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LICENSE AND WEB SITE DEVELOPMENT AGREEMENT
between
MEDSCAPE, INC.
and
SOFTWATCH INC.
----------------------------------
Dated as of June 15, 1999
----------------------------------
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TABLE OF CONTENTS
Page(s)
ARTICLE 1. LICENSE OF SOFTWARE, CUSTOMIZATIONS;
DIETWATCH WEBSITE......................................................................1
Section 1.1 (a) SoftWatch Software License Grant.....................................1
(b) Medscape Consumer Site Defined................................................2
(c) Internet Defined..............................................................2
(d) SoftWatch Software Further Defined............................................2
(e) Licence For Use in Connection with Multiple Sclerosis.........................3
(f) Copying.......................................................................3
Section 1.2 Customization Services........................................................3
Section 1.3 DietWatch Site License........................................................4
(a) Exclusive Diet Center.........................................................4
(b) General Health and Wellness Center; Hyperlink.................................4
(c) Branding......................................................................4
(d) Member Information............................................................5
(e) Medscape Content; Editorial and Artistic Control;
Look and Feel of Tools.......................................................6
(f) Limited Use License As to Medscape Content....................................6
ARTICLE 2. MEDSCAPE CONSUMER SITE DEVELOPMENT SERVICES............................................6
Section 2.1 Development Services..........................................................6
ARTICLE 3. ADDITIONAL MEDSCAPE CONSUMER SITE
DEVELOPMENT SERVICES AND CO-BRANDED
DIET CENTER CRITERIA...................................................................7
Section 3.1 Content and Uploading of Content..............................................7
Section 3.2 Editorial and Artistic Control................................................7
ARTICLE 4. DELIVERY, TESTING AND ACCEPTANCE; RESPONSIBILITIES
OF THE PARTIES.........................................................................8
Section 4.1 Commencement of Services......................................................8
Section 4.2 Certification Testing.........................................................8
Section 4.3 Final Certification; Deemed Acceptance........................................8
Section 4.4 Retesting.....................................................................9
Section 4.5 Failure to Achieve Final Certification........................................9
Section 4.6 Delivery Delays..............................................................10
Section 4.7 Medscape Responsibilities with respect
to Deliverables..............................................................10
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ARTICLE 5. MAINTENANCE AND SUPPORT SERVICES......................................................11
Section 5.1 Maintenance Period...........................................................11
Section 5.2 SoftWatch Services; Outside Consultants......................................11
Section 5.3 Medscape.com Website.........................................................12
ARTICLE 6. FEES FOR DEVELOPMENT AND CUSTOMIZATION
SERVICES; ROYALTIES..................................................................12
Section 6.1 SoftWatch Software Basic License Fee
and Customization Fee........................................................12
Section 6.2 Maintenance Fees.............................................................12
Section 6.3 Royalty Payments.............................................................13
(a) End-User Tools Royalties.....................................................13
(b) Co-Branded Diet Center Royalties.............................................13
(c) Nutrition/General Health and Wellness
Center Royalties.............................................................14
Section 6.4 Payment Terms; Taxes.........................................................15
Section 6.5 (a) Reporting by Medscape for purposes
of Calculating Royalties.....................................................15
(b) Independent Auditor on Change of Control.....................................16
Section 6.6 (a) Audit Rights.............................................................16
(b) Audit Report on Change of Control............................................16
(c) Change in Control............................................................16
Section 6.7 Expense Reimbursement........................................................17
ARTICLE 7. INTELLECTUAL PROPERTY RIGHTS..........................................................17
Section 7.1 SoftWatch Owned Software and Customizations..................................17
Section 7.2 Medscape-Owned Materials; Customization
User Interfaces..............................................................17
Section 7.3 Shared Materials.............................................................18
Section 7.4 Trademarks, Etc..............................................................18
Section 7.5 Limited License..............................................................18
Section 7.6 Third Party Materials........................................................18
ARTICLE 8. TRADEMARKS; COPYRIGHT NOTICES.........................................................18
Section 8.1 Incorporation of Marks.......................................................18
Section 8.2 Mutual Covenants as to Marks and Notices.....................................19
ARTICLE 9. CONFIDENTIALITY; NON-COMPETE..........................................................19
Section 9.1 Confidentiality Obligations..................................................19
Section 9.2 Confidential Information.....................................................19
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Section 9.3 Exclusivity; Non-Competition Covenants.......................................20
Section 9.4 Specific Performance.........................................................21
ARTICLE 10. REPRESENTATIONS, WARRANTIES, COVENANTS,
AND INDEMNITIES..............................................................22
Section 10.1 SoftWatch....................................................................22
Section 10.2 SoftWatch, Ltd...............................................................23
Section 10.3 Medscape.....................................................................24
Section 10.4 Indemnification..............................................................24
Section 10.5 Indemnification Procedures...................................................25
ARTICLE 11. PRODUCT RELATED WARRANTIES AND
COVENANTS...................................................................25
Section 11.1 General Provisions...........................................................25
Section 11.2 Viruses......................................................................25
Section 11.3 Year 2000 Compliance.........................................................25
Section 11.4 Limited Warranty.............................................................26
Section 11.5 Limitation of Liability......................................................26
Section 11.6 Adequate Controls............................................................26
Section 11.7 Reverse Engineering..........................................................27
Section 11.8 Encryption Covenant..........................................................27
Section 11.9 Medscape.com Website.........................................................27
ARTICLE 12. SALES AGENCY..........................................................................27
Section 12.1 Appointment..................................................................27
Section 12.2 Scope of Agency; Right of Approval..........................................27
Section 12.3 Medscape's Obligations.......................................................27
Section 12.4 Commission...................................................................27
Section 12.5 Expenses.....................................................................28
Section 12.6 SoftWatch's Responsibilities.................................................28
Section 12.7 Payment Terms; Taxes.........................................................28
Section 12.8 (a) Reporting by SoftWatch for purposes of
Calculating Sales Commissions................................................28
(b) Independent Auditor on Change of Control.....................................28
Section 12.9 (a) Audit Rights........................................................28
(b) Audit Report on Change of Control............................................29
(c) Medscape Change in Control...................................................29
ARTICLE 13. TERM AND TERMINATION..................................................................30
Section 13.1 Term.........................................................................30
Section 13.2 Termination for Breach.......................................................30
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Section 13.3 Bankruptcy and Related Events................................................30
Section 13.4 Obligations Upon Termination or Expiration...................................30
Section 13.5 Transfer of Site.............................................................30
Section 13.6 Survival.....................................................................31
ARTICLE 14. GUARANTY OF SOFTWATCH, LTD............................................................31
Section 14.1 Guaranty.....................................................................31
Section 14.2 Obligations Unconditional....................................................31
Section 14.3 Successors and Assigns; Applicable Law.......................................31
ARTICLE 15. GENERAL PROVISIONS....................................................................32
Section 15.1 No Joint Venture Created.....................................................32
Section 15.2 Entire Agreement.............................................................32
Section 15.3 Assignment...................................................................32
Section 15.4 Waiver.......................................................................32
Section 15.5 Notices......................................................................32
Section 15.6 Force Majeure................................................................33
Section 15.7 Publicity....................................................................33
Section 15.8 Governing Law................................................................34
Section 15.9 Including....................................................................34
Section 15.10 Schedules and Exhibits.......................................................34
Section 15.11 Captions.....................................................................34
Section 15.12 Counterparts.................................................................34
Section 15.13 SoftWatch, Ltd as Party......................................................34
Section 15.14 Right of Offset..............................................................34
Exhibit 1.1 LICENSED SOFTWARE.....................................................................36
Exhibit 1.2 SPECIFICATIONS........................................................................39
Exhibit 1.3 THE CO-BRANDED DIET CENTER SPECIFICATIONS.............................................42
Exhibit 9.3 MEDSCAPE COMPETITIVE BUSINESSES.......................................................44
INDEX OF DEFINED TERMS..................................................................................46
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LICENSE AND WEB SITE DEVELOPMENT AGREEMENT
This LICENSE AND WEB SITE DEVELOPMENT AGREEMENT (this "Agreement") is
made as of June 15, 1999 (the "Effective Date"), between MEDSCAPE, INC., a
Delaware corporation, with offices at 134 W. 29th Street, New York, New York
10001-5399 ("Medscape"), SOFTWATCH INC., a Delaware corporation, with offices at
67 South Bedford St., Burlington, MA 01803 ("SoftWatch" and together with
Medscape, collectively, the "Parties," and each a "Party"), and solely with
respect to the provisions of Article 9 (Non-Compete, Confidentiality), Section
10.2 (Representations and Warranties), and Article 14 (Guaranty), SOFTWATCH,
LTD., a corporation organized under the laws of Israel, with offices at 1 Ta'as
Street, Ramat-Gan 52512, Israel, and the direct parent of wholly-owned
subsidiary SoftWatch ("SoftWatch, Ltd."). Unless otherwise specified herein,
capitalized terms used in this Agreement have the meanings defined in this
Agreement and the Schedules and Exhibits hereto.
ARTICLE 1. LICENSE OF SOFTWARE, CUSTOMIZATIONS; DIETWATCH WEBSITE
Section 1.1 (a) SoftWatch Software License Grant. Subject to
Section 9.3 and the other terms and conditions of this Agreement, SoftWatch
grants to Medscape and its Affiliates during the Term a non-exclusive, worldwide
license (the "SoftWatch Software License"):
(i) to use, execute and display on the Medscape Consumer Site and the
Co-Branded Diet Center SoftWatch's end-user interactive healthcare
tools identified on Exhibit 1.1 (the "End-User Tools"); and
(ii) to use, execute and display for and in connection with the development,
construction, enhancement and continuing operation and maintenance of,
the Medscape.com website, the Medscape Consumer Site and the Co-Branded
Diet Center SoftWatch's content creation, data management, display and
other tools identified on Exhibit 1.1 (the "Creation Tools," and
together with the End-User Tools, collectively the"SoftWatch
Software"), in each case at any location or locations around the world.
In addition:
(x) SoftWatch agrees that the foregoing grant of license with respect to
the End-User Tools includes the right of all end-users of the Medscape
Consumer Site and the Co-Branded Diet Center, wherever such end-users
are located, to use, execute and display the End-User Tools within and
in connection with services and functionalities made available in the
Medscape Consumer Site and the Co-Branded
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Diet Center; and the foregoing grant of license with respect to the
End-User Tools includes the right of any and all of Medscape's
employees, contractors and agents (including any operator or host of
the Medscape Consumer Site and/or the Co- Branded Diet Center),
wherever such employees, contractors and agents are located, to use,
display and execute the End-User Tools in connection with the
development, construction, operations, maintenance, and hosting of the
Medscape Consumer Site and/or the Co-Branded Diet Center; and
(x) the foregoing grant of license with respect to the Creation Tools
includes the right of any and all of Medscape's employees, contractors
and agents (including any operator or host of the Medscape.com website,
the Medscape Consumer Site and/or the Co-Branded Diet Center), wherever
such employees, contractors and agents are located, to use, display and
execute the Creation Tools in connection with the development,
construction, operations, maintenance, and hosting of the Medscape.com
website, the Medscape Consumer Site and/or the Co-Branded Diet Center.
(b) Medscape Consumer Site Defined. As used in this Agreement
the "Medscape Consumer Site" means: (i) Medscape's principal publicly available
website on the Internet containing medical and healthcare information which
Medscape makes available to consumers or other members of the general public,
and (ii) all other eHealth service sites or other commercial on-line service
sites (whether or not mainly providing healthcare news, information and/or
related tools or features) on or available through the Internet (including such
as may be made available to private entities and individuals in connection with
a customized "intranet" service) which contain Medscape's proprietary marks and
contain substantially all the content and functionality as Medscape's principal
publicly available website on the Internet referred to above.
(c) Internet Defined. For purposes of this Agreement,
"Internet" means the public collection of computer networks referred to
generally as the "internet" as in existence on the date hereof and any evolution
thereof or successor network thereto, and includes privately available computer
networks connected to the Internet (e.g. so-called "intranets") or which use (x)
Internet standards and/or (y) other use standards which are compatible with, or
essentially similar in functionality to, such networks (including websites, HTML
or other similar delivery systems). The term "Internet" shall also mean and
include any and all other commercial on-line services, whether or not based on
Internet compatible use standards such as HTML.
(d) SoftWatch Software Further Defined. The term "SoftWatch
Software" shall be deemed to mean and include all enhancements, modifications,
customizations and corrections to the SoftWatch Software made by or on behalf of
SoftWatch during the Term, including as part of the Customization Services
referred to in Section 1.2 or the Maintenance Services referred to in Section
5.1. The term "SoftWatch Software" shall
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expressly exclude new modules or other developments which add to, or
substantially increase the functionality of, the SoftWatch Software which
SoftWatch generally makes available to third parties for an additional license
fee, unless Medscape has agreed to license the same and pay to SoftWatch any
such additional license fee.
