Panel Maintenance Agreement - NetRatings Inc. and Nielsen Media Research Inc.
PANEL MAINTENANCE AGREEMENT
THIS PANEL MAINTENANCE AGREEMENT, made and entered into as of this 15th
day of August, 1999 (the "Agreement") by and between NetRatings, Inc., a
Delaware corporation ("NRI"), and Nielsen Media Research, Inc., a Delaware
corporation ("NMR", and together with NRI, the "Parties").
B A C K G R O U N D
A. Simultaneously with the execution and delivery of this Agreement,
NMR and NRI are entering into an Operating Agreement (the "Operating Agreement")
pursuant to which, among other things, NMR and NRI have agreed to cooperate in
the development, marketing, sale and distribution of a data collection,
processing, storage, analysis and reporting service to measure Internet usage
provided under the NRI trademarks and NMR trademarks (the "Internet Service");
B. Pursuant to the terms of the Operating Agreement, the Parties have
agreed to enter into this Agreement.
In consideration of these premises, and of the mutual promises and
conditions contained in this Agreement, NMR and NRI hereby agree as follows:
For the purposes of this Agreement, the following terms shall have the
meanings indicated. Capitalized terms not otherwise defined shall have the
meanings set forth in the Operating Agreement.
1.1 "AFFILIATE" shall mean a Person that controls, is controlled by or
is under common control with another Person. For purposes of this Agreement,
"control" shall mean direct or indirect ownership of more than 50% of the voting
interest or income interest in an Entity, or such other relationship as, in
fact, constitutes actual control.
1.2 "ANCILLARY AGREEMENTS" shall mean, collectively, the Operating
Agreement and the License Agreement.
1.3 "COLLECTION SOFTWARE" shall mean the part of the NRI Proprietary
Software that is installed on a Panel Member's computer to gather data about
such Panel Member's Internet usage activities.
1.4 "CONFIDENTIAL PANEL DATA" shall have the meaning set forth in
Section 2.3 below.
1.5 "ENTITY" shall mean any general partnership, limited partnership,
limited liability company, corporation, joint venture, trust, business trust,
cooperative or association, or any foreign trust or foreign business
1.6 "HOUSEHOLD PANEL" shall mean the Panel comprised of the initial
group of Panel Members identified by NMR on behalf of NRI for use in connection
with the Internet Service, consisting of approximately 5,000 households selected
by NMR through the NMR Sampling Methodology.
1.7 "INTELLECTUAL PROPERTY RIGHTS" shall mean all worldwide right,
title and interest of a Person in, to and under any and all: (i) United States
or foreign patents and pending patent applications therefor, including the right
to file new and additional patent applications based thereon, including
provisionals, divisionals, continuations, continuations-in-part, reissues and
reexaminations; (ii) copyrights; and (iii) trade secrets, know-how, processes,
methods, engineering data and technical information.
1.8 "INTERNET SERVICE" shall have the meaning set forth in the
1.9 "INTERNET USAGE DATA" shall have the meaning set forth in Section
1.10 "LICENSE AGREEMENT" shall mean the Software License Agreement
between the Parties of even date.
1.11 "MAINTENANCE FEES" shall have the meaning set forth in Section
1.12 "MAINTENANCE SERVICES" shall have the meaning set forth in Section
1.13 "NMR SAMPLING METHODOLOGY" shall mean NMR's proprietary analytical
and statistical protocols, methodologies for developing universe estimates,
sampling methodologies and related technologies for the identification,
selection and recruitment of households and Persons within certain specified
market, demographic, geographic and other criteria, in each case as the same
exist on the date hereof or as the same may be hereafter modified, supplemented
1.14 "NRI PROPRIETARY SOFTWARE" shall mean all computer software
programs owned by NRI as of the date hereof, as listed on EXHIBIT A, or at any
time during the term of this Agreement, and all Updates thereto, for providing
the Approved Internet Service (as defined in the Operating Agreement). NRI
Proprietary Software expressly excludes any software that NRI licenses from
Third Parties for use with the NRI Proprietary Software.
1.15 "PANEL" shall mean any group of households or Persons identified
and selected in accordance with specified criteria under the NMR Sampling
Methodology for purposes of measuring specified activities.
1.16 "PANEL MEMBER" means households, Persons or other participants
comprising the Household Panel who are provided with the Collection Software for
individual use in connection with the Internet Service in accordance with the
terms of the Panel Member License Agreement.
