Consumer Marketing Database Services Agreement - ADS Alliance Data Systems Inc., Intimate Brands Inc. and The Limited Inc.
CONSUMER MARKETING DATABASE SERVICES AGREEMENT
AMONG
ADS ALLIANCE DATA SYSTEMS, INC.,
INTIMATE BRANDS, INC.
AND
THE LIMITED, INC.
DATED AS OF SEPTEMBER 1, 2000
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TABLE OF CONTENTS
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Section 1. DEFINITIONS..................................................1
1.1 Certain Definitions..........................................1
1.2 Other Definitions............................................4
Section 2. DATABASE SERVICES............................................4
2.1 Database Services............................................4
2.2 Operating Procedures.........................................4
2.3 Software and Technology Ownership............................4
2.4 Data Entry and Transmission..................................5
2.5 ADS Intellectual Property....................................5
2.6 Ownership Rights of Parties..................................5
2.7 Data Use, Sales, and No-Compete Restrictions.................5
2.8 Revenue Sharing..............................................6
2.9 Consumer Privacy Protection..................................6
2.10 Name, Trademarks, and Service Marks..........................8
Section 3. FEES...............................................................8
3.1 Fees.........................................................8
3.2 Taxes........................................................8
3.3 Invoices.....................................................8
3.4 Suspension...................................................9
Section 4. REPRESENTATIONS AND WARRANTIES OF THE TLI ENTITIES...........9
4.1 Organization, Power and Qualification........................9
4.2 Authorization, Validity and Non-Contravention................9
4.3 Accuracy of Information.....................................10
4.4 Name, Trademarks and Service Marks..........................10
4.5 Ownership Rights............................................10
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TABLE OF CONTENTS
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Section 5. COVENANTS OF THE TLI ENTITIES...............................10
5.1 Compliance with Law.........................................10
Section 6. REPRESENTATIONS AND WARRANTIES OF ADS.......................10
6.1 Organization, Power and Qualification.......................10
6.2 Authorization, Validity and Non-Contravention...............10
6.3 Accuracy of Information.....................................11
6.4 Ownership Rights............................................11
Section 7. COVENANTS OF ADS............................................11
7.1 Compliance with Law.........................................11
Section 8. INDEMNIFICATION.............................................12
8.1 Indemnification Obligations.................................12
8.2 LIMITATION ON LIABILITY.....................................13
8.3 NO WARRANTIES...............................................14
8.4 Notification of Indemnification; Conduct of Defense.........14
Section 9. TERM AND TERMINATION........................................14
9.1 Term........................................................14
9.2 Termination with Cause by ADS; ADS Termination Events.......14
9.3 Termination with Cause by the TLI Entities;
TLI Termination Events......................................15
9.4 Effect of Termination.......................................16
Section 10. MISCELLANEOUS...............................................17
10.1 Entire Agreement............................................17
10.2 Coordination of Public Statements...........................17
10.3 Amendment...................................................17
10.4 Successors and Assigns......................................17
10.5 Waiver......................................................18
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TABLE OF CONTENTS
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10.6 Severability................................................18
10.7 Notices.....................................................18
10.8 Captions and Cross-References...............................18
10.9 GOVERNING LAW...............................................18
10.10 Counterparts................................................18
10.11 Force Majeure...............................................19
10.12 Relationship of Parties.....................................19
10.13 Survival....................................................19
10.14 Mutual Drafting.............................................19
10.15 Independent Contractor......................................19
10.16 No Third Party Beneficiaries................................20
10.17 Counterparts................................................20
10.18 Confidentiality.............................................20
10.19 Non-interference with Employees.............................21
10.20 Victoria's Secret Catalogue
SCHEDULES
A Database Services.................................................23
B Service Standards.................................................28
C Fees..............................................................33
D Demographic and Lifestyle Elements................................34
E Addresses of The Limited, Inc., Intimate Brands, Inc. and
Subsidiaries......................................................41
F TLI Entities' Privacy Policies....................................43
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CONSUMER MARKETING DATABASE SERVICES AGREEMENT
THIS CONSUMER MARKETING DATABASE SERVICES AGREEMENT is made as of this 1st day
of September, 2000 among ADS Alliance Data Systems, Inc., with an office at 800
TechCenter Drive, Gahanna, Ohio 43230 (hereinafter referred to as "ADS"),
Intimate Brands, Inc., with its principal office at Three Limited Parkway,
Columbus, Ohio 43230 (hereinafter referred to as "IBI"), and The Limited, Inc.,
with its principal office at Three Limited Parkway, Columbus, Ohio 43230 ("TLI"
and, together with IBI, the "TLI Entities").
WITNESSETH:
WHEREAS, TLI has requested ADS to perform certain marketing database services
for TLI; and
WHEREAS, ADS has agreed to perform such database services subject to the terms
and conditions as more fully set forth herein;
NOW THEREFORE, in consideration of the terms and conditions hereof, and for
other good and valuable consideration, the receipt of which is hereby mutually
acknowledged by the parties, ADS and the TLI Entities agree as follows.
SECTION 1. DEFINITIONS
1.1 CERTAIN DEFINITIONS. As used herein and unless otherwise required
by the context, the following terms shall have the following respective
meanings.
"ADS Data" shall mean data provided by ADS to the Main Data Warehouse
which is owned by or licensed to ADS and/or its affiliates (other than TLI
Data). Such data may be of any Data Type.
"Affiliate" means any wholly-owned subsidiary or parent company of ADS,
TLI or IBI, or any other entity of which a majority is owned by ADS, TLI, IBI or
by the same entity owning ADS, TLI or IBI.
"Agreement" shall mean this Consumer Marketing Database Services
Agreement, including all Schedules hereto, and any future amendments or
supplements thereto.
"Applicable Law" shall mean any applicable federal, state or local law,
rule, regulation, administrative interpretation, order, writ, injunction,
directive, judgment or decree.
"Base Fee" shall have the meaning set forth in Schedule C hereto.
"Business Day" shall mean any day, except Saturday, Sunday, New Year's
Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day or Christmas
Day.
"CASS" shall mean the Coding Accuracy Support System as defined by the
United States Postal Service.
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"Catalog" shall mean the catalog operations of any Subsidiary of either
of the TLI Entities.
"Contract Year" shall mean the consecutive one-year periods during the
Term commencing on the Effective Date of this Agreement.
"Customer" shall mean any individual who is a retail customer of a TLI
Store or a Catalog.
"Data" shall mean the ADS Data and the TLI Data.
"Database System" shall mean the information database system operated
by or on behalf of ADS, including but not limited to hardware, software and
other equipment.
"Data Mart" shall mean an application database created by ADS and used
for direct marketing analysis or segmentation selections.
"Data Type" shall mean any one or all of the following three types of
data:
CONSUMER DATA consists of information related to identifying and
maintaining accurate descriptions of consumers on the database.
Consumer Data is gained from a variety of sources, including without
limitation from ADS with respect to WFN's proprietary credit
cardholders, ADS or either TLI Entity and/or their Subsidiaries
purchasing identifying information from third parties, or either TLI
Entity and/or their Subsidiaries receiving information directly from
Customers. The primary element of Consumer Data is name and address
information, from which data elements from all Data Types are keyed.
Other Consumer Data elements include without limitation credit card
account information from proprietary or general-purpose card accounts,
proprietary account status, consumer responses to opinion surveys, and
demographic or psychographic information, which is usually licensed
from third-party vendors.