(e) Licence For Use in Connection with Multiple Sclerosis. It
is expressly understood and agreed by the parties that the SoftWatch Software
License is intended by the Parties to include Medscape's right to use, on all
the terms and conditions set forth in this Section 1.1, the SoftWatch Software
in connection with a specific disease channel on the Medscape Consumer Site
dedicated to the medical condition Multiple Sclerosis. If by September 30, 1999
SoftWatch: (i) is unable to secure the necessary rights to permit Medscape to
use the SoftWatch Software in relation to a specific disease channel for
Multiple Sclerosis on all the terms and conditions set forth in this Section
1.1, or (ii) otherwise to secure, at SoftWatch's expense, the license to
Medscape of a functional equivalent of the SoftWatch Software satisfactory to
Medscape (in its sole discretion) which can be used in a specific disease
channel on the Medscape Consumer Site for Multiple Sclerosis on all the terms
and conditions set forth in this Section 1.1, then SoftWatch shall pay to
Medscape (x) on September 30,1999 an amount equal to $125,000, and (y) on
September 30, 2000 an amount equal to $100,000, provided, however, that if at
any date after September 30, 1999, but prior to September 30, 2000, SoftWatch is
able to secure the rights contemplated in clause (i) or (ii) above, and Medscape
elects (in its sole discretion) to accept a license of such rights, then
SoftWatch shall have no obligation to make the payment of $100,000 referred to
in the foregoing clause (y).
(f) Copying. Medscape may not copy the SoftWatch Software
except as necessary for maintenance, backup, test and disaster recovery
purposes, or as otherwise authorized or permitted by SoftWatch. Notwithstanding
the foregoing, Medscape may, without the consent of SoftWatch, make non-revenue
generating demonstration copies of the SoftWatch Software for use in connection
with Medscape's general marketing and promotion activities. This Agreement does
not provide Medscape with title or ownership of the SoftWatch Software, but only
a right of limited use. Subject to Article 7 and the terms of the SoftWatch
Software License granted under this Agreement, SoftWatch retains sole and
exclusive ownership of, and all right, title and interest in and to the
SoftWatch Software and all copies thereof.
Section 1.2 Customization Services. SoftWatch agrees to
perform customization services (the "Customization Services") in respect of the
SoftWatch Software in accordance with the specifications, and subject to the
delivery terms attached hereto as Exhibit 1.2 (the "Customization
Specifications"). As used in this Agreement, "Customize," "Customized" and
related words means the modeling of the existing SoftWatch Software for a
specific use, purpose or application as provided in the relevant Customization
Specifications, and the term "Customization" means any such SoftWatch
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Software as so modeled. The Certification Testing procedures specified in
Article 4 shall be applicable to any Customization to be delivered pursuant to
this Agreement.
Section 1.3 DietWatch Site License. Subject to the terms of
this Agreement, SoftWatch grants to Medscape a worldwide license during the Term
to create, operate and maintain using the SoftWatch Software, and/or otherwise
to incorporate and display within and in connection with the Medscape Consumer
Site, a version of SoftWatch's proprietary Internet web-site service known as
"DietWatch.com," as modified in accordance with the specifications (the
"Co-Branded Diet Center Specifications") set forth on Exhibit 1.3 attached
hereto (the "Co-Branded Diet Center"). Except as otherwise provided in this
Agreement, the term "Co-Branded Diet Center" shall be deemed to mean and include
all enhancements, modifications, customizations and corrections to the Co-
Branded Diet Center. The foregoing license shall be subject to the following
additional terms, and such other terms as may be agreed by the Parties in the
Co-Branded Diet Center Specifications:
(a) Exclusive Diet Center. Medscape agrees that the Co-Branded Diet Center
will be the exclusive weight management and dieting center for the
Medscape Consumer Site, provided, however that the foregoing shall not
limit or otherwise restrict Medscape from integrating third-party tools
or other software components not proprietary to SoftWatch in the
Co-Branded Diet Center;
(b) General Health and Wellness Center; Hyperlink. The Co-Branded Diet
Center will be maintained separate and apart from, and will contain
content distinct from that of, any "general health and wellness"
service or channel maintained on the Medscape Consumer Site (the
"General Health and Wellness Center"), provided, however, that the
General Health and Wellness Center may contain End-User Tools similar
to those contained in the Co-Branded Diet Center (e.g. a diary tool).
In addition, Medscape agrees that: (i) any such General Health and
Wellness Center shall be designed and maintained in such a manner as to
permit users thereof to directly link to the Co-Branded Diet Center if
they wish to access content and features specifically relating to
dieting and weight management or control, and (ii) the General Health
and Wellness Center will not be exclusively or primarily related to
dieting and/or nutrition.
(c) Branding. The Co-Branded Diet Center will be branded as the "Medscape
Diet Center powered by DietWatch.com" (or such other name and SoftWatch
product reference as may be mutually agreed by the Parties). The
DietWatch.com logo will be displayed at not less than 50% of the scale
of, and with substantially similar graphics, visibility and other
characteristics as, the "Medscape Diet Center" logo (or other Medscape
proprietary mark) in order to properly convey the co-branding of the
Co-Branded Diet Center.
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(d) Member Information; All customer information (the "Member Information")
relating to registered members of the Medscape Consumer Site
("Members") using the Medscape Consumer Site and/or the Co-Branded Diet
Center during the Term (including personal dietary diary information
collected from such Members) shall be owned exclusively by Medscape,
provided, however, that at least thirty (30) days prior to termination
or other expiration of this Agreement (or if termination is by Medscape
for any cause in respect of which Medscape has an immediate right of
termination, then upon notice of termination), Medscape will coordinate
with SoftWatch to provide a mutually agreeable e-mail notice to all
registered Co-Branded Diet Center users:
(i) announcing the termination of the relationship contemplated
hereby and alerting them to the existence of the independent
"DietWatch.com" website; and
(ii) advising such users that they may, by written or electronic
notice to Medscape, authorize and direct Medscape to promptly
release and transfer a copy of such of their personnel Member
Information as is maintained as part of the Co-Branded Diet
Center to SoftWatch for use in the independent "DietWatch.com"
website.
If a Member requests the release and transfer of his or her Member
Information as contemplated in clause (ii), Medscape will, subject to
any privacy laws then in effect, exercise reasonable commercial efforts
to promptly as technically practicable transfer a copy of the relevant
Member Information to SoftWatch so that SoftWatch may provide
continuous service to such Member on the DietWatch.com website.
Medscape further agrees to provide SoftWatch with a non-exclusive,
perpetual, royalty free license to use such Member Information solely
for the purpose of continuing to provide service to such Member on the
DietWatch.com website. Notwithstanding the foregoing: (x) SoftWatch
will have no right to obtain or use any of Medscape's proprietary
clinical content, and (y) Medscape shall have no responsibility for the
accuracy or completeness of any data released and transferred to
SoftWatch and makes no representation or warranty that such information
will be incorrupt or error free. It is further understood and agreed
that, after any termination or expiration of this Agreement,
information provided directly to SoftWatch by users who directly log-in
to, or otherwise access, the DietWatch.com website service shall be the
property of SoftWatch, and that nothing herein shall restrict or
prohibit SoftWatch from compiling and using customer information
gathered through its own efforts or those of its agents, except to the
extent constituting Medscape Confidential Information derived directly
or indirectly in the course of the services being performed by
SoftWatch's under this Agreement.
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(e) Medscape Content; Editorial and Artistic Control; Look and Feel of
Tools. Medscape will have the right to integrate Medscape Content into
the Co-Branded Diet Center. Medscape will have exclusive editorial and
artistic control over the Co- Branded Diet Center and all elements
thereof, including (i) the selection of the Medscape Content, (ii) the
selection, from among those set out in Schedule 1.3 or otherwise
included in the grants of license made by SoftWatch's under this
Agreement, of the functionalities and features from DietWatch.com that
Medscape wishes to include in the Co-Branded Diet Center, and (iii) the
determination of the design and look and feel of all visual elements
(including the End-User Tools), appearing in the Co-Branded Diet
Center. Medscape acknowledges that the exercise of its rights to
editorial and artistic control may materially alter the Specifications
as then in effect, and that the same may result in an extension of, or
other change to the relevant Delivery and Milestone Schedule and/or
additional expense to Medscape. SoftWatch will promptly notify Medscape
if any change requested by Medscape will result in any such extension
of, or other change and/or additional expense, and will not undertake
the same without Medscape's prior authorization.
(f) Limited Use License As to Medscape Content. If applicable, and subject
to Article 7 and the other terms and conditions of this Agreement,
Medscape grants SoftWatch a non-exclusive, non-transferable license
during the Term to reproduce, display and perform Medscape Content and
other Medscape Materials within and in connection with the
construction, development, operations and maintenance of the Co-Branded
Diet Center and for such other purposes as Medscape may authorize or
request in writing. SoftWatch will comply with such restrictions and
requirements regarding the use of such Medscape Content as may be
specified in the Co-Branded Diet Center Specifications, or as may be
otherwise notified by Medscape to SoftWatch from time to time.
ARTICLE 2. MEDSCAPE CONSUMER SITE DEVELOPMENT SERVICES
Section 2.1 Development Services. In consultation with
Medscape, SoftWatch will develop and build for Medscape the Medscape Consumer
Site in accordance with the Site Specifications and the Co-Branded Diet Center
Specifications. As used herein, "Site Specifications" means the site
specifications for the Medscape Consumer Site attached hereto as Exhibit 1.2,
and "Specifications" means, collectively, the Site Specifications, the
Customization Specifications, the Co-Branded Diet Center Specifications and any
other specifications agreed by the parties pursuant to this Agreement.
The foregoing development services (the "Development Services") shall be subject
to Medscape's testing and acceptance as provided in Article 4 and shall include
the following:
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(a) the coordination with Medscape's technical personnel and vendors to
develop:
(i) the input system to accept, organize and store the Medscape
Content; and
(ii) the tools and user interface components to surface and display
the Medscape Content on the Medscape Consumer Site; and
(b) implementing the overall Site Design in consultation with Medscape and
any third party design vendor retained by Medscape;
(c) integrating any third-party components (including chat software and
existing professional content and/or other applications) specified in
the Specifications ("Third Party Components"), which Medscape will be
responsible for providing to SoftWatch at Medscape's expense; and
(d) the development by SoftWatch of certain other functionalities as
provided in the Specifications.
ARTICLE 3. ADDITIONAL MEDSCAPE CONSUMER SITE DEVELOPMENT SERVICES
AND CO-BRANDED DIET CENTER CRITERIA.
Section 3.1 Content and Uploading of Content. Medscape will
provide to SoftWatch Medscape's proprietary data and content that Medscape
determines will be part of the Medscape Consumer Site and/or the Co-Branded Diet
Center, including text and visual material regarding itself, Medscape products,
services, pricing, Medscape Trademarks, and conditions for the Medscape Consumer
Site and the Co-Branded Diet Center (including proprietary notices) ("Medscape
Content"). In accordance with the Specifications, SoftWatch will provide
Medscape with web-based interfaces to enable Medscape to upload Medscape Content
to the Medscape Consumer Site and the Co- Branded Diet Center, and Medscape will
maintain the on-going responsibility for uploading content to, and managing the
content on, the Medscape Consumer Site and the Co- Branded Diet Center.
Section 3.2 Editorial and Artistic Control. Medscape will have
exclusive editorial and artistic control over the Medscape Consumer Site and all
elements thereof, including the selection of the Medscape Content and Third
Party Components, and the design and look and feel of all visual elements
(including the End-User Tools), appearing in the Medscape Consumer Site.
Medscape acknowledges that the exercise of its rights to editorial and artistic
control may materially alter the Specifications as then in effect, and that the
same may result in an extension of, or other change to the relevant Delivery and
Milestone Schedule and/or additional expense to Medscape. SoftWatch will
promptly notify Medscape if any change requested by Medscape will result in any
such extension of, or
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other change and/or additional expense, and will not undertake the same without
Medscape's prior authorization.
ARTICLE 4. DELIVERY, TESTING AND ACCEPTANCE; RESPONSIBILITIES OF THE
PARTIES.
Section 4.1 Commencement of Services. The services to be
performed under this Agreement shall commence no later than the execution hereof
and shall proceed in accordance with the relevant Delivery and Milestone
Schedule included in the Specifications. The Parties acknowledge and agree that
certain services contemplated in this Agreement have been performed prior to,
and are in the course of being performed as of the Effective Date, and that all
of the terms and conditions of this Agreement shall be applicable to the same
extent and with the same effect as if such services had been performed after the
Effective Date. The Parties anticipate and intend that a commercial launch of
the initial phase of the Medscape Consumer Site will occur on July 7, 1999 (the
"Phase I Delivery Date"), and that all remaining deliveries to be made by
SoftWatch shall be made by September 30, 1999 (the "Phase II Delivery Date").
Each Party will provide or otherwise make available to the other each
deliverable ("Deliverable") or other materials identified in the Specifications
on the date (the "Delivery Date") specified therefor in the relevant Delivery
and Milestone Schedule. Medscape acknowledges that if it requests SoftWatch to
implement a material change in the Specifications (as in effect from time to
time), such a request may result in an extension of, or other change to the
relevant Delivery and Milestone Schedule and/or additional expense to Medscape.
