Distribution and Service Agreement - AdStar.com Inc. and CareerPath.com
DISTRIBUTION AND SERVICE AGREEMENT
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This Distribution and Service Agreement ("Agreement") is made and entered into
between AdStar.com, Inc., a Delaware Corporation ("AdStar") with offices at
4553 Glencoe Avenue, Suite 325, Marina del Rey, CA 90292 and CareerPath.com a
Delaware Corporation (the "Company"), with offices at 10880 Wilshire Boulevard,
Suite 600, Los Angeles, CA 90024 as of August 27, 1999 ("Effective Date").
NOW, THEREFORE, in consideration of the premises and the mutual covenants and
conditions herein contained, ADSTAR and the Company agree as follows:
1) Purpose: Company provides a career advertising Web site ("CareerPath.com")
on the World Wide Web part of the Internet for employers ("Users") to
connect with job seekers ("Consumers"). AdStar provides an Internet based
marketplace for the buying and selling of classified advertising
("Advertise123.com") for its media and advertisers clients. The parties
wish to make Company's online job listing advertising opportunity ("Ads")
accessible from Advertise123.com and a network of related sites (the
"Service") for the purpose of allowing Users to purchase Ads on
CareerPath.com.
2) Responsibilities of the Parties:
The responsibilities of the parties are detailed in Attachment A.
3) General:
3.1 Each party shall be solely responsible for supplying and
managing its own Web site at its own expense and neither party
shall have any obligation or liability whatsoever with respect
to the Web site of the other. Each party shall manage, review,
delete, edit, create, update and otherwise manage all content
and services available on or through its respective Web site.
3.2 Each party shall promptly inform the other of (a) any
information related to its Web site that could reasonably be
anticipated to lead to a claim, demand, or liability of or
against the other party by any third party, (b) any changes to
its Web site which would substantially change the content in any
area to which the other party has linked, and (c) any changes in
its Web site which would substantially change the page(s) in
which links to the other party appear.
3.3 AdStar grants to the Company during the term of this Agreement a
non-exclusive, royalty-free, world-wide right and license to use
its trade names, trademarks, service names and service marks
("AdStar Marks") for promotion in connection with this
Agreement, subject to the following conditions: (a) the Company
shall comply with all guidelines that AdStar may provide from
time to time; (b) the look and feel, the use of all logos, the
design, and the overall quality of the AdStar Marks shall be
subject to AdStar's approval; (c) any use of the AdStar Marks
shall inure to the benefit of AdStar; and (d) the Company shall
submit to AdStar for its prior approval, not to be unreasonably
withheld, all advertising, promotional and other material
bearing any AdStar Marks.
3.4 The Company grants to AdStar during the term of this Agreement a
non-exclusive, royalty-free, world-wide right and license to
use its trade names, trademarks, service names and service marks
("Company Marks") for promotion in connection with this, subject
to the following conditions: (a) AdStar shall comply with all
guidelines that the Company may provide from time to time; (b)
any use of the Company Marks shall inure to the benefit of the
Company; and (c) AdStar shall submit to Company for its prior
approval, not to be unreasonably withheld, all advertising,
promotional and other material bearing any Company Marks.
3.5 Nothing in this Agreement shall be deemed to grant to the
Company any ownership interest in the AdStar Marks or to AdStar
any ownership interest in the Company Marks.
4) Promotional Efforts: Each party will submit to the other party, for its
prior written approval, which shall not be unreasonably withheld or
delayed, all press releases, and marketing, advertising, and other
promotional materials that refer to the other party and/or its trade
names, trademarks, service names and service marks (the "Materials").
Copy substantially similar to that already approved shall be deemed
approved.
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5) Fees, Share of Advertising Revenue and Payment: AdStar will pay Company
advertising revenues earned and actually received for Ads on Company's Web
site, less advertising percentage shares and applicable fees, in a calendar
month within thirty (30) days of the end of that calendar month. Each party
will provide the other party with a monthly report with all information
necessary to show the basis on which advertising revenues and fee payments
are calculated in accordance with this Agreement. Each party will have the
right, at its own expense, to inspect and audit the accounting books and
records of the other party that are specifically relevant to the
determination of advertising percentage shares, fees and payments due under
this Agreement. In the event such inspection and audit shows a discrepancy
in payments in the recipient party's disfavor of five percent (5%) or more,
then the other party shall promptly reimburse the recipient party for the
costs and expense of such inspection and audit and pay the amount of any
underpayment. AdStar applicable fees and share of revenue which will be
deducted from advertising revenues include:
a) The Ad-Star advertising percentage shares, which are defined in
Attachment B;
b) The merchant and ACH online processing fees, which are defined in
Attachment B;
c) a reserve for credit charge backs of three percent (3%) of the
total advertising revenues for a rolling twelve (12) months. This
reserve will serve to reduce fluctuations in monthly payments and
may be adjusted from time to time with written notice to more
accurately reflect the actual charge back experience. Sole
liability for chargebacks will remain with the Company.