TRANSACTION DATA consists of information gained from purchase and/or
return transactions from the point of sale, as well as accompanying
information related to the retail, catalogue or web transactions of the
offering division or company. Transaction Data consists of details
about the items purchased or returned, price paid, discounts, or
ring-coded coupons used in the transaction, as well as other related
information regarding the organization of the brand, division, company,
and geography of the region, district and store of the transaction.
CONTACT DATA consists of information used to measure, manage, and
control the results of direct marketing campaigns and other consumer
contacts. Contact Data consists of campaign control information such as
direct mail drop dates and tape specifications,
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consumer names and segments selected for contact, and response records
of those consumers who responded to individual contacts.
"Effective Date" shall mean September 1, 2000.
"Goods and Services" shall mean those certain products and/or services
sold by either TLI Entity and/or their Subsidiaries or a TLI Store to Customers
and shall not include any credit or other financial products, such as credit
cards or insurance products.
"Initial Term" shall have the meaning set forth in Section 9.1 of this
Agreement.
"Main Data Warehouse" shall mean the central repository where all Data
is assembled, manipulated and maintained.
"Operating Procedures" shall mean those written procedures mutually
agreed to by ADS, TLI and IBI, as the same may be modified from time to time by
written instrument executed by ADS, TLI and IBI.
"Retail Point of Sale System" shall mean the equipment and processes
used by either TLI Entity, its Subsidiary, licensee or franchisee to record a
purchase transaction when a Customer buys Goods and Services at a TLI Store.
"Renewal Term" shall mean each one (1) year renewal term of this
Agreement following the completion of the initial three (3) year term hereof.
"Services" shall mean those marketing database services set forth in
Schedule A hereto.
"Subsidiaries" shall mean Bath & Body Works, Inc., Victoria's Secret
Stores, Inc., Lerner New York, Inc., Lane Bryant, Inc., Express, LLC, The
Limited Stores, Inc. and Structure, Inc.
"Term" shall mean the Initial Term and any and all Renewal Terms as
defined in Section 9.1 of this Agreement.
"TLI Data" shall mean data provided to ADS under this Agreement by
either TLI Entity and/or their Subsidiaries which is owned by or licensed to
such entity. Such data may be of any Data Type and shall include, but not be
limited to, the data collected by TLI, IBI, their Subsidiaries and all TLI
Stores during a Transaction.
"TLI's Stores" shall mean those certain retail locations selling Goods
and Services of either TLI Entity or its Subsidiaries which are owned and
operated by either TLI Entity or which are franchisees of either TLI Entity or
the Subsidiaries, including, Bath & Body Works, Victoria's Secret Stores, Lerner
New York, Lane Bryant, Express, The Limited, and Structure stores.
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"Transaction" shall mean any event encompassing when a Customer
purchases Goods and Services, including without limitation, purchases at any TLI
Stores, TLI's Catalog and through the Internet.
"USPS" shall mean the United States Postal Service.
"WFN" shall mean World Financial Network National Bank, an affiliate of
ADS.
1.2 OTHER DEFINITIONS. As used herein, terms defined in the
introductory paragraph hereof and in other sections of this Agreement shall have
such respective defined meanings. Defined terms stated in the singular shall
include reference to the plural and vice versa.
SECTION 2. DATABASE SERVICES
2.1 DATABASE SERVICES. Subject to the terms and conditions of this
Agreement, ADS shall perform the Services for the TLI Entities. During the Term,
neither TLI Entity nor their Subsidiaries shall appoint any third-party to
perform any of the Services for either TLI Entity or any one of the
Subsidiaries. It is understood and agreed that the TLI Entities and their
affiliates may manipulate, evaluate and otherwise utilize any and all Data,
including the TLI Data, in connection with their retail businesses. The TLI
Entities agree that it is their intent that if either TLI Entity or any one of
the Subsidiaries, acquires or commences any new businesses or subsidiaries,
unless prohibited from doing so by an existing agreement or other obligation,
the relevant TLI Entity intends to enter into an amendment to this Agreement to
bring all new businesses or subsidiaries within the scope of this Agreement,
except for any test, pilot or concept businesses or subsidiaries with less than
100 stores. It is understood and agreed that, unless and until each such
amendment is entered into, no new business or subsidiary shall be within the
scope of or subject to this Agreement, and no TLI Entity, nor Subsidiary shall
have any obligation under this Agreement with respect to any such business or
subsidiary or any information or data related thereto or arising therefrom.
2.2 OPERATING PROCEDURES. The TLI Entities, the Subsidiaries and all
TLI Stores shall observe and comply with the Operating Procedures and such other
reasonable procedures mutually agreed to in writing by TLI, IBI and ADS or as
required by Applicable Law.
2.3 SOFTWARE AND TECHNOLOGY OWNERSHIP. All software or other technology
owned, developed by or licensed to ADS (including, but not limited to, software
or other technology developed by or licensed to ADS in response to a TLI
Entity's request or to accommodate a TLI Entity's special requirements) will
remain the exclusive property of ADS, regardless of whether or not TLI or IBI is
required to pay ADS for such software or technology development (it being
understood that in no event shall either TLI Entity be required to pay for any
such software or technology development unless the relevant TLI Entity shall
have agreed to make such payment in writing in advance). Nothing in this
Agreement shall be deemed to convey a proprietary interest to TLI, IBI, any
Subsidiary or to any party other than ADS in any of the software,
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hardware or technology used or provided by ADS to permit or facilitate use of
the Services, or in any of the derivative works thereof.
2.4 DATA ENTRY AND TRANSMISSION. ADS shall not be responsible for
errors in the Services to the extent such errors result from either TLI Entity's
or their Subsidiaries' error in inputting and/or transmitting Data or either TLI
Entity's or their Subsidiaries' failure to follow ADS's Operating Procedures.
ADS shall be entitled to rely upon information submitted by the TLI Entities,
the Subsidiaries and by other parties on their behalf.
2.5 ADS INTELLECTUAL PROPERTY. ADS intellectual property shall include,
without limitation: ADS's marketing database system and design, and ADS's unique
segmentation designs and incremental sales models, other models or modeled data
aggregations, and customer clustering and profiling products (i.e., Portrait).
2.6 OWNERSHIP RIGHTS OF PARTIES. Except as expressly set forth in this
Agreement, no Party will, as a result of this Agreement, or of performance
hereunder, acquire any property or other right, claim or interest, including any
patent right, trade secret, or copyright or other intellectual property right,
in any of the information systems, processes, equipment, or computer software of
the other, or any service marks or trademarks of the other.
2.7 DATA USE, SALES AND NO-COMPETE RESTRICTIONS. Each of TLI and IBI
agree that ADS shall have the exclusive right to provide, share, barter and/or
sell all TLI Data and data elements derived from the TLI Data PROVIDED that, in
no event shall ADS provide, share, barter and/or sell any TLI Data or any data
elements derived from any TLI Data without the prior written consent of the TLI
Entities which shall not be unreasonably withheld. Without limiting the
generality of the proviso to the immediately preceding sentence, ADS agrees that
it shall not (and shall cause it affiliates not to) provide, share, barter,
and/or sell TLI Data or any other data elements derived from the TLI Data which
could be identified by third parties as being derived from the TLI Data to any
third parties who, in the sole judgment of TLI and IBI, compete, directly or
indirectly, with any retail or catalogue business conducted by any TLI Entity or
any of their subsidiaries from time to time. It is understood that, subject to
compliance with the proviso to the first sentence of this Section 2.7, the
immediately preceding sentence shall not prohibit ADS to share TLI Data or other
data elements derived from the TLI Data with data "compilers" (or similar
entities); provided that ADS prohibits any such third party with whom it shares
TLI Data or any other data elements derived from the TLI Data which could be
identified by third parties as being derived from the TLI Data, from identifying
such data as being derived from ADS, the TLI Entities or their subsidiaries from
time to time. Neither TLI, IBI, nor any of the Subsidiaries may provide, share,
barter, and/or sell any Data or data elements contained in the Main Data
Warehouse to any third party without the prior express written consent of ADS.