SoftWatch will promptly notify Medscape if any change requested by Medscape will
result in any such extension of, or other change and/or additional expense, and
will not undertake the same without Medscape's prior authorization.
Section 4.2 Certification Testing. Promptly upon Medscape's
receipt of each Deliverable on the relevant Delivery Date, Medscape shall
conduct tests to determine whether the relevant Deliverable contains the
features and is capable of performing the operations set forth in the
Specifications (each such test a "Certification Test" and the process of
performing them, "Certification Testing"). Each Deliverable shall be accepted by
Medscape upon the first to occur of: (x) Medscape's written notice to SoftWatch
specifying successful completion of Final Certification, (y) Medscape's written
waiver of such Certification Tests, or (z) deemed acceptance pursuant to Section
4.3. SoftWatch may observe or participate in any Certification Tests performed
by Medscape.
Section 4.3 Final Certification; Deemed Acceptance. If: (i)
the relevant Deliverable is in conformity in all material respects with the
relevant Specifications, as Medscape in its reasonable judgment determines (but
subject to the understanding that no initial release software operates
uninterrupted or error free); or (ii) if Medscape determines to waive
Certification Testing with respect to such Deliverable), then Medscape
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shall notify SoftWatch of its acceptance thereof ("Final Certification"). If
Medscape either (i) fails to give notice of Final Certification or a notice of
non-conformity within thirty (30) days after Medscape receives the relevant
Deliverable, or (ii) makes the relevant Deliverable commercially available to
the public on the Internet for revenue generating purposes (i.e. not as or part
of a beta test version), then Medscape will be deemed to have accepted such
Deliverable on the earlier to occur of (x) the date on which such thirty (30)
day period ends or (y) the date on which the relevant Deliverable becomes so
available to the public, provided, however, that deemed acceptance by Medscape
of any Deliverable pursuant to either of clause (i) or (ii) shall not constitute
a waiver of, or otherwise affect, any rights or claims which Medscape may have
hereunder with respect to any such Deliverable under the warranty and
maintenance provisions hereof, all of which rights and claims are expressly
reserved by Medscape. In addition, deemed acceptance shall not in any way affect
any rights or claims which Medscape may have against SoftWatch for fraud or
gross negligence.
Section 4.4 Retesting. If the relevant Deliverable fails to
meet all or any part of the relevant Certification Tests, Medscape shall
promptly deliver to SoftWatch a written notice of non-conformity, specifying in
detail the manner in which the same does not conform to the Specifications.
Promptly upon its receipt of such notice, SoftWatch shall have ten (10) days
thereafter, or such longer period of time as may be agreed by the Parties, to
correct the deficiencies cited by Medscape so as to meet the criteria set forth
in such Specifications, and to deliver a corrected version to Medscape. Upon its
receipt thereof, Medscape shall have an additional ten (10) days to reinitiate
and complete an additional round of Certification Tests (the "Retesting") of the
relevant Deliverable as so corrected. SoftWatch shall be permitted, in any such
case, to direct, oversee and perform additional testing in order to determine
the cause or causes for any error or malfunction. Medscape shall be responsible
for all direct costs and expenses which Medscape incurs in connection with any
required Retesting.
Section 4.5 Failure to Achieve Final Certification. Medscape
and SoftWatch shall follow the delivery, testing and cure procedure set forth in
Section 4.4 until such time as the relevant Deliverable has been finally
accepted by Medscape as provided in Section 4.3, provided, however, that unless
such failure has resulted from (x) conditions which were beyond the reasonable
control of SoftWatch, or (y) conditions which were caused by Medscape, or which
Medscape should have disclosed to SoftWatch, but failed to do so, on the date
the Specifications therefor were agreed, then the failure of such Deliverable to
meet in all material respects the criteria set forth in such Specifications
(subject to the understanding that no initial release software operates
uninterrupted or error free) upon completion of two (2) rounds of Certification
Testing shall, at Medscape's option, be deemed to be a failure by SoftWatch to
deliver, and upon delivery of written notice by Medscape to SoftWatch referring
to this Section 4.5, Medscape shall have the right, exercisable in its sole
discretion, to reject and to refuse payment for such
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Deliverable, and, if prior payment has been made in respect thereof, to receive
a credit equal to the pro rata portion of the Development Fee attributable
thereto.
Section 4.6 Delivery Delays. Each Party will cooperate with
the other in good faith to facilitate the completion, testing and acceptance of
the Deliverables. Each Party will promptly give notice to the other if such
Party determines at any time prior to the Delivery Date of any Deliverable, or
prior to the date specified in the Delivery and Milestone Schedule for any
information or materials due pursuant thereto, that there has occurred any
condition or event which adversely affects such Party's ability to deliver the
same by its Delivery Date or other applicable date. Medscape shall have the
right to delay any payments due to SoftWatch hereunder in connection with the
Development Services or the Customization Services if SoftWatch fails to deliver
any Deliverable within thirty (30) days of its scheduled Delivery Date, unless
Medscape has given its prior consent to such delay, or if such delay has
resulted, in whole or in part, from an event of force majeure or any delay or
failure by Medscape to perform its obligations hereunder.
Section 4.7 Medscape Responsibilities with respect to
Deliverables. In conjunction with SoftWatch's performance of the Development
Services and the Customization Services, Medscape is responsible for performing
and bearing all costs of the following actions:
(a) determining whether the Deliverables meet the applicable
Specifications;
(b) procuring, installing, and operating hardware and operating systems to
run the Deliverables in accordance with the Specifications;
(c) providing a proper environment and proper utilities for the computers
on which the Deliverables operate, including an uninterrupted power
supply;
(d) selecting and training personnel who can operate computers and are
familiar with the accounts and records that serve as input and output
for the relevant Deliverables;
(e) establishing adequate operational back-up provisions to protect against
data loss and/or a defect or malfunction that renders any Deliverable
or the computer systems on which it runs non-operational; and
(f) identifying and making available during the Term, specific project
managers to serve as Medscape's contacts with SoftWatch.
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ARTICLE 5. MAINTENANCE AND SUPPORT SERVICES
Section 5.1 Maintenance Period. Subject to the terms and
conditions of this Agreement, SoftWatch will provide such maintenance services
to Medscape (the "Maintenance Services") as may be required to maintain and
update the Medscape Consumer Site, the Co-Branded Diet Center, the SoftWatch
Software and the individual components thereof. The initial one-year Maintenance
Services period (the "Initial Maintenance Period") shall begin on the date of
Final Certification of the Phase I Deliverables (as set forth in the
Specifications), and subject to the payment of the fees specified in Section
6.2, each additional one-year maintenance period thereafter shall begin on the
date immediately following the date on which the preceding maintenance period
ends (each such period a "Paid Maintenance Period" and together with the Initial
Maintenance Period, the "Maintenance Period"). The Maintenance Services shall be
of the same scope and character as are generally provided by SoftWatch to its
best maintenance customers, and shall include Medscape's right, so long as it
remains current in Maintenance Fees owed to SoftWatch as provided in Section
6.2, to receive at no additional costs all updates, bug fixes and other standard
modifications provided by SoftWatch to its other maintenance customers.
Maintenance Services shall not include the distribution of new modules or other
developments which add to, or substantially increase the functionality of, the
SoftWatch Software or the Co-Branded Diet Center and which SoftWatch generally
makes available to third parties at additional cost. During the Maintenance
Period, SoftWatch will promptly correct any material errors, defects, bugs,
viruses, design flaws or other malfunctions (taking into account the severity
and technical difficulty in fixing the same) in the SoftWatch Software, the
Customizations, the Medscape Consumer Site, the Co-Branded Diet Center, or any
other Deliverable, in each case, which result from causes within SoftWatch's
control and which have not resulted from the inoperability or incompatibility
of Third Party Components or any other material supplied by Medscape.
Section 5.2 SoftWatch Services; Outside Consultants. If
Medscape requests maintenance or consulting services beyond the scope of those
either identified in the Development Services or otherwise being provided
pursuant to this Agreement, SoftWatch will provide such services, subject to
SoftWatch's resources and the requirements of its other customers, at
SoftWatch's then current rates. Notwithstanding the foregoing, during the
one-year period following the Effective Date, SoftWatch will make available to
Medscape at a rate of $175/hour up to 4000 hours of additional services beyond
those specified in Exhibit 1.2. In each subsequent year, SoftWatch will make
available to Medscape at its then current rates up to 4,000 hours, of additional
consulting and/or maintenance services. Medscape agrees to provide advance
notice to SoftWatch, which notice shall be reasonable under the circumstances,
if Medscape requires any of the above-referenced additional hours of service.
SoftWatch agrees to use its reasonable commercial efforts to timely respond to
and address any emergency or other exigent
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request. The Parties anticipate developing an annual plan describing additional
consulting and/or maintenance services to be performed during the proceeding
year, including financial terms for budgeting purposes, and such plan, shall,
upon agreement by the Parties, become a part of this Agreement. If during any
year Medscape requires out-of- scope consulting and/or maintenance services
which require hours in excess of those contemplated above, Medscape and
SoftWatch shall cooperate in good faith to negotiate the terms on which
SoftWatch will perform such services, taking into account such resource
constraints which SoftWatch may have at the relevant time. SoftWatch's agreement
to provide the foregoing out-of-scope maintenance and/or consulting services
shall in no way expand, or be construed to expand, the scope of the licenses
granted by SoftWatch under this Agreement.
Section 5.3 Medscape.com Website. Notwithstanding anything in
this Article 5 to the contrary, the Maintenance Services shall not include the
correction of any operability, functionality or compatibility errors or
malfunctions relating to the use of the Creation Tools with the Medscape.com
website, or the provision of general maintenance service in respect of the
Creation Tools to the extent relating exclusively to the use of the Creation
Tools in or with the Medscape.com website, it being understood that any
maintenance or consulting services requested by Medscape in connection with the
Creation Tools, as used in or with the Medscape.com website, shall be considered
out-of-scope consulting and/or maintenance services subject to the provisions
of Section 5.2.
ARTICLE 6. FEES FOR DEVELOPMENT AND CUSTOMIZATION SERVICES;
ROYALTIES.
Section 6.1 SoftWatch Software Basic License Fee and
Customization Fee. Medscape will pay a basic license fee of $1,000,000 with
respect to the SoftWatch Software (the "SoftWatch Software License Fee") and a
fee of $500,000 for SoftWatch's Customization Services and Development Services,
with such total payable as follows: (i) one third ($500,000) on the execution of
this Agreement, (ii) one third ($500,000) on Final Certification of the Phase I
Deliverables (as set forth in the Specifications); and (iii) the balance
($500,000) on Final Certification of the Phase II Deliverables (as set forth in
the Specifications).
Section 6.2 Maintenance Fees. During the Initial Maintenance
Period, SoftWatch shall perform Maintenance Services at no cost to Medscape.
Unless Medscape terminates (or gives prior notice of its intent to terminate)
this Agreement as provided in Section 13.1 or 13.2, from and after the date on
which the Initial Maintenance Period ends, Medscape agrees to subscribe, on an
annual basis, for continuing Maintenance Services at SoftWatch's then-current
standard annual maintenance fee rates (the "Maintenance Fee"). Medscape's annual
Maintenance Fee for the one year period immediately following the end of the
Initial Maintenance Period shall be fixed at $150,000,
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\with the first monthly installment of $12,500 due on the first anniversary of
the date of Final Certification of the Phase I Deliverables. All Maintenance
Fees shall be payable on a monthly basis in advance.
Section 6.3 Royalty Payments. Subject to the terms of this
Article 6 and for so long as the grants of license made in Article 1 and
elsewhere in this Agreement remain in effect, the following royalties
(collectively "Royalties") shall be payable to SoftWatch by Medscape:
(a) End-User Tools Royalties. Medscape shall pay to SoftWatch
the following royalties with respect to the End-User Tools:
(i) for each quarterly period during the Term, an amount equal to five
percent (5%) of all Net Advertising Revenue derived from the sales for
such quarter of Sponsorships specifically tied to a specific End-User
Tool (other than as appear in the Co-Branded Diet Center, and other
than as appear in Nutrition/GHW Sponsorship Pages) (e.g. Claritin
Sponsorship of the diary End-User Tool in the "Medscape Allergy
Center") (the "Quarterly Sponsorship Royalty"); and
(ii) for each quarterly period during the Term, an amount equal to two and
one-half percent (2.5%) of all Net Advertising Revenue derived from the
sale of Run-of-Site banner advertisements on the Medscape Consumer Site
for such quarter multiplied by a fraction, the numerator of which is
the total number of page views on which an End-User Tool application
(not just a link to the application) appears on the Medscape Consumer
Site (other than in the Co-Branded Diet Center and other than in
Nutrition/GHW ROS Banner Pages) during such quarter and the denominator
of which is the number of total page views displayed in the Medscape
Consumer Site for the same quarter (the "Quarterly ROS/Tool Banner
Royalty").
