMS ANY WARRANTIES THAT MAY BE EXPRESS OR IMPLIED BY
LAW REGARDING THE LOGOS, INCLUDING WARRANTIES AGAINST INFRINGEMENT.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit E
MS Online ID Evaluation Program Agreement
This evaluation agreement ("Agreement") is made by and between MICROSOFT
CORPORATION, One Microsoft Way, Redmond, WA 98052 ("Microsoft") and WebMD Inc.,
400 The Lenox Building, 3399 Peachtree Road NE Atlanta, Georgia 30326
("Company") as of the later of the two signature dates (the "Effective Date").
WHEREAS, Microsoft desires that Company test, utilize and evaluate the
software associated with Microsoft's proprietary authentication service
currently known as Microsoft Online ID and the associated SDK (the "Product");
and
WHEREAS, Company desires to test, utilize and evaluate the Product in
anticipation of participating in the full Microsoft Online ID program when, and
if, such program is generally released to the market.
NOW THEREFORE, the parties agree as follows:
1. EVALUATION LICENSE
(a) Company shall implement the Product and all upgrades and fixes
provided by Microsoft within a test version of the Health Channel and the WebMD
Site ("Company Site"), such implementation shall be in compliance with the
standard SDK provided with the Product. Upon Microsoft's direction, Company
shall implement the Product on the version of Company's Site that is available
to the general public. In connection with such implementation, Microsoft grants
to Company a limited, non-exclusive, nontransferable, royalty-free license to
use the Product on Company's CPUs and any accompanying printed materials
("Documentation"), for the purpose of developing the Company Site to ensure
compatibility with the Product and testing and evaluating the Product and
associated applications created by Company that are required to be integrated
with the Product. All other rights are reserved to Microsoft. Company shall not
use the Product for any purpose other than as set forth in this Agreement.
Company shall not rent, lease, sell, sublicense, assign, or otherwise transfer
the Product or the Documentation. Company may not reverse engineer, decompile,
or disassemble the Product, except to the extent that the foregoing restriction
is expressly prohibited by local law. Microsoft and its suppliers shall retain
title and all ownership rights to the Product.
(b) Company agrees to provide reasonable feedback to Microsoft,
including but not limited to usability, bug reports and test results, with
respect to the testing of the Product, within fifteen (15) days of Company's
receipt of the Product and each upgrade and fix. Company will use reasonable
efforts to review and comment on all Documentation supplied. All bug reports,
test results and other feedback made by Company shall be the property of
Microsoft and may be used by Microsoft for any purpose it sees fit. Due to the
nature of the development work, Microsoft is not certain as to when errors or
discrepancies in the Product may be corrected; however Microsoft will provide
Company with all bug fixes and upgrades as such items become available and
Company agrees to implement said fixes and upgrades within ten (10) days of
receipt.
2. PRIVACY POLICY
Company acknowledges that the privacy of end-users' personal information is a
core component of the Microsoft Online ID program. Company represents that it
is either currently or will become, prior to the implementation of the Product
on the version of Company's Site that is available to the general public, a
participant in an industry recognized independent privacy program, such as the
TRUSTe Program or the BBBOnline Privacy Seal Program, which: (a) requires an
approved privacy policy to be posted within the Company Site in a manner that
is readily accessible to the end-users; (b) requires Company to obtain explicit
consent to any usage of their personal information for any purpose other than
described in Company's privacy policy; (c) provides for a dispute resolution
method with adequate enforcement mechanisms; (d) reviews, monitors and enforces
the standards set by the program; and (e) requires Company to comply with
additional privacy standards which may become recognized by the industry from
time to time. All versions of Company Site utilizing the Product shall comply
with the standards set by such independent privacy program.
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
3. MICROSOFT SERVICES
(a) Microsoft shall provide a mechanism and user interface (the
"Sign Up Mechanism") which will allow end-users to participate in the Microsoft
Online ID program and obtain appropriate user names and passwords upon
accessing Company Site.
(b) Microsoft shall provide authentication services for end-users
entering the Company site who have a Microsoft Online ID. If such end-user has
not yet obtained a Microsoft Online ID the end-user will be directed to the
Sign Up Mechanism described in Section 3(a).
(c) During the authentication process, Microsoft shall provide
Company with the core profile information contained within the Microsoft Online
ID database as determined by Microsoft in its sole discretion (the "Core
Profile").
4. INFORMATION USAGE
(a) Company may use the information in the Core Profile in
perpetuity for any purpose provided that Company complies with the requirements
set forth in Sections 2 and 7.
(b) Microsoft shall provide Company with a list of the information
contained within the Core Profile and if Company receives updated or additional
Core Profile information from an end-user then Company agrees to provide
end-users with the option of updating this information in the central Microsoft
Online ID Core Profile. The Product will provide a standard Microsoft Online ID
update mechanism to facilitate updates to the Microsoft Online ID Core Profile.
5. DESIGN AND USER INTERFACE
(a) Prior to the implementation of the Product on the version of the Company
Site which is available to the general public, Microsoft may request compliance
with certain additional design and user interface guidelines ("Microsoft Online
ID UI Guidelines") not included within the SDK, including but not limited to
Microsoft Online ID logo placement, text copy, links, and input boxes (e.g. for
sign in). Within ten (10) days of Company's receipt of the Microsoft Online ID
UI Guidelines, Company shall implement the specified user interface and comply
with the specifications set forth in such guidelines.
(b) Microsoft will include Company's logo within the Sign Up Mechanism, in
connection with such use Company hereby grants Microsoft a non-exclusive,
royalty free, worldwide limited right to use and display Company's name and
logo. Microsoft will provide logo specifications to the Company and the Company
agrees to provide the requested logos to Microsoft on a timely basis.
6. PRODUCT MAINTENANCE AND SUPPORT
Microsoft shall use commercially reasonable efforts to provide technical
support for the Product. Microsoft agrees to designate one primary contact
person that will be responsible for coordinating all technical support inquires
and responses and Company agrees to designate one primary contact person that
will be responsible for sending inquiries to and receiving responses from the
designated Microsoft person.