ADS will control all such third-party Data transactions from one
organization within the Consumer Database Marketing Services area and will name
a single point of contact for managing the review and approval process with the
TLI Entities. TLI and IBI agree to name a
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single point of contact for review and written approval of such third-party
data sales with ADS, which review and written approval shall be binding on
both TLI and IBI. The initial point of contact at ADS shall be the Consumer
Database Marketing Services Director of Product Management and the initial
point of contact for the TLI Entities shall be Vice-President, Database
Marketing. Any such point of contact may be changed at any time by the
relevant Party upon delivery to the other party of written notice to such
effect (which notice shall identify and provide contact information for the
new point of contact). ADS and the TLI Entities shall agree to work in good
faith to develop procedures to identify and agree to a jointly understood
list of non-competitive third party purchasers and/or categories of
purchasers from non-competitive categories and/or industries. This list will
be reviewed and accepted in writing by both ADS and the TLI Entities at least
annually.
ADS shall retain any and all rights which ADS has to the ADS Data. The TLI
Entities shall retain any and all rights which they have to the TLI Data.
Nothing contained in this Agreement shall be deemed to convey any rights or
proprietary interest in the Data to TLI, IBI or ADS other than the specific
rights to use the Data granted in this Agreement.
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2.8 REVENUE SHARING. "Net Revenues" from Data sales to third parties
shall be shared between ADS and the TLI Entities on the following schedule
during the Term. Payments made by ADS to the TLI Entities shall be made to the
TLI Entity set forth in the Notices Section 10.7 of this Agreement. "Net
Revenues" shall mean gross revenues collected by ADS from sales of Data
elements from the Main Data Warehouse by ADS pursuant to Section 2.7 of this
Agreement, less the amount of: (a) customary trade, cash and quantity discounts
actually allowed and taken; (b) allowances actually given for returned or
rejected Data; (c) actual charges for losses; (d) government mandated and other
rebates; (e) value added tax, sales, use or turnover taxes, excise taxes,
customs duties and other applicable charges; and (f) processing expenses and
list brokerage fees. Contract Year 1: ADS shall retain one hundred percent
(100%) of the initial One Million Five Hundred Thousand Dollars ($1,500,000) of
Net Revenues. ADS shall retain seventy percent (70%) of all Net Revenues above
and beyond the initial One Million Five Hundred Thousand Dollars ($1,500,000)
of Net Revenues, and ADS shall pay the TLI Entities the remaining thirty
percent (30%) of all Net Revenues above and beyond the initial One Million Five
Hundred Thousand Dollars ($1,500,000) of Net Revenues. Contract Year 2: ADS
shall retain one hundred percent (100%) of the initial Two Million Five Hundred
Thousand Dollars ($2,500,000) of Net Revenues. ADS shall retain seventy percent
(70%) of all Net Revenues above and beyond the initial Two Million Five Hundred
Thousand Dollars ($2,500,000) of Net Revenues, and ADS shall pay the TLI
Entities the remaining thirty percent (30%) of all Net Revenues above and
beyond the initial Two Million Five Hundred Thousand Dollars ($2,500,000) of
Net Revenues. Contract Year 3 and during each Renewal Term: ADS shall retain
one hundred percent (100%) of the initial Three Million Five Hundred Thousand
Dollars ($3,500,000) of Net Revenues. ADS shall retain seventy percent (70%) of
all Net Revenues above and beyond the initial Three Million Five Hundred
Thousand Dollars ($3,500,000) of Net Revenues, and ADS shall pay the TLI
Entities the remaining thirty percent (30%) of all Net Revenues above and
beyond the initial Three Million Five Hundred Thousand Dollars ($3,500,000) of
Net Revenues.
2.9 CONSUMER PRIVACY PROTECTION. All provision, sharing and/or sales
of Data to third parties shall be subject to and effected in accordance with
the provisions of the ADS and WFN Privacy Policies and procedures for consumer
notification and provisions for opt-out. The ADS and WFN Privacy Policies may
be modified by ADS and/or WFN from time to time as regulation, legislation, or
commonly accepted industry practices change or otherwise in ADS' and/or WFN's
reasonable discretion. In addition to the requirements set forth in the
preceding sentences of this Section 2.9, ADS agrees to take all action
necessary to ensure that the provision, sharing, bartering and/or sale of TLI
Data or data elements derived from any TLI Data by ADS shall also be subject to
and effected in accordance with the privacy policies of the TLI Entities as in
effect from time to time. The TLI Entities' privacy policies in effect as of
the date hereof are found in Schedule F. In the event either of the TLI
Entities, during the Term of this Agreement, changes its privacy policies
(which each TLI Entity shall be entitled to do as it shall determine from time
to time), then the TLI Entity shall promptly notify ADS, in writing, of such
change. If such
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change would, in ADS' reasonable business judgment, materially negatively
impact the ability of ADS to profit from the business arrangements established
by the terms of this Agreement, then ADS and the TLI Entities shall enter into
negotiations to execute a mutually satisfactory written amendment to this
Agreement designed to compensate ADS for such reduced profitability.
In determining the compensation to ADS, the parties shall consider the
following. In the event ADS would be unable as a result of the privacy policies
change to generate any Net Revenues, then the TLI Entities would pay to ADS the
following amounts set forth below:
(a) $690,000 per month for the remaining Services provided by
ADS; and
(b) An amount equal to (i) the monthly average from the six
(6) month period prior to the date on which the TLI Entity's privacy
policies revision took effect of the 70% portion of Net Revenues
retained by ADS pursuant to the Revenue Sharing provision of Section
2.8, multiplied by (ii) the number of months remaining in the Term.
If ADS would be able to generate some Net Revenues, but not to the
same extent as if the privacy policies were not changed, then the parties shall
negotiate in good faith to determine adequate compensation to ADS, taking into
consideration the full compensation set forth in the preceding paragraph.
If the parties fail to execute a mutually acceptable agreement with
ninety (90) days after the date on which the TLI Entities notified ADS of the
change, then the parties shall submit to arbitration as provided below.
Any controversy, claim or dispute between the parties related to or
arising out of this Section that cannot be resolved in the normal course of
business (which shall include at least one meeting between senior executive
officers of ADS and the TLI Entities) shall be settled by arbitration,
conducted on a confidential basis, under the then current Commercial Rules of
the American Arbitration Association. The arbitrators may not add to the terms
of this Agreement, but must resolve the dispute or disagreement in accordance
with the Agreement's existing terms. Any decision by the arbitrators shall be
binding and judgment upon the award rendered by the arbitrators may be entered
in any court having jurisdiction thereof. The arbitration shall be conducted by
three arbitrators. One arbitrator shall be selected by ADS, one arbitrator
shall be selected by the TLI Entities and the third arbitrator shall be
selected by the American Arbitration Association and shall be subject to
approval by ADS and the TLI Entities. The Arbitration shall be conducted in
accordance with the terms of this Agreement and the following principles:
(1) The parties agree that each party has the same discovery rights as are
afforded under the Federal Rules of Civil Procedure, including such discovery
of third parties as is necessary to resolve the controversy. Each party shall
bear its own costs (e.g., filing, attorney and expert
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witness fees) and shall share equally the cost of arbitration (e.g.,
arbitrator, court reporter and hearing room fees). The arbitrator shall provide
detailed, written findings of fact and conclusions of law to the parties in
support of any award or decision the arbitrator makes.