(b) Co-Branded Diet Center Royalties. Medscape shall pay to
SoftWatch the following royalties with respect to Co-Branded Diet Center:
(i) for each quarterly period during the Term, an amount equal to fifty
percent (50%) of all Net Advertising Revenue derived from the sale of
Sponsorships for such quarter specifically tied to the Co-Branded Diet
Center multiplied by a fraction, the numerator of which is the number
of total page views appearing in the Co-Branded Diet Center during such
quarter less the total number of page views on which content provided
by Medscape (not just links to such Medscape content) appears during
the same quarter, and the denominator of which is the number of total
page views displayed in the Co-Branded Diet Center during the same
quarter (the "Quarterly Diet Center Tools Sponsorship Royalty");
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(ii) for each quarterly period during the Term, an amount equal to
twenty-five percent (25%) of all Net Advertising Revenues derived from
the sale of Sponsorships for such quarter specifically tied to the
Co-Branded Diet Center multiplied by a fraction, the numerator of which
is the number of total page views on which content provided by Medscape
(not just links to such Medscape content) appears in the Co-Branded
Diet Center during such quarter, and the denominator of which is the
total number of page views displayed in the Co-Branded Diet Center
during the same quarter (the "Quarterly Diet Center Medscape Content
Sponsorship Royalty");
(iii) for each quarterly period during the Term, an amount equal to fifty
percent (50%) of Diet Center/ROS Tools Banner Revenue. For purposes
hereof, "Diet Center/ROS Tools Banner Revenue" means all Net
Advertising Revenue derived from the sale of Run-of-Site banner
advertisements appearing on the Medscape Consumer Site during such
quarter multiplied by a fraction, the numerator of which is the number
of total page views appearing in the Co-Branded Diet Center during such
quarter less the total number of page views on which content provided
by Medscape (not just links to such Medscape content) appears in the
Co-Branded Diet Center during the same quarter and the denominator of
which is the number of total page views displayed in the Medscape
Consumer Site during the same quarter (the "Quarterly ROS/Diet Center
Tools Banner Royalty");
(iv) for each quarterly period during the Term, an amount equal to
twenty-five percent (25%) of Diet Center/ROS Content Banner Revenue.
For purposes hereof, "Diet Center/ROS Content Banner Revenue" means all
Net Advertising Revenues derived from the sale of Run-of-Site banner
advertisements in the Medscape Consumer Site for such quarter
multiplied by a fraction, the numerator of which is total number of
page views appearing in the Co-Branded Diet Center for such quarter on
which content provided by Medscape (not just links to such Medscape
content) appears and the denominator of which is the number of total
page views displayed in the Medscape Consumer Site for the same quarter
(the "Quarterly ROS/Diet Center Content Banner Royalty").
(c) Nutrition/General Health and Wellness Center Royalties.
Medscape shall pay to SoftWatch the following royalties with respect to
"Nutrition" pages appearing in the General Health and Wellness Center:
(i) for each quarterly period during the Term, an amount equal to fifteen
percent (15%) of all Net Advertising Revenue derived from the sales for
such quarter of Sponsorships which are displayed when a user of the
General Health and Wellness Center clicks on or otherwise selects any
"Nutrition" icon featured within such General Health and Wellness
Center (each such display a "Nutrition/GHW Sponsorship Page"); and
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(ii) for each quarterly period during the Term, an amount equal to fifteen
percent (15%) of all Net Advertising Revenue derived from the sale of
Run-of-Site banner advertisements on the Medscape Consumer Site for
such quarter multiplied by a fraction, the numerator of which is the
total number of page views displayed during such quarter as a result of
a General Health and Wellness Center user's clicking or otherwise
selecting any "Nutrition" icon featured within such General Health and
Wellness Center (each such display a "Nutrition/GHW ROS Banner Page"),
and the denominator of which is the number of total page views
displayed in the Medscape Consumer Site for the same quarter.
For purposes of this Section 6.3: "Net Advertising Revenue"
means all advertising revenue actually received by Medscape less all related
sales credits, rebates, taxes and third-party ad sales commissions, paid or
issued by Medscape; "Run-of Site" or "ROS" means advertising by one or more
advertisers which is evenly distributed throughout the web-site; and
"Sponsorship" means all other advertising which is not ROS (e.g. is unevenly
distributed or is specifically tied to a particular feature, tool or content set
in the Medscape Consumer Site or the Co-Branded Diet Center). By way of example
only, Schering Plough's purchase of all or a portion of the ad impressions
delivered in the "Medscape Asthma interactive diary" is a Sponsorship. Medscape
agrees that it will not use the Co-Branded Diet Center or any "Nutrition" icon
or nutrition management tool identified in Schedule 1.1 (or the related
functionality of any of foregoing) featured in the General Health and Wellness
Center as a "loss leader."
Section 6.4 Payment Terms; Taxes. All payments due to
SoftWatch under this Agreement are stated and payable in U.S. dollars and shall
be paid by wire transfer to such account as SoftWatch shall from time to time
notify Medscape in writing. Amounts subject to Royalty and received by Medscape
during each Reporting Period shall be paid to SoftWatch within thirty (30) days
after the end of such Reporting Period, and each such payment shall be
accompanied by a copy of the report specified in Section 6.5. All payments
specified in this Agreement are exclusive of, and Medscape agrees to pay, any
applicable sales or use tax related to the transactions described herein (other
than taxes based on the net income to SoftWatch). Unless otherwise specified in
this Agreement, invoices are payable within 30 days of receipt. SoftWatch
reserves the right to charge a late fee of up to 1.5% per month (or, if less,
the maximum rate permitted by law) on any balance remaining unpaid for more than
forty-five (45) days.
Section 6.5 (a) Reporting by Medscape for purposes of
Calculating Royalties. Subject to Section 6.5(b), within thirty (30) days after
the end of each calendar quarter during the Term (each such quarterly period a
"Reporting Period" with the first such Reporting Period to end on the last day
of the first full calendar quarter to occur after commercial launch of the
Medscape Consumer Site), Medscape shall send a statement to SoftWatch
summarizing, and certifying as to, the information used by Medscape to calculate
the Royalties payable to SoftWatch for such Reporting Period in order to confirm
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the actual amount of Net Advertising Revenues received or projected to be
received by Medscape during the applicable Reporting Period for each category
specified in Section 6.3.
(b) Independent Auditor on Change of Control. If at any time
after the Restricted Period a Change of Control occurs, all reports required to
be delivered by Medscape to SoftWatch pursuant to Section 6.5(a) shall be
delivered to and subject to review by an independent auditor reasonably
acceptable to both parties, who shall agree to be bound by the confidentiality
obligations set forth in Article 9 (an "Independent Auditor"). The Independent
Auditor shall prepare a report confirming the accuracy of information provided
by Medscape. SoftWatch shall have the right to receive solely the results of
such review only, and shall have no right to receive, review or consult actual
information provided by Medscape in its reports, Medscape's books of account, or
any workpapers prepared by the Independent Auditor in connection with its
review. The costs of any such Independent Auditor shall be borne equally by the
parties.
Section 6.6 (a) Audit Rights. Medscape will maintain for at
least three (3) years its records, contracts and accounts relating to each sale,
license, service, or other transaction in respect of which a Royalty is payable
by Medscape hereunder, and will permit examination not more frequently than once
per calendar year of that information upon reasonable request and during normal
business hours by an Independent Auditor. In addition, but subject to Section
6.6(b), SoftWatch shall be entitled annually to appoint an Independent Auditor
to audit the books of account of Medscape, at SoftWatch's expense, during normal
business hours, with at least two weeks' prior notice. If during the course of
such audit, it is discovered that Medscape has underpaid SoftWatch by an amount
in excess of five percent (5%) of the amount determined to be due for the
audited period, then the cost of such audit shall be borne by Medscape.
Furthermore, any error discovered by the Independent Auditor shall be promptly
remedied by Medscape after receipt of notice by SoftWatch. All information
received by a Party in the course of such audit shall be treated as Confidential
Information and shall not be disclosed to any third party (other than its
attorneys and accountants) or used for any purpose whatsoever other than to
determine compliance with this Article 6.
(b) Audit Report on Change of Control. If at any time after
the Restricted Period a Change of Control occurs, SoftWatch shall have the right
to receive solely the results of any audit performed pursuant to Section 6.6(a),
and shall have no right to receive, review or consult Medscape's books of
account, the Independent Auditor's audit report, or any workpapers prepared by
the Independent Auditor in connection with its audit.
(c) Change in Control. A "Change of Control" means the sale or
other transfer of all or substantially all of the assets of SoftWatch, Ltd. or
SoftWatch or the acquisition of SoftWatch, Ltd. or SoftWatch by, or other merger
of SoftWatch, Ltd. or SoftWatch with or into, any Competitive Business, or if
there shall occur any other event
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which results in the direct or indirect possession or exercise by any
Competitive Business of voting control over SoftWatch, Ltd. or SoftWatch, or the
direct or indirect holding by any Competitive Business of a majority of the
equity interests in SoftWatch, Ltd. or SoftWatch The foregoing shall not be
applicable to any change in the ownership of any publicly held stock of
SoftWatch, Ltd. or SoftWatch to the extent that such change does not result in
the acquisition by any Competitive Business of ownership or control of more than
49% of any class of publicly held stock entitled to vote for the election of
directors. A "Change of Control" shall also be deemed to occur if any officer,
director, employee, shareholder (or other equity participant) of, or other
individual associated with, any Competitive Business shall become a director of
either SoftWatch or SoftWatch, Ltd.
Section 6.7 Expense Reimbursement. In addition to the other
fees payable by Medscape pursuant to this Agreement, Medscape agrees to
reimburse SoftWatch for the reasonable and necessary out-of-pocket travel and
living expenses related to the provision of the Services, including travel,
lodging meals, incidentals and miscellaneous materials and supplies, provided,
however, that any individual item, or series of related items, of expense in
excess of $750.00 shall require the prior written authorization of Medscape.
ARTICLE 7. INTELLECTUAL PROPERTY RIGHTS
Section 7.1 SoftWatch Owned Software and Customizations.
SoftWatch owns all copyright and other proprietary rights in the SoftWatch
Software, Customizations and all other extensions and derivative works created
by SoftWatch pursuant to this Agreement or otherwise (the foregoing,
collectively, the "SoftWatch Materials"). This Agreement does not provide
Medscape with title or ownership of the SoftWatch Software, but only a right of
limited use as provided in Article 1. Subject to the grants of license made
pursuant to Article 1, and to the restrictions contained in Section 9.3,
SoftWatch retains sole and exclusive ownership of all right, title and interest
in and to the SoftWatch Software and all copies thereof.
Section 7.2 Medscape-Owned Materials; Customization User
Interfaces. Medscape owns all copyright and other proprietary rights in all of
the materials Medscape supplies to SoftWatch under this Agreement, including all
Medscape proprietary marks and brands, the specific user interface design
elements for or related to the Medscape Consumer Site and the Customizations
(including the particular look and feel and navigation thereof), all Medscape
Content (including as may be integrated in the Co- Branded Diet Center),
customer and professional data (including Member Information embodied in, or
relating to, the SoftWatch Software and Customizations thereof), metadata
structure and registration questionnaire (all of the foregoing, collectively,
the "Medscape Materials").
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Section 7.3 Shared Materials. Each Party shall contribute
materials pursuant to this Agreement which are to be used jointly throughout the
Term (collectively, the "Shared Materials"). Each Party retains ownership of
whatever material that Party contributed to the Shared Materials pursuant to
this Agreement both during the Term and thereafter, and each Party may
re-implement or otherwise use (subject, in the case of SoftWatch, to the
provisions of Section 9.3) its respective portion of the Shared Material both
during and after the Term. Under no circumstances will either Party use after
the Term any portion of the Shared Materials that the other Party contributed to
the Shared Materials.
Section 7.4 Trademarks, Etc. Medscape owns all rights in its
Trademarks, and SoftWatch owns all rights in its Trademarks.
Section 7.5 Limited License. Medscape grants SoftWatch a
non-exclusive, non-transferable license during the Term, to reproduce, display
and perform the Medscape Materials for the limited purpose of designing,
building, and maintaining the Medscape Consumer Site. SoftWatch may make only
such copies of the foregoing as may be necessary to perform its obligations
under this Agreement.
Section 7.6 Third Party Materials. For any material
incorporated in any Deliverable included in the Specifications that is not
original material created by, or licensed to, SoftWatch or is not in the public
domain (but excluding Third Party Components (including chat software) which are
provided to SoftWatch by Medscape), SoftWatch will have the responsibility to
obtain at its expense, on Medscape's behalf, all permissions necessary to
incorporate and use such third-party material on an irrevocable, worldwide,
perpetual basis (except as a result of a breach by Medscape or its sub-
licensors) as part of the Medscape Consumer Site. Medscape may obtain (or shall
have the right to request SoftWatch to obtain on Medscape's behalf) at
Medscape's expense such rights as Medscape may require to incorporate additional
third party materials not included in the Specifications (e.g. new features, or
enhancements) in the Medscape Consumer Site.