7. TERM OF AGREEMENT
(a) The term of this Agreement shall commence on the Effective
Date and shall continue for an initial period of six (6) months provided that
the term shall automatically renew for additional one (1) month periods unless
terminated as otherwise provided for in this Agreement, amended or superceded
by further agreement. Either party may terminate this Agreement at any time,
with or without cause, upon sixty (60) days prior written notice;
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
provided that neither party may terminate this Agreement under this sentence
prior to the termination of the MSN Channel and Cross Promotion Agreement
("Channel Agreement") entered into of even date herewith.
(b) In addition to any other rights and/or remedies that either
party may have under the circumstances, all of which are expressly reserved,
either party may terminate this Agreement immediately upon written notice at
any time if the other party is in material breach of any material warranty,
representation, term, condition or covenant of this Agreement and fails to cure
that breach within five (5) days after written notice thereof, provided that if
WebMD is the terminating party, such material breach must also be a material
breach of the Channel Agreement and WebMD must also simultaneously terminate
such Channel Agreement.
(c) Upon the termination of this Agreement, Company shall:
(i) promptly cease using the Product and return to Microsoft,
or certify destruction of, all full or partial copies of the Product,
Documentation and related materials provided by Microsoft;
(ii) notify end-users that the Company site is no longer
utilizing the Microsoft Online ID authentication service; and
(iii) discontinue the use of all Core Profile information;
provided that Company may continue to use the Core Profile information if
Company continues to comply with the terms of Section 2.
(d) In the event of termination or expiration of this Agreement
for any reason each and every clause which by its nature is intended to survive
the termination of this Agreement including, without limitation, Sections 7
through 12 shall survive termination. Neither party shall be liable to the
other for damages of any sort resulting solely from terminating this Agreement
in accordance with its terms.
8. CONFIDENTIALITY
(a) The Product, including its existence and features, are
proprietary and confidential information to Microsoft and its suppliers.
Company agrees not to disclose or provide the Product, Documentation, or any
information relating to the Product (including the existence of the Product,
features, or the results of use or testing) to any third party (except as
otherwise necessary to operate Company's Web site). If Microsoft and Company
have entered into a Microsoft Non-Disclosure Agreement, Microsoft and Company
agree that the terms of such agreement shall be deemed incorporated herein, and
further, that all terms and conditions of this Agreement shall be deemed
Confidential Information as defined therein. If Microsoft and Company have not
entered into a Microsoft Non-Disclosure Agreement, then Company agrees that at
all times during the term of this Agreement, and for five (5) years thereafter,
Company will hold in strictest confidence, and will not use or disclose to any
third party, any confidential information of Microsoft. The term "confidential
information of Microsoft" shall mean all non-public information that Microsoft
designates as being confidential, or which, under the circumstances of
disclosure ought to be treated as confidential. "Confidential information of
Microsoft" includes, without limitation, the terms and conditions of this
Agreement, information relating to released or unreleased Microsoft software or
hardware products, marketing or promotion of any Microsoft product, business
policies or practices of Microsoft, customers or suppliers of Microsoft, or
information received from others that Microsoft is obligated to treat as
confidential. If Company has any questions as to what comprises such
confidential information, Company agrees to consult with Microsoft.
"Confidential information of Microsoft" shall not include information that was
known to Company prior to Microsoft's disclosure to Company, or information
that becomes publicly available through no fault of Company.
(b) Unless Company receives prior written authorization from MS,
Company may disclose the Product only to its employees or sub-contractors who
have a need to know in order to assist in Company's testing and evaluation of
the Product, provided that: (1) such employee's or sub-contractor's use of the
Product takes place solely at the location where Company's CPUs reside; and (2)
Company has executed appropriate written agreements with such employees and
sub-contractors sufficient to enable it to comply with the terms of this
Agreement. Upon Microsoft's request, Company shall provide to Microsoft a list
of all employees and sub-contractors granted access to the Product hereunder.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
9. PRESS RELEASES/MARKETING PARTICIPATION.
(a) Microsoft will issue an initial press release relating to the
establishment of the Microsoft Online ID Evaluation Program, which will
describe the relationship between Microsoft and the third parties participating
in the program, including Company. Company may be provided with an opportunity
to provide a quote and/or information to be included in such initial press
release. Except as specified above, neither party will issue any press release
or make any public announcement(s) relating in any way whatsoever to this
Agreement or the relationship established by this Agreement without the express
prior written consent of the other party, which consent shall not be
unreasonably withheld, provided that Microsoft may make informational
references to the Microsoft Online ID Evaluation Program and Company's
participation in such program in other publicity and press releases without
obtaining Company's consent.
(b) Company agrees to participate in all marketing programs for
the Microsoft Online ID program as reasonably requested by Microsoft. Microsoft
shall be solely responsible for any and all costs associated with any marketing
program for the Microsoft Online ID program which may be incurred by Company
provided that such costs have been pre-approved in writing by Microsoft.
10. DISCLAIMER OF WARRANTY
THE PRODUCT IS DEEMED ACCEPTED BY COMPANY. THE PRODUCT IS PROVIDED "AS IS"
WITHOUT WARRANTY OF ANY KIND. MICROSOFT FURTHER DISCLAIMS ALL WARRANTIES,
INCLUDING WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. THE ENTIRE RISK ARISING
OUT OF THE USE OR PERFORMANCE OF THE PRODUCT AND DOCUMENTATION REMAINS WITH
COMPANY.