(2) During any arbitration or other dispute resolution proceeding, the parties
shall remain obligated to perform as required under this Agreement; PROVIDED
that any payments that may be in dispute shall be made to the court or placed
in escrow, under terms that are mutually acceptable to the parties, until the
dispute is resolved.
2.10 NAME, TRADEMARKS AND SERVICE MARKS. The TLI Entities hereby grant
to ADS and purchasers of Data from ADS the non-exclusive right to use the
tradenames, logos, trademarks and service marks of the TLI Entities (including,
without limitation, the name, trademarks and service marks of the Subsidiaries)
for purposes of performing the Services, provided that (i) such use shall be in
accordance with any written usage guidelines provided to ADS in advance by the
TLI Entities and (ii) such usage shall be subject to the relevant TLI Entity's
prior written consent.
SECTION 3. FEES
3.1 FEES. The TLI Entities will pay to ADS the fees set forth in
Schedule C hereto during the Term.
3.2 TAXES. The TLI Entities will be responsible for payment of all
sales, use, excise, and value-added taxes, or taxes of a similar nature,
imposed by the United States, any state or local government, or other taxing
authority, on the Services paid for hereunder.
3.3 INVOICES. During the Term, ADS shall send quarterly invoices to
each of the Subsidiaries at the corresponding address initially set forth in
Schedule E of this Agreement, and each of the Subsidiaries shall pay ADS within
thirty (30) days after the date of the corresponding invoice. In the event of a
dispute as to the accuracy of an invoice or calculation made pursuant to this
Agreement, the TLI Entities shall within sixty (60) days of the date of the
invoice, request that ADS provide such supporting material as would be
reasonably designed to ascertain the accuracy of the invoice or calculation.
The TLI Entities shall nevertheless pay the portion of the invoice that is not
in dispute. The parties shall cooperate to resolve any payment disputes under
this Agreement in an expeditious manner. If indicated, ADS shall either
promptly issue invoice credit to the TLI Entities against the earliest
subsequent invoices or make prompt payment to the TLI Entities as per the terms
of such resolution. Any payment by ADS to the TLI Entities shall be made to the
TLI Entity set forth in the Notices Section 10.7 of this Agreement. If any
amount remains due and unpaid, the TLI Entities shall promptly pay such amount.
Invoices not paid within thirty (30) days of the invoice date may be assessed
interest by ADS at a rate equal to the prime interest rate as published for the
relevant period in the Wall Street Journal plus one and one-half percent
(1-1/2%) per annum.
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3.4 SUSPENSION. ADS shall have the right to suspend its performance of
the Services in the event that the TLI Entities fails to pay an undisputed
amount due to ADS hereunder within sixty (60) days after the date of the
corresponding invoice.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE TLI ENTITIES
Each TLI Entity hereby represents and warrants on behalf of itself to ADS as
follows:
4.1 ORGANIZATION, POWER AND QUALIFICATION. It is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has full corporate (or equivalent) power and authority to enter
into this Agreement on its own behalf and on behalf of each of its respective
Subsidiaries, and to carry out the provisions of this Agreement. It is duly
qualified and in good standing to do business in all the states where it is
located, except where the failure to so qualify would not have a material
adverse effect on its business, or where the failure to so qualify would not
have a material adverse effect on its ability to perform under this Agreement.
4.2 AUTHORIZATION, VALIDITY AND NON-CONTRAVENTION. (a) This Agreement
has been duly authorized by all necessary corporate proceedings, has been duly
executed and delivered and is a valid and legally binding agreement, duly
enforceable in accordance with its terms (except as such enforcement may be
limited by bankruptcy, insolvency, reorganization, moratorium and other laws
relating to or affecting creditors' rights generally and by general equity
principles).
(b) No consent, approval, authorization, order, registration or
qualification of or with any court or regulatory authority or other governmental
body having jurisdiction over it is required for, and the absence of which would
adversely affect, the legal and valid execution and delivery of this Agreement,
and the performance of the transactions contemplated by this Agreement.
(c) Its execution, delivery and performance of this Agreement by the
relevant TLI Entity hereunder, including, without limitation, its provision of
TLI Data to ADS and the compliance by it with all provisions of this Agreement
(i) will not conflict with or violate any Applicable Law, and (ii) will not
conflict with or result in a breach of or default under any of the terms or
provisions of any indenture, loan agreement or other contract or agreement
under which it is an obligor or by which its property is bound where such
conflict, breach or default would have a material adverse effect on it, nor
will such execution, delivery or compliance violate or result in the violation
of its Articles of Incorporation or by-laws.
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4.3 ACCURACY OF INFORMATION. All factual information that is
generated by it internally and not from a third party and that is furnished
by it to ADS in writing at any time pursuant to any requirement of, or
furnished in response to any written request of, ADS under this Agreement or
any transaction contemplated hereby has been, and all such factual
information hereafter furnished by it to ADS will be, based on the relevant
TLI Entity's reasonable knowledge, true and accurate in every respect
material to the transactions contemplated hereby on the date as of which such
information was or will be stated or certified.
4.4 NAME, TRADEMARKS AND SERVICE MARKS. It has the legal right to use
and to permit ADS to use, to the extent set forth herein, the various
tradenames, trademarks, logos and service marks utilized by it in the conduct of
its business.
4.5 OWNERSHIP RIGHTS. It is the owner of or otherwise has the lawful
right to transfer, use and license the TLI Data pursuant to this Agreement.
SECTION 5. COVENANTS OF THE TLI ENTITIES
Each of the TLI Entities agrees on behalf of itself that during the Term of this
Agreement:
5.1 COMPLIANCE WITH LAW. It shall do or cause to be done all things
necessary to comply with all Applicable Laws (including but not limited to all
applicable state and federal privacy laws including without limitation the
federal Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.) the federal Driver's
Privacy Protection Act (18 U.S.C. 2721 et seq.)) in connection with its
business, its use of the Data and its obligations pursuant to this Agreement. It
shall comply with the Direct Marketing Association's guidelines with respect to
the Data.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF ADS
ADS hereby represents and warrants to the TLI Entities as follows:
6.1 ORGANIZATION, POWER AND QUALIFICATION. ADS is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has full corporate power and authority to enter into this Agreement
and to carry out the provisions of this Agreement. ADS is duly qualified and in
good standing to do business in all jurisdictions where such qualification is
necessary for ADS to carry out its obligations under this Agreement.
6.2 AUTHORIZATION, VALIDITY AND NON-CONTRAVENTION. (a) This Agreement
has been duly authorized by all necessary corporate proceedings, has been duly
executed and delivered by ADS and is a valid and legally binding agreement of
ADS duly enforceable in accordance with its terms (except as such enforcement
may be limited by bankruptcy, insolvency, reorganization, moratorium and other
laws relating to or affecting creditors' rights generally and by general equity
principles).