ARTICLE 8. TRADEMARKS; COPYRIGHT NOTICES.
Section 8.1 Incorporation of Marks. Medscape and SoftWatch
shall incorporate the other's trademarks, service marks, trade names, logos and
other similar proprietary rights ("Trademarks") as they may mutually agree in
good faith, provided that each of Medscape and SoftWatch shall comply with such
restrictions and requirements as may be notified to it from time to time by the
other with respect to the use of the same. Neither Party shall incorporate the
other's Trademarks without first submitting a sample of the use to the Trademark
owner and obtaining written consent.
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Section 8.2 Mutual Covenants as to Marks and Notices.
SoftWatch covenants and agrees that it shall not knowingly delete any Trademarks
or copyright notices of Medscape or any of its Affiliates that are present in or
on, or displayed by, the Medscape Consumer Site or the Co-Branded Diet Center,
or otherwise use without Medscape's consent any of Medscape's Trademarks or
other identifiers in any manner other than as is expressly provided by this
Agreement, Medscape covenants and agrees that it shall not knowingly delete any
Trademarks or copyright notices of SoftWatch that are present in or on, or
displayed by, the Medscape Consumer Site or the Co-Branded Site, or otherwise
use without SoftWatch's consent any of SoftWatch's Trademarks or other
identifiers in any manner other than as is expressly provided by this Agreement.
If either Party for any reason deletes or causes the deletion of any Trademark
or copyright notice of the other Party or any of its Affiliates that are present
in or on, or displayed by, the Medscape Consumer Site or the Co-Branded Diet
Center, such Party shall, upon notice by the affected Party, promptly take such
remedial actions as the affected Party may request.
ARTICLE 9. CONFIDENTIALITY; NON-COMPETE
Section 9.1 Confidentiality Obligations. Each Party
acknowledges that it and its subcontractors(if any) have had prior to the
Effective Date, and in performing its obligations under this Agreement, it and
its subcontractors (if any) will have access to or be directly or indirectly
exposed to Confidential Information . Each Party covenants and agrees that it
shall hold confidential all Confidential Information and shall not use or
disclose such Confidential Information without the express consent of the
disclosing Party. Each Party shall take reasonable measures and efforts to
provide protection for the disclosing Party's Confidential Information,
including measures at least as strict as those the receiving Party uses to
protect its own Confidential Information. Such measures will include requiring
employees and any independent contractors to sign a non-disclosure agreement
before obtaining access to the disclosing Party's Confidential Information. The
confidentiality obligations of the Parties shall survive any termination or
other expiration of this Agreement.
Section 9.2 Confidential Information. "Confidential
Information" means information in the possession or under the control of a Party
relating to a Party's technical, marketing, product and business affairs,
including customer, price, and other proprietary and trade secret information,
whether oral, graphic, written, electronic or in machine readable form, and
includes the computer code embodying the Medscape Consumer Site, the SoftWatch
Software and any Customizations thereof, and the underpinnings of the
DietWatch.com website, and the terms and conditions of this Agreement (except
that any Party may disclose the Agreement to its legal and financial advisers
for the purpose of obtaining legal or financial advice). In the case of
Medscape, Confidential Information includes the Medscape Content, source code of
any software Deliverables, Member
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Information and other customer and user information, including any information
pertaining to usage of the Medscape Consumer Site or the Medscape.com website.
Confidential Information does not include information which (A) was known to the
receiving Party or in the public domain before disclosure; (B) becomes part of
the public domain after disclosure by a publication or other means except by a
breach of this Agreement by the receiving Party, (C) or was received from a
third party under no duty or obligation of confidentiality to the disclosing
Party. Upon termination or other expiration of this Agreement, all Confidential
Information disclosed by a Party to a receiving Party will be returned to the
disclosing Party or, upon the request of the disclosing Party, will be promptly
destroyed and certified as destroyed by the receiving Party.
Section 9.3 Exclusivity; Non-Competition Covenants. (a) Each
of SoftWatch, Ltd. and SoftWatch hereby agrees for itself and on behalf of its
Affiliates, that it shall not independently or in connection with any other
person or entity, directly or indirectly until the end of the Restricted Period:
(i) license or sell to any Competitive Business, or otherwise
authorize, permit, or allow (with or without its consent) any
Competitive Business to use: (1) DietWatch or the
DietWatch.com website or any part thereof, (2) the SoftWatch
Software, (3) any Customizations thereof, or (4) any other
tools substantially similar to the SoftWatch Software or such
Customizations; and
(ii) negotiate or conclude any license, acquisition, merger,
partnership, joint venture or similar arrangement, or sale of
all or substantially all of its assets or equity interests,
with, or otherwise establish, acquire, participate or own any
interest in, any Competitive Business established or
conducting business anywhere in the world;
"Competitive Business" means (1) the business entities set
forth on Exhibit 9.3 hereof or (2) any other business that owns or operates an
"eHealth Service". "Restricted Period" means (x) with respect to any
Competitive Business (other than WebMD, Healtheon and InteliHealth), the period
beginning on the Effective Date and ending on September 30, 1999, and with
respect to WebMD, Healtheon and InteliHealth only, the period beginning on the
Effective Date and ending on October 31, 1999. "eHealth Service" means an
Internet, website or online service that mainly provides healthcare news,
information and/or interactive tools or features to physicians, allied
healthcare professionals or consumers, including, those listed on Exhibit 9.3,
provided, however, that the term "eHealth Service" shall not include any website
operated or developed by a pharmaceutical or medical device company, ad agency
or other nutrition, sports or wellness organization focused on a limited number
of closely related products or medical conditions (e.g., MSWatch by Teva).
"Affiliate", as to any Party, means any person or entity directly or indirectly
controlling, controlled by or under common control with such Party, and shall
include any officer, director and partner of any such Party. A
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Party shall be deemed to control another person if it owns or has the power to
exercise voting rights with respect to more than 50 percent of the voting
securities of such other person or entity.
(b) Notwithstanding the provisions of Section 9.3(a) above,
nothing in this Agreement shall prevent or otherwise restrict SoftWatch from:
(i) the marketing and sale of its products and services (including the
SoftWatch Software and the DietWatch.com website) to any entity after
the Restricted Period, or to any entity other than a Competitive
Business during the Restricted Period; and
(ii) performing its obligations under its existing arrangements with Third
Age, the material terms of which SoftWatch has previously disclosed to
Medscape.
(c) Each of SoftWatch and SoftWatch, Ltd. acknowledges that
Medscape's business, insofar as its relates to provision of content and services
over World Wide Web of the Internet, is global in scope, and that, accordingly,
competition with Medscape's business is possible from nearly every part of the
world. Each of SoftWatch and SoftWatch, Ltd. further acknowledges and agrees
that the restrictions set forth in this Section 9.3 are reasonable in scope and
duration and are necessary to protect, and to enable Medscape to receive the
anticipated benefits of this Agreement and the arrangements contemplated hereby.
The Parties hereto agree that, if any of the length of time, the geographical
area, the scope or another parameter of the restrictions set forth above is
deemed to be unlawfully restrictive by a court of competent jurisdiction, such
provision shall be deemed to be amended and shall be construed by such court to
have the broadest type, scope and duration permissible under applicable law, and
if no validating construction is possible, shall be severable from the rest of
this Agreement, and the validity, legality or enforceability of the remaining
provisions of this Agreement shall not in any way be affected or impaired
thereby.
Section 9.4 Specific Performance. The parties recognize that
the performance of the obligations by the Parties of their respective
obligations under this Article 9 is special, unique and extraordinary in
character. In addition to such other rights and remedies as a non-breaching
Party may have at equity or in law with respect to any breach of this Agreement,
if a Party commits a breach of any of the provisions of this Article 9, the
non-breaching Party shall have the right and remedy to have such provisions
specifically enforced by any court of competent jurisdiction or to enjoin the
breaching Party from performing any act being taken by the breaching Party in
violation of this Article 9, it being acknowledged and agreed that any such
breach or threatened breach will cause irreparable injury to the non-breaching
Party, its business, proprietary marks and brands, and the goodwill associated
therewith and that money damages will not provide an adequate remedy to the
non-breaching Party.
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ARTICLE 10. REPRESENTATIONS, WARRANTIES, COVENANTS, AND
INDEMNITIES
Section 10.1 SoftWatch. SoftWatch represents, warrants, and
covenants that:
(a) all of the services it performs under this Agreement will be
performed in a professional and workmanlike manner, consistent
with generally accepted industry standards, using trained
personnel;
(b) all Deliverables and the Medscape Consumer Site, in light of
the fact that no software operates uninterrupted or is
error-free, will be designed and operate in all material
respects in conformity with the relevant Specifications and
the terms and conditions of this Agreement. Notwithstanding
the foregoing, but subject to Section 11.4, SoftWatch makes no
representation or warranty that the operation of the Medscape
Consumer Site or any other Deliverable will not be adversely
affected by documented or other known errors in any Microsoft
or other standard third-party operating system or similar
software in generally accepted industry use (including
Webserver and database and other e-commerce software) included
in the Medscape Consumer Site or such Deliverable, or on which
their operations rely;
(c) SoftWatch has full authority to enter into this Agreement, and
the person signing on behalf of SoftWatch is authorized to
sign on SoftWatch's behalf;
(d) SoftWatch is the owner, or has the right to use, license,
reproduce, and distribute all materials and methodologies,
including computer programs, used, licensed or supplied by
SoftWatch in connection with the services it is providing
under this Agreement;
(e) SoftWatch owns, or has the right to use, and has the right to
authorize Medscape to use, the SoftWatch Software and other
materials supplied by SoftWatch pursuant to this Agreement;
(f) none of the materials that SoftWatch supplies pursuant to this
Agreement (including non-standard or custom designed
third-party materials such as charting software) infringes any
copyright, patent, trademark, trade secret or other third
party proprietary right. Notwithstanding the foregoing, it is
expressly understood and agreed by the Parties that SoftWatch
makes no representation or warranty, and shall have no
liability, with respect to any claim that any Microsoft or
other standard third-party operating system or similar
software which is in generally accepted industry use
(including
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Webserver and database and other e-commerce software) (or any
use thereof) infringes the rights of any third party; and
(g) SoftWatch will comply with all applicable and material
federal, state, and local laws and regulations in the
performance of its obligations under this Agreement, including
laws concerning the encryption and import/export of software
products;
Section 10.2 SoftWatch, Ltd. SoftWatch, Ltd. represents,
warrants, and covenants that:
(a) SoftWatch, Ltd. has full authority to enter into the
provisions of this Agreement applicable to, and the person
signing on behalf of SoftWatch, Ltd. is authorized to sign on
SoftWatch, Ltd.'s behalf;
(b) upon execution and delivery of this Agreement by SoftWatch,
Ltd., this Agreement shall be the legal, valid, and binding
obligation of SoftWatch, Ltd., enforceable against it in
accordance with the terms hereof;
(c) the performance by SoftWatch, Ltd of its obligations
hereunder, and its compliance with the terms hereof, do not
and will not violate any provisions of applicable Israeli law;
(d) SoftWatch, Ltd. is the owner, or has the right to use,
reproduce, and distribute all materials and methodologies,
including computer programs, licensed to SoftWatch for
SoftWatch's use in connection with the services its is
providing pursuant to this Agreement;
(e) SoftWatch, Ltd. owns, or has the right to use, the SoftWatch
Software and other materials (including third-party materials)
licensed by SoftWatch, Ltd to SoftWatch; and
(f) None of the materials that SoftWatch, Ltd. licenses to
SoftWatch (including non-standard or custom designed
third-party materials such as charting software) infringes any
copyright, patent, trademark, trade secret or other third
party proprietary right. Notwithstanding the foregoing, it is
expressly understood and agreed by the Parties that SoftWatch,
Ltd. makes no representation or warranty, and shall have no
liability, with respect to any claim that any Microsoft or
other standard third-party operating system or similar
software which is in generally accepted industry use
(including Webserver and database and other e-commerce
software) infringes the rights of any third party.
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Section 10.3 Medscape. Medscape represents, warrants, and
covenants:
(a) Medscape has full authority to enter into this Agreement, and
the person signing on behalf of Medscape is authorized to sign
on Medscape's behalf;
(b) the Medscape Content and any other materials (including Third
Party Components) supplied by Medscape pursuant to this
Agreement do not and will not infringe any copyright, patent,
trademark, trade secret, or other third- party proprietary
right. Notwithstanding the foregoing, it is expressly
understood and agreed by the Parties that Medscape makes no
representation or warranty, and shall have no liability, with
respect to any claim that any Microsoft or other standard
third-party operating system or similar software which is in
generally accepted industry use (including Webserver and
database and other e-commerce software) (or any use thereof)
infringes the rights of any third party;
(c) Medscape is the owner, or has the right to use, reproduce, and
distribute all materials and methodologies, including computer
programs used or supplied by Medscape in connection with this
Agreement;
(d) Medscape will comply will all applicable and material federal,
state and locals laws and regulations in the performance of
its obligations under this Agreement, including any applicable
laws concerning the encryption and import/export of software
products; and
(e) Medscape will use its reasonable commercial efforts to promote
the Medscape Consumer Site and the Co-Branded Diet Center, and
to market and sell of advertising on such sites.