IN NO EVENT SHALL MICROSOFT OR ITS SUPPLIERS BE LIABLE FOR ANY CONSEQUENTIAL,
INCIDENTAL, DIRECT, INDIRECT, SPECIAL, PUNITIVE, OR OTHER DAMAGES WHATSOEVER
(INCLUDING, WITHOUT LIMITATION, DAMAGES FOR LOSS OF BUSINESS PROFITS, BUSINESS
INTERRUPTION, LOSS OF BUSINESS INFORMATION, OR OTHER PECUNIARY LOSS) ARISING
OUT OF THE USE OF OR INABILITY TO USE THE PRODUCT OR DOCUMENTATION, EVEN IF
MICROSOFT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
11. EXPORT RESTRICTIONS
Company acknowledges that the Product is subject to the export control laws and
regulations of the U.S.A., and any amendments thereof. Company confirms that
with respect to the Product it will not export or re-export them, directly or
indirectly, either to (i) any countries that are subject to U.S.A. export
restrictions, (ii) any end user who Company knows or has reason to know will
utilize them in the design, development or production of nuclear, chemical or
biological weapons; or (iii) any end user who has been prohibited from
participating in the U.S.A. export transactions by any federal agency of the
U.S.A. government. Company further acknowledges that the Product may include
technical data subject to export and re-export restrictions imposed by U.S.A.
law.
12. GENERAL
12.1 Independent Contractors. The parties are independent
contractors with respect to each other, and nothing in this Agreement shall be
construed as creating an employer-employee relationship, a partnership, agency
relationship or a joint venture between the parties.
12.2 Governing Law. This Agreement shall be governed by the laws of
the State of New York as though entered into by New York residents and to be
performed entirely within the State of New York. The parties consent to
exclusive jurisdiction and venue in the state and federal courts sitting in New
York. In any action or suit to enforce any right or remedy under this Agreement
or to interpret any provision of this Agreement, the prevailing party shall be
entitled to recover its costs, including reasonable attorneys' fees.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
12.3 Assignment. This Agreement and any rights and/or obligations
hereunder may be assigned by Microsoft but may not be assigned by Company
without Microsoft's prior written approval. Any attempted assignment,
sub-license, transfer, encumbrance or other disposal without such consent shall
be void and shall constitute a material default and breach of this Agreement.
12.4 Construction. In the event that any provision of this
Agreement conflicts with governing law or if any provision is held to be null,
void or otherwise ineffective or invalid by a court of competent jurisdiction,
(i) such provision shall be deemed to be restated to reflect as nearly as
possible the original intentions of the Parties in accordance with applicable
law, and (ii) the remaining terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect. This Agreement has been
negotiated by the parties and their respective counsel and will be interpreted
fairly in accordance with its terms and without any strict construction in
favor of or against either party. The section headings used in this Agreement
are intended for convenience only and shall not be deemed to affect in any
manner the meaning or intent of this Agreement or any provision hereof.
12.5 Notices. All notices and requests in connection with this
Agreement shall be given in writing and shall be deemed given as of the day
they are received either by messenger, delivery service, or in the United
States of America mails, postage prepaid, certified or registered, return
receipt requested, and addressed as follows:
>TABLE>
>S> >C>
To Company: To Microsoft:
WebMD, Inc. Microsoft Corporation
3399 Peachtree Road NE One Microsoft Way
Atlanta, Georgia 30326 Redmond, WA 98052-6399
Attn: Product Manager - Web Essentials
Phone: (404) 479-7600 Phone: 425-882-8080
Fax: (404) 479-7603 Fax: 425-936-7329
Attention General Counsel Copy to:
Law & Corporate Affairs, US Legal
Fax: (425) 936-7409
>/TABLE>
or to such other address as a party may designate pursuant to this notice
provision.
12.6 Entire Agreement. This Agreement does not constitute an offer
by Microsoft and it shall not be effective until signed by both parties. This
Agreement constitutes the entire agreement between the parties with respect to
the subject matter hereof and supersedes all prior and contemporaneous
agreements or communications. This Agreement shall not be modified except by a
written agreement dated subsequent to the date of this Agreement and signed on
behalf of Company and Microsoft by their respective duly authorized
representatives. No waiver of any breach of any provision of this Agreement
shall constitute a waiver of any prior, concurrent or subsequent breach of the
same or any other provisions hereof, and no waiver shall be effective unless
made in writing and signed by an authorized representative of the waiving
party.
The parties have caused this Agreement to be executed by their duly authorized
representatives as of the Effective Date.
MICROSOFT CORPORATION WEBMD, INC.
/s/ Laura Jennings /s/ W. Michael Heekin
By By
Laura Jennings W. Michael Heekin
Name (Print) Name (Print)
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Title Vice President Title Executive Vice President and Secretary
Date 6/4/99 Date 5/10/99
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit F
MCS Agreement and Work Order
MICROSOFT MASTER CONSULTING SERVICES AGREEMENT
This Microsoft Master Consulting Services Agreement ("Agreement") is made as of
the Effective Date indicated below by and between Microsoft Corporation, a
Washington corporation, and WebMD, Inc., a Georgia, corporation ("Customer").
This Agreement sets forth the general terms and conditions under which
Microsoft Corporation, either on its own behalf or through one or more
divisions or, for services to be provided outside of the United States,
subsidiaries (collectively, "Microsoft"), will provide consulting services to
Customer and its Affiliates. Microsoft agrees that any of Customer's Affiliates
shall have the right (but not the obligation) to submit Work Orders to
Microsoft under the terms and conditions of this Agreement. All references to
"Customer" in this Agreement shall be deemed to include the Affiliate placing
the Work Order. Such Work Orders shall be subject to the terms and conditions
of this Agreement and as to such Work Orders, the Affiliate becomes "Customer"
hereunder. "Affiliate" means any person, partnership, joint venture,
corporation or other form of enterprise, domestic or foreign, including, but
not limited to, subsidiaries, which directly or indirectly Control, are
Controlled by, or are under common Control with Customer. "Control" means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and operating policies of the entity in respect of
which the determination is being made, through the ownership of more than fifty
percent (50%) of its voting or equity securities, contract, voting trust or
otherwise.