6) Data Ownership and Usage: Company will own the data generated by its Users
generated through the Service, such as the Users name, billing address and
ad content. Company grants AdStar a royalty free world wide right to use
its data, which originates through the Service, for purposes other than
Consumer searches to locate prospective employers. Some examples of such
non-Consumer use of this data includes providing data along with other
publisher data in aggregate to determine average advertising expenditure by
job title, industry or geography. In addition, AdStar will not individually
identify Company data, other than anonymously as in peer group analysis.
7) Non-Exclusivity: Both parties agree and acknowledge that nothing in this
Agreement shall be deemed or construed to provide the other with any manner
of exclusivity.
8) Assignability: This Agreement shall not be assigned, sublicensed or
transferred by either party, without the prior written consent of the other
party, which shall not be unreasonably withheld or delayed. An acquisition,
merger or other change of control of either the Company or AdStar shall not
be deemed an assignment.
9) Confidentiality: Each party acknowledges and agrees that any and all
information relating to the other party's business and not publicly known
including, without limitation, the contents of this Agreement, technical
processes and formulas, source codes, trade secrets, names, addresses and
information about users and advertisers, product designs, sales, costs and
other unpublished financial information, product plans, and marketing data
is confidential and proprietary information. Each party agrees that it will
not use or disclose any confidential or proprietary information for any
purpose other than in connection with the performance of and obligations
under the terms and conditions of this Agreement or as required by a court
of competent jurisdiction.
10) Representations and Warranties, Disclaimers, and Advertising Acceptability:
Each party represents and warrants to the other that (a) its Web site is a
functional Internet site accessible to subscribers and users of the
Internet; (b) it has the right and authority to enter into and perform all
obligations under this Agreement; and (c) its execution and performance of
this Agreement does not and will not violate any agreement to which such
party is bound. In the event of an error, delay, defect, breakdown or
failure of either party's Web site, that party's obligation shall be
limited to using its reasonable efforts to restore its Web site to
operation as soon as feasible.
The Company further represents and warrants to AdStar that the Company's
Web site does not and will not contain any content, material, or
advertisement that infringes any proprietary right of any third party,
including, without limitation, any copyright, trademark, patent or trade
secret, or that violates any law or governmental regulation. AdStar does
not create the advertisements or other material which originate through the
Service, nor does it review or exercise control over the content of such
material, and consequently, all content, material and advertisements coming
through the Service are provided
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AS IS and AdStar expressly disclaims any responsibility for the accuracy,
quality or nature of such content, material and advertisements.
The Company and AdStar reserve the right to refuse to display any
advertisement, including without limitation, any advertisement that: would
or might violate any law or governmental regulation; would or might violate
or infringe any right of any third party; it determines is inappropriate or
might subject it to liability or adverse publicity; or its otherwise
injurious to its interests; provided that, neither party shall be
responsible for, or obligated to review any content, advertisement or other
material on the other's Web site.
EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES, AND
EACH PARTY HEREBY SPECIFICALLY DISCLAIMS, ANY REPRESENTATION OR WARRANTY,
EXPRESS OR IMPLIED, REGARDING ANY MATTER SUBJECT TO THIS AGREEMENT,
INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE, AND IMPLIED WARRANTIES ARISING FROM COURSE
OF DEALING OR COURSE OF PERFORMANCE.
11) Indemnity: Each party will defend, indemnify, save and hold harmless the
other party, AdStar's clients and Company Affiliates, and their officers,
directors, agents and employees, from any and all third-party claims,
demands, liabilities, costs or expenses, including, without limitation,
reasonable attorneys' fees ("Liabilities"), resulting from the indemnifying
party's breach of any representation or warranty contained in this
Agreement. Each party agrees to (a) promptly notify the other party in
writing of any indemnifiable claim or demand and (b) give the other party
the opportunity to defend or negotiate a settlement of any such claim or
demand at such other party's expense and cooperate fully with the other
party, at that other party's expense, in defending or settling such claim or
demand. The indemnifying party will not settle a claim or demand for the
indemnified party without the prior written consent of the indemnified
party, which consent shall not be unreasonably withheld. Each party reserves
the right, at its own expense, to participate in the defense of any matter
otherwise subject to indemnification by the other party.
12) Limitation of Liability: In no event will either party be liable to the
other party for consequential, incidental, special, punitive, exemplary, or
indirect damages, including but not limited to, loss of profits or sales or
loss of or damage to data, regardless of the form of action, whether in
contract, tort, breach of warranty or otherwise, even if a party has been
advised of the possibility thereof. Moreover, except for the indemnification
obligations and charge back allowance and liability described above, in no
event shall the maximum liability of either party arising out of or relating
to the transaction which is the subject matter of this Agreement, regardless
of cause, exceed the amounts payable by the Company to AdStar under this
Agreement.
