Production and Distribution Agreement - Earthlink Networks Inc. and National Media Corp.
PRODUCTION AND DISTRIBUTION AGREEMENT
THIS PRODUCTION AND DISTRIBUTION AGREEMENT ("Agreement") is dated May 6,
1996 and is between EARTHLINK NETWORK, INC., a California corporation
("EarthLink"), and NATIONAL MEDIA CORPORATION, a Delaware corporation
The parties wish to set forth in this Agreement the terms upon which
EarthLink will grant to National certain rights to market and distribute
EarthLink's proprietary EarthLink Network-Registered Trademark-
TotalAccess-Trademark- Internet Access software for the Macintosh, Windows 95
and Windows 3.1 platforms (such software, as it presently exists and as it
may hereafter be modified, collectively referred to as the "Software") and
EarthLink's Internet Access Service (the "ELN Service"), all as more
specifically set forth herein.
In consideration of the mutual promises and undertakings set forth
herein, and intending to be legally bound hereby, the parties agree as follows:
1. LICENSE RIGHTS.
1.1 GRANT OF RIGHTS. Subject to all of the terms and conditions
of this Agreement, EarthLink hereby grants to National the following rights
(collectively, the "License Rights"), which National may exercise itself or
through any one or more of its existing and future subsidiaries under its
(a) EXCLUSIVE MARKETING RIGHTS. The exclusive right to
advertise, promote, market, sell and otherwise distribute the Software and
the ELN Service throughout the United States, Canada and such other countries
as the parties may from time to time agree (collectively, the "Territory")
via airings, on broadcast, cable, satellite and all other forms of
television transmission now existing or hereafter developed, of short-form
(i.e. two minutes running time or less) direct response television
(b) USE OF INTELLECTUAL PROPERTY AND PROMOTIONAL MATERIALS.
In connection with the exercise of its rights hereunder, and subject to the
prior approval of EarthLink (which will not be unreasonably withheld or
delayed), the nonexclusive right to: (a) use any and all trademarks, trade
names, copyrights, trade secrets and other intellectual property rights which
EarthLink may own or control with respect to the Software and the ELN Service
(including, without limitation those specifically identified on Schedule I
attached hereto), and (b) reproduce, copy and otherwise use any and all artwork,
graphics and other promotional materials which EarthLink owns or controls with
respect to the Software and the ELN Service ("EarthLink's Promotional
Materials"), copies of all of which EarthLink shall provide to National as soon
as practicable after the execution of this Agreement.
1.2 EXCEPTIONS TO EXCLUSIVITY.
(a) AMERICAN INTERACTIVE MEDIA. The parties acknowledge
that, pursuant to preexisting contractual arrangements between EarthLink and
American Interactive Media ("AIM"), EarthLink granted nonexclusive rights to
AIM to market the Software and the ELN Service in the United States and
Canada via short-form direct response television programming. EarthLink
believes that AIM has
concluded and discontinued all such marketing efforts. Nonetheless, the License
Rights shall in all events be subject to the valid exercise of such rights by
AIM so long as AIM shall retain such rights.
(b) GUTHY RENKER CORPORATION. The parties acknowledge that
EarthLink has previously granted certain nonexclusive rights to Guthy Renker
Corporation ("GRC") to market the Software and the ELN Service when bundled
with other products and services marketed by GRC, such rights to be formally
acknowledged in writing pursuant to a Distribution Agreement dated on or about
April 18, 1996 (the "GRC Distribution Agreement"). Accordingly, the License
Rights shall in all events be subject to the valid exercise of the rights
granted to GRC under the GRC Distribution Agreement for so long as GRC shall
retain such rights.
1.3 LOSS OF EXCLUSIVITY. In the event that National fails, for a
period of four consecutive weeks, to air the EarthLink Spots as contemplated by
Sections 2.2(a) and (b) of this Agreement in any country within the Territory,
then National's -rights -pursuant to Section 1.l of this Agreement shall cease
being exclusive in such country, and EarthLink, by itself or through any
licensee, may exercise such rights in such country concurrently with National's
exercise of such rights.
2. PRODUCTION AND AIRING OF EARTHLINK SPOTS.
2.1 PRODUCTION OF EARTHLINK SPOTS. National, through its
employees, agents and/or independent contractors, shall write, produce and edit
two television direct response advertisements (collectively, the "EarthLink
Spots"), one of approximately 15 seconds in length (the "Short Spot") and one of
approximately 60 seconds in length (the "Long Spot"). National shall bear all
costs incurred from and after the date of this Agreement in connection with the
production, editing and airing of the EarthLink Spots. National shall consult
with EarthLink with respect to the production of the EarthLink Spots, each of
which shall be subject to EarthLink's approval, which shall neither be
unreasonably withheld nor delayed. To that end, National shall provide
EarthLink with a review copy of each preliminary version of each of the
EarthLink Spots as promptly as practicable.