1.17 "PANEL MEMBER LICENSE AGREEMENT" shall mean the license agreement
entered into between each Panel Member and NRI, as amended from time to time,
substantially in the form attached hereto as EXHIBIT B.
1.18 "PERSON" shall mean any individual or Entity, and the heirs,
executors, administrators, legal representatives, successors and assigns of the
"Person" when the context so permits.
1.19 "THIRD PARTY" shall mean a Person other than NMR or its Affiliates
and NRI or its Affiliates.
1.20 "UPDATES" shall have the meaning set forth in the Operating
HOUSEHOLD PANEL SERVICES
2.1 NMR PANEL MAINTENANCE OBLIGATIONS. The services to be rendered by
NMR hereunder shall include services relating to (i) the maintenance of the
Household Panel and (ii) where Approved by the Operating Committee, the
expansion of the Household Panel, in each case as further provided in this
Section 2.1 below. Such services, together with the technical support services
to be rendered by NMR pursuant to Section 2.2(a) below, are referred to
collectively herein as the "Maintenance Services." NMR shall be the exclusive
supplier of Maintenance Services to the Household Panel, provided that NMR shall
have the right to outsource certain aspects of the Maintenance Services to Third
Parties under its supervision in accordance with the provisions of Section 2.5.
NRI may request outsourcing of Maintenance Services as provided in Section 2.5.
(a) Subject to the terms and conditions of this Agreement, NMR hereby
agrees to maintain the Household Panel (as the same may be expanded pursuant to
Section 2.1(b) below) in accordance with the NMR Sampling Methodology, as the
same may be updated from time to time by NMR. NRI has been provided with access
to the NMR Sampling Methodology pursuant to the Operating Agreement and is
familiar therewith. NMR shall not be obligated to render any maintenance
obligations with respect to the Household Panel which are not contemplated by
the NMR Sampling Methodology, unless specifically agreed to in writing by NMR.
(b) The Parties acknowledge that the size of the Household Panel may
be expanded upon Operating Committee Approval. If an expansion of the Household
Panel is Approved by the Operating Committee, NMR will take steps to build the
size of the Household Panel in accordance with the NMR Sampling Methodology,
subject, however, to such guidelines as to timing, cost and other factors as are
determined by Operating Committee Approval with respect to the implementation of
such expansion. Notwithstanding the above, the Parties have agreed to increase
the Household Panel to 25,000 Panel Members by October 31, 1999.
2.2 TECHNICAL SUPPORT OBLIGATIONS. NMR and NRI shall each provide
technical support with respect to the NRI Proprietary Software and the use of
such software by Panel Members pursuant to this Section 2.2. NMR and NRI shall
reasonably coordinate their efforts in performing their respective technical
service obligations hereunder so as to minimize technical problems encountered
by Panel Members and raise the installation and cooperation rates among Panel
(a) NMR shall provide "front-line" technical support to Panel Members
in connection with their installation, use and maintenance of the Collection
Software. Such support services shall include providing hotline telephone
service to Panel Members, trouble shooting to correct errors, bugs and
incompatibilities in the Collection Software and similar technical support. If
NMR is unable to resolve any such technical problems, it shall refer them to NRI
for resolution pursuant to Section 2.2(b). NMR shall provide NRI with a written
monthly report describing all problems reported to NMR under this Section 2.2(a)
and their resolution.
(b) NRI shall provide, at its own cost and expense, back-up technical
support to Panel Members, technical training and assistance to NMR personnel and
technical support with respect to the Collection Software as follows:
(i) NRI shall provide backup technical support to NMR and/or
Panel Members, as and when requested by NMR, with respect to technical problems
that NMR is unable to initially resolve under Section 2.2(a). NRI shall respond
to all such requests for assistance as promptly as practicable in order to
maximize participation rates among Panel Members and facilitate NMR's
maintenance of the Household Panel. NRI shall provide NMR with a written
monthly report describing all outstanding bugs/incompatibilities and the
estimated resolution dates therefor.
(ii) NRI shall provide up to four three day sessions per
calendar year of technical training to NMR personnel at no cost to NMR at NMR's
facilities. NRI shall be responsible for all expenses of its personnel
providing training, including without limitation, lodging and food.
