CONFIDENTIAL
MUTUAL RELEASE AND TERMINATION AGREEMENT
This Mutual Release and Termination Agreement (this "Termination
Agreement"), dated as of September 15, 2001, is made and entered into by and
between America Online, Inc. ("AOL"), with offices located at 22000 AOL Way,
Dulles, Virginia 20166 and PurchasePro.com, Inc. ("PurchasePro"), a Nevada
corporation with principal offices located at 7690 West Cheyenne Avenue, Las
Vegas, Nevada 89129 (each a "Party" and collectively the "Parties").
INTRODUCTION
WHEREAS, AOL and PurchasePro are parties to multiple agreements bearing
effective dates prior to the Termination Effective Date, (collectively, the
"Agreements," but, specifically excluding the Continuing Agreements as defined
below).
WHEREAS, the Parties have agreed to terminate all Agreements.
NOW, THEREFORE, in consideration of the terms and conditions set forth
in this Termination Agreement and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, AOL and PurchasePro
hereby agree to terminate the Agreements and release each other from their
respective obligations in accordance with the following terms and conditions:
TERMS
1. PAYMENT AMOUNT. AOL agrees to pay PurchasePro a guaranteed cash payment
of One Million Five Hundred Thousand Dollars (US $1,500,000.00),
payable within three (3) business days of execution hereof (the
"Payment Amount") [...***...]
2. TERMINATION.
(a) AOL and PurchasePro hereby agree to terminate all Agreements
and any amendments to such Agreements (but specifically
excluding the Continuing Agreements), including without
limitation, the following:
(i) the IMA;
(ii) Technology Development Agreement dated March 15, 2000
(the "Technology Development Agreement" or "TDA");
(iii) Bulk Subscriptions Sales Agreement dated December 1,
2000, as amended; and
(iv) Advertising Services Agreement dated December 1, 2000
(the "ASA").
(b) As stated above, the Agreements subject to this Termination
Agreement shall specifically exclude the Continuing
Agreements. For the avoidance of doubt, the Parties
acknowledge that this Termination Agreement shall have no
affect on either Parties' rights or obligations under any
Continuing Agreement. For purposes of this Termination
Agreement, "Continuing Agreements" shall mean the
following: [...***...]
[...***...] CONFIDENTIAL MATERIAL REDACTED AND FILED SEPARATELY WITH THE
COMMISSION.
In addition to the foregoing, the Parties acknowledge and agree that
this Termination Agreement shall become effective only and immediately
after the Parties execution of this Termination Agreement (the
"Termination Effective Date").
3. JOINTLY DEVELOPED TECHNOLOGY. The Parties acknowledge and agree that as
of the Termination Effective Date, the Jointly Developed Technology
includes, and is limited to, the technology set forth in Schedule A
attached hereto with all rights of ownership and use (including all
Intellectual Property Rights related thereto) as set forth in Section
7.5 thereof, which, shall survive termination of the TDA. The Parties
acknowledge and agree that within thirty (30) days of the Termination
Effective Date, each Party shall, for each disparate item of technology
set forth
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on Schedule A, complete performance of any required action of such
Party set forth on Schedule A for such item of technology.
4. SURVIVAL.
(a) Notwithstanding the survival provisions of any of the
Agreements terminated by this Termination Agreement, except to
the extent specifically modified pursuant to this Section 4 of
this Termination Agreement, the provisions of the Agreements
which by their terms are intended to survive termination of
such Agreements shall survive the termination effected hereby.