2.2 AIRING OF EARTHLINK SPOTS.
(a) SHORT SPOT. During the six-month period immediately
following EarthLink's approval of the Short Spot, National shall take such
steps as are necessary to add such Spot to the beginning or end of each 30-
minute infomercial which National airs on television in the Territory.
Following the conclusion of such six-month period, National shall air the Short
Spot in conjunction with each 30-minute infomercial which National airs in the
Territory for the balance of the term of this Agreement.
(b) LONG SPOT. As soon as practicable (but in any event not
longer than 90 days) following EarthLink's approval of the Long Spot, National
shall cause such Spot to be aired within the Territory not less than 50 times
per week for the balance of the term of this Agreement.
(c) NATIONAL'S EXCLUSIVE (CONTROL). Except to the extent
expressly set forth in Sections 2.2 hereof, National shall have exclusive
control over and shall be responsible for the broadcast, performance and
transmission of the EarthLink Spots within the Territory via broadcast, cable
and satellite television, at such times, with such frequency, in such markets
and on such networks and stations as National, in its sole judgment, shall
determine. National shall have no liability whatsoever to EarthLink arising
from or in connection with any action or determination made by National in the
good faith exercise
of its business judgment regarding the foregoing matters. Notwithstanding
anything to the contrary contained in this Section 2.2(d), National shall, as
promptly as practicable upon the request of EarthLink, discontinue airing the
EarthLink Spots in conjunction with any 30-minute infomercial which EarthLink,
in its reasonable business judgment, concludes reflects unfavorably on EarthLink
or its products and services.
2.3 SUBSTANTIATION AND DOCUMENTATION OF PRODUCT ATTRIBUTES. The
EarthLink Spots shall be based upon such attributes of and claims made about the
Software and the ELN Service as have been documented or substantiated to
National's satisfaction. EarthLink shall be under a continuing obligation to
provide (or cause to be provided), at As sole expense, all such documentation
and substantiation as National shall determine may be necessary to facilitate
compliance with all applicable laws governing the advertising and marketing of
the Software and the ELN Service.
2.8. LICENSE OF FOOTAGE. EarthLink may, without fee, incorporate
footage and still images created by or for National in the course of producing
the EarthLink Spots into promotional materials to be exhibited at trade shows
and other promotional events. EarthLink may further edit and modify such
materials as it deems necessary for such purposes, subject to National's prior
approval (which shall not be unreasonably withheld or delayed). National shall
cooperate with EarthLink in making available all such materials as EarthLink
shall reasonably request. National shall retain all right, title and interest
in all such materials (and all modifications thereof) in accordance with the
provisions of Section 5.2 hereof.
3. CERTAIN OBLIGATIONS OF EARTHLINK.
3.1 FULFILLMENT. EarthLink shall, at its sole expense, be
responsible for all order processing, credit card processing, telemarketing,
warehousing, fulfillment, customer service, and returns processing in connection
with all orders for the Software and the ELN Service placed by customers who
order in response to the EarthLink Spots (collectively, "National Customers").
EarthLink shall encode all copies of the Software which are distributed to
National Customers with a special code identifying National as the source of the
3.2 TECHNICAL SUPPORT. EarthLink shall, at its sole expense,
provide technical support to all end users of the Software distributed to
National Customers. Such technical support shall be consistent with the support
provided to existing customers of EarthLink as of the date of this Agreement.
4.1 FEE. EarthLink shall pay a fee to National with respect to
each National Customer. Such fee shall be determined in accordance with either
of the following methods, at the election of National, which shall be
communicated to EarthLink in writing prior to the first airing of an EarthLink
(a) ONE-TIME PAYMENT. A one-time fee of $45.00 for each
National Customer who subscribes to and pays in full for the ELN Service for at
least 60 days from the date of registration; or
(b) PERIODIC PAYMENTS. A fee equal to 7% of EarthLink's
gross receipts received from each National Customer, such fee to be payable to
National for a period of five years from the date on which each such National
Customer registers for the ELN Service.
(a) WARRANTS FOR EARTHLINK SP. EarthLink shall provide
National with warrants to purchase 50,000 shares of EarthLink's common stock
upon EarthLink's approval of the Short Spot and warrants to purchase an
additional 50,0OO shares of EarthLink's common stock upon EarthLink's approval
of the Long Spot. The exercise price for all such warrants shall be $4.88 per
(b) WARRANTS FOR NATIONAL CUSTOMERS. EarthLink shall
provide National with warrants to purchase one share of EarthLink common stock
for each National Customer who subscribes to and pays in full for the ELN
Service for at least 60 days from the date of registration, up to a maximum of
warrants for 600,000 shares of EarthLink common stock. The exercise price for
all such warrants shall be $4.88 per share with respect to all warrants so
earned on or before December 31, 1997 and the fair market value of EarthLink's
common stock, as determined by EarthLink's Board of Directors, (or, if
EarthLink's common stock is publicly traded, the then-applicable 30-day average
closing price thereof) with respect to all warrants so earned from and after
January 1, 1998.