(iii) To assist NMR in raising the installation and continued
cooperation rate among Panel Members, NRI shall make such improvements,
enhancements and modifications to the Collection Software as may be reasonably
necessary and technically possible at reasonable expense from time to time in
order to (A) minimize the occurrence of conflicts between the Collection
Software and typical systems of computers used by Panel Members and (B) improve
the ease of installation and operation of the Collection Software by Panel
Members. NRI shall provide NMR with a written monthly report setting forth all
planned Updates and other improvements, enhancements and modifications to the
Collection Software in order to facilitate the timely preparation of revised
instruction and other printed materials for distribution by NMR to Panel Members
and the training of NMR's personnel with respect to the technical modifications
to be implemented.
(c) The Parties acknowledge and agree that transfers of data are
necessary between NRI's data collection and reporting systems and NMR's Panel
management systems. To facilitate such transfers, the Parties will reasonably
cooperate with each other to ensure that all such data are in a format that is
compatible with each party's data management systems.
2.3 PANEL DATA. (a) Subject to NMR's rights under the Operating
Agreement and this Agreement, as between NMR and NRI, all right, title and
interest in the data obtained via the Collection Software concerning the
Internet usage activities of Panel Members in the Household Panel, and all
reports generated from such data for sale and distribution to customers of the
Internet Service (collectively, "Internet Usage Data"), shall be vested in NRI.
NMR shall have
the right to store, access, sell, distribute and use the Internet Usage Data
in accordance with the provisions of the Operating Agreement.
(b) The Parties acknowledge and agree that the NMR Sampling
Methodology imposes certain restrictions and limitations on any oral, written or
other contacts with active and former Panel Members and members of the sample
frame about which NRI has actual knowledge and on the use and dissemination of
data and information relating to the Panel Members, including their identities
and addresses. Accordingly, the Parties hereby undertake and agree to the
(i) All contacts with active and former Panel Members shall be
controlled by NMR, and such contacts shall only occur in
compliance with applicable restrictions contained in the NMR
Sampling Methodology. Neither NRI, its employees nor agents shall
contact Panel Members for any purpose except as follows:
(1) Appropriate NRI technical personnel may contact Panel
Members by telephone or by E-mail to render the backup
technical support services described in Section
(2) Appropriate NRI personnel may contact a Panel Member by
telephone or by E-mail to confirm such Panel Member's
continued active participation in the Household Panel if
Internet Usage Data has not been received from such
Panel Member for a period set by the Operating Committee.
(3) Other contacts between NRI and Panel Members may occur
for appropriate reasons (e.g., NRI's internal research
purposes), but only to the extent such other contacts
are mutually agreed upon in advance by NMR and NRI. NRI
shall give NMR prior written notice of any such proposed
contacts it wishes to make so that mutual agreement of
the Parties can be obtained.
(4) All permitted contacts between NRI and Panel Members
shall take place in accordance with applicable
restrictions contained in the NMR Sampling Methodology
which are disclosed to NRI in writing. NRI shall
institute any additional limitations on contacts with
Panel Members pursuant to the NMR Sampling Methodology
within fifteen (15) days of notice by NMR.
(ii) All data concerning active and former Panel Members in the
Household Panel, including the names, addresses, and related
demographic profiles of such Panel Members, prior contact
information, current follow-up status and such other information
as is generated by NMR or NRI hereunder (collectively,
"Confidential Panel Data") shall be held strictly confidential by
each of the Parties and their respective employees and agents in
accordance with the NMR Sampling Methodology. Such Confidential
Panel Data shall be maintained by each party in a secure database
with appropriate restrictions on access and use which are
consistent with the NMR Sampling Methodology as disclosed to NRI
and this Agreement. None of such Confidential Panel Data shall be
sold, transferred or otherwise disseminated by either party to any
Third Party for any reason whatsoever.
(iii) Neither party shall permit its employees or consultants to assist
any oral, written or other contact to occur between Panel Members
and customers of the Internet Service or any other Third Parties.
2.4 REPORTS. (a) NMR shall provide NRI with regular access to NMR's
sample management system with respect to real time (i) results of ongoing
recruitment efforts and acceptance rates and trends for prospective Panel
Members and (ii) technical information and assistance requests received by NMR.
(b) NRI shall provide NMR with regular access to NRI's sample
management system with respect to real time reports with respect to (i) Panel
Members who cease to be active Panel Members during the reporting period and
(ii) the information concerning outstanding bugs/incompatibilities and planned
Updates described in Section 2.2(b) above.