1. CONSULTING SERVICES AND FEES.
a. Microsoft, through its Microsoft Consulting Services division
("MCS"), shall perform the consulting services for Customer specified in work
orders (each a "Work Order") that may be entered into pursuant to this
Agreement from time to time ("Services"). Neither Microsoft nor Customer shall
be obligated to enter into any Work Order.
b. Customer shall pay Microsoft the fees identified on each Work
Order for Services rendered, and the reasonable out-of-pocket travel and living
expenses incurred by MCS consultants during performance of a Work Order.
Payment shall be made to Microsoft within thirty (30) days of the date of
Microsoft's invoice. Microsoft shall not change its fees during the term of a
Work Order, unless otherwise agreed by Microsoft and Customer, but may adjust
fees prior to entering any new Work Order. Microsoft's fees do not include any
taxes, duties, tariffs or other governmental charges or expenses imposed in
connection with this Agreement (including, without limitation, any value added
taxes), and such taxes shall be billed to and paid by Customer. Microsoft shall
be responsible for all taxes based upon its personal property ownership and net
income. A finance charge of one and one-half percent (1.5%) per month or the
highest amount allowed by law, whichever is less, will be assessed on all
payments that are past due. Any amount outstanding for more than sixty (60)
days after the date of invoice shall constitute a material breach on the part
of Customer.
2. RIGHTS IN PROGRAMS AND DATA. The rights in programs and data shall be
specified in each Work Order.
3. CONFIDENTIALITY.
a. Confidential Information. Except as otherwise specified
herein, Microsoft and Customer each expressly undertake to retain in confidence
all information transmitted to it by the other party pursuant to this Agreement
that the disclosing party identifies as being proprietary and/or confidential
or that, by the nature of the circumstances surrounding the disclosure, ought
in good faith to be treated as proprietary and/or confidential ("Confidential
Information"), and will make no use of such Confidential Information except
under the terms and during the existence of this Agreement. Information
disclosed by Microsoft, in any form, regarding pre-release
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
products, access numbers and passwords provided to Customer by Microsoft, shall
be Microsoft Confidential Information. Microsoft and Customer shall treat the
terms and conditions of this Agreement as confidential; however, either party
may disclose such information in confidence to its immediate legal and
financial consultants as required in the ordinary course of that party's
business. The receiving party's obligation hereunder shall extend for five (5)
years following the disclosure of the Confidential Information. Customer shall
cause its Affiliates to retain Microsoft Confidential Information in accordance
with the terms of this Section 3.
b. Exclusions. Confidential Information shall not include any
information that: (i) is at the time of disclosure or subsequently becomes
publicly available without the receiving party's breach of any obligations owed
the disclosing party; (ii) became known to the receiving party prior to the
disclosing party's disclosure of such information to the receiving party; (iii)
became known to the receiving party from a source other than the disclosing
party other than by the breach of an obligation of confidentiality owed to the
disclosing party; or (iv) is independently developed by the receiving party.
c. Independent Development; Residuals. The terms of
confidentiality under this Agreement shall not be construed to limit
Microsoft's or Customer's right to independently develop or acquire products
without use of the other party's Confidential Information. Further, Microsoft
or Customer shall be free to use for any purpose the residuals resulting from
access to or work with such Confidential Information, provided that such party
shall maintain the confidentiality of the Confidential Information as provided
herein. The term "residuals" means technical information related to computer
software technology in non-tangible form, which may be retained by persons who
have had access to the Confidential Information, including ideas, concepts,
know-how or techniques contained therein. Neither Microsoft nor Customer shall
have any obligation to limit or restrict the assignment of such persons or to
pay royalties for any work resulting from the use of residuals. However, the
foregoing shall not be deemed to grant to either Microsoft or Customer a
license under the other party's copyrights or patents.
d. Customer Information. Customer grants to Microsoft the right
to use technical information for problem resolution, internal troubleshooting,
product functionality enhancements and fixes, and Knowledge Base articles.
Microsoft will not identify Customer or publish any of Customer's Confidential
Information in any Knowledge Base article.
4. LIMITED WARRANTIES. Microsoft warrants that the Consulting Services
will be performed using generally accepted industry standards and practices.
5. LIMITATION OF WARRANTIES. THE LIMITED WARRANTIES SET FORTH ABOVE ARE
EXCLUSIVE AND ARE IN LIEU OF ALL OTHER WARRANTIES AND CONDITIONS, EXPRESS,
IMPLIED, STATUTORY OR OTHERWISE WITH RESPECT TO THE SERVICES OR PRODUCTS
PROVIDED UNDER THIS AGREEMENT, THE PERFORMANCE OF MATERIALS OR PROCESSES
DEVELOPED OR PROVIDED UNDER THIS AGREEMENT, OR AS TO THE RESULTS WHICH MAY BE
OBTAINED THEREFROM, AND ALL IMPLIED WARRANTIES AND CONDITIONS OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON-INFRINGEMENT.
MICROSOFT SHALL NOT BE LIABLE FOR ANY SERVICES OR PRODUCTS PROVIDED BY THIRD
PARTY VENDORS, DEVELOPERS OR CONSULTANTS IDENTIFIED OR REFERRED TO COMPANY BY
MICROSOFT UNLESS SUCH THIRD PARTY SERVICES ARE PROVIDED UNDER WRITTEN AGREEMENT
WITH MICROSOFT.
6. LIMITATION OF LIABILITY.
a. Limitation. Microsoft' total liability under this Agreement
shall be limited to the total amount actually paid by Customer to Microsoft
under the applicable Work Order.
b. Exclusion of Certain Damages. TO THE MAXIMUM EXTENT PERMITTED
BY APPLICABLE LAW, IN NO EVENT SHALL MICROSOFT, MICROSOFT SUBSIDIARIES OR THEIR
RESPECTIVE SUPPLIERS BE LIABLE TO COMPANY FOR ANY INCIDENTAL, CONSEQUENTIAL,
INDIRECT, SPECIAL, OR PUNITIVE DAMAGES (INCLUDING, BUT NOT LIMITED TO, LOST
PROFITS, BUSINESS INTERRUPTION, LOSS OF BUSINESS INFORMATION OR OTHER PECUNIARY
LOSS)
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
REGARDLESS OF WHETHER SUCH LIABILITY IS BASED ON BREACH OF CONTRACT, TORT
(INCLUDING NEGLIGENCE), STRICT LIABILITY, BREACH OF WARRANTIES, FAILURE OF
ESSENTIAL PURPOSE OR OTHERWISE AND EVEN IF ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES.