(c) OTHER TERMS OF WARRANTS. All warrants provided to
National hereunder shall be in form substantially similar to warrants provided
to EarthLink's Board of Directors as of the date of this Agreement; PROVIDED,
however, that all such warrants shall contain antidilution provisions reasonably
acceptable to National.
4.3 RECORD KEEPING. REPORTING AND REMITTANCE. EarthLink shall
maintain and retain complete and accurate records of all orders which are
subject to the payment of fees and the issuance of warrants hereunder. So long
as orders shall continue to be placed, and whether or not any payment of fees or
issuance of warrants on such orders shall be due hereunder, EarthLink shall
render to National on or before the thirtieth day following each month a true
and correct accounting setting forth the following information for the preceding
month: (i) total National Customers, (ii) gross receipts from National
Customers, (iii) EarthLink's calculations determining the fees payable and
warrants issuable on orders placed by National Customers (if any). Each such
accounting shall be accompanied by the fees payable and the warrants issuable on
orders so reported.
4.4 INSPECTION AND AUDIT RIGHTS. All records required to be kept
pursuant to Section 4.3 hereof shall be made available for inspection by
National (or its designee) at its expense during normal business hours upon
reasonable prior notice (which in any event shall not be less than five business
days). National may cause such records to be audited at its expense not more
than once in any twelve-month period upon five business days prior notice to
EarthLink; PROVIDED, however, that if any such audit shall show underpayment of
fees or underissuance of war-rants due hereunder and such underpayment exceeds
by more than 5% of the total amount actually due, then EarthLink shall bear the
cost -of such audit and shall promptly pay all fees and issue all warrants
determined by such audit to be due.
5. PROPRIETARY RIGHTS.
5.1 EARTHLINK'S INTELLECTUAL PROPERTY.
(a) GENERALLY. Subject to the rights granted to National
hereunder, all right, title and interest (including, without limitation, all
rights arising under the United States Trademark Act, 15 U.S.C. Section 1501 et
seq. (the "Trademark Act"), the United States Copyright Act, 17 U.S.C. Section
et seq. (the "Copyright Act"), and all other applicable laws, rules and
regulations) in and to the Software, the ELN Service, EarthLink's Promotional
Materials and all patents, trademarks, trade names, copyrights and trade
secrets licensed to National hereunder (collectively, EarthLink's Intellectual
Property), is and shall remain the sole property of EarthLink. Neither National
nor any third-party shall acquire any right, title or interest in EarthLink's
Intellectual Property by virtue of this Agreement or otherwise, except to the
extent expressly provided herein. Any unauthorized use of EarthLink's
Intellectual Property by National or any third party shall be deemed an
infringement of the rights of EarthLink therein. National shall not in any way
or at any time dispute or attack the validity or harm or contest the rights of
EarthLink in or to any of EarthLink's Intellectual Property. National shall
display such notices as may be necessary or, in EarthLink's reasonable judgment,
desirable in order to preserve and protect EarthLink's proprietary rights in
EarthLink's Intellectual Property.
(b) USE OF TRADEMARKS. National acknowledges that some of
the trademarks listed on Schedule I hereto are not owned by EarthLink and
therefore are being sublicensed to National hereby. The trademarks licensed or
sublicensed to National pursuant to this Agreement may be used by National only
in connection with advertising EarthLink, the Software and the ELN Service and
as a means of identifying EarthLink and its licensors as the sources of such
products and services. Such trademarks may be used only in the form and manner
specified in Schedule I hereto (as such schedule may from time to time be
amended), and they may not be removed or altered in any way, whether by change
of color, typeface, design or otherwise. Moreover, in order to insure the
proper use of all such trademarks by National under this Agreement, all
proposed usages of such trademarks by National shall be submitted to EarthLink
for its prior review and approval.
5.2 NATIONAL'S INTELLECTUAL PROPERTY. All right, title and
interest (including, without limitation, all rights arising under the Copyright
Act, the Trademark Act and all other applicable laws, rules and regulations) in
and to the entire editorial, visual, audio, and graphic content of all
advertisements and promotional materials developed by National in connection
with its activities under this Agreement, including, without limitation, (i) the
EarthLink Spots and the performances recorded therein, (ii) all raw footage shot
in the course of producing the EarthLink Spots, (iii) all trademarks developed
or controlled by National, and (iv) all musical compositions included in the
EarthLink Spots (collectively, "National's Intellectual Property") shall be and
remain the sole property of National. Neither EarthLink nor any third party
shall acquire any right, title or interest in National's Intellectual Property
- -by virtue of this Agreement or otherwise. Any unauthorized use of any of
National's Intellectual Property by EarthLink or any third party shall be deemed
an infringement of the rights of National therein.