(b) No consent, approval, authorization, order, registration or
qualification of or with any court or regulatory authority or other governmental
body having jurisdiction over ADS is
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required for, and the absence of which would materially adversely affect, the
legal and valid execution and delivery of this Agreement, and the performance
of the transactions contemplated by this Agreement.
(c) The execution, delivery and performance of this Agreement by ADS
hereunder including the provision, sale, barter or sharing of Data, and the
compliance by ADS with all provisions of this Agreement (i) will not conflict
with or violate any Applicable Law, (ii) will not conflict with or result in
a breach of the terms or provisions of any indenture, loan agreement or other
contract or agreement under which ADS is an obligor or by which its property
is bound where such conflict, breach or default would have a material adverse
effect on ADS, nor will such execution, delivery or compliance violate or
result in the violation of the Articles of Incorporation or by-laws of ADS.
6.3 ACCURACY OF INFORMATION. All factual information that is generated
by ADS internally and not from a third party that is furnished by ADS to the TLI
Entities in writing at any time pursuant to any requirement of, or furnished in
response to any written request of the TLI Entities under this Agreement or any
transaction contemplated hereby has been, and all such factual information
hereafter furnished by ADS to the TLI Entities will be, based on ADS' reasonable
knowledge, true and accurate in every respect material to the transactions
contemplated hereby on the date as of which such information has or will be
stated or certified.
6.4 OWNERSHIP RIGHTS. ADS represents and warrants that it is the owner
of or otherwise has the lawful right to transfer, use and license the ADS Data
pursuant to this Agreement.
SECTION 7. COVENANTS OF ADS
ADS agrees that during the Term of this Agreement:
7.1 COMPLIANCE WITH LAW. ADS shall do or cause to be done all things
necessary to comply with all Applicable Laws (including but not limited to all
applicable state and federal privacy laws including without limitation the
federal Gramm-Leach-Bliley Act (15 U.S.C. 6801 et seq.) the federal Driver's
Privacy Protection Act (18 U.S.C. 2721 et seq.)) in connection with its
business, its use of the Data and its obligations pursuant to this Agreement.
ADS shall comply with the Direct Marketing Association's guidelines with respect
to the Data. ADS shall do or cause to be done all things necessary to ensure
that (x) its actions with respect to obtaining Data and (y) the provision,
sharing, bartering and/or selling of Data to third parties complies (in the case
of clauses (x) and (y)) with Applicable Law (including the federal and state
privacy laws noted above) and shall require in its transactions with third
parties that the use of Data by such third parties complies with all Applicable
Laws.
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SECTION 8. INDEMNIFICATION
8.1 INDEMNIFICATION OBLIGATIONS. (a) TLI shall be liable to and shall
indemnify and hold ADS and its affiliates, subsidiaries and parent and their
respective officers, directors, employees, subcontractors and their successors
and assigns, harmless from any and all Losses (as hereinafter defined) incurred
by reason of: (i) TLI's breach of any representation, warranty or covenant
hereunder, (ii) TLI's performance of or failure to perform its obligations
hereunder, (iii) any action or failure to act by TLI, any of the Subsidiaries or
a TLI Store and its respective officers, directors and/or employees, which
results in a claim against ADS, its officers, employees, affiliates,
subsidiaries, and parent, unless the proximate cause of any such claim is an act
or failure to act by ADS, its officers, directors or employees.
(b) IBI shall be liable to and shall indemnify and hold ADS and its
affiliates, subsidiaries and parent and their respective officers, directors,
employees, subcontractors and their successors and assigns, harmless from any
and all Losses (as hereinafter defined) incurred by reason of: (i) IBI's breach
of any representation, warranty or covenant hereunder, (ii) IBI's performance of
or failure to perform its obligations hereunder, (iii) any action or failure to
act by IBI, any of the Subsidiaries or a IBI Store and its respective officers,
directors and/or employees, which results in a claim against ADS, its officers,
employees, affiliates, subsidiaries, and parent, unless the proximate cause of
any such claim is an act or failure to act by ADS, its officers, directors or
employees.
(c) ADS shall be liable to and shall indemnify and hold TLI, IBI and
their respective affiliates, subsidiaries and parent and their respective
officers, directors, employees, sub-contractors and their successors and
assigns, harmless from any and all Losses (as hereinafter defined) incurred by
reason of: (i) ADS's breach of any representation, warranty or covenant
hereunder, (ii) ADS's performance or and failure to perform its obligations
hereunder, and (iii) any action or failure to act by ADS and its officers,
directors, and employees which results in a claim against TLI, IBI or their
officers, employees, affiliates, subsidiaries and parent, unless the proximate
cause of any such claim is an act or failure to act by TLI, IBI and their
respective officers, directors or employees.
(d) For purposes of this Section 8.1 the term "Losses" shall mean any
liability, damage, costs, fees, losses, judgments, penalties, fines, and
expenses, including without limitation, any reasonable attorneys' fees,
disbursements, settlements (which require the other party's consent which shall
not be unreasonably withheld), and court costs, reasonably incurred by ADS, TLI,
or IBI as the case may be, without regard to whether or not such Losses would be
deemed material under this Agreement except that Losses may not include any
overhead costs that any party would normally incur in conducting its everyday
business.
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8.2 LIMITATION ON LIABILITY. (a) IN NO EVENT SHALL ADS, TLI OR IBI BE
LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES ARISING
OUT OF THIS AGREEMENT.
(b) ADS' TOTAL ANNUAL LIABILITY TO THE TLI ENTITIES FOR ALL DAMAGES FOR
ANY CAUSE WHATSOEVER OCCURRING DURING ANY YEAR OF THE TERM OF THIS AGREEMENT,
SHALL NOT EXCEED ONE HUNDRED PERCENT (100%) OF THE ACTUAL FEES RECEIVED OR
RECEIVABLE BY ADS FROM THE TLI ENTITIES DURING SUCH YEAR. ADS' TOTAL CUMULATIVE
LIABILITY TO THE TLI ENTITIES UNDER THIS AGREEMENT FOR ALL DAMAGES FOR ANY CAUSE
WHATSOEVER, SHALL NOT EXCEED ONE HUNDRED PERCENT (100%) OF THE ACTUAL FEES
RECEIVED OR RECEIVABLE BY ADS FROM THE TLI ENTITIES DURING THE TERM OF THIS
AGREEMENT; PROVIDED, HOWEVER, THAT THE LIMITATIONS ON LIABILITY SET FORTH IN
CLAUSES (A) AND (B) OF THIS SECTION 8.2 SHALL NOT APPLY TO ADS' INDEMNITY
OBLIGATIONS WHEN THE INDEMNITY OBLIGATION ARISES FROM ALLEGATIONS OR CLAIMS WITH
RESPECT TO THE FOLLOWING:
(1) ADS' FAILURE TO COMPLY WITH ANY APPLICABLE LAWS OR THE TLI
ENTITIES' PRIVACY POLICIES AS IN EFFECT FROM TIME TO TIME;
(2) ADS' BREACH OF ANY OF ITS OBLIGATIONS UNDER SECTION 2.7; AND
(3) ADS' WILLFUL OR GROSSLY NEGLIGENT ACTS.