Without limiting the generality of the foregoing, the Parties
to this Termination Agreement agree and acknowledge that:
(i) the following provisions shall specifically survive
termination of the Agreements in which such
provisions are contained: IMA, Sections 3.9.4, 5.3
(as modified by Section 4(a)(ii) below) and 5.4; IMA,
Exhibit F, Sections 3 - 9 (with Section 3 hereby
amended to include such tradenames, trademarks and
services marks of AOL as are contained in the AOL
Exchange as of the Termination Effective Date or are
hereafter furnished to PurchasePro by AOL for the
purpose of modifying the branding of the AOL
Exchange), 11 - 16 (including all provisions relating
to use of data after termination), 18 - 22, 24 - 30;
TDA, Sections 4.2(c), 4.3(g), 12 and the sections
enumerated in Section 8.4 of the TDA (subject to the
modifications to Section 7 of the TDA set forth in
Section 4(b)(ii) below);
(ii) neither party shall have any payment obligations
under any of the Agreements, whether related to
Continued Linking rights (as described in Section 5.3
of the Interactive Marketing Agreement rights),
guaranteed fixed payments, revenue sharing payments,
commissions or otherwise, except as set forth in this
Termination Agreement or any Continuing Agreement;
and
(iii) All solicitations by PurchasePro using information
contained in the NetBusiness Card database as
permitted under Exhibit F of the IMA, shall be
subject to the following:
(x) if such proposed solicitation is of a
PurchasePro product existing as of the
Termination Effective Date and is to be
conducted in a manner (e.g., content and
frequency of solicitation) which is
consistent with the types of communications
set forth on Schedule C attached hereto,
then PurchasePro may conduct such
solicitation; provided, however, that
PurchasePro will reasonably consider any
suggestions from AOL related to such
proposed solicitation.
(y) PurchasePro will provide AOL with reasonable
advance written notice (in no event less
than thirty (30) days) of any solicitations
not described in the foregoing Section
4(a)(iii)(x). With respect to such
solicitations, the Parties will work
together in good faith to create a mutually
agreeable marketing message that complies
with all applicable privacy policies. If,
however, the Parties are unable to agree on
the advisability or content of such proposed
solicitation, AOL shall provide PurchasePro
with a written listing of its objections to
such proposed solicitation and, if
PurchasePro is unable or unwilling to modify
the proposed solicitation to address such
objections, the matter shall be referred for
resolution in accordance with the dispute
resolution procedures set forth in Section 8
of the IMA (in the event AOL does not
provide such a listing within ten (10)
business days from receipt of written notice
of the proposed solicitation, AOL shall be
deemed to have no objections and the
proposed solicitation shall be
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deemed approved by AOL). The Management
Committee or arbitrators, as the case may
be, shall devise a resolution which
addresses the objections of AOL to the
extent that AOL's objections are reasonably
designed to protect a legitimate interest or
right of AOL and does not unduly restrict
the ability of PurchasePro to effectively
market its products. If these dispute
resolution procedures have been invoked, no
disputed proposed solicitation shall be
implemented until such dispute resolution
process has been completed. Once a proposed
solicitation has been approved by AOL or is
otherwise permitted to be implemented
pursuant to this section 4 (a) (iii) (y),
such solicitations shall be deemed to be,
and treated as, solicitations for a
PurchasePro existing product existing as of
the Termination Effective Date and treated
in accordance with 4 (a) (iii) (x) above.
(b) Without limiting the generality of Section 4(a) above, the
Parties agree and acknowledge that notwithstanding any
inconsistent term of the TDA or IMA, after the execution of
this Termination Agreement at no cost to AOL:
(i) Until such time as AOL delivers notice to PurchasePro
that AOL no longer desires that PurchasePro do so or
March 14, 2003, whichever occurs first, PurchasePro
will continue to: (x) Host the Platform for the AOL
Exchange (defined as the Marketplace resulting from
the collective efforts of PurchasePro and AOL prior
to the Termination Effective Date which, as of the
Termination Effective Date, is manifested as the
"Netbusiness Marketplace" located at the URL:
http://purchasepro.netscape.com) after the
termination of the IMA and TDA in a manner materially
consistent and substantially similar to the manner in
which the AOL Exchange was hosted by PurchasePro
immediately prior to the Termination Effective Date;
and (y) ensure that the Hosting of the AOL Exchange
is maintained in a manner that is materially
compliant with the Hosting and Operating Standards
set forth in Exhibit A to the TDA.