6. SPECIAL REPRESENTATIONS, WARRANTIES AND COVENANTS OF EARTHLINK.
6.1 REGULATORY REQUIREMENTS. EarthLink represents, warrants and
covenants to National that (i) it has (or, prior to the initial airing of any
EarthLink Spot, will obtain) all required governmental and regulatory approvals,
licenses, permits and consents which are required to market and distribute the
Software and the ELN Service within the Territory and (ii) the Software and the
ELN Service are not prohibited or otherwise restricted from being marketed and
used in commerce within the Territory. In the event that any modification to
the Software or its labeling, packaging or instructions is or becomes necessary
in order for it lawfully to be sold anywhere within the Territory, EarthLink
shall cause such modification to be made at no cost to National. The foregoing
shall be a continuing representation, warranty and covenant and shall remain in
full force and effect and shall bind EarthLink, and its successors and assigns,
throughout the term of this Agreement.
6.2 PROPRIETARY RIGHTS. EarthLink represents, warrants and
covenants to National that:
(a) EARTHLINK'S INTELLECTUAL PROPERTY. EarthLink owns or
otherwise controls all right, title and interest in and to EarthLink's
Intellectual Property and has all necessary licenses, clearances and other
authorizations to permit the marketing and distribution of the Software and the
ELN Service as contemplated herein;
(b) POWER AND AUTHORITY. EarthLink has all necessary power
and authority to grant to National all of the rights and privileges granted
pursuant to this Agreement;
(c) NO INFRINGEMENT. Neither the granting of the rights and
privileges granted hereunder nor the exercise thereof by National in accordance
with the terms of this Agreement will infringe or otherwise violate the
proprietary rights of any person or entity under any patent, trademark,
copyright, trade secret or otherwise; and
(d) NO ADVERSE CLAIMS. EarthLink (i) has not been and is
not, as of the date of this Agreement, a party to any litigation enforcing or
defending its rights in, to or with respect to the Software, the ELN Service
or any of EarthLink's Intellectual Property, (ii) is not aware of any claims or
demands made or threatened by any person or entity involving the validity of its
rights in, to or with respect to the Software, the ELN Service or any of
EarthLink's Intellectual Property, and (iii) is not aware of any patents,
trademarks, copyrights, devices, processes, methods or other intellectual
property rights owned or controlled by any third party which may infringe or be
infringed by the Software, the ELN Service or any of EarthLink's Intellectual
7. SPECIAL REPRESENTATIONS, WARRANTIES AND COVENANTS OF NATIONAL.
National represents, warrants and covenants to EarthLink that:
7.1 NATIONAL'S INTELLECTUAL PROPERTY. National owns or otherwise
controls (or, in the case of intellectual property not yet conceived, shall,
prior to the initial airing of each EarthLink Spot, obtain) all right, title and
interest in and to National's Intellectual Property and has or shall have all
necessary licenses, clearances and other authorizations to use, in the manner
contemplated herein, National's Intellectual Property; and
7.2 NO INFRINGEMENT. The use by National of National's
Intellectual Property as contemplated by this Agreement will not knowingly
infringe or otherwise violate the proprietary rights of any person or entity
under any patent trademark, copyright, trade secret or otherwise.
8. GENERAL REPRESENTATIONS AND WARRANTIES. Each party represents and
warrants to the other as follows:
8.1 POWER AND AUTHORIZATION. It has all requisite power and
authority (corporate and otherwise) to enter into this Agreement, and has duly
authorized by all necessary action the execution and delivery hereof by the
officer or individual whose name is signed on its behalf below.
8.2 NO CONFLICT. Its execution and delivery of this Agreement
and the performance of its obligations hereunder, do not and will not conflict
with or result in a breach of or a default under its
organizational instruments or any other agreement, instrument order, law-or
regulation applicable to it or by which it may be bound.
8.3 ENFORCEABILITY. This Agreement has been duly and validly
executed and delivered by it and constitutes its valid and legally binding
obligation, enforceable in accordance with its terms, except as enforcement may
be limited by bankruptcy, insolvency or other laws of general application
relating to or affecting the enforcement of creditors' rights and except as
enforcement is subject to general equitable principles
9.1 BY NATIONAL. National shall defend, indemnify and hold
harmless EarthLink, its affiliated companies and their respective officers,
directors, shareholders, employees, licensees, agents, successors and assigns
from and against any and all liabilities and expenses whatsoever, including,
without limitation, claims, damages, judgments, awards, settlements,
investigations, costs, and attorneys fees and disbursements (collectively
"Claims") which any of them may incur or become obligated to pay arising out of
or resulting from (i) the noncompliance of the EarthLink Spots with any
applicable law, regulation or order relating to the advertisement and sale of
the Software and the ELN Service, (ii) the infringement of the proprietary
rights of any third party with respect to National's Intellectual Property or
any television programming aired by National in connection with either of the
EarthLink Spots, or (iii) the breach by National of any of its
representations, warranties, covenants, obligations, agreements or duties under
9.2 BY EARTHLINK. EarthLink shall defend, indemnify and hold
harmless National, its affiliated companies and their respective officers,
directors, shareholders, employees, licensees, agents, successors and assigns
from and against any and all Claims which any of them may incur or become
obligated to pay arising out of or resulting from (i) the use of the Software or
the ELN Service, (ii) the infringement of the proprietary rights of any third
party with respect to the Software, the ELN Service or any of EarthLink's
Intellectual Property in the course of the exercise by National of -the rights
granted to it under this Agreement, or (iii) the breach by EarthLink of any of
its representations, warranties, covenants, obligations, agreements or duties
under this Agreement.