Section 10.4 Indemnification. Each Party agrees to defend and
indemnify the other Party, its directors, officers, employees, and agents
against any claim, demand, suit, debt, liability, or costs, including reasonable
attorney's fees ("Losses"), to the extent that it is based on a claim that: (a)
constitutes a breach of the indemnifying Party's warranties, representations,
and undertakings in this Agreement; or (b) arises out of the gross negligence or
willful misconduct of the indemnifying Party, provided, however, that neither
Party shall not have any liability pursuant to this Section 10.4 unless the
aggregate of all Losses for which the indemnifying Party would, but for this
proviso, be liable, exceeds on a cumulative basis $25,000, in which case the
indemnifying Party shall be liable for the aggregate of all Losses (i.e.,
without regard to the foregoing limitation). Notwithstanding the foregoing, the
limitation on liability contained in the foregoing proviso shall not be
applicable in the case of any Losses on account of any breach of a Party's
representations and warranties pertaining to (x) the infringement of any
copyright, patent, trademark, trade secret or other third party proprietary
right or (y) compliance with any applicable and
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material federal, state, and local laws, it being understood that the
indemnifying Party shall be liable to the indemnified Party in all events for
the aggregate amount of all such Losses.
Section 10.5 Indemnification Procedures. The Party claiming
indemnification pursuant to Section 10.4, shall notify the other Party promptly
of the claim. The indemnified Party may, at its own expense, assist in the
defense if it so chooses, provided that the indemnifying Party controls the
defense and all negotiations relative to any settlement and further provided
that any settlement intended to bind the indemnified Party is not final without
the indemnified Party's consent. Without limiting the foregoing, if a third
party makes a claim against Medscape alleging that any Deliverable infringes the
intellectual or other proprietary rights, SoftWatch (x) shall, at its expense,
secure for Medscape the right to continue to use the relevant Deliverable in the
territory or jurisdiction to which the infringement claim relates, or if the
claim relates to worldwide rights, everywhere throughout the world (the
"Affected Territory"), or (y) modify or replace the Deliverable so as to make it
non-infringing, or (z) if neither of the foregoing options is available in
SoftWatch's reasonably commercial judgment, require Medscape to either cease
using the Deliverable in the Affected Territory or return the Deliverable, in
each case, for a credit equal to a pro-rata portion of the previously paid
license fee (if any), in either of which event Medscape's obligation to pay
royalties with respect to such Deliverable to the extent relating to the
Affected Territory shall terminate with effect from the date on which the third
party infringement claim is first made, and Medscape shall be entitled to a
refund of any royalty actually paid to SoftWatch with respect to any period
occurring after such date to the extent relating to the Affected Territory.
ARTICLE 11. PRODUCT RELATED WARRANTIES AND COVENANTS.
Section 11.1 General Provisions. The provisions of this
Article 11 shall be applicable to each Deliverable required to be delivered by
SoftWatch to Medscape pursuant to the Specifications.
Section 11.2 Viruses. SoftWatch represents and warrants that
prior to delivery of any media containing any Deliverable, it shall use
reasonable efforts, consistent with generally accepted industry practice, to
ensure that the relevant Deliverable is free of any programming devices (e.g.,
viruses, key locks, back doors, Trojan horses, worms, etc.) that are designed to
disrupt or are capable of disrupting the use of the Deliverable or any system
with which the Deliverable operates, or destroy or damage data or make it
delayed or inaccessible, except for file and purge routine functioning of the
relevant Deliverable.
Section 11.3 Year 2000 Compliance. SoftWatch represents and
warrants that the Deliverables and the Medscape Consumer Site, when operated
according to the applicable Specifications, will accurately recognize, record,
store and process (including
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calculating, comparing, and sequencing) date data from, into and between the
years 1999 and 2000 and the twentieth and twenty-first centuries; will
accurately perform leap-year calculations; will accurately recognize, record,
store and process two- and four-digit dates; and will not cause other
information technology to fail or generate errors related to two-or four-digit
dates.
Section 11.4 Limited Warranty. SoftWatch makes no
representation or warranty that the operations of any Deliverable will be error
free or uninterrupted in all circumstances. If any Deliverable (including
standard third-party operating systems or similar software in generally accepted
industry use) or the media of which it is contained is found to contain an
operability problem, bug, virus or other destructive programming device (whether
or not any of the same are documented), then SoftWatch's sole obligation and
liability hereunder shall be upon the request of Medscape, and if appropriate
upon Medscape's return of the defective Deliverable, to correct the operability
problem, bug, virus or other programming device (such as by providing an
effective by-pass or patch where technically practicable) at no charge to
Medscape, or, if SoftWatch is unable to do so, to replace the affected
Deliverable with a functional equivalent. EXCEPT AS EXPRESSLY SET FORTH IN THIS
AGREEMENT, SOFTWATCH MAKES NO WARRANTIES, EXPRESS, IMPLIED, OR STATUTORY.
SOFTWATCH SPECIFICALLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR
A PARTICULAR PURPOSE.
Section 11.5 Limitation of Liability. THE CUMULATIVE LIABILITY
OF EITHER PARTY FOR ALL CLAIMS RELATING TO ARISING UNDER OR IN CONNECTION WITH
THIS AGREEMENT, WHETHER IN CONTRACT, TORT OR OTHERWISE, SHALL NOT EXCEED THE
TOTAL AMOUNT OF ALL FEES PAYABLE BY MEDSCAPE TO SOFTWATCH UNDER THIS AGREEMENT
DURING THE TWENTY- FOUR (24) MONTH PERIOD IMMEDIATELY PRECEDING THE DATE ON
WHICH THE RELEVANT CLAIM IS MADE. NOTWITHSTANDING THE FOREGOING, THIS LIMITATION
SHALL NOT APPLY TO LOSSES RELATING TO CLAIMS ASSERTED BY THIRD PARTIES WITH
RESPECT TO INFRINGEMENT OF INTELLECTUAL PROPERTY OR OTHER PROPRIETARY RIGHTS.
NEITHER PARTY SHALL IN ANY EVENT BE LIABLE TO THE OTHER FOR INDIRECT,
INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES (EVEN IF THAT PARTY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES) INCLUDING LOSS OF REVENUE, LOSS
OF DATA, OR ANTICIPATED PROFITS OR LOST BUSINESS.
Section 11.6 Adequate Controls. SoftWatch covenants and agrees
that, at all times during the Term, it shall implement and maintain systems that
provide for the effective back-up and recovery of all data relating to the
Development Services.
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Section 11.7 Reverse Engineering. Medscape will not cause or
permit the reverse engineering, disassembly or decompilation of the SoftWatch
Software, whether alone or as used in any Deliverable.
Section 11.8 Encryption Covenant. At the specific request of
Medscape, SoftWatch will encrypt each Deliverable in the manner reasonably
directed by Medscape, but then only to the extent such encryption is permissible
under applicable law.
Section 11.9 Medscape.com Website. Notwithstanding anything in
this Article 11 to the contrary, SoftWatch makes no representation or warranty
as to the Creation Tools, when and to the extent used or operated in or with the
Medscape.com website.
ARTICLE 12. SALES AGENCY.
Section 12.1 Appointment. During the Term, SoftWatch appoints
Medscape, and Medscape shall act, as SoftWatch's non-exclusive agent for the
purpose of soliciting advertising, sponsorship and co-branded distribution sales
in the United States and elsewhere throughout the world related to DietWatch.com
(the "Sales Agency Services").
Section 12.2 Scope of Agency; Right of Approval. Medscape has
no power or authority to execute any advertising agreements or other contracts
for or on behalf of SoftWatch. All orders procured by Medscape in the
performance of the Sales Agency Services are subject to final acceptance and
approval by SoftWatch, in its sole discretion.
Section 12.3 Medscape's Obligations. Medscape will:
(a) forward all orders to SoftWatch for its approval or disapproval;
(b) arrange for direct billing by and payment to SoftWatch with respect to
each advertiser, sponsorship or other account approved by SoftWatch;
and
(c) unless authorized or directed by SoftWatch, make no representation with
respect to any SoftWatch product which is at variance with SoftWatch's
own representations, and indemnity SoftWatch for all claims or damages
resulting for any representations made by Medscape which are at
variance with SoftWatch's own representations and which are not
otherwise authorized or directed by SoftWatch.
Section 12.4 Commission. In consideration of Medscape's Sales
Agency Services, SoftWatch will pay to Medscape a sales commission ("Sales
Commission") equal
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to fifty (50%) of each order solicited by Medscape for which SoftWatch actually
receives payment.
Section 12.5 Expenses. Unless otherwise agreed by SoftWatch in
advance in writing, Medscape is responsible for all costs and expenses incurred
by Medscape in performing the Sales Agency Services under this Agreement.
Section 12.6 SoftWatch's Responsibilities. SoftWatch will
furnish Medscape with all necessary promotional and other materials and will pay
Medscape the compensation set out in Section 12.4.
Section 12.7 Payment Terms; Taxes. All payments due to
Medscape under this Article 12 are stated and payable in U.S. dollars and shall
be paid by wire transfer to such account as Medscape shall from time to time
notify SoftWatch in writing. Amounts subject to Sales Commission shall be paid
to Medscape within thirty (30) days after the end of the relevant SoftWatch
Reporting Period . Medscape reserves the right to charge a late fee of up to
1.5% per month (or, if less, the maximum rate permitted by law) on any balance
remaining unpaid for more than forty-five (45) days.
Section 12.8 (a) Reporting by SoftWatch for purposes of
Calculating Sales Commissions. Subject to Section 12.8(b), within thirty (30)
days after the end of each calendar quarter during the Term (each such quarterly
period a "SoftWatch Reporting Period," with the first such SoftWatch Reporting
Period to end on the last day of the first full calendar quarter to occur after
Medscape begins conducting the Sales Agency Services), SoftWatch shall send a
statement to Medscape summarizing, and certifying as to, the information used by
SoftWatch to calculate the Sales Commissions payable to Medscape in order to
confirm the actual amount of Sales Commissions due or projected to be due to
Medscape during the applicable SoftWatch Reporting Period.
(b) Independent Auditor on Change of Control. If at any time
after the Restricted Period a Medscape Change of Control occurs, all reports
required to be delivered by SoftWatch to Medscape pursuant to Section 12.8(a)
shall be delivered to an Independent Auditor, who shall agree to be bound by the
confidentiality obligations set forth in Article 9. The Independent Auditor
shall prepare a report confirming the accuracy of information provided by
SoftWatch only. Medscape shall have the right to receive solely the results of
such review only, and shall have no right to receive, review or consult actual
information provided by SoftWatch in its reports, SoftWatch's books of account,
or any workpapers prepared by the Independent Auditor in connection with its
review. The costs of any such Independent Auditor shall be borne equally by the
parties.
Section 12.9 (a) Audit Rights. SoftWatch will maintain for at
least three (3) years its records, contracts and accounts relating to each
transaction in respect of which a Sales Commission is payable to Medscape
hereunder, and will permit examination
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not more frequently than once per calendar year of that information upon
reasonable request and during normal business hours by an Independent Auditor.
In addition, Medscape shall be entitled annually to appoint an Independent
Auditor to audit the books of account of SoftWatch, at Medscape's expense,
during normal business hours, with at least two weeks' prior notice. If during
the course of such audit, it is discovered that SoftWatch has underpaid Medscape
by an amount in excess of five percent (5%) of the amount determined to be due
for the audited period, then the cost of such audit shall be borne by SoftWatch.
Furthermore, any error discovered by the Independent Auditor shall be promptly
remedied by SoftWatch after receipt of notice by Medscape. All information
received by a Party in the course of such audit shall be treated as Confidential
Information and shall not be disclosed to any third party (other than its
attorneys and accountants) or used for any purpose whatsoever other than to
determine compliance with this Article 12.
(b) Audit Report on Change of Control. If at any time after
the Restricted Period a Medscape Change of Control occurs, Medscape shall have
the right to receive solely the results of any audit performed pursuant to
Section 12.9(a), and shall have no right to receive, review or consult
SoftWatch's books of account, the Independent Auditor's audit report, or any
workpapers prepared by the Independent Auditor in connection with its audit.