7. TERM AND TERMINATION.
a. Term. This Agreement shall remain in effect until terminated
by either Microsoft or Customer as provided herein; provided that neither party
may terminate this Agreement prior to the termination of the MSN Channel and
Cross Promotion Agreement entered into of even date herewith. The term of any
Work Order shall be as provided therein; provided that neither party may
terminate any incomplete Work Order prior to the termination of the MSN Channel
and Cross Promotion Agreement ("Channel Agreement") entered into of even date
herewith. Termination of this Agreement shall terminate all outstanding Work
Orders between Microsoft and Customer.
b. Termination. Subject to Section 7(a) above, Customer may
terminate this Agreement or any Work Order without cause by giving Microsoft
thirty (30) days written notice. Either Microsoft or Customer may terminate
this Agreement or any Work Order if the other party is in material breach or
default of any obligation hereunder, which breach or default is not cured
within thirty (30) days notice of such breach, provided that such material
breach or default is also a material breach or default of the Channel Agreement
and the terminating party simultaneously terminates such agreement. Customer
shall pay all fees to Microsoft for Services performed and expenses incurred
which have accrued through the date of termination.
c. Survival. Sections 1(b), 2, 3, 4, 5, 6, 7(b), 7(c), 8, and 10
of this Agreement and any provisions specified as surviving in a Work Order
shall survive any termination of this Agreement and termination or expiration
of any Work Order.
8. NOTICES. All notices, authorizations, and requests in connection with
this Agreement shall be deemed given on the day they are (i) deposited in the
mails, postage prepaid, certified or registered, return receipt requested; or
(ii) sent by air express courier (e.g., DHL, Federal Express or Airborne),
charges prepaid, return receipt requested; and addressed as follows:
>TABLE>
>CAPTION>
---------------------------------------------------------------------------------------------------
To Customer: To Microsoft:
>S> >C>
WebMD Inc. Microsoft Corporation
400 The Lenox Building One Microsoft Way
3399 Peachtree Road NE Redmond, WA 98052-6399
Atlanta, Georgia 30326
Attention: General Counsel Phone: 425-882-8080
Phone: 404-479-7600 Fax: 425-936-7329
Fax: 404-479-7603
cc: Law and Corporate Affairs
One Microsoft Way
Redmond, WA 98052-6399
---------------------------------------------------------------------------------------------------
>/TABLE>
9. INSURANCE. At all times when Microsoft will be performing Services on
Customer's premises pursuant to this Agreement, Microsoft will procure and
maintain the following insurance coverage:
a. Commercial General Liability covering bodily injury and
property damage liability with a limit of not less than $1,000,000 each
occurrence;
b. Workers' Compensation (or maintenance of a legally permitted
and governmentally-approved program of self-insurance) covering Microsoft
employees pursuant to applicable state workers' compensation laws for
work-related injuries suffered by employees of Microsoft;
c. Employer's Liability with limits of not less than $1,000,000
each accident; and
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
d. Software Errors and Omissions Liability covering damages
arising out of negligent acts, errors, or omissions committed by Microsoft or
its employees in the performance of this Agreement, with a limit of liability
of not less than $2,000,000 each claim.
Microsoft will provide Customer with certificates of insurance evidencing this
coverage on request.
10. MISCELLANEOUS.
a. No Assignment. This Agreement and any rights or obligations
hereunder shall not be assigned by contract or by operation of law without the
prior written agreement of the other party. Microsoft may use subcontractors to
deliver the Services, provided that Microsoft shall remain liable to Customer,
in accordance with this Agreement, for all Services provided to Customer. The
Services are provided solely for the benefit of Customer and its Affiliates, as
applicable.
b. Applicable Law. This Agreement shall be governed by the laws
of the State of New York, and the parties further consent to the exclusive
jurisdiction by the state and federal courts sitting in the State of New York.
Any action of any kind by any party against another party arising as a result
of this Agreement must be commenced within two (2) years from the date the
right, claim, demand, or cause of action shall first accrue.
c. Entire Agreement. This Agreement and the Work Orders
constitute the entire agreement between Microsoft and Customer, and merge all
prior and contemporaneous communications, with respect to the Services provided
hereunder. The terms on any purchase order or other form submitted by Customer
shall not apply to this Agreement or any of the Services. This Agreement can be
modified only by later written agreement signed by both Microsoft and Customer.
In the event of a conflict between this Agreement and any Work Order, the terms
of this Agreement shall control.
d. Compliance with Laws. Microsoft and Customer shall comply with
all applicable laws and regulations with respect to this Agreement. Customer
acknowledges that the Services and the related software and other materials are
subject to United States export control laws and regulations, and Customer
confirms that it will not export or re-export them, directly or indirectly,
either to (i) any countries that are subject to U.S. export restrictions
(currently including, but not necessarily limited to, Cuba, Iran, Iraq, Libya,
North Korea, Syria and Sudan), or to any national of any such country, wherever
located, who intends to transmit or transport the services or materials back to
such country; or (ii) any end-user whom Customer knows or has reason to know
will utilize them in the design, development or production of nuclear, chemical
or biological weapons, or (iii) any end-user who has been prohibited from
participating in U.S. export transactions by any federal agency of the U.S.