9.3 PROCEDURE. Promptly after learning of the occurrence of any
event which may give rise to its rights under the provisions of this section,
any person seeking to enforce such rights (a "Claiming Person") shall give
written notice of such matter to the party against whom enforcement of such
rights is sought (the "Indemnifying Party"). The Claiming Person shall
cooperate with the Indemnifying Party in the negotiation, compromise and defense
of any such matter. The Indemnifying Party shall be in charge of and control
such negotiations, compromise and defense and shall have the right to select
counsel with respect thereto, provided that the Indemnifying Party shall
promptly notify the Claiming Person of all developments in the matter. In no
event shall the Claiming Person compromise or settle any such matter without the
prior consent of the Indemnifying Party, which shall not be bound by any such
compromise or settlement absent its prior consent, which shall not be
unreasonably withheld or delayed.
10. TERM. Unless sooner terminated in accordance with the provisions
of Section 1 1 hereof, this Agreement shall remain in Full force and effect for
an initial term of three years, commencing as of the date hereof. Upon the
expiration of such initial term (or any extension thereof), this Agreement shall
automatically be extended for an additional period of one year unless, within
not less than 30 and not
more than 60 days before the expiration of such initial term (or any
extension thereof) either party shall give the other written notice of
11.1 TERMINATION EVENTS.
(a) TERMINATION UPON BREACH. Either party may terminate
this Agreement upon 30 days written notice thereof to the other party upon
the breach by the other party of any of its representations, warranties,
covenants or agreements contained in this Agreement. Upon the expiration of
such notice period, this Agreement shall terminate without the need for
further action by either party; PROVIDED, however, that if the breach upon
which such notice of termination is based shall have been fully cured to the
reasonable satisfaction of the nonbreaching party within such 30-day period,
then such notice of termination shall be deemed rescinded, and this
Agreement shall be deemed reinstated and in full force and effect. Such
right of termination shall be in addition to such other rights and remedies
as the terminating party may have under applicable law.
(b) TERMINATION BY EARTHLINK UPON IMPROPER USE OF
TRADEMARKS, ETC. EarthLink may terminate this Agreement upon written notice to
National of the breach by National of its obligations with respect to the use
and depiction of the trademarks licensed (or sublicensed) to National pursuant
to this Agreement or the breach of any of the representations, warranties or
covenants of National to EarthLink set forth min Section 7 hereof.
(c) TERMINATION BY NATIONAL UPON BREACH OF PROPRIETARY
WARRANTIES, ETC. National may terminate this Agreement upon written notice to
EarthLink of the breach of any of the representations, warranties or covenants
of EarthLink to National set forth in Section thereof.
(d) TERMINATION BY NATIONAL UPON MATERIAL ADVERSE CHANGES.
National may terminate this Agreement upon written notice to Earthlink upon
learning of the occurrence or existence, at any time during the term hereof, of
any event or circumstance which, in National's reasonable judgment, materially
adversely affects National's ability to market and distribute the Software and
the ELN Service. In such case, neither party shall have any claim as against
the other arising from such termination (including, without limitation, any
claim based on delay, lost profits, or loss of opportunity), all such claims
having been deemed waived, and each party shall be free thereafter to pursue its
respective business interests without regard to any of the obligations set forth
in this Agreement. Notwithstanding the foregoing, if National terminates this
Agreement pursuant to this Section 11.1 (d) at any time Within 180 days of the
commencement of airings of the EarthLink Spots hereunder, then the warrants
granted to National pursuant to Section 4.2(a) hereof shall be subject to pro
rata reduction by the amount by which such period of airing is less than 180
11.2 RIGHTS AND DUTIES UPON TERMINATION.
(a) GENERALLY. Except as otherwise provided in Section
11.2(b) hereof, for a period of six months following the expiration or
termination of this Agreement, National shall retain the rights to (i) advertise
and promote the Software and the ELN Service by means of any media purchased
prior to the effective date of termination and (ii) use EarthLink's
Intellectual Property in connection therewith. Notwithstanding any termination
of this Agreement, National and EarthLink shall perform as
though this Agreement were still in effect with respect to all existing and
pending orders for the Software and the ELN Service arising from the airing
of the EarthLink Spots until all such orders are filled and all requests for
refunds and replacements received in connection therewith have been
satisfactorily honored. Without limitation of the preceding sentence,
EarthLink shall remain liable for all fees and warrants which become due
pursuant to the terms of this Agreement with respect to all orders placed by
National Customers following the termination of this Agreement.