(c) Medscape Change in Control. A "Medscape Change of Control"
means the merger or consolidation of Medscape into or with any SoftWatch
Competitor, or the acquisition of Medscape by a SoftWatch Competitor, or the
sale of all or substantially all of the shares, properties or assets of Medscape
to a SoftWatch Competitor, in each case under circumstances in which the holders
of a majority (by voting power) of the outstanding capital stock of Medscape
immediately prior to such merger, consolidation, acquisition or sale own less
than a majority (by voting power) of outstanding capital stock of Medscape or
the surviving or resulting entity or acquirer, as the case may be, immediately
following such merger, consolidation, acquisition or sale. A "Medscape Change of
Control" shall also be deemed to occur if any officer, director, employee,
shareholder (or other equity participant) of, or other individual associated
with any SoftWatch Competitor shall become a director of Medscape. For purposes
hereof, a "SoftWatch Competitor" means (i) each of Agency.com, BroadVision,
Caresoft, Clarify, CyberDiet, Dr. Koop, eDiets, Exchange Applications,
HealthDesk, Healtheon, HealthMagic, Jenny Craig, Mediconsult, Patinet Info
systems, peregrine Systems, PHDI, Phys, remedy Corp, Siebel, USWeb, Vantive,
Vignette, WebMD, WeightWatchersgency.com, or (ii) any other entity, including
those referred to in the foregoing clause (i), whose primary business is: (1)
the development and sale of web software relating to healthcare, self-care
management, or healthcare relationship marketing, or (2) the development,
marketing and sale of on-line diet/nutrition information services.
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ARTICLE 13. TERM AND TERMINATION
Section 13.1 Term. This Agreement will begin on the date that
it is signed by Medscape, SoftWatch and SoftWatch, Ltd. and, unless sooner
terminated, shall continue until the date which is twelve months after the date
on which Medscape notifies SoftWatch of its intent to terminate all or a portion
of this Agreement. Medscape shall have the right to terminate all or any portion
of the services being provided by SoftWatch under this Agreement at any time
after the Development Services have been completed.
Section 13.2 Termination for Breach. Either Medscape or
SoftWatch may terminate this Agreement on thirty (30) days' notice if the other
materially breaches any of its obligations hereunder unless the breach is cured
within the thirty (30) day period, provided, however, this Agreement shall be
subject to termination (x) by Medscape, effective immediately upon written
notice, if either SoftWatch or SoftWatch, Ltd. breaches any of its obligations
under Article 9, or (y) by SoftWatch effective immediately upon written notice,
if Medscape breaches its confidentiality obligations under Section 9.1.
Section 13.3 Bankruptcy and Related Events. Either Party may
terminate this Agreement, effective immediately upon written notice, if (a) all
or a substantial portion of the other Party's assets are transferred to an
assignee for the benefit of creditors or to a receiver or trustee in bankruptcy;
(b) a proceeding is commenced by or against the other Party for relief under the
bankruptcy or similar laws and such proceeding is not dismissed within thirty
(30) days; or (c) the other Party is adjudged bankrupt or insolvent. In
addition, the foregoing terminate right shall be exercisable by Medscape if any
of the specified events shall occur with respect to SoftWatch, Ltd.
Section 13.4 Obligations Upon Termination or Expiration. Upon
termination or expiration of this Agreement, (a) SoftWatch shall immediately
return to Medscape all copies of the Medscape Confidential Information and all
records pertaining to Medscape's Member Information or other proprietary user
information in SoftWatch's possession or control, except as specifically
provided to the contrary in Section 1.3(d); and (b) Medscape shall immediately
return to SoftWatch all copies of the SoftWatch Confidential Information. In
addition, each Party shall promptly pay to the other Party any and all amounts
due and owing by such Party to such other Party for all periods up to and
including the date of termination or expiration.
Section 13.5 Transfer of Site. Upon Medscape's request, or
upon the termination or expiration of this Agreement (other than as a result of
Medscape's breach), whichever occurs first, SoftWatch shall provide all
reasonable assistance to Medscape and third parties authorized by Medscape to
transfer the Medscape Consumer Site or parts of it to an alternate server to be
owned and operated by whatever entity Medscape chooses. Unless termination has
resulted from a breach by SoftWatch of SoftWatch, Ltd. of their
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respective obligations hereunder, such assistance shall be provided to Medscape
at SoftWatch's then-current cost for such services. Such transition assistance
may include: (A) delivery of full and complete copies of all computer programs
that are not SoftWatch Software; and (B) assignment of all necessary rights
under third-party agreements to Medscape or a new hosting service.
Section 13.6 Survival. The provisions of Section 6.6, Article
7, Article 8, Section 9.1, Section 9.2 , Section 10.4 , Section 12.9, Section
13.5, Article 14 , Section 15.8 and any other provision of this Agreement
necessary for the interpretation of any of the foregoing shall survive the
termination or expiration of this Agreement.
ARTICLE 14. GUARANTY OF SOFTWATCH, LTD.
Section 14.1 Guaranty. SoftWatch, Ltd. irrevocably and
unconditionally guarantees all financial obligations and liabilities of
SoftWatch under this Agreement, and the due performance and compliance by
SoftWatch with the terms hereof. All payments by SoftWatch, Ltd. pursuant to
this Article 14 shall be made on the same basis as are required to be made by
SoftWatch pursuant to this Agreement. SoftWatch, Ltd. hereby waives notice of
acceptance of this guaranty, presentment, demand of payment, protest, notice of
dishonor or nonpayment, and any suit or taking of other action by Medscape
against, and any other notice to, SoftWatch. SoftWatch, Ltd. waives, to the
fullest extent permitted by law, the benefit of any statute of limitations
affecting its liability hereunder or the enforcement thereof. This guaranty
shall be binding upon SoftWatch, Ltd. and its successors and assigns and shall
inure to the benefit of Medscape and its successors and assigns.
Section 14.2 Obligations Unconditional. The obligations of
SoftWatch, Ltd. under this Article 14 are absolute and unconditional and shall
remain in full force and effect without regard to, and shall not be released,
suspended, discharged, terminated or otherwise affected by, any circumstance or
occurrence whatsoever, including termination of this Agreement. The guaranty
made by SoftWatch, Ltd. pursuant to this Article 14 is a primary obligation of
SoftWatch, Ltd. No failure or delay on the part of Medscape in exercising any
right, power or privilege hereunder and no course of dealing between SoftWatch,
Ltd. and Medscape shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege. The rights, powers and remedies herein expressly provided are
cumulative and not exclusive of any rights, powers or remedies which Medscape
may otherwise have.
Section 14.3 Successors and Assigns; Applicable Law. The
provisions of this Article 14 shall be binding upon SoftWatch, Ltd. and its
successors and assigns and shall inure to the benefit of Medscape and its
successors and assigns.
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ARTICLE 15. GENERAL PROVISIONS
Section 15.1 No Joint Venture Created. Nothing in this
Agreement shall be construed so as to constitute SoftWatch and Medscape as joint
venturers, partners, or agents of each other, and neither SoftWatch nor Medscape
shall have the power to obligate or bind the other in any way whatsoever.
Section 15.2 Entire Agreement. This Agreement constitutes the
complete agreement between the parties and supersedes all other agreements
(including confidentiality agreements), promises, representations, and
negotiations, whether written or oral, between the parties regarding the subject
matter of the Agreement. No amendment of this Agreement shall be valid or take
effect unless it is in writing and signed by all the parties.
Section 15.3 Assignment. SoftWatch may not assign this
Agreement without Medscape's prior written permission, except that from and
after the end of the Restricted Period, SoftWatch may assign this Agreement (and
any license contained in it) to any of its Affiliates or any person or entity
that acquires its business. Medscape may assign this Agreement (and any license
contained in it) to any of its Affiliates, any person or entity that acquires
all or portion its business, or to any other person that operates and maintains
the Medscape Consumer Site. Any assignment in violation of this provision will
be null and void.
Section 15.4 Waiver. No waiver of any term or condition or of
any breach of this Agreement or of any part of it, shall be deemed a waiver of
any other term or condition or of any later breach of the Agreement or of any
part of it.
Section 15.5 Notices. Any notice, consent, approval or
disapproval, required or permitted under this Agreement, including any change to
this Section 15.5, shall not be valid unless in writing and shall be given
either personally; by certified mail, return receipt requested, or by fax which
the sending Party must confirm at the following addresses or telephone and fax
numbers:
If to Medscape:
Medscape, Inc.
134 W. 29th Street
New York, New York
10001-5399
Attn: Paul Sheils
Phone: (212) 760-3200
Fax: (212) 265-9228
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with a copy to:
Patterson, Belknap, Webb & Tyler LLP
1133 Avenue of the Americas
New York, New York 10036
Attn: John P. Schmitt
Phone: (212) 336-2849
Fax: (212) 336-2222
If to SoftWatch:
SoftWatch, Inc.
67 South Bedford St.
Burlington, MA 01803
Attn: Asaf Evenhaim, Executive VP
Tel: 781-229-5802
Fax: 781-229-5878
with a copy to:
Lucash, Gesmer & Updegrove, LLP
40 Broad Street
Boston, MA 02109
Attention: Peter M. Moldave, Esq.
Tel: 617-350-6800
Fax: 617-350-6878
Section 15.6 Force Majeure. Neither Party shall be deemed in
default of this Agreement to the extent that performance of its obligations or
attempts to cure any breach are delayed, restricted, or prevented by reason of
any act of God or government, fire, natural disaster, labor stoppage, the
failure of necessary power systems or connections, or any other act or condition
beyond the reasonable control of the Parties, or agents appointed by such
Parties, provided that the Party so affected uses its commercially reasonable
efforts to avoid or remove the causes of nonperformance and continues
performance immediately after those causes are removed. Notwithstanding this
provision, any delay that exceeds (2) two months shall entitle the Party whose
performance is not affected by the relevant event of force majeure to terminate
the Agreement and to revert any rights granted hereunder.
Section 15.7 Publicity. A Party may use the name of the other
Party in press releases, sales material and literature only with the written
consent of the other Party.
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Section 15.8 Governing Law. This Agreement shall be governed
by and construed under the laws of the State of New York and of the United
States, without regard to their conflicts of laws provisions.
Section 15.9 Including. The word "including" shall mean
"including without limitation."
Section 15.10 Schedules and Exhibits. The Schedules and
Exhibits hereto are an integral part of this Agreement, and any reference herein
to this Agreement shall be deemed to mean and include a reference to such
Schedules and Exhibits.
Section 15.11 Captions. Headings and captions throughout this
Agreement are for convenience only and should not be considered part of the
Agreement.
Section 15.12 Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original and all of
which together shall constitute one and the same document.
Section 15.13 SoftWatch, Ltd as Party. All references in
Article 9 and the other provisions of this Agreement to a "Party" or "Parties"
shall be deemed to mean and include reference to SoftWatch, Ltd. to the extent
such provisions are expressly applicable to SoftWatch, Ltd., or the context so
requires.
Section 15.14 Right of Offset. Medscape shall have the right
to offset against any and all amounts due and owing by Medscape to SoftWatch
hereunder any and all amounts due by SoftWatch to Medscape hereunder. SoftWatch
shall have the right to offset against any and all amounts due and owing by
SoftWatch to Medscape hereunder any and all amounts due by Medscape to SoftWatch
hereunder.
[THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed and delivered on its behalf, as of the date and year first written
above, by its duly authorized representative.
MEDSCAPE INC.
By: /s/ Paul T. Sheils
----------------------------------
Name: Paul T. Sheils
Title: President & CEO
SOFTWATCH INC.
By: /s/ Asaf Evenhaim
----------------------------------
Name: Asaf Evenhaim
Title: Executive Vice President
SoftWatch, Ltd. joins this
Agreement solely for purposes
of Article 9, Section 10.2,
and Article 14
SOFTWATCH, LTD.
By: /s/ Amir Kishon
----------------------------
Name: Amir Kishon
Title: CEO & President
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Exhibit 1.1
LICENSED SOFTWARE
FRAMEWORK SERVICES
Enrollment-registration (*)(+)
Logins/lost passwords (*)(+)
Access control, privacy and security tracking (*)(-)
Back-end tools for content management and reports (*)(-)
Database (*)(-)
User consoles
Consumer (*)(+)
Reporting (*)(-)
Community administrator (back-end administration for content,
discussion groups and other community functionality) (*)(-)
News administrator (*)(-)
Medical expert (*)(-)
System administrator (*)(-)
SEGMENTATION
Additional risk assessment/segmentation questionnaire to cluster users in
registration phase to segments (+)
Target specific content and functionality to specific segment (-)
Targeted messaging lists (-)
Targeted reporting (example: which services where utilized most by segment
1 users, etc.) (-)
SELF-CARE MANAGEMENT TOOLS
Diary (*) (+)
Weight (*)(+)
Medication (**)(+)
Doctor visits (**)(+)
Memos (*)(+)
To Dos (*)(+)
Peak flow (+)
Blood pressure (+)
Glucose level (+)
Health journal (condition specific) (**)(+)
Graphs (Chart effects standard license) (*)(+)
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NUTRITION MANAGEMENT TOOLS
Nutrition tracking (*)(+)
USDA and user contributed food database (over 10,000 foods) (*)(+)
BMI calculation, RDA guidelines and personal nutritional goal setting (*)
(+)
Add new food, recipe, or meal (*)(+)
Interactive database search (*)(+)
Immediate visual feedback (*)(+)
Graphs and reports of nutritional information (*)(+)
Diary-to-go (*)(+)
EXERCISE MANAGEMENT TOOLS
Exercise and activity tracking (*)(+)
A database of activities (*)(+)
Calculations of time and energy burnt (*)(+)
Add new physical activity (*)(+)
Graphs and reports of exercise information (*)(+)
COMMUNITY INFORMATION TOOLS FOR END-USERS
Ask-an-expert (*)(+)
Personal stories (*)(+)
Recommend a friend (*)(+)
Vote of the week (*)(+)
Library (*)(+)
COMMUNITY NEWS TOOLS FOR END-USERS
Health news (3rd party news feed) (**)(+)
Community news (what's new on the site) (*)(+)
COMMUNITY COMMUNICATION TOOLS FOR END-USER
Chat ( Third party "eshare" with standard license for 50 users included)
(*)(+) (moderated chat option (-))
Discussion forums (*)(+)
Instant messaging (*)(+)
Buddy list (*)(+)
White pages (*)(+)
Postcards (*)(+)
MESSAGING SYSTEM UNI-DIRECTIONAL
Support for newsletter attachments (*)(-)
Broadcast messages to members (*)(-)
Attachments capability (for forms, questionnaires, surveys, instruments)
(*)(-)
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MESSAGING SYSTEM BI-DIRECTIONAL
Adds the consumer-to-consumer messages (*)(+)
Adds consumer to company messages (customer service or technical support).