(c) NMR shall maintain records for four (4) years after providing such
Maintenance Services of all the Maintenance Services provided under this
Agreement and the similar services provided to its internal divisions to enable
NRI to audit such records to confirm that the amounts charged as Maintenance
Fees relate to Maintenance Services as defined in this Agreement and that NRI is
being charged therefor in the same manner as the internal divisions. NRI may
audit such records upon forty-eight (48) hours' prior written notice at the
headquarters of NMR during normal business hours. If such audit reveals fees
charged by NMR equaling or exceeding 110% of the actual amount due, then NMR
shall pay the expenses of such audit.
2.5 OUTSOURCING. NMR shall have the right to retain the services of
Third Party vendors and suppliers to perform (or to assist it in performing) any
aspect of the Maintenance Services, in each case in compliance with the NMR
Sampling Methodology and under the supervision of NMR. At NRI's request, NMR
agrees to provide the Maintenance Services through such Third Parties on the
same terms such services are provided to NMR if NMR uses such Third Parties for
services similar to the Maintenance Services.
2.6 UNIVERSE ESTIMATES. At the request of NRI, NMR currently prepares
special monthly universe estimates of the total population of Internet users in
the United States ("Special Internet Universe Estimates"). NMR shall continue
to prepare Special Internet Universe Estimates for NRI on a monthly basis or on
such other basis as the Operating Committee may determine. NMR shall make all
Special Internet Universe Estimates available to NRI on a co-exclusive basis
with NMR solely for use by NMR in projecting Internet usage from the Household
Panel to the entire population for the Internet Service. NMR agrees to include
new questions in the Special Internet Universe Estimate script unless NMR
reasonably believes that such change will be inconsistent with the quality
control of the NMR Sampling Methodology. The Parties acknowledge and agree that
the cost of preparing the Special Internet Universe
Estimates will be charged to NRI as part of the Maintenance Fees described in
Article III below. NRI may use the Special Internet Universe Estimate in any
manner, including selling it as part of a different service.
3.1 FEES AND CHARGES. In consideration of the Maintenance Services to
be rendered by NMR hereunder, NRI agrees to reimburse NMR for all of its costs
incurred in connection with the provision of such Maintenance Services on the
same basis as NMR charges its own divisions, including, without limitation, all
compensation and benefits of NMR employees in the provision of the Maintenance
Services and an allocable portion of NMR's overhead charges with respect
thereto. NMR shall also be reimbursed for all out-of-pocket costs incurred by
it in the performance (or its supervision of the performance by a Third Party
outsourced pursuant to Section 2.5 above) of Maintenance Services hereunder,
including the cost of consultants and contractors retained by NMR with the prior
written approval of NRI, the cost of all training manuals and other
instructional materials with the prior written approval of NRI, packaging
materials and printing and shipping costs for the Collection Software incurred
specifically in connection the Maintenance Services. If the Operating Agreement
is terminated as a result of NMR owning less than 5.0% of NRI on a fully-diluted
basis (i.e. based on the assumption that all options, warrants or other
convertible securities or instruments or other rights to acquire Common Stock or
any other existing or future classes of capital stock have been exercised or
converted, as applicable, in full, regardless of whether any such options,
warrants, convertible securities or instruments of other rights are then vested
or exercisable or convertible in accordance with their terms), as a result of
the purchase by NRI of NMR's shares of capital stock of NRI and the Warrants (as
defined in as defined in that certain Addendum No. 1 to Restated Stockholders'
Agreement by and among NMR, NRI and the other parties set forth therein (the
"Addendum")) upon the occurrence of a Competitive Takeover (as defined in the
Addendum), the Maintenance Fees shall be 120% of the cost of providing the
Maintenance Services as determined above. All amounts charged by NMR pursuant
to this Section 3.1 are referred to herein collectively as the "Maintenance
NMR and NRI shall agree upon a budget for providing the
Maintenance Services for 1999 within sixty (60) days of the date hereof.
Thereafter, for each successive calendar year (each, a "Budget Year"), NMR and
NRI will agree upon a budget for each Budget Year at least thirty (30) days
prior to the first day of such Budget Year. If the expenditures exceed the
budget, then NMR agrees to promptly meet with NRI to discuss methods to reduce
the costs. Any budget item greater than $25,000 shall be itemized (each a
"Special Budget Item"). If the actual aggregate expenditures by NMR on any
Budget Item exceed the budget for such Special Budget Item by more than 20%
during such Budget Year, NMR shall not spend more than the full amount budgeted
for such Special Budget Item during such Budget Year without the prior written
approval of NRI which shall not be unreasonably withheld. For purposes of this
Agreement, the period from the date hereof through December 31, 1999 shall be
deemed a Budget Year.