(b) TERMINATION BASED ON NATIONAL'S MATERIAL OR INTENTIONAL
BREACH. In the event that EarthLink terminates this Agreement upon a material
or intentional breach hereof by National, National shall discontinue further
airings of the EarthLink Spots as promptly as possible (but in no event longer
than three months from the effective date of such termination).
12.1 GENERALLY. The terms of this Agreement and all customer
lists, price lists, marketing plans, techniques, methods and data, sales and
transaction data, media purchase and placement data, and all other nonpublic
information designated by any party as being confidential or a trade secret,
written (whether in machine readable form or otherwise) or unwritten, shall
constitute confidential information of the disclosing party ("Confidential
Information"). Each party shall hold all Confidential Information in the
strictest confidence and shall protect all Confidential Information with the
same degree of care that it exercises with respect to its own proprietary
information. Without the prior written consent of the disclosing party, the
receiving party may not use, disclose, divulge or otherwise disseminate any
Confidential Information to any person or entity, except for the receiving
party's attorney and such other professionals as the receiving party may retain
in order for it to enforce the provisions of this Agreement.
12.2 EXCEPTIONS. Notwithstanding Section 12.1 hereof, neither
party shall have any obligations with respect to any Confidential Information
which (i) is or becomes within the public domain through no act of such party in
breach of this Agreement, (ii) was lawfully in the possession of such party
without any restriction on use or disclosure prior to its disclosure hereunder,
(iii) is lawfully received from another source subsequent to the date of this
Agreement without any restriction on use or disclosure, (iv) is disclosed by
order of any court of competent jurisdiction or other governmental authority
(PROVIDED in such latter case, however, that the receiving party shall timely
inform the disclosing party of all such legal or governmental proceedings so
that the disclosing party may attempt by appropriate legal means to limit such
disclosure, and the receiving party shall further use its best efforts to limit
the disclosure and maintain confidentiality to the maximum extent possible).
13. INDEPENDENT CONTRACTOR. No party nor any of its officers,
employees, agents or representatives is an employee or agent of any other party
for any purpose whatsoever. Rather, each party is and shall at all times remain
an independent contractor.
14. FORCE MAJEURE. Neither EarthLink nor National shall be
responsible for any delay or failure to perform any part of this Agreement to
the extent that such delay or failure is caused by fire, flood, explosion, war,
strike, labor unrest, riot, embargo, act of governmental, civil or military
authority, accident, inability to obtain raw materials or supplies, acts or
omissions of carriers, act of God, or other such contingencies beyond its
control. Notice with full details of any such event shall be given to the other
party as promptly as practicable after its occurrence. The affected party shall
use due diligence, where
practicable, to minimize the effects of or end any such event so as to
facilitate the resumption of full performance hereunder.
15. FURTHER ACTIONS. The parties agree to execute such additional
documents and to perform all such other and further acts as may be necessary or
desirable to carry out the purposes and intents of this Agreement.
16. LICENSE OF INTELLECTUAL PROPERTY. This Agreement shall be deemed to
constitute an executory contract under which EarthLink is a licensor of
intellectual property, as to which National may make an election under Section
365(n) of the United States Bankruptcy Code, 11 U.S.C. Sec. 365(n).
17.1 NOTICES. All notices, requests, instructions, consents and other
communications to be given pursuant to this Agreement shall be in writing and
shall be deemed received (i) on the same day if delivered in person, by same-day
courier or by telegraph, telex or facsimile transmission, (ii) on the next day
if delivered by overnight mail or courier, or (iii) on the date indicated on the
return receipt, or if there is no such receipt, on the third calendar day
(excluding Sundays) if delivered by certified or registered mail, postage
prepaid, to the party for whom intended to the following addresses:
If to EarthLink:
EarthLink Network, Inc.
3100 New York Drive
Pasadena, CA 91107
Attention: Garry Betty
If to National:
National Media Corporation
1700 Walnut Street
Philadelphia, PA 19103-6013
Attention: Marshall A. Fleisher, Esq.
Each party may by written notice given to the other in accordance with this
Agreement change the address to which notices to such party are to be delivered.
17.2 ENTIRE AGREEMENT. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, whether written or oral,
between them with respect to the subject matter hereof.
17.3 AMENDMENT. No amendment of this Agreement shall be effective
unless embodied in a written instrument executed by all of the parties.
17.4 WAIVER OF BREACH. The failure of any party hereto at any time to
enforce any of the provisions of this Agreement shall not be deemed or construed
to be a waiver of any such provision, nor in any way to affect the validity of
this Agreement or any provisions hereof or the right of any party hereto to
thereafter enforce each and every provision of this Agreement. No waiver of any
breach of any of the provisions of this Agreement shall be effective unless set
forth in a written instrument executed by the party against whom or which
enforcement of such waiver is sought; and no waiver of any such breach shall be
construed or deemed to be a waiver of any other or subsequent breach.
