Master Agreement - CNP Inc. and ARTISTdirect Inc.
MASTER AGREEMENT
CNP, INC.
1465 Northside Drive, Suite 222
Atlanta, Georgia 30318
Agreement Number: _____________
Date: ___________________
This Master Agreement ("Agreement") is between CNP, INC. (a Delaware
Corporation) on behalf of itself and its affiliated companies (collectively
"CNP") and ARTISTDIRECT, INC. (a Delaware corporation) (hereinafter "Licensee"
or "Customer").
ALL REFERENCES TO "AGREEMENT" SHALL MEAN THIS SIGNATURE PAGE, THE TERMS AND
CONDITIONS, THE ATTACHMENTS LISTED BELOW ("ATTACHMENTS") AND ALL OTHER
AGREEMENTS BETWEEN THE PARTIES THAT MAY FROM TIME TO TIME BE INCORPORATED
HEREIN.
ATTACHMENTS CNP'S INITIALS/CUSTOMER'S INITIALS
o Terms and Conditions / /s/ KY
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o Hosted Platform License Agreement / /s/ KY
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o Professional Services Agreement / /s/ KY
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o Mutual Non-Disclosure Agreement / /s/ KY
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o Platform License and Maintenance Agreement / /s/ KY
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o Preferred Escrow Agreement
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By executing this Agreement, Customer acknowledges that it has reviewed the
terms and conditions incorporated into this Agreement and agrees to be legally
bound by the same. The parties hereby cause this Agreement to be executed by
their duly authorized representative.
ACCEPTED AND AGREED:
ARTISTDIRECT, INC. CNP, INC.
By: /s/ KEITH YOKOMOTO By: /s/ CHRIS MELTON
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Name: Keith Yokomoto Name:
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Title: President Title: CEO
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Date: 8/14/01 Date: 8/10/2001
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TERMS AND CONDITIONS
1. General. The following terms and conditions ("Terms and Conditions") provide
for terms that are common to this Agreement, including all Attachments. In the
event of a conflict between these Terms and Conditions and any Attachment, the
Attachment will control, unless expressly stated to the contrary.
2. Definitions. As used in this Agreement, and in addition to any other terms
defined in this Agreement, the following terms will have the following meanings:
(i) "Services" means collectively, all services provided by CNP under this
Agreement, whether provided directly to Customer or to Customer's employees, and
Customer's contract employees, and whether designated as a part of the support
services, maintenance services, professional services, or otherwise; (ii) "CNP
Technology" means the content, materials, and technology developed and owned by
CNP as more particularly set forth on the Attachments; (iii) "Third Party
Technology" means technology provided by CNP to Customer which is licensed by a
third party to Customer or sublicensed by CNP to Customer; (iv) "Technology"
means collectively, the CNP Technology and the Third Party Technology; (v)
"Deliverables" means collectively, the Services, technology associated with the
Services, and all applicable documentation and ancillary materials for such
technology; and (vi) "Customer Content" means the content and other materials
provided or made available by Customer to CNP for use in connection with the
Technology or otherwise identified under the Professional Services Agreement.
3. Rights Reserved. Customer acknowledges and agrees that CNP or its third party
suppliers own all right, title and interest to all intellectual property and
proprietary rights in the Technology. Customer acknowledges that the Technology
is confidential information, trade secret and proprietary information of CNP or
its suppliers and that the source code for the Technology will not be provided
by CNP except as otherwise expressly set forth under this Agreement. Customer
further agrees not to lease, license, sell, sublicense or otherwise transfer the
Technology or decompile, reverse compile, or reverse engineer the Technology;
except as otherwise expressly set forth under this Agreement.
4. Confidential Information. The confidentiality terms agreed to by the parties
under this Agreement or in an Attachment shall apply. All Deliverables shall be
deemed confidential and proprietary information of the owner of such
Deliverables. All Customer Content shall be deemed confidential and proprietary
information of Customer or its licensors.
5. Competitors. CNP will not license Restricted Components to any third party
without the prior written approval of Customer, which may be withheld in
Customer's sole and exclusive discretion. "Restricted Components" means
components of the Platform developed exclusively for Customer and designated in
a Request or related statement of work with the legend "RESTRICTED COMPONENTS".