3.2 MONTHLY INVOICES. Following the end of each calendar month, NMR
shall furnish NRI with an invoice for the Maintenance Fees for such calendar
month (or partial calendar month prorated for such partial calendar month). NRI
shall remit payment for such invoice within fifteen (15) business days from the
date of its receipt thereof. NMR shall furnish NRI upon request with all
necessary supporting documentation for the calculation of the Maintenance Fees.
Interest shall be charged at the prime rate on any invoice which remains unpaid
for more than thirty (30) business days after its receipt by NRI.
(a) The term of this Agreement shall commence on the date hereof and
continue for so long as the Household Panel is marketed under the NMR Trademarks
and the NRI Trademarks (as those terms are defined in the Operating Agreement)
whether or not the Operating Agreement is terminated. If NMR elects to withdraw
the use of the NMR Trademarks in connection with the marketing and sale of the
Household Panel in accordance with the terms of the Operating Agreement, this
Agreement shall terminate upon the effective date of such withdrawal.
(b) This Agreement may be terminated at any time by the mutual consent
of NMR and NRI.
(c) Either Party may terminate this Agreement with respect to the
Household Panel upon the material breach of any other provision of this
Agreement by the other Party in respect of the Household Panel and such other
party's failure to cure such breach within thirty (30) days after its receipt of
written notice specifying the breach.
4.2 EFFECT OF TERMINATION. In the event of any termination of this
Agreement, NRI shall pay to NMR any and all amounts owed to NMR pursuant to
Article III with respect to the month in which such termination occurs and all
previous months, to the extent not already paid and such other amounts as may be
5.1 GENERAL DISPUTE PRINCIPLES.
(a) All disputes between NRI and NMR under this Agreement shall be
settled, if possible, through good faith negotiations between the Parties. In
the event such disputes cannot be so resolved, such disputes shall be resolved
as provided in Section 5.2.
(b) If either party or any of its Affiliates is subject to a claim,
demand, action or proceeding by a Third Party and is permitted by law or
arbitral rules to join another party to such proceeding, this Article V shall
not prevent such joinder. This Article V shall also not prevent either party or
any such Affiliate from pursuing any legal action against a Third Party.
5.2 ARBITRATION OF OTHER DISPUTES.
(a) The Parties shall submit any controversy or claim arising out of,
relating to or in connection with this Agreement or any Ancillary Agreement, or
the breach hereof or thereof ("Demand for Arbitration"), to arbitration
administered by the American Arbitration Association ("AAA") in accordance with
its then existing Commercial Arbitration Rules then in effect (collectively,
"AAA Rules") and judgment upon the award rendered by the arbitrator may be
entered in any court having jurisdiction thereof.
(b) The place of arbitration shall be San Diego, California.
(c) The Parties shall attempt, by agreement, to nominate a sole
arbitrator for confirmation by the AAA. If the Parties fail so to nominate a
sole arbitrator within 30 days from the date when the Demand for Arbitration has
been communicated by the initiating Party, the arbitrator shall be appointed by
the AAA in accordance with the AAA Rules. For purposes of this Section, the
"commencement of the arbitration proceeding" shall be deemed to be the date upon
which the Demand for Arbitration has been delivered to the Parties in accordance
with Section 5.2. A hearing on the matter in dispute shall commence within
30 days following selection of the arbitrator, and the decision of the
arbitrator shall be rendered no later than 60 days after commencement of such
(d) An award rendered in connection with an arbitration pursuant to
this Section 5.2 shall be final and binding upon the Parties, and the Parties
agree and consent that the arbitral award shall be conclusive proof of the
validity of the determinations of the arbitrator set forth in the award and any
judgment upon such an award may be entered and enforced in any court of
(e) The Parties agree that the award of the arbitral tribunal will be
the sole and exclusive remedy between them regarding any and all claims and
counterclaims between them with respect to the subject matter of the arbitrated
dispute. The Parties hereby waive all IN
PERSONAM jurisdictional defenses in connection with any arbitration hereunder
or the enforcement of an order or award rendered pursuant thereto (assuming
that the terms and conditions of this arbitration clause have been complied
(f) The arbitrator shall issue a written explanation of the reasons
for the award and a full statement of the facts as found and the rules of law
applied in reaching his decision to both parties. The arbitrator shall
apportion to each party all costs (including attorneys' and witness fees, if
any) incurred in conducting the arbitration in accordance with what the
arbitrator deems just and equitable under the circumstances. Any provisional
remedy which would be available in a court of law shall be available from the
arbitrator pending arbitration of the dispute. Either party may make an
application to the arbitrator seeking injunctive or other interim relief, and
the arbitrator may take whatever interim measures such arbitrator deems
necessary in respect of the subject matter of the dispute, including measures to
maintain the status quo until such time as the arbitration award is rendered or
the controversy is otherwise resolved. The arbitrator shall only have the
authority to award any remedy or relief (except ex parte relief) that a Superior
Court of the State of California could order or grant, including, without
limitation, specific performance of any obligation created under this Agreement,
the issuance of an injunction, or the imposition of sanctions for abuse or
frustration of the arbitration process, but specifically excluding punitive
(g) The Parties may file an application in any proper court for a
provisional remedy in connection with an arbitrable controversy, but only upon
the ground that the award to which the application may be entitled may be
rendered ineffectual without provisional relief. The Parties may also commence
legal action in lieu of any arbitration under this Section 5.2 in connection
with any Third Party litigation proceedings.