13) Term and Termination: The initial term of this agreement will be for the
period of one (1) year from the Effective Date and will automatically renew
for successive one year periods unless terminated by either party. Either
party may terminate this Agreement after the initial term for any reason on
ninety (30) days' prior written notice. Notwithstanding the foregoing,
either party may terminate this Agreement with immediate effect if the other
party is in breach of a material obligation hereunder and fails to cure such
breach within thirty (30) days of notice from the non-breaching party or
fails to promptly after notice from the non-breaching party begin to cure
such breach and diligently pursue its cure if such breach is curable but is
not capable of being cured within thirty (30) days of notice from the
non-breaching party. Upon termination, each party shall promptly return to
the other all of the confidential information (as defined above) of the
other party in its possession or control. Section 5, 8, 9, 10, 11, 12, 13
and 14 shall survive termination or expiration.
14) General Provisions:
14.1 Amendment: No change, amendment or modification of any provision of
this Agreement shall be valid unless set forth in a written instrument
signed by both parties.
14.2 Entire Agreement: This Agreement sets forth the entire agreement and
supersedes any prior agreements, written or oral, of the parties with
respect to the transactions set forth herein.
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14.3 Construction: In the event that any provision of this Agreement
conflicts with the law under which this 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 the applicable law, and the remainder of this Agreement
shall remain in full force and effect. There shall be no presumption for or
against either party as a result of such party being the principal drafter
of this Agreement.
14.4 Independent Contractors: The parties to this Agreement are independent
contractors. Neither party is an agent, representative, or partner of the
other party. Neither party shall have any right, power or authority to
enter into any agreement for, or on behalf of, or incur any obligation or
liability of, or to otherwise bind, the other party. This Agreement shall
not be interpreted or construed to create an association, agency, joint
venture or partnership between the parties or to impose any liability
attributable to such a relationship upon either party.
14.5 Governing Law: This Agreement will be governed by and construed in
accordance with the laws of the State of California, without giving effect
to principles of conflicts of law.
14.6 Arbitration: A. In the event of any disagreement, controversy or
dispute regarding performance under or interpretation of this Agreement,
the parties agree to attempt to reach a negotiated resolution. If such
dispute remains unresolved for a period of thirty (30) days after one party
has provided written notice of the dispute to the other, then each party
shall designate an officer to meet to endeavor to resolve the dispute.
Arbitration in accordance with this section may not be commenced by either
party until said officers determine in good faith that a negotiated
resolution is unlikely, or the passage of thirty (30) days from their first
meeting, whichever occurs later.
Upon the expiration of said thirty (30) day period, if a negotiated
resolution has not been reached, the disagreement, controversy or dispute
shall be settled by binding arbitration in accordance with the commercial
arbitration rules of the American Arbitration Association and judgement
upon the award rendered by the arbitrators may be entered in any court
having jurisdiction thereof. The arbitration shall be conducted in Los
Angeles, CA by three arbitrators. One arbitrator shall be selected by
AdStar, one arbitrator shall be selected by Company and the third
arbitrator shall be selected by the American Arbitration Association and
shall be subject to approval by both AdStar and Company.
AdStar and Company intend that this provision for settling disputes be
irrevocable.
14.7 Attorney's Fees: In any action or proceeding to enforce any of the
terms or provisions of this Agreement or on account of the breach hereof,
the party prevailing shall be entitled to recover all its expenses,
including, without limitation, reasonable attorney's fees from the other
party.
14.8 Notice: Any notices herein shall be given to the appropriate party at
the address specified above or at such address as the party shall specify
in writing. Notice shall be deemed given: upon personal delivery; if sent
by fax, upon confirmation of receipt; or if sent by certified or registered
mail, postage prepaid, five (5) days after the date of mailing.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.
For Company: For AdStar:
CareerPath.com AdStar.com, Inc.
By: By:
Name: Name: /s/ Adam Leff
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Title: VP Finance Title: SVP Business Development
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8/26/99 8/30/99
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ATTACHMENT A - RESPONSIBILITIES OF THE PARTIES
Company Shall:
a) publish the ads delivered to them via the Service, in accordance with what
the Users has paid for, such as appropriate placement and frequency.
ADSTAR Shall:
a) provide Company with the ability to sell Ads via the Web through
www.Advertise132.com and a network of related Web sites into the
CareerPath.com Web site. These Ads will be pre-paid and conform to the
reasonable pricing instructions from the Company. AdStar will deliver the Ads
coming through the Service to Company publication via e-mail or FTP, in a
format specified by company.
b) support and maintain the Company Ad taking functionality on the Service.
AdStar will provide reasonable telephone and e-mail support for the Users
with regard to the Service at 310-577-8255 during normal business hours,
Pacific Standard Time.
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Attachment B - Fees and Share of Advertising Revenue
Ad-Star advertising percentage shares for providing Service are as follows:
1. AdStar receives 10% of all advertising revenue provided from Service when
User comes from Advertise123.com or its related network of Web sites.
Merchant and ACH online processing fees for Service, which are in addition to
the AdStar advertising percentage shares and reserve for credit card charge
backs, are as follows:
1. Credit card process fees are 5.80 per transaction for online clearing plus
the credit card discount -
* MasterCard/Visa 3.05%
* American Express 3.75%
* Diners Club 2.80%
* JCB 2.75%
2. ACH process fees -
* 1.25% of transaction with a $1.25 minimum per transaction
Other fees -
* ACH refund $2.00
* ACH return item $10.00
* ACH Notice of change $2.50