(c) THE TLI ENTITIES' TOTAL ANNUAL LIABILITY TO ADS FOR ALL DAMAGES FOR
ANY CAUSE WHATSOEVER OCCURRING DURING ANY YEAR OF THE TERM OF THIS AGREEMENT,
SHALL NOT EXCEED ONE HUNDRED PERCENT (100%) OF THE ACTUAL FEES PAID BY THE TLI
ENTITIES TO ADS DURING SUCH YEAR. THE TLI ENTITIES' TOTAL CUMULATIVE LIABILITY
TO ADS UNDER THIS AGREEMENT FOR ALL DAMAGES FOR ANY CAUSE WHATSOEVER, SHALL NOT
EXCEED ONE HUNDRED PERCENT (100%) OF THE ACTUAL FEES PAID BY THE TLI ENTITIES TO
ADS DURING THE TERM OF THIS AGREEMENT; PROVIDED, HOWEVER, THAT THE LIMITATIONS
ON LIABILITY SET FORTH IN CLAUSES (A) AND (C) OF THIS SECTION 8.2 SHALL NOT
APPLY TO THE TLI ENTITIES' INDEMNITY OBLIGATIONS WHEN THE INDEMNITY ARISES FROM
ALLEGATIONS OR CLAIMS WITH RESPECT TO THE TLI ENTITIES' WILLFUL OR GROSSLY
NEGLIGENT ACTS.
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8.3 NO WARRANTIES. EXCEPT AS EXPRESSLY PROVIDED HEREIN, THERE ARE NO
EXPRESS OR IMPLIED WARRANTIES, INCLUDING THE IMPLIED WARRANTIES OF
NON-INFRINGEMENT, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE,
RESPECTING THE SERVICES PROVIDED BY ADS PURSUANT TO THIS AGREEMENT; PROVIDED
THAT THE PROVISIONS OF THIS SECTION 8.3 SHALL NOT LIMIT OR AFFECT ADS'
INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTIONS 8.1, 8.2 AND 8.4.
8.4 NOTIFICATION OF INDEMNIFICATION; CONDUCT OF DEFENSE. (a) In no case
shall the indemnifying party be liable under Section 8.1 of this Agreement with
respect to any claim or claims made against the indemnified party or any other
person so indemnified unless it shall be notified in writing of the nature of
the claim within a reasonable time after the assertion thereof, but failure to
so notify the indemnifying party shall not relieve it from any liability which
it may have under other provisions of this Agreement.
(b) The indemnifying party shall be entitled to participate, at its own
expense, in the defense, or, if it so elects, within a reasonable time after
receipt of such notice, to assume the defense of any suit brought against the
indemnified party which gives rise to a claim against the indemnifying party,
but, if the indemnifying party so elects to assume the defense, such defense
shall be conducted by counsel chosen by it and approved by the indemnified party
or the person or persons so indemnified, who are the defendant or defendants in
any suit so brought, which approval shall not be unreasonably withheld. If the
indemnifying party elects to assume the conduct of the defense of any suit
brought to enforce any such claim and retains counsel to do so, the indemnified
party or the person or persons so indemnified who are the defendant or
defendants in the suit, shall bear the fees and expenses of any additional
counsel thereafter retained by the indemnified party or such other person or
persons.
SECTION 9. TERM AND TERMINATION
9.1 TERM. This agreement will be effective as of September 1, 2000 and
shall remain effective through August 31, 2003, unless sooner terminated in
accordance with this Section 9. After August 31, 2003 (the "Initial Term") the
agreement shall be extended automatically for one (1) year Renewal Terms unless
any party has notified the other in writing not later than six (6) months prior
to the end of the Initial Term or any subsequent Renewal Term, subject to the
termination provisions in Section 9 of this Agreement. Notice of termination
shall be given in the manner set forth in Section 10.7.
9.2 TERMINATION WITH CAUSE BY ADS; ADS TERMINATION EVENTS. Any of the
following conditions or events shall constitute a "ADS Termination Event"
hereunder, and ADS may terminate this Agreement immediately without further
action if either TLI Entity causes such ADS Termination Event to occur and be
continuing:
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(a) If TLI or IBI shall (i) generally not pay its debts as they
become due; (ii) file, or consent by answer or otherwise to the filing against
it, of a petition for relief, reorganization or arrangement or any other
petition in bankruptcy, for liquidation or to take advantage of any bankruptcy
or insolvency law of any jurisdiction; (iii) make an assignment for the
benefit of its creditors; (iv) consent to the appointment of a custodian,
receiver, trustee or other officer with similar powers of itself or of any
substantial part of its property; (v) be adjudicated insolvent or be
liquidated; (vi) take corporate action in preparation for the events set forth
in subsections (ii), (iii), or (iv); (vii) have a materially adverse change in
its financial condition, including, but not limited to receiving a bond
downgrade or being downgraded by a rating agency to a rating below an
investment grade rating, or (viii) receive an adverse opinion by its auditors
or accountants as to its viability as a going concern or (ix) breach or fail
to perform or observe any covenant or agreement contained in any creditor loan
agreement, debt instrument or any other contract or agreement to which it is
bound; or
(b) If a court or government authority of competent jurisdiction
shall enter an order appointing, without consent by TLI or IBI, a custodian,
receiver, trustee or other officer with similar powers with respect to it or
with respect to any substantial part of its property, or if an order for
relief shall be entered in any case or proceeding for liquidation or
reorganization or otherwise to take advantage of any bankruptcy or insolvency
law of any jurisdiction, or ordering the dissolution, winding up or
liquidation of TLI or IBI, or if any petition for any such relief shall be
filed against TLI or IBI and such petition shall not be dismissed within 60
days; or
(c) If TLI or IBI shall materially default in the performance of
or compliance with any term or violates any of the covenants, representations,
warranties or agreements contained in this Agreement and TLI shall not have
remedied such default within thirty (30) days after written notice thereof
shall have been received by TLI or IBI from ADS; or
(d) If any law, ordinance, regulation or the like, including,
without limitation, any applicable state or federal law, prohibits or
significantly impacts ADS' performance of the Services. In the event of
termination on this basis, TLI, IBI and ADS shall negotiate in good faith to
establish mutually agreeable terms and condition for continued use of the then
existing Main Data Warehouse.
9.3 TERMINATION WITH CAUSE BY THE TLI ENTITIES; TLI TERMINATION
EVENTS. Any of the following conditions or events shall constitute an "TLI
Termination Event" hereunder, and the TLI Entities may terminate this
Agreement immediately without further action if ADS causes such TLI
Termination Event to occur and be continuing:
(a) If ADS shall (i) generally not be paying its debts as they
become due; (ii) file or consent by answer or otherwise to the filing against
it, of a petition for relief, reorganization or arrangement or any other
petition in bankruptcy, for liquidation or to take advantage of any bankruptcy
or insolvency law of any jurisdiction; (iii) make an assignment for the
benefit of its creditors; (iv) consent to the appointment of a custodian,
receiver, trustee or other officer with
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similar powers for itself or of any substantial part of its property; (v) be
adjudicated insolvent or be liquidated; or (vi) take corporate action in
preparation for events set forth in subsections (ii), (iii) or (iv); (vii)
have a materially adverse change in its financial condition, including, but
not limited to receiving a bond downgrade or being downgraded by a rating
agency to a rating below an investment grade rating, or (viii) receive an
adverse opinion by its auditors or accountants as to its viability as a going
concern or (ix) breach or fail to perform or observe any covenant or agreement
contained in any creditor loan agreement, debt instrument or any other
contract or agreement to which it is bound; or
(b) If a court or government authority of competent jurisdiction
shall enter an order appointing, without consent by ADS, a custodian,
receiver, trustee or other officer with similar powers with respect to it or
with respect to any substantial part of its property, or if an order for
relief shall be entered in any case or proceeding for liquidation or
reorganization or otherwise to take advantage of any bankruptcy or insolvency
law of any jurisdiction, or ordering the dissolution, winding up or
liquidation of ADS, or if any petition for any such relief shall be filed
against ADS and such petition shall not be dismissed within 60 days; or
(c) If ADS shall materially default in the performance of or
compliance with any term or violates any of the covenants, representations,
warranties or agreements contained in this Agreement and ADS shall not have
remedied such default within thirty (30) days after written notice thereof
shall have been received by ADS from the TLI Entities.