(h) For purposes of any suit, action or legal proceeding permitted
under this Article V, each Party (a) hereby irrevocably submits itself to and
consents to the non-exclusive jurisdiction of the United States District Court
for the Southern District of California for the purposes of any suit, action or
legal proceeding in connection with this Agreement, including to enforce an
arbitral resolution, settlement, order or award made pursuant to this Agreement
(including pursuant to the U.S. Arbitration Act or otherwise), and (b) to the
extent permitted by applicable law, hereby waives, and agrees not to assert, by
way of motion, as a defense, or otherwise, in any such suit, action or legal
proceeding pending in such event, any claim that it is not personally subject to
the jurisdiction of such court, that the suit, action or legal proceeding is
brought in an inconvenient forum or that the venue of the suit, action or legal
proceeding is improper. Each party hereby agrees to the entry of an order to
enforce any resolution, settlement, order or award made pursuant to this Section
5.2 by the United States District Court for the Southern District of California
and in connection therewith hereby waives, and agrees not to assert by way of
motion, as a defense, or otherwise, any claim that such resolution, settlement,
order or award is inconsistent with or violative of the laws or public policy of
the State of California or any other jurisdiction.
INDEMNIFICATION; CERTAIN LIMITATIONS
6.1 NMR INDEMNIFICATION. NMR hereby agrees, at its expense, to
defend, indemnify and hold harmless NRI from and against any losses, damages,
expenses, liabilities and costs (including reasonable legal fees) incurred by
NRI as a result of any claims brought against NRI by Third Parties arising out
of NMR's performance of Maintenance Services or any technical support services
and performance of the Collection Software hereunder, except to the extent that
NRI is responsible for any such losses and damages pursuant to Section 6.2. NMR
is not liable for any claims of infringement of Third Party intellectual
property rights by the Collection Software.
6.2 NRI INDEMNIFICATION. NRI's indemnification obligations with
respect to infringement of Third Party intellectual property rights are governed
solely by Article X of the License Agreement. In addition, NRI hereby agrees,
at its expense, to defend, indemnify and hold harmless NMR from and against any
losses, damages, expenses, liabilities and costs (including reasonable legal
fees) incurred by NMR as a result of any claims brought against NMR by Panel
Members arising out of the provision of technical support services by NRI for
the Collection Software or the performance of the Collection Software by any
Panel Member, including, without limitation, any claims that the Collection
Software as delivered to NMR damaged or otherwise harmed any computers when
properly used, except to the extent that such damages or claims are caused by
NMR's or the Panel Member's failure to follow technical support guidelines or
instructions established by NRI with respect to the Collection Software or NMR's
errors or other problems introduced as part of the reproduction or distribution
of the Collection Software by NMR or its Affiliates.
6.3 CERTAIN LIMITATIONS. The Parties' obligations under this Article
VI shall be subject to the following terms and conditions:
(i) The indemnified party shall give the indemnifying party
prompt written notice of any claim, provided that any
delay in or failure to provide such notice shall relieve
the indemnifying party of its obligation to indemnify
only to the extent that such failure or delay results in
material prejudice to the indemnifying party,
(ii) The indemnifying party shall have exclusive control over
the defense and settlement of such claim, except that
the indemnified party may participate in such action at
its own cost and expense.