Government.
e. Severability/Waiver. If a court holds that any provision of
this Agreement to be illegal, invalid or unenforceable, the remaining
provisions shall remain in full force and effect. No waiver of any breach of
this Agreement shall be a waiver of any other breach, and no waiver shall be
effective unless made in writing and signed by an authorized representative of
the waiving party.
f. Independent Contractor. Microsoft shall act at all times as
an independent contractor, and shall be responsible for any and all social
security, unemployment, workers' compensation and other withholding taxes for
any and all of its employees.
g. Cost or Pricing Data. Microsoft will not, under any
circumstances, be obligated to perform Services that would require the
submission of cost or pricing data (as defined by U.S. Government regulations)
or be obligated to provide such data.
h. Force Majeure. Except for Customer's obligation to pay for
services already performed by Microsoft, if either party is prevented from
complying, either totally or in part, with any of the terms or provisions of
this Agreement by reason of fire, flood, storm, strike, lockout or other labor
trouble, riot, war, rebellion, accident or other acts of God, then upon written
notice to the other party, the requirements of this Agreement, or the affected
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
provisions hereof to the extent affected, shall be suspended during the period
of such disability. During such period, the party not prevented from complying
as aforesaid may seek to have its needs (which would otherwise be met
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
hereunder) met by or through others without liability hereunder. The party
prevented from complying shall make all reasonable efforts to remove such
disability within thirty (30) days of giving such notice.
i. English Language Governs. The parties have requested that this
Agreement be drawn up in English; les parties ont exiges que cette entente soit
redigee en anglais.
IN WITNESS WHEREOF, the parties have agreed to the terms and conditions of this
Agreement as of the Effective Date indicated below.
MICROSOFT CORPORATION
By: /s/ Laura Jennings
-------------------------------------------------------------
Print Name: Laura Jennings
-----------------------------------------------------
Title: Vice President
----------------------------------------------------------
Date: 6/4/99
-----------------------------------------------------------
WEBMD INC.
By: /s/ W. Michael Heekin
-------------------------------------------------------------
Print Name: W. Michael Heekin
-----------------------------------------------------
Title: Executive Vice President
----------------------------------------------------------
Date: 5/9/99
-----------------------------------------------------------
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
MICROSOFT CONSULTING SERVICES
MASTER SERVICE AGREEMENT
WORK ORDER NO. - (MCS Health Care Practice)
This Work Order is made pursuant to the Microsoft Master Consulting Services
Agreement (the "Agreement") effective on , by and between WebMD ("Customer")
and Microsoft Corporation ("Microsoft") and is incorporated therein by
reference. Capitalized terms not otherwise defined have the meanings provided
in the Agreement.
1. Services. MCS shall perform the services identified below for Customer.
Dates provided herein are estimates only. Services shall not include
development of, and Microsoft shall not deliver, any software, computer program
or code under this Work Order.
MCS shall perform the services as described in Section 4.2 of the MSN Channel
and Cross Promotion Agreement ("Promotion Agreement") between the parties dated
as of even date herewith, including specifically the architectural review phase
of the current WebMD technical platform in order to develop the vision and
scope of the Transition Schedule Work Order to be executed by the parties and
the implementation of the Microsoft technology, including the Microsoft
Technology Platform, phase. WebMD shall ensure both under this work order and
under the Transition Schedule Work Order: 1) that adequate WebMD technical
resources are assigned to the migration effort; 2) that a core WebMD technical
team is adequately training on NT and Internet Information Server; 3) that a
WebMD operations team is available to assume responsibility for the operations
and management of the production site; 4) that WebMD assigns a key manager to
act as the MCS contact for the project; 5) that WebMD provides MCS with access
to the source code and design documentation to the existing site and
applications; 6) that WebMD provides for all hardware and software necessary to
support the production environment; and 7) that Web MD will contract with
Microsoft Premier Support Services for technical product support.
The dates set out in Section 4.2 of the Promotion Agreement by which each party
must complete a task shall be met by such party as part of this Work Order.
The parties agree that the estimated time to complete the architectural review
contemplated hereunder is 160 hours. The product of the architectural review
shall be at a minimum the Transition Schedule and the Transition Schedule Work
Order.
The parties shall complete the tasks specified in Section 2.5 of the meet the
dates specified in the Promotion Agreement.
2. Rates. The hourly rates shown below shall be applicable to this Work
Order. Any total fee stated herein is an estimate only. The total estimated fee
for this project is $33,600, based on the estimated 160 hours of service in the
45 day time period, plus travel and expenses. Project expense will be charged
to WebMD in addition to project fees.
>TABLE>
>CAPTION>
Staff Level Rate/hour
>S> >C>
Enterprise Program Manager $210.00
Senior Consultant - Infrastructure $210.00
Consultant - Infrastructure $180.00
Senior Consultant - Development $210.00
Consultant - Development $180.00
Principal Consultant $250.00
Managing Consultant $250.00
>/TABLE>
Microsoft shall determine in its sole discretion what personnel is required to
complete the work contemplated by this Work Order and may use third parties, as
determined by MCS in its sole discretion, to complete any work.
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Microsoft shall invoice Customer monthly for services performed and expenses
incurred during the previous period. Microsoft invoices for payment should be
directed to Customer's representative for payment at the address shown below
(Customer to provide).
>TABLE>
>S> >C>
Contact: David Lubinski Mailstop (if any):
Address: 5080 Spectrum Drive, Suite 900E Telephone: (972) 716-2629
City: Addison Fax: (972) 233-7280
State: TX Zip:75001 Email: davidlu@microsoft.com
>/TABLE>
Purchase Order No. (if any):
3. Commencement Date. Services under this Work Order will begin on the
date that is within 45 days of the Effective Date of the Promotion Agreement.
The Expiration Date of this Work Order is upon completion of the work
contemplated in this Work Order, which in no event shall be less than 360 days
from the Effective Date, or such later date as the Work contemplated by this
Work Order has been completed.
4. Ownership and License. The copyright in that specific set of tangible
written materials developed by Microsoft at the specific direction of Customer
and provided to Customer in the course of performance under this Work Order
("Materials") shall be owned by Customer, and Microsoft hereby assigns all
right, title and interest in such copyright to Customer. Customer agrees to use
Materials only for Customer's internal business purposes and not for resale or
distribution outside of Customer. Notwithstanding the above, the parties agree
that Microsoft reserves the right to use for any purpose subsets or modules of
the Materials which by themselves provide generic technical information not
unique to Customer's business. Customer may sublicense the rights granted
hereunder to its affiliates (i.e., any entity controlling, controlled by, or
under common control with, Customer). All rights not expressly granted, are
reserved.