(ii) AOL shall retain its licenses granted under Section 7
of the TDA; provided that the parties acknowledge and
agree that: (x) such licenses for all PurchasePro
Technology and PurchasePro Private Marketplace
Technology are object code licenses (i.e., not source
code licenses); (y) within thirty (30) days of the
Termination Effective Date the Parties shall enter
into a mutually agreed upon form of software escrow
agreement for the source code underlying the
PurchasePro Technology and PurchasePro Private
Marketplace Technology (the "PurchasePro Source
Code") which software escrow agreement shall provide
for the release of the PurchasePro Source Code to AOL
in the event of PurchasePro's insolvency or an
uncured failure to perform maintenance obligations
with respect to either the Purchase Pro Technology or
the Purchase Pro Private Marketplace Technology; and,
accordingly (z) AOL's right to modify the Purchase
Pro Technology and the Purchase Pro Private
Technology shall, notwithstanding the language set
forth in Section 7 of the TDA, not arise until such
time, if ever, as the PurchasePro Source Code is
released to AOL under the terms of such software
escrow agreement.
(iii) Until such time as AOL delivers notice to PurchasePro
that AOL no longer desires that PurchasePro do so or
March 14, 2003, whichever occurs first, to the extent
that PurchasePro develops, creates or licenses any
Purchase Pro Improvements, PurchasePro will make such
Purchase Pro Improvements available to AOL. Any such
PurchasePro Improvements made available to AOL are
hereby deemed for all purposes to be Purchase Pro
Technology and shall be
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licensed to AOL under the license provisions
pertaining to Purchase Pro Technology.
Notwithstanding any other provision to the contrary,
AOL shall only use Purchase Pro Improvements as
incorporated or integrated into, or otherwise in
conjunction with, PurchasePro Technology previously
licensed to AOL.
(iv) PurchasePro will permit AOL to maintain a Continued
Link; provided that AOL shall have no obligation to
actually establish or maintain such Continued Link
and, regardless of whether AOL elects to maintain
such Continued Link, no revenue share or other fees
shall be payable by AOL under Section 5.3 of the IMA
or any other provision of either the IMA or the TDA.
5. RELEASE. Effective upon the Termination Effective Date, and subject to
Section 4 above, each Party releases and forever discharges the other
Party and all of its stockholders, employees, agents, successors,
assigns, legal representatives, affiliates, directors and officers from
and against any and all actions, claims, suits, demands, payment
obligations or other obligations or liabilities of any nature
whatsoever, whether known or unknown, which such Party or any of its
stockholders, employees, agents, successors, assigns, legal
representatives, affiliates, directors or officers have had, now have
or may in the future have directly or indirectly arising out of (or in
connection with) any of the Agreements including any activities
undertaken pursuant to any of the Agreements.
6. GENERAL PROVISIONS.
(a) FURTHER ASSURANCES AND FUTURE OPPORTUNITIES. Each Party shall
take such further action (including, but not limited to, the
execution, acknowledgment and delivery of documents or other
tangible items in such Party's possession) as may reasonably
be requested by the other Party in order to facilitate the
implementation and performance of this Termination Agreement.
Notwithstanding anything set forth herein, AOL and PurchasePro
may consider future opportunities to transact business in a
form and regarding such matters deemed appropriate by the
Parties.
(b) CONFIDENTIALITY.
(i) Except as expressly set forth in the press release
attached hereto as Schedule B, neither AOL nor
PurchasePro shall disclose the existence of this
Termination Agreement or the terms hereof without the
prior approval of the other Party, nor publish or
release any other press release, promotional
materials or other public statement regarding or
referencing the other Party except: (a) as may be
required by law, rule, regulation, or government or
court order, or rules or regulations of any
securities exchange; (b) in the case of confidential
disclosures on a need to know basis to employees,
consultants, counsel, accountants, investors or other
professional advisers of the Party and its
affiliates; (c) in connection with required tax and
accounting disclosures; or (d) in connection with any
proceeding to enforce any term of this Termination
Agreement. In addition to the foregoing, neither
Party shall make any disparaging statements against
the other Party. The foregoing sentence shall not
apply to any statements made (x) pursuant to any of
the exceptions to the first sentence of this
paragraph, (y) in any court proceeding or (z) to any
governmental entity.