(iii) The indemnified party shall provide reasonable
assistance to the indemnifying party, at the
indemnifying party's expense, in connection with the
defense of such claim. The indemnified party will
cooperate with the indemnifying party to reduce its
liability, such as by shipping new Collection Software
to Panel Members.
6.4 NMR OBLIGATIONS. The Parties acknowledge and agree that the size
of the Household Panel will fluctuate as Panel Members terminate their active
participation in such Panel or cease to qualify for such participation based
upon criteria and requirements reflected in the relevant Panel Member License
Agreement or the NMR Sampling Methodology. Further, the size of the Household
Panel will be affected by the technical performance of the Collection Software
which may impact install rates for such software, including, among other
factors, such software's capacity to measure all Internet usage within each
household in accordance with NMR Sampling Methodology and such software's
compatibility with personal computers operated by Panel Members. However, NMR
shall use reasonable commercial efforts to maintain the number of Panel Members
in the Household Panel at the minimum size requirements of 25,000 after October
31, 1999 or such other number as the Operating Committee shall decide.
Notwithstanding the foregoing, the Parties agree that the failure to maintain
the number of Panel Members in the Household Panel because of the failure of the
Collection Software to perform in accordance with its specifications, a general
decrease in the participation by Panel Members not caused by changes in the NMR
Sampling Methodology or other factors beyond the reasonable control of NMR shall
not be a material breach of its obligations under the Agreement.
6.5 LIMIT OF LIABILITY. EXCEPT AS PROVIDED IN SECTIONS 6.1 AND 6.2,
NEITHER PARTY WILL BE LIABLE TO THE OTHER FOR ANY SPECIAL, INDIRECT, INCIDENTAL,
CONSEQUENTIAL OR STATUTORY DAMAGES RELATED TO ANY CAUSE OF ACTION OF THE OTHER
PARTY ARISING OUT OF THIS AGREEMENT, EVEN IF SUCH PARTY IS INFORMED OF THE
POSSIBILITY THEREOF IN ADVANCE.
7.1 GOVERNING LAW. This Agreement, and the respective rights, duties
and obligations of the Parties hereunder, shall be governed by and construed and
enforced in accordance with the laws of the State of New York.
7.2 SUCCESSORS AND ASSIGNS. Except as otherwise provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of, and
be binding upon, the successors, assigns, heirs, executors and administrators of
the parties to this Agreement. Notwithstanding anything herein to the contrary,
either Party shall have the right to assign its rights or obligations hereunder,
without the prior written consent of the other Party, to an Affiliate, provided
that no such assignment hereunder shall relieve the assigning Party of its
7.3 ENTIRE AGREEMENT; AMENDMENT. This Agreement, the Ancillary
Agreements and the other documents delivered pursuant to this Agreement at the
closing constitute the full and entire understanding and agreement between the
Parties with regard to the subject matter hereof and thereof, and supersede all
prior agreements and merge all prior discussions, negotiations, proposals and
offers (written or oral) between them, and neither Party shall be liable or
bound to the other party in any manner by any warranties, representations or
covenants except as specifically set forth herein or therein. Except as
expressly provided in this Agreement, neither
this Agreement nor any term hereof may be amended, waived, discharged or
terminated other than by a written instrument signed by the Party against
whom enforcement of any such amendment, waiver, discharge or termination is
7.4 NOTICES, ETC. All notices and other communications hereunder
shall be deemed given if given in writing and delivered by hand, prepaid express
or courier delivery service or by facsimile transmission or mailed by registered
or certified mail (return receipt requested), facsimile or postage fees prepaid,
to the party to receive the same at the respective addresses set forth below (or
at such other address as may from time to time be designated by such Party in
accordance with this Section 7.4):
(a) If to NMR:
Nielsen Media Research, Inc.
299 Park Avenue
New York, NY 10171
Telephone: (212) 708-7004
Facsimile: (212) 708-7012
Attention: Chief Legal Officer
With copies to:
1114 Avenue of the Americas
New York, New York 10036
Telephone: (212) 626-4400
Facsimile: (212) 626-4120
Attention: James C. Colihan, Esq.