(d) The TLI Entities may terminate this Agreement upon thirty
(30) days written notice if ADS Substantially fails to meet two or more of the
required service standards set forth in Schedule B hereto. It is understood
and agreed that the penalties specified in the Schedules hereto are in
addition to the rights of the TLI Entities under this Agreement, including
their right to terminate this Agreement pursuant to Section 9.1(c) and 9.3(d).
"Substantially" in this case means more than one-third of the time to provide
the Services in any given Contract Year, in accordance with the relevant
service standards and subject to Section 10.11.
9.4 EFFECT OF TERMINATION. Upon expiration or termination of
this Agreement, all of the following provisions shall be applicable:
(1) The TLI Entities shall pay ADS the full amount of any
and all outstanding invoices for undisputed fees or
charges within thirty (30) days;
(2) within ten (10) Business Days of the expiration or
termination of this Agreement, ADS shall deliver to
the TLI Entities (x) all of the TLI Data and all other
information or materials reflecting or based upon, in
whole or in part, any TLI Data which ADS developed for
the TLI Entities pursuant to this Agreement (the TLI
Data and such other information and materials are
referred to collectively as the "Relevant Data") in
cartridge media or such other format as the TLI
Entities shall reasonably request, (y) a copy
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of ADS' data model, table structure, business rules
and all other documentation relating to the Services
which is reasonably required by TLI for the transition
of the Services, and (z) all other promotional or
other materials relating, directly or indirectly, to
any TLI Entity or any aspect of the business of either
TLI Entity;
(3) the rights of ADS to utilize any Relevant Data in any
manner whatsoever, directly or indirectly, for
internal purposes or otherwise (including, without
limitation, the provision, sharing, bartering or
selling of any Relevant Data to third parties) shall
cease immediately;
(4) from and after such expiration or termination, ADS shall
take all steps reasonably necessary or appropriate to
assist the TLI Entities in transitioning to another
provider of services similar to the Services,
including causing ADS personnel to be reasonably
available to the TLI Entities or such new service
provider as reasonably necessary or appropriate to
respond to inquiries and otherwise to facilitate the
transition; and
(5) all obligations of the parties hereunder shall cease
except such obligations which survive termination
pursuant to Section 10.13, it being understood,
however, that the parties shall be obligated to
perform all of their obligations hereunder until the
effective date of termination.
SECTION 10. MISCELLANEOUS
10.1 ENTIRE AGREEMENT. This Agreement constitutes the entire
Agreement and supersedes all prior agreements and understandings, whether oral
or written, among the parties hereto with respect to the subject matter hereof
and merges all prior discussions between them.
10.2 COORDINATION OF PUBLIC STATEMENTS. No party will make any
public announcement of this Agreement or provide any information concerning
this Agreement to any representative of any news, trade or other media without
the prior approval of the other party, and will not respond to any inquiry
from any public or governmental authority, except as required by law,
concerning this Agreement without prior consultation and coordination with the
other party.
10.3 AMENDMENT. Except as otherwise provided for in this
Agreement, the provisions herein may be modified only upon the mutual
agreement of the parties, however, no such modification shall be effective
until reduced to writing and executed by both parties.
10.4 SUCCESSORS AND ASSIGNS. This Agreement and all obligations
and rights arising hereunder shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, transferees and assigns.
None of TLI, IBI or ADS may assign its rights and obligations under this
Agreement without the prior written consent, which consent shall not be
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unreasonably withheld, of ADS (in the case of TLI or IBI) or TLI (in the case
of ADS); provided that a party may assign its rights and obligations to any
Affiliate of such party without the other parties' consent (it being
understood that no assignment pursuant to this proviso shall relieve the
assigning party of any of its obligations hereunder).
10.5 WAIVER. No waiver of the provisions hereto shall be
effective unless in writing and signed by the party to be charged with such
waiver. No waiver shall be deemed to be a continuing waiver in respect of any
subsequent breach or default either of similar or different nature unless
expressly so stated in writing. No failure or delay on the part of any party
in exercising any power or right under this Agreement shall be deemed to be a
waiver, nor does any single or partial exercise of any power or right preclude
any other or further exercise, or the exercise of any other power or right.
10.6 SEVERABILITY. If any of the provisions or parts of the
Agreement are determined to be illegal, invalid or unenforceable in any
respect under any applicable statute or rule of law, such provisions or parts
shall be deemed omitted without affecting any other provisions or parts of the
Agreement which shall remain in full force and effect, unless the declaration
of the illegality, invalidity or unenforceability of such provision or
provisions substantially frustrates the continued performance by, or
entitlement to benefits of, any party, in which case this Agreement may be
terminated by the affected party, without penalty.
10.7 NOTICES. All communications and notices pursuant hereto to
any party shall be in writing and addressed or delivered to it at its address
shown below, or at such other address as may be designated by it by notice to
the other party, and shall be deemed given when delivered by hand, or two (2)
Business Days after being mailed (with postage prepaid) or when sent by
receipted courier service:
<CAPTION>
If to ADS: If to the TLI Entities:
--------- ----------------------
800 TechCenter Drive The Limited, Inc.
Gahanna, Ohio 43230 Three Limited Parkway
Attn.: Dennis Kooker, VP Consumer Columbus, Ohio 43230
Database Marketing Services Attn.: Daniel P. Finkelman
With a Copy to: Karen Morauski
10.8 CAPTIONS AND CROSS-REFERENCES. The table of contents and
various captions in this Agreement are included for convenience only and shall
not affect the meaning or interpretation of any provision of this Agreement.
References in this Agreement to any Section are to such Section of this
Agreement.
10.9 GOVERNING LAW. THIS AGREEMENT SHALL BE A CONTRACT MADE UNDER
AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF OHIO, REGARDLESS OF THE
DICTATES OF OHIO CONFLICTS OF LAW, AND THE PARTIES HEREBY SUBMIT TO EXCLUSIVE
JURISDICTION AND VENUE IN THE UNITED
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STATES FEDERAL DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO OR ANY OF THE
STATE COURTS LOCATED IN FRANKLIN COUNTY, OHIO.
10.10 COUNTERPARTS. This Agreement may be signed in one or more
counterparts, all of which shall be taken together as one agreement.
10.11 FORCE MAJEURE. No party will be responsible for any failure
or delay in performance of its obligations under this Agreement because of
circumstances beyond its control, including, but not limited to, acts of God,
flood, criminal acts, fire, riot, computer viruses, computer hackers,
accident, strikes or work stoppage, embargo, sabotage, inability to obtain
material, equipment or phone lines, government action (including any laws,
ordinances, regulations or the like which restrict or prohibit the providing
of the services contemplated by this Agreement), and other causes whether or
not of the same class or kind as specifically named above. In the event a
party is unable to perform substantially for any of the reasons described in
this Section, it will notify the other party promptly of its inability so to
perform, and if the inability continues for at least thirty (30) consecutive
days, the party so notified may then terminate this Agreement forthwith. This
provision shall not, however, release the party unable to perform from using
its best efforts to avoid or remove such circumstance and such party unable to
perform shall continue performance hereunder with the utmost dispatch whenever
such causes are removed.