(ii) In the event that either Party determines it must
issue a press release or other disclosure without the
consent of the other Party in reliance on Section
6(b)(i)(a) above, , the disclosing Party shall
provide prompt written notice to the non-disclosing
Party, but in no event (absent circumstances beyond
the reasonable control of the disclosing Party) shall
such written notice be provided later than five (5)
business days prior to such disclosure. Further, in
the event
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such disclosure is required of either Party under the
laws, rules or regulations of the Securities and
Exchange Commission or any other applicable governing
body, such Party will (i) redact mutually agreed-upon
portions of this Termination Agreement to the fullest
extent permitted under applicable laws, rules and
regulations and (ii) submit a request to the SEC or
such governing body that such portions of this
Termination Agreement receive confidential treatment
under the laws, rules and regulations of the
Securities and Exchange Commission or otherwise be
held in the strictest confidence to the fullest
extent permitted under the laws, rules or regulations
of any other applicable governing body.
(c) ENTIRE AGREEMENT. This Termination Agreement is the entire
agreement between the Parties regarding the subject matter
contained herein. It supersedes, and its terms govern, all
prior proposals, agreements, or other communications between
the Parties, oral or written, regarding the subject matter
contained herein. This Termination Agreement shall not be
modified or amended unless done so in a writing signed by
authorized representatives of both Parties.
(d) APPLICABLE LAW. This Termination Agreement shall be
interpreted, construed and enforced in all respects in
accordance with the laws of the Commonwealth of Virginia,
without regards to its conflicts of laws principals. Each
Party irrevocably consents to the jurisdiction of the courts
of the Commonwealth of Virginia, in connection with any action
to enforce the provisions of this Termination Agreement or
arising under or by reason of this Termination Agreement.
(e) ASSIGNMENT. Neither Party shall assign this Termination
Agreement or any right, interest or benefit under this
Termination Agreement without the prior written consent of the
other Party; provided that, assignment by a Party to a
successor by way of merger, consolidation or sale of all or
substantially all of such Party's stock or assets shall not
require the consent of the other Party. Subject to the
foregoing, this Termination Agreement shall be fully binding
upon, inure to the benefit of and be enforceable by the
Parties hereto and their respective successors and assigns.
(f) CONSTRUCTION. In the event that any provision of this
Termination Agreement conflicts with the law under which this
Termination Agreement is to be construed or if any such
provision is held invalid by a court with jurisdiction over
the Parties to this Agreement, such provision shall be deemed
to be restated to reflect as nearly as possible the original
intentions of the Parties in accordance with applicable law,
and the remainder of this Termination Agreement shall remain
in full force and effect.
(g) COUNTERPARTS. This Termination Agreement may be executed in
counterparts, each of which shall be deemed an original and
all of which together shall constitute one and the same
document.
(h) DEFINED TERMS. Except as specifically noted to the contrary
herein, defined terms used, but not defined in this
Termination Agreement shall have the meanings given them in
the Agreement in which such defined terms are expressly
defined. Other terms used in this Termination Agreement are
defined in the context in which they are used and shall have
the meanings there indicated. In the event a term defined in
this Termination Agreement is also defined in one or more of
the Agreements, the term shall be as defined in this
Termination Agreement.
(i) ORDER OF PRECEDENCE. In the event of any conflicts between the
provisions contained in this Termination Agreement and the
provisions of any of the Agreements, the provisions contained
in this Termination Agreement shall prevail. Any defined terms
used in the
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Agreements and the Continuing Agreements which are wholly or
partially re-defined by this Termination Agreement shall be
interpreted in such Agreements as being so re-defined.
[SIGNATURE PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the Parties hereto have executed this Termination Agreement
as of the date first above written.
AMERICA ONLINE, INC. PURCHASEPRO.COM, INC.
By: ________________________ By: _________________________
Print Name: _____________________ Print Name: ______________________
Title: ________________________ Title: _________________________
Date: ________________________ Date: _________________________
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SCHEDULE A
JOINTLY DEVELOPED TECHNOLOGY
Mutual Release and Termination Agreement - America Online Inc. and PurchasePro.com Inc.
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