THEREFORE, the parties have executed this Work Order in duplicate originals.
MICROSOFT CORPORATION WebMD, Inc. INC.
By /S/ Laura Jennings By /s/ W. Michael Heekin
Name (Print) Laura Jennings Name (Print) W. Michael Heekin
Title Vice President Title Executive Vice President and Secretary
Date 6/9/99 Date 5/10/99
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit G
Use Specifications for the MSN Logos
WebMD may use the MSN Logos solely in the Network Frameworks header and footer
as approved in advance by Microsoft, only on the WebMD Site where the Health
Channel appears.
WebMD's name, logo, or trademark must appear on any site where the MSN Logo is
used, with wording such as "Content by WebMD" as provided in Section 2.2 of the
Agreement, and WebMD's name, logo, or trademark must be at least as prominent
as the MSN Logos.
The MSN Logos may not be used in any manner that expresses or might imply
Microsoft's affiliation, sponsorship, endorsement, certification, or approval,
other than as contemplated by the Agreement.
WebMD shall not use the MSN Logos in association with any third party
trademarks in a manner that might suggest co-branding or otherwise create
potential confusion as to source or sponsorship of the Health Channel or
ownership of the MSN Logos.
The MSN Logos may not be included in any non-Microsoft trade name, business
name, domain name, product or service name, logo, trade dress, design, slogan,
or other trademark.
WebMD may use the MSN Logos only as provided by Microsoft electronically or in
hard copy form. Except for size subject to the restrictions herein, the MSN
Logos may not be altered in any manner, including proportions, colors,
elements, etc., or animated, morphed, or otherwise distorted in perspective or
dimensional appearance.
The MSN Logos may not be combined with any other symbols, including words,
logos, icons, graphics, photos, slogans, numbers, or other design elements.
The MSN Logos (including but not limited to Microsoft's logos, logotypes, trade
dress, and other elements of product packaging and web sites) may not be
imitated in any WebMD materials.
The MSN Logos may not be used as a design feature in any materials.
The MSN Logos must stand alone. A minimum amount of empty space must surround
each MSN Logo separating it from any other object, such as type, photography,
borders, edges, and so on. The required area of empty space around the MSN
Logos must be 1/2x, where x equals the height of the MSN Logo.
Each use of the MSN Logo must include the notice: "Microsoft and MSN are
registered trademarks or trademarks of Microsoft Corporation in the United
States and other countries and the MSN logo is used under license from owner".
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit H
MICROSOFT CORPORATION NON-DISCLOSURE AGREEMENT
(STANDARD RECIPROCAL)
THIS AGREEMENT (the "Agreement") is made between MICROSOFT
CORPORATION, a Washington corporation, and WebMD INC. ("COMPANY") and entered
into this 10th day of February, 1999.
In consideration of the mutual promises and covenants contained in
this Agreement, the mutual disclosure of confidential information to each
other, the parties hereto agree as follows:
1. Confidential Information and Confidential Materials
(a) "Confidential Information" means nonpublic information that
Disclosing Party designates as being confidential or which, under the
circumstances surrounding disclosure ought to be treated as confidential.
"Confidential Information" includes, without limitation, information relating
to released or unreleased Disclosing Party software or hardware products, the
marketing or promotion of any Disclosing Party product, Disclosing Party's
business policies or practices, and information received from others that
Disclosing Party is obligated to treat as confidential. Confidential
Information disclosed to Receiving Party by any Disclosing Party Subsidiary
and/or agents is covered by this Agreement.
(b) Confidential Information shall not include any information
that: (i) is or subsequently becomes publicly available without Receiving
Party's breach of any obligation owed Disclosing Party; (ii) became known to
Receiving Party prior to Disclosing Party's disclosure of such information to
Receiving Party; (iii) became known to Receiving Party from a source other than
Disclosing Party other than by the breach of an obligation of confidentiality
owed to Disclosing Party; or (iv) is independently developed by Receiving
Party.
(c) "Confidential Materials" shall mean all tangible materials
containing Confidential Information, including without limitation written or
printed documents and computer disks or tapes, whether machine or user
readable.
2. Restrictions
(a) Receiving Party shall not disclose any Confidential
Information to third parties for five (5) years following the date of its
disclosure by Disclosing Party to Receiving Party, except to Receiving Party's
consultants as provided below. However, Receiving Party may disclose
Confidential Information in accordance with judicial or other governmental
order, provided Receiving Party shall give Disclosing Party reasonable notice
prior to such disclosure and shall comply with any applicable protective order
or equivalent.
(b) Receiving Party shall take reasonable security precautions, at
least as great as the precautions it takes to protect its own confidential
information, to keep confidential the Confidential Information. Receiving Party
may disclose Confidential Information or Confidential Material only to
Receiving Party's employees or consultants on a need-to-know basis. Receiving
Party will have executed or shall execute appropriate written agreements with
its employees and consultants sufficient to enable it to comply with all the
provisions of this Agreement.
(c) Confidential Information and Confidential Materials may be
disclosed, reproduced, summarized or distributed only in pursuance of Receiving
Party's business relationship with Disclosing Party, and only as otherwise
provided hereunder. Receiving Party agrees to segregate all such Confidential
Materials from the confidential materials of others in order to prevent
commingling.
(d) Receiving Party may not reverse engineer, decompile or
disassemble any software disclosed to Receiving Party.
3. Rights and Remedies
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
(a) Receiving Party shall notify Disclosing Party immediately upon
discovery of any unauthorized use or disclosure of Confidential Information
and/or Confidential Materials, or any other breach of this Agreement by
Receiving Party, and will cooperate with Disclosing Party in every reasonable
way to help Disclosing Party regain possession of the Confidential Information
and/or Confidential Materials and prevent its further unauthorized use.