17.5 ASSIGNABILITY. This Agreement shall be binding on and inure to
the benefit of the parties hereto and their respective heirs, representatives,
successors and assigns; PROVIDED, however, except as otherwise expressly
permitted hereunder, no party hereto may assign this Agreement or any rights
hereunder to any person or entity without the prior written consent of the other
party, and any attempted assignment without such consent shall be void.
Notwithstanding the foregoing, it is understood and agreed that National may
exercise its rights and perform its obligations hereunder through any existing
or future subsidiary under its control.
17.6 GOVERNING LAW: JURISDICTION. This Agreement shall be governed
by and construed in accordance with the integral substantive and procedural laws
of the Commonwealth of Pennsylvania without regard to conflict of laws
principles. The parties consent to the personal jurisdiction and venue of the
Court of Common Pleas of Philadelphia County (Pennsylvania) and the United
States District Court for the Eastern District of Pennsylvania and further
consent that any process, notice of motion or other application to either such
court or a judge thereof may be served outside the Commonwealth of Pennsylvania
by registered or certified mail or by personal service, provided that a
reasonable time for appearance is allowed.
17.7 SEVERABILITY. All the provisions of this Agreement are intended
to be distinct and severable. If any provision of this Agreement is or is
declared to be invalid or unenforceable in any jurisdiction, it shall be
ineffective in such jurisdiction only to the extent of such invalidity or
unenforceability. Such invalidity or unenforceability shall not affect either
the balance of such provision, to the extent it is not invalid or unenforceable,
or the remaining provisions hereof, nor render invalid or unenforceable such
provision in any other jurisdiction.
17.8 SURVIVAL. The provisions of Sections 4 (compensation) 6 (special
representations, warranties and covenants of EarthLink), 7 (special
representations, warranties and covenants of National), 9 (indemnification),
11.2 (rights upon termination), 12 (confidentiality) and 17.6 (governing law;
jurisdiction) shall survive the termination of this Agreement.
17.9 HEADINGS AND COUNTERPARTS. The headings of sections and
subsections have been included for convenience only and shall not be considered
in interpreting this Agreement. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, and all of which
together shall constitute one and the same Agreement. This Agreement may be
executed and delivered via electronic facsimile transmission with the same force
and effect as if it were executed and delivered by the parties simultaneously in
the presence of one another.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed on the date first written above.
Attest: EARTHLINK NETWORK, INC
By: By: /s/ Charles G. Betty
Title: Title: President
Attest: NATIONAL MEDIA CORPORATION
By: /s/ Marshall A. Fleisher By: /s/ Constantinos I. Costalas,
Marshall A. Fleisher, Constantinos I. Costalas,
Secretary Vice Chairman
TRADEMARKS, TRADE NAMES AND OTHER PRODUCT AND PROPRIETARY IDENTIFIERS
1. EarthLink Network-Registered Trademark-
3. Netscape-Registered Trademark-
4. Netscape Navigator-Trademark-
5. Qualcomm's Eudora-Light-Registered Trademark-
- - EarthLink Network-Registered Trademark- and TotalAccess-Trademark- are
trademarks of EarthLink Network, Inc.
- - Navigator-Trademark- is a trademark of Netscape-Registered Trademark-
- - Netscape-Registered Trademark- is a registered trademark of
Netscape-Registered Trademark- Communications Corporation.
- - Eudora-Light-Registered Trademark- is a registered trademark of the
University of Illinois Board of Trustees, licensed to Qualcomm Incorporated.
- - [See attached for Logo-and Trademark Usage Guidelines for Netscape
NETSCAPE NAVIGATOR-TM- INCLUDED
LOGO AND TRADEMARK USAGE GUIDELINES
THE NETSCAPE NAVIGATOR INCLUDED LOGO MAY ONLY BE USED BY LICENSED
THIRD PARTIES (OEM'S) TO INDICATE THAT NETSCAPE NAVIGATOR-TM- SOFTWARE
IS INCLUDED IN AN OEM'S BRANDED PRODUCT. THE USAGE OF THE LOGO MUST
COMPLY WITH ALL OF THESE GUIDELINES. NO USE OF THE LOGO SHOULD IMPLY
THAT NETSCAPE COMMUNICATIONS EITHER WARRANTS OR SUPPORTS THE OEM
2. REQUIRED USAGE OF THE "NETSCAPE NAVIGATOR-TM- INCLUDED" LOGO
A. IN PRODUCT PACKAGING
PLACEMENT: The logo must appear on the front of the product package.
The logo may appear on the spine and/or back of the product package.
The logo must be placed on a high contrast background and must stand-
alone in making a commercial impression. The logo must not touch or
overlap any other logo on the packaging.
SIZE: The N-graphic portion of Netscape Navigator Included logo must
be at least 3/4" on each side. Always size the logo proportionally
based on the size of the N-graphic.
For CD-ROMs and CD-ROM jewel case size packaging, the minimum size of
the N-graphic portion of Netscape Navigator Included logo must be at
least 1/2" on each side.