Messages may be in a structured form format (*)(+)
KEY TO SYMBOLS
(*) substantially as in www.DietWatch.com
(**) substantially as in www.MSWatch.com
(+) this component/functionality is part of the End-User Tools.
(-) this component/functionality is part of the Creation Tools.
Capitalized terms used herein without definition have the respective meanings
provided in the License and Web Site Development Agreement.
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Exhibit 1.2
SPECIFICATIONS
The specifications for the customization services are outlined below.
Capitalized terms used herein without definition have the respective meanings
provided in the License and Web Site Development Agreement. The full
Specifications, which will be negotiated and mutually agreed upon between the
Parties within 30 days of the Effective Date, will provide that Phase I will not
exceed 10 man-months work and Phase II will not exceed 10 man-months work. The
specifications will be provided by Medscape, and shall include:
1. the architectural and graphical design components of the Medscape
Consumer Site, including a complete storyboard description showing the
opening pages, content and link structure, logo design, page layout,
descriptions of elements, and sample interactions within the Medscape
Consumer Site ("Site Design"), which Medscape will be responsible for
providing to SoftWatch in a timely manner and in a form reasonably
acceptable to SoftWatch;
2. specifications for any Third Party Components and integration
requirements;
3. a delivery and milestone schedule for performance of the Development
Services (as may be modified from time to time by agreement of the
Parties( the "Delivery and Milestone Schedule");
4. guidelines and specifications pertaining to generally accepted
technical standards applicable to the computer program and web-site
development industry ("Process Certification Requirements");
5. specifications for the use of standard encryption technologies (e.g.,
Secure Socket Layer) to provide a secure environment for all transfer
of personal, confidential user information and transactions; and
6. registration process specifications to implement registration of
existing Medscape users and existing DietWatch users;
7. specifications of Medscape document structure and tagging scheme; and
8. other information reasonably necessary for the implementation of the
Medscape Consumer Site.
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The Specifications will be based on the following outline:
PHASE I FOR JULY 7 LAUNCH (VERSION 1.0) OUTLINE:
- Implementation of Medscape look and feel
- Implement the Medscape Consumer Registration Process (Phase I will
include a single tier registration process with 10 questions)
- Consumer / Professional / DW registration and login transparency
- Enhance content loading tools and surfacing to users based on Medscape
personalization and metadata structure and 18 conditions
- At least one custom event per health condition
- Adopt Medscape platform requirements: development, staging and
production.
- Start integration of existing Professional Site Components that will be
implemented by a third party with the Medscape Consumer Site (These
components include: (i) MEDLINE; (ii) AIDSLINE; (iii) TOXLINE; (iv)
Drug database; (v) Medical dictionary; and (vi) importing of existing
~40K HTML articles from Medscape Professional Site to the Medscape
Consumer Site database) as agreed based on effort and impact. Final
integration specification will be mutually developed by June 15, 1999.
- External ad service integration (e.g. Doubleclick)
- Implementation of the Co-Branded Diet Center Specifications
- Track and report defined measurements such as page view calculations to
support revenue share calculations
- Partial site search of defined areas using SQL search
- Establish and meet SoftWatch promulgated system performance
measurements
PHASE II FOR SEPTEMBER 30 LAUNCH (VERSION 1.1):
- Implement look and feel overhaul as supplied by design firm, in html,
by July 30, 1999. Project not to exceed 3 man months.
- Completion of Professional Site Components integration (as defined
above)
- Full site search using commercial search engine
- Nutrition support for current generation on at least one Macintosh
browser platform
- Make major user screens bookmark-able
- Implement 2-tier registration process
- Bulk load of content sets where appropriate and automatable.
Specification to be mutually developed by June 18, 1999.
- Resource assignment to address future defined projects not to exceed
40 man-days and must be functionally defined by June 18.
- Support for multiple web servers and database servers to permit
hardware scalability
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CUSTOM MODULES
Currently all the professional site components are defined as "custom
modules."
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Exhibit 1.3
THE CO-BRANDED DIET CENTER SPECIFICATIONS
Capitalized terms used herein without definition have the respective meanings
provided in the License and Web Site Development Agreement.
OVERALL PLAN: The Co-Branded Diet Center will use templates created and
delivered by Medscape (Medscape look and feel with appropriate co-branding as
specified in the Agreement). Final layouts and HTML pages will be provided by
Medscape to SoftWatch by June 20, 1999;
Additionally, Medscape will provide DietWatch editorial the Medscape Consumer
Editorial Guidelines as updated from time to time. DietWatch editorial will
follow these guidelines for all DietWatch content that will be presented in the
Co-Branded Diet Center. The existing Medscape Consumer Editorial Guidelines will
be provided to SoftWatch by June 20, 1999.
The following is the list of features for the Co-Branded Diet Center:
Featured article: DietWatch feature article (not "announcements") content would
be used, in addition to Medscape Consumer featured articles. The DietWatch
article would be served from the DietWatch server and the Medscape articles from
the Medscape server. Both would be presented on the page, with the Medscape
article in the first position. May involve some coordination between editorial
groups for content programming. DietWatch editorial will follow Medscape
Consumer Editorial Guidelines for all feature articles.
News: News content will come from Medscape Consumer only.
Ask-an-expert: The Co-Branded Diet Center will include DietWatch's
Ask-an-expert. DietWatch experts will follow Medscape Consumer Editorial
Guidelines for all Ask-an-Expert questions. In the future Medscape may offer
additional experts from its own network of experts.
Personal Zone/Stories: The Co-Branded Diet Center will include the DietWatch
personal stories. All existing and future personal stories will be in compliance
with Medscape Consumer Editorial Guidelines.
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Recipe of the Week: DietWatch Recipe of the Week content will not be used on the
Co-Branded Diet Center.
Vote: DietWatch Vote will be available on the Co-Branded Diet Center. All votes
will be selected by DietWatch community manager in compliance with Medscape
Consumer Editorial Guidelines.
Activist: This feature will not be used on the Co-Branded Diet Center.
Feedback: Medscape will receive and process this information per the
functionality specified for Medscape Consumer 1.0. SoftWatch will receive a copy
of user feedback for the Co-Branded Diet Center for the purpose of enhancing its
tools and content.
Chat: Only DietWatch's moderated chat sessions will be offered in the Co-Branded
Diet Center according to Medscape Consumer Editorial Guidelines regarding the
topic and schedule; no unmoderated chat will be offered; In the future, Medscape
may expand this offering using moderators in its expert network
Discussion Groups: The Co-Branded Diet Center will not have DietWatch or other
discussion groups.
Users Online: To be integrated per 1.0 template specifications
Postcards: To be integrated per 1.0 template specifications
Diary to Go: To be integrated per 1.0 template specifications; needs to include
Medscape logo
Tips: The Co-Branded Diet Center will not include DietWatch Tips section. It
will use the Medscape Consumer Tips functionality.
Humor: The Co-Branded Diet Center will not include DietWatch or other humor
content.
Newsletter: The Co-Branded Diet Center will not include DietWatch newsletter. It
will include the general Medscape Consumer newsletter.
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Exhibit 9.3
MEDSCAPE COMPETITIVE BUSINESSES
AltaVista
America's Doctor
AOL
Ask Dr. Weil
@Home
BetterHealth
CareInsite
CVS/Soma
CyBear
Dr. Koop/Empower
Drugstore.com
Excite
GO Network
Healtheon
HealthGate
HealthScout
Infoseek
InteliHealth
iVillage/Thrive
Lycos
Mayo Clinic Health Oasis
MD Consult
Medicalogic
Mediconsult
Medsite
Mining Company
MSN
MSNBC
OnHealth
Physician's Online
PlanetRx
QD Online
RiteAide
Salu.net
Snap
Walgreen
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Walmart
WebMD
Women.com
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INDEX OF DEFINED TERMS
"Affected Territory" - Section 10.5
"Affiliate" - Section 9.3(a)
"Agreement" - Preamble
"Certification Test" - Section 4.2
"Certification Testing" - Section 4.2
"Change of Control" - Section 6.6(c)
"Co-Branded Diet Center Specifications" - Section 1.3
"Co-Branded Diet Center" - Section 1.3
"Competitive Business" - Section 9.3(a)
"Confidential Information" - Section 9.2
"Creation Tools" - Section 1.1(a)(ii)
"Customization" - Section 1.2
"Customization Services" - Section 1.2
"Customization Specifications" - Section 1.2
"Customize", "Customized" and related words - Section 1.2
"Deliverable" - Section 4.1
"Delivery and Milestone Schedule" - Exhibit 1.2 (Specifications)
"Delivery Date" - Section 4.1
"Development Services" - Section 2.1
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"Diet Center/ROS Content Banner Revenue" - Section 6.3(b)(iv)
"Diet Center/ROS Tools Banner Revenue" - Section 6.3 (b)(iii)
"Effective Date" - Preamble
"eHealth Service" - Section 9.3(a)
"End-User Tools" - Section 1.1(a)(i)
"Final Certification" - Section 4.3
"General Health and Wellness Center" - Section 1.3(b)
"Including" - Section 15.9
"Independent Auditor" - Section 6.5(b)
"Initial Maintenance Period" - Section 5.1
"Internet" - Section 1.1(c)
"Losses" - Section 10.4
"Maintenance Fee" - Section 6.2
"Maintenance Period" - Section 5.1
"Maintenance Services" - Section 5.1
"Medscape" - Preamble
"Medscape Change in Control" - Section 12.9(c)
"Medscape Consumer Site" - Section 1.1(b)
"Medscape Content" - Section 3.1
"Medscape Materials" - Section 7.2
"Member Information" - Section 1.3(d)
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"Members" - Section 1.3(d)
"Net Advertising Revenue" - Section 6.3
"Nutrition/GHW Sponsorship Page" - Section 6.3(c)
"Nutrition/GHW ROS Banner Page" - Section 6.3(c)
"Paid Maintenance Period" - Section 5.1
"Parties" - Preamble
"Party" - Preamble
"Phase I Delivery Date" - Section 4.1
"Phase II Delivery Date" - Section 4.1
"Process Certification Requirements" - Exhibit 1.2 (Specifications)
"Quarterly Diet Center Medscape Content Sponsorship Royalty" - Section
6.3(b)(ii)
"Quarterly Diet Center Tools Sponsorship Royalty" - Section 6.3(b)(i)
"Quarterly ROS/Diet Center Tools Banner Royalty" - Section 6.3(b)(iii)
"Quarterly ROS/Diet Center Content Banner Royalty" - Section 6.3(b)(iv)
"Quarterly ROS/Tool Banner Royalty" - Section 6.3(a)(ii)
"Quarterly Sponsorship Royalty" - Section 6.3(a)(i)
"Reporting Period" - Section 6.5(a)
"Restricted Period" - Section 9.3(a)
"Retesting" - Section 4.4
"Royalties" - Section 6.3
"Run-of Site" ("ROS") - Section 6.3
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"Sales Agency Services" - Section 12.1
"Sales Commissions" - Section 12.4
"Shared Materials" - Section 7.3
"Site Design" - Exhibit 1.2 (Specifications)
"Site Specifications" - Section 2.1
"SoftWatch" - Preamble
"SoftWatch Competitor" - Section 12.9(c)
"SoftWatch, Ltd." - Preamble
"SoftWatch Materials" - Section 7.1
"SoftWatch Reporting Period" - Section 12.8(a)
"SoftWatch Software" - Section 1.1
"SoftWatch Software License" - Section 1.1
"SoftWatch Software License Fee" - Section 6.1
"Specifications" - Section 2.1
"Sponsorship" - Section 6.3
"Third Party Components" - Section 2.1(c)
"Trademarks" - Section 8.1
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