(b) If to NRI:
830 Hillview Court #225
Milpitas, California 95035
Telephone: (408) 941-2946
Facsimile: (408) 951-0487
Attention: Stephen Gross, Vice President Finance
With copies to:
Gray, Cary, Ware & Freidenrich, LLP
400 Hamilton Avenue
Palo Alto, CA 94301
Telephone: (650) 328-6561
Facsimile: (650) 327-3699
Attention: Mark F. Radcliffe, Esq.
All such notices and communications hereunder shall for all purposes of
this Agreement be treated as effective or having been given when delivered if
delivered personally, or, if sent by mail, at the earlier of its receipt or 72
hours after the same has been deposited in a regularly maintained receptacle for
the deposit of the United States mail, addressed and postage prepaid as
7.5 DELAYS OR OMISSIONS. Except as expressly provided in this
Agreement, no delay or omission to exercise any right, power or remedy accruing
to either party, upon any breach or default of the other party under this
Agreement, shall impair any such right, power or remedy of such party nor shall
it be construed to be a waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor
shall any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of such party of any
breach or default under this Agreement, or any waiver on the part of such party
of any provisions or conditions of this Agreement, must be in writing and shall
be effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to any
holder, shall be cumulative and not alternative.
7.6 CONFIDENTIAL INFORMATION. (a) For the purposes of this
Agreement, "Confidential Information" shall mean any information delivered by
one party ("Disclosing Party") to the other party ("Receiving Party") which the
Receiving Party knows or has reason to know is considered confidential by the
Disclosing Party. Receiving Party agrees to take precautions to prevent any
unauthorized disclosure or use of Confidential Information consistent with
precautions used to protect Receiving Party's own confidential information, but
in no event less than reasonable care. Except as provided below, Receiving
Party agrees to treat the Confidential Information as confidential and shall not
disclose the Confidential Information to any Person or Entity without Disclosing
Party's prior written consent. Disclosing Party may only disclose the
Confidential Information to Receiving Party's employees or contractors who
reasonably require access to such Confidential Information to perform
obligations under this Agreement. Receiving Party shall take all appropriate
steps to ensure that its employees and contractors who are permitted access to
the Confidential Information agree to act in accordance with the obligations of
confidentiality imposed by this Agreement. Should Receiving Party be faced with
legal action to disclose Confidential Information received under this Agreement,
Receiving Party shall promptly notify Disclosing Party, and upon Disclosing
Party's request, shall reasonably cooperate with Disclosing Party in contesting
such disclosures. Receiving Party shall maintain the secrecy of the
Confidential Information disclosed pursuant to this Agreement for a period of
five (5) years from the date of disclosure thereof. The obligations imposed by
this Article VII shall survive any termination of this Agreement.
7.7 NON-CONFIDENTIAL INFORMATION. The obligations set forth in
Section 7.6 shall not apply to any particular portion of any Confidential
Information that: (i) now or subsequently becomes generally known or available
through no act or omission of Receiving Party; (ii) is known to Receiving Party
at the time of receipt of the same from Disclosing Party; (iii) is provided by
the Disclosing Party to a Third Party without restriction on disclosure; (iv) is
subsequently rightfully provided to Receiving Party by a Third Party without
restriction on disclosure; or (v) is independently developed by Receiving Party,
as can be demonstrated from
Receiving Party's business records and documentation, provided the person or
persons developing the same had not had access to the Confidential
Information of the Disclosing Party prior to such independent development.
7.8 PUBLICITY. Neither Party (nor such Party's Affiliates) shall issue
any press release disclosing the terms of, or relating to, this Agreement or any
Ancillary Agreement, without the prior written consent of the other Party;
provided, however, that neither Party or its Affiliates shall be prevented from
complying with any duty of disclosure it may have pursuant to Applicable Laws.
Such disclosing Party shall use its best efforts to consult with the other Party
regarding the issuance of any such press release, or with regard to any public
statement disclosing the terms of this Agreement or any Ancillary Agreement and
shall use its best efforts to obtain confidential treatment for any Confidential
Information where such press release or other public statement is required to be
made by Applicable Law.
7.9 EXPENSES. Each of the Parties shall bear all legal, accounting
and other transaction expenses incurred by it in connection with the
negotiation, execution, delivery and performance of this Agreement.
7.10 COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be enforceable against the parties actually executing such
counterparts, and both of which together shall constitute one instrument.
7.11 SEVERABILITY. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; provided that no such severability shall be effective if
it materially changes the economic benefit of this Agreement to any party.
7.12 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not considered in construing or
interpreting this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.
NIELSEN MEDIA RESEARCH, INC.