The logo may be no larger than the OEM brand or product name or logo
on the package. The N-graphic portion of the logo may never exceed
1 1/2" on each side.
B. IN PRINT, ONLINE, AND BROADCAST ADVERTISING AND DIRECT MAIL:
PLACEMENT: The logo must be on a high contrast background and stand-
alone in making a commercial impression. The logo must not touch or
overlap any other logo on the advertisement. In print advertising and
direct mail, the logo must appear in every viewing plane (i.e. page,
spread or gatefold) of the ad. In broadcast advertising, the logo
must be on screen for at least 5 seconds and totally within the title-
safe screen area.
SIZE: For all print applications, the N-graphic portion of Netscape
Navigator Included logo must be at least 3/4". The logo may be no
larger than the OEM brand or product name or logo in the printed
material. In addition, the graphic portion of the logo may never
exceed 1 1/2" on each side.
For all broadcast applications, the logo must be a minimum of 15% of
the title safe area. The logo may be no larger than the OEM brand or
product name or logo in the broadcast advertisement.
For all online advertising, the N-graphic portion of Netscape
Navigator Included logo must be at least 30 pixels on each side and
must link to the Netscape site at this URL: "www.netscape.com"
3. OPTIONAL USAGE: IN PRODUCT BROCHURES AND OTHER COLLATERAL:
PLACEMENT: The logo must be displayed on the first page of all
brochures and on the cover of all manuals and bound collateral. The
logo must be on a high contrast background and stand-alone in making a
SIZE: The N-graphic portion of Netscape Navigator Included logo must
be at least 3/4". The logo may be no larger than the OEM brand or
product name or logo. In addition, the N-graphic portion of the logo
may never exceed 1 1/2" on each side. The logo may be no larger than
the OEM brand or product name or logo in the collateral.
4. ALTERING OF THE LOGO
The logo may only be reproduced directly from the diskette, provided
by Netscape in this kit. It may not be altered in color, shape, font,
proportion or in any other manner. The logo may be increased in size,
but only in whole and in proportion to the original.
5. TRADEMARK CREDIT:
In all usage the Netscape Navigator Included logo should always be
identified as a trademark of Netscape Communications Corporation with
the following credit line: NETSCAPE NAVIGATOR AND THE NETSCAPE
NAVIGATOR INCLUDED LOGO ARE TRADEMARKS OF NETSCAPE COMMUNICATIONS.
6. STANDARDS AND QUALITY: The Netscape Navigator Included logo must be
displayed in a positive manner. The logo may not depict Netscape in
any negative way.
NETSCAPE NAVIGATOR-TM- NAME USAGE GUIDELINES
THESE GUIDELINES APPLY TO PRINTED COLLATERAL, ADVERTISING, POINT OF SALE
MATERIAL, RETAIL PACKAGING, ALL ON-LINE COMMUNICATIONS, ICONS AND ALL OTHER
The OEM must always represent the product as "Including", "containing"
or "with" Netscape Navigator software.
The OEM must brand the product as their own. The words "Netscape" or
"Netscape Navigator" may NOT appear in the product or brand name.
EXAMPLES OF CORRECT USAGE:
XYZ Online Kit containing Netscape Navigator-TM- Internet
ABC internet Suite with Netscape Navigator-TM- software,
Smallmail e-mail and MyStack software.
123 Company's Family Internet Fun-pak. Netscape Navigator
Internet client included.
EXAMPLES OF INCORRECT USAGE:
XYZ Netscape Browser
The Netscape Navigator from ABC Company
123 Internet Navigator
ABC Netscape Navigator
The words "Netscape Navigator" should always be used together to
represent the Internet client product supplied by Netscape. Never use
the term, Netscape, Mozilla or Mosaic to refer to the Netscape
The Netscape Navigator name should always be used as a adjective
followed by an appropriate noun. Appropriate nouns are: Internet
client and software. Browser is NOT an appropriate noun. Never use
Netscape or Netscape Navigator as a verb or noun.
EXAMPLES OF CORRECT USAGE:
"...includes the Netscape Navigator-TM- Internet client."
"...with Netscape Navigator-TM- software, you can view..."
EXAMPLES OF INCORRECT USAGE:
"Includes the Netscape browser..."
"with Navigator, you can view..."
"Includes Netscape's Mosaic-like Navigator..."
"Just use Netscape to view this..."
"You can Netscape from your home PC..."
FONT SIZE: In all media, the size of the font of the words Netscape
Navigator should be no larger than the font of the brand or product
name of the OEM product.
SUPPORT: The OEM may NOT indicate in any way that the product is
supported or warranted directly by Netscape Communications
TRADEMARK CREDIT: Netscape Navigator software should always be
identified as a trademark of Netscape Communications Corporation with
the following credit line: NETSCAPE NAVIGATOR IS A TRADEMARK OF
STANDARDS AND QUALITY: The Netscape Navigator name must be used in a
positive manner. The name may not depict Netscape in any negative