10.12 RELATIONSHIP OF PARTIES. This Agreement does not constitute
the parties as partners or joint venturers and no party will so represent
itself.
10.13 SURVIVAL. No termination of this Agreement shall in any way
affect or impair the powers, obligations, duties, rights, indemnities,
liabilities, covenants or warranties and/or representations of the parties
with respect to times and/or events occurring prior to such termination. No
powers, obligations, duties, rights, indemnities, liabilities, covenants or
warranties and/or representations of the parties with respect to times and/or
events occurring after termination shall survive termination except for the
following Sections: Section 3, Section 8, Section 10.7 and Section 10.18.
10.14 MUTUAL DRAFTING. This Agreement is the joint product of ADS,
IBI and TLI and each provision hereof has been subject to mutual consultation,
negotiation and agreement of ADS, IBI and TLI.
10.15 INDEPENDENT CONTRACTOR. The parties hereby declare and agree
that ADS is engaged in an independent business, and shall perform its
obligations under this Agreement as an independent contractor; that any of
ADS's personnel performing the services hereunder are agents, employees,
affiliates, or subcontractors of ADS and are not agents, employees,
affiliates, or subcontractors of the TLI Entities; that ADS has and hereby
retains the right to exercise full control of and supervision over the
performance of ADS's obligations hereunder and full control over the
employment, direction, compensation and discharge of any and all of the ADS's
agents,
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employees, affiliates, or subcontractors, including compliance with workers'
compensation, unemployment, disability insurance, social security, withholding
and all other federal, state and local laws, rules and regulations governing
such matters; that ADS shall be responsible for ADS's own acts and those of
ADS's agents, employees, affiliates, and subcontractors; and that except as
expressly set forth in this Agreement, ADS does not undertake by this
Agreement or otherwise to perform any obligation of the TLI Entities, whether
regulatory or contractual, or to assume any responsibility for the TLI
Entities' business or operations.
10.16 NO THIRD PARTY BENEFICIARIES. The provisions of this
Agreement are for the benefit of the parties hereto and not for any other
person or entity.
10.17 COUNTERPARTS. This Agreement may be executed in several
counterparts all of which taken together shall constitute one single agreement
between the parties.
10.18 CONFIDENTIALITY. (a) No party shall disclose any information
not of a public nature concerning the business or properties of any other
party which it learns as a result of negotiating or implementing this
Agreement or the transactions contemplated hereby, including, without
limitation, the terms and conditions of this Agreement, trade secrets,
business and financial information, business methods, procedures, know-how and
other information of every kind that relates to the business of any party
except to the extent disclosure is required by applicable law, is necessary
for the performance of the disclosing party's obligation under this Agreement,
or is agreed to in writing by the other party; provided that: (i) prior to
disclosing any confidential information to any third party, the party making
the disclosure shall give notice to the other party of the nature of such
disclosure and of the fact that such disclosure will be made; and (ii) prior
to filing a copy of this Agreement with any governmental authority or agency,
the filing party will consult with the other party with respect to such filing
and shall redact such portions of this Agreement which the other party
requests be redacted, unless, in the filing party's reasonable judgment based
on the advice of its counsel (which advice shall have been discussed with
counsel to the other party), the filing party concludes that such request is
inconsistent with the filing party's obligations under applicable laws. No
party shall use the other party's name for advertising or promotional purposes
without such other party's written consent. None of the foregoing shall
preclude any party from disclosing Data in the course of exercising its rights
under Section 2.4 hereof.
(b) The obligations of this Section, shall not apply to any
information:
(i) which is generally known to the trade or to the public
at the time of such disclosure; or
(ii) which becomes generally known to the trade or the public
subsequent to the time of such disclosure; provided,
however, that such general knowledge is not the result
of a disclosure in violation of this Section; or
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(iii) which is obtained by a party from a source other than the
other party, without breach of this Agreement or any other
obligation of confidentiality or secrecy owed to such
other party or any other person or organization; or
(iv) which is independently conceived and developed by the
disclosing party and proven by the disclosing party
through tangible evidence not to have been developed as a
result of a disclosure of information to the disclosing
party, or any other person or organization which has
entered into a confidential arrangement with the
non-disclosing party.
(c) If any disclosure is made pursuant to the provisions of this
Section, to any parent company, subsidiary, affiliate or third party, the
disclosing party shall be responsible for ensuring that such parent, subsidiary,
affiliate or third party keeps all such information in confidence and that any
third party executes a confidentiality agreement provided by the non-disclosing
party. Each party covenants that at all times it shall have in place procedures
designed to assure that each of its employees who is given access to the other
party's confidential information shall protect the privacy of such information.
Each party acknowledges that any breach of the confidentiality provisions of
this Agreement by it will result in irreparable damage to the other party and
therefore in addition to any other remedy that may be afforded by law any breach
or threatened breach of the confidentiality provisions of this Agreement may be
prohibited by restraining order, injunction or other equitable remedies of any
court. The provisions of this Section will survive termination or expiration of
this Agreement.
10.19 NON-INTERFERENCE WITH EMPLOYEES. The parties acknowledge that
their continuing relationship with their own employees is an essential
requirement of their business. Accordingly, during the Term of this Agreement
and continuing for six (6) months thereafter, unless it has received the other
parties' prior written consent, each party agrees not to solicit for employment
any person who is an employee of the other who is involved in any way in
providing or receiving the Services under this Agreement (it being understood
that general solicitations through newspaper advertisements, recruitment firms
and similar means not violate the provisions of this Section 10.19).
10.20 VICTORIA'S SECRET CATALOGUE. Notwithstanding any provision of
this Agreement to the contrary, (i) Victoria's Secret Catalogue is not a part of
or subject to this Agreement and (ii) any and all data or other information
derived from or attributable to the business or operations of Victoria's Secret
Catalogue ("VSC Data"), which may be present on the Main Data Warehouse from
time to time, shall not be subject to or considered a part of this Agreement.
Without limiting the generality of the foregoing, the rights granted to ADS and
its affiliates, and the restrictions imposed on the TLI Entities and their
affiliates, pursuant to this Agreement shall not extend to or encompass any such
VSC Data. Notwithstanding the foregoing, data derived from another business that
is the same as VSC Data, including without limitation customer names and
addresses, is subject to and considered a part of this Agreement.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement in manner
and form sufficient to bind them as of the date first above written.
THE LIMITED, INC. BY AND ON BEHALF OF ADS ALLIANCE DATA SYSTEMS, INC.
THE LIMITED, INC. AND ITS SUBSIDIARIES
By: /s/ Daniel P. Finkelman By: /s/ J.B. Sullivan
-------------------------- ------------------------
Title: Senior Vice President Title: Senior Vice President
-------------------------- ------------------------
Date: 9/15/00 Date: 9-15-00
-------------------------- ------------------------
INTIMATE BRANDS, INC. BY AND ON BEHALF OF INTIMATE
BRANDS, INC. AND ITS SUBSIDIARIES
By: /s/ Michael D. Newman
--------------------------
Title: CFO
--------------------------
Date: 9-26-00
--------------------------
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