(b) Receiving Party shall return all originals, copies,
reproductions and summaries of Confidential Information or Confidential
Materials at Disclosing Party's request, or at Disclosing Party's option,
certify destruction of the same.
(c) Receiving Party acknowledges that monetary damages may not be
a sufficient remedy for unauthorized disclosure of Confidential Information and
that Disclosing Party shall be entitled, without waiving any other rights or
remedies, to such injunctive or equitable relief as may be deemed proper by a
court of competent jurisdiction.
(d) Disclosing Party may visit Receiving Party's premises, with
reasonable prior notice and during normal business hours, to review Receiving
Party's compliance with the terms of this Agreement.
4. Miscellaneous
(a) All Confidential Information and Confidential Materials are
and shall remain the property of Disclosing Party. By disclosing information to
Receiving Party, Disclosing Party does not grant any express or implied right
to Receiving Party to or under Disclosing Party patents, copyrights,
trademarks, or trade secret information.
(b) If either party provides pre-release software as Confidential
Information or Confidential Materials under this Agreement, such pre-release
software is provided "as is" without warranty of any kind. Receiving Party
agrees that neither Disclosing Party nor its suppliers shall be liable for any
damages whatsoever relating to Receiving Party's use of such pre-release
software.
(c) Any software and documentation provided under this Agreement
is provided with RESTRICTED RIGHTS. Use, duplication, or disclosure by the
Government is subject to restrictions as set forth in subparagraph (c)(1)(ii)
of The Rights in Technical Data and Computer Software clause at DFARS
252.227-7013 or subparagraphs (c)(1) and (2) of the Commercial Computer
Software -- Restricted Rights at 48 CFR 52.227-19, as applicable. Manufacturer
is Microsoft Corporation/One Microsoft Way/Redmond, WA 98052-6399.
(d) Both parties agree that they do not intend nor will they,
directly or indirectly, export or re-export (i) any Confidential Information or
Confidential Materials, or (ii) any product (or any part thereof), process or
service that is the direct product of the Confidential Information or Materials
to (A) any country that is subject to U.S. export restrictions (currently
including, but not necessarily limited to, Iran, Iraq, Syria, Cuba, North
Korea, Libya, and Sudan), or to any national of any such country, wherever
located, who intends to transmit or transport the products back to such
country; (B) to any end-user who either party knows or has reason to know will
utilize them in the design, development or production of nuclear, chemical or
biological weapons; or (C) to any end-user who has been prohibited from
participating in U.S. export transactions by any federal agency of the U.S.
government.
(e) The terms of confidentiality under this Agreement shall not be
construed to limit either party's right to independently develop or acquire
products without use of the other party's Confidential Information. Further,
either party shall be free to use for any purpose the residuals resulting from
access to or work with such Confidential Information, provided that such party
shall maintain the confidentiality of the Confidential Information as provided
herein. The term "residuals" means information in non-tangible form, which may
be retained by persons who have had access to the Confidential Information,
including ideas, concepts, know-how or techniques contained therein. Neither
party shall have any obligation to limit or restrict the assignment of such
persons or to pay royalties for any work resulting from the use of residuals.
However, the foregoing shall not be deemed to grant to either party a license
under the other party's copyrights or patents.
(f) This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof. It shall not be modified
except by a written agreement dated subsequent to the date of this Agreement
and signed by both parties. None of the provisions of this Agreement shall be
deemed to have been waived by any act or acquiescence on the part of Disclosing
Party, its agents, or employees, but only by an instrument in writing signed by
an authorized officer of Disclosing
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Party. No waiver of any provision of this Agreement shall constitute a waiver
of any other provision(s) or of the same provision on another occasion.
68
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
(g) If either party employs attorneys to enforce any rights
arising out of or relating to this Agreement, the prevailing party shall be
entitled to recover reasonable attorneys' fees. This Agreement shall be
construed and controlled by the laws of the State of Washington, and both
parties further consent to jurisdiction by the state and federal courts sitting
in the State of Washington. Process may be served on either party by U.S. Mail,
postage prepaid, certified or registered, return receipt requested, or by such
other method as is authorized by the Washington Long Arm Statute.
(h) Subject to the limitations set forth in this Agreement, this
Agreement will inure to the benefit of and be binding upon the parties, their
successors and assigns.
(i) If any provision of this Agreement shall be held by a court of
competent jurisdiction to be illegal, invalid or unenforceable, the remaining
provisions shall remain in full force and effect.
(j) All obligations created by this Agreement shall survive change
or termination of the parties' business relationship.
5. Suggestions and Feedback
Either party may from time to time provide suggestions, comments or other
feedback to the other party with respect to Confidential Information provided
originally by the other party (hereinafter "Feedback"). Both parties agree that
all Feedback is and shall be entirely voluntary and shall not, absent separate
agreement, create any confidentiality obligation for the Receiving Party.
However, the Receiving Party shall not disclose the source of any feedback
without the providing party's consent. Feedback shall be clearly designated as
such and, except as otherwise provided herein, each party shall be free to
disclose and use such Feedback as it sees fit, entirely without obligation of
any kind to the other party. The foregoing shall not, however, affect either
party's obligations hereunder with respect to Confidential Information of the
other party.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
COMPANY: WebMD, Inc. MICROSOFT CORPORATION
Address: By: /s/ Laura Jennings
Name: Laura Jenning
By: /s/ W. Michael Heekin Title: Vice President
Name: W. Michael Heekin Date: 6/4/99
Title: Executive Vice President and Secretary MS Contact:
Date: 5/10/99
69
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[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit I
WebMD Logos
[GRAPHIC OMITTED]
Graphic shows screenshot from WebMD's web site, including WebMD's logo.
70
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit J-1
Medical Professionals Section List #1
*
71
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WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
Exhibit J-2
Medical Professionals Section List #2
*
72
Distribution and Cross Promotion Agreement - Microsoft Corp and WebMD Inc.
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