Notwithstanding anything to the contrary, CNP shall retain shall the perpetual
right to use, on a non-restricted basis, all ideas, concepts, tools, templates,
methods, processes, know-how, and organization techniques used by CNP personnel
in the development of the Restricted Components.
6. Payment. All invoices submitted to Customer by CNP are payable in full within
fifteen (15) days after Customer's receipt of an invoice. All amounts shall be
payable in U.S. dollars. Customer shall pay interest on all overdue amounts at
the rate of the lesser of (i) one and one-half percent (1-1/2%) per month; or
(ii) the maximum rate permitted by law. Any and all fees, retainers, expenses,
reimbursements or other amounts paid by Customer to CNP under this Agreement
shall be non-refundable. The amounts due under this Agreement do not include any
amount for taxes, duties or other similar assessments. If any sales taxes, use
taxes, excise taxes, value added taxes, duties or other similar amounts (except
for taxes based upon CNP's net income) are assessed against or required to be
collected in connection with this Agreement, Customer agrees to pay all such
amounts. Customer shall not deduct from payments to CNP any amounts paid or
payable to third parties for taxes, duties, etc., however designated.
7. WARRANTY DISCLAIMER. OTHER THAN AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER CNP, ITS AFFILIATES, LICENSORS OR SUPPLIERS, THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, SHAREHOLDERS, AGENTS OR REPRESENTATIVES, NOR CUSTOMER, ITS
AFFILIATES, LICENSORS, OR SUPPLIERS, THEIR RESPECTIVE OFFICERS, DIRECTORS,
EMPLOYEES, SHAREHOLDERS, AGENTS OR REPRESENTATIVES MAKE ANY EXPRESS OR IMPLIED
WARRANTIES, CONDITIONS, OR REPRESENTATIONS TO EACH OTHER, OR ANY OTHER PERSON OR
ENTITY WITH RESPECT TO THE DELIVERABLES PROVIDED HEREUNDER OR OTHERWISE
REGARDING THIS AGREEMENT, WHETHER ORAL OR WRITTEN, EXPRESS, IMPLIED OR
STATUTORY. WITHOUT LIMITING THE FOREGOING, ANY IMPLIED WARRANTY OR CONDITION OF
MERCHANTABILITY, THE IMPLIED WARRANTY AGAINST INFRINGEMENT, AND THE IMPLIED
WARRANTY OR CONDITION OF FITNESS FOR A PARTICULAR PURPOSE ARE EXPRESSLY EXCLUDED
AND DISCLAIMED. STATEMENTS MADE BY CNP'S SALES REPRESENTATIVES OR IN PROMOTIONAL
MATERIALS DO NOT CONSTITUTE WARRANTIES.
8. LIMITATION OF REMEDY. IN NO EVENT WILL EITHER PARTY, ITS AFFILIATES,
LICENSORS OR SUPPLIERS, OR ANY OF THEIR OFFICERS, DIRECTORS, EMPLOYEES,
SHAREHOLDERS, AGENTS OR REPRESENTATIVES BE LIABLE TO THE OTHER
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PARTY, OR ANY OTHER PERSON OR ENTITY FOR ANY INDIRECT, INCIDENTAL, SPECIAL,
EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES OR LOSS OF GOODWILL IN ANY WAY
RELATING TO THIS AGREEMENT OR RESULTING FROM THE USE OF OR INABILITY TO USE THE
DELIVERABLES OR THE PERFORMANCE OR NON-PERFORMANCE OF ANY SERVICES, INCLUDING
THE FAILURE OF ESSENTIAL PURPOSE, EVEN IF EACH PARTY HAS BEEN NOTIFIED OF THE
POSSIBILITY OR LIKELIHOOD OF SUCH DAMAGES OCCURRING, AND WHETHER SUCH LIABILITY
IS BASED ON CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY OR
OTHERWISE.
9. MAXIMUM LIABILITY. EXCEPT FOR THE PARTIES' RESPECTIVE INDEMNIFICATION
OBLIGATIONS UNDER SECTIONS 10 AND 11, MISUSE OF THE OTHER PARTY'S INTELLECTUAL
PROPERTY, AND/OR BREACHES OF THE CONFIDENTIALITY PROVISIONS OF THIS AGREEMENT,
IN NO EVENT WILL EITHER PARTY'S LIABILITY FOR ANY DAMAGES TO CUSTOMER OR TO ANY
OTHER PERSON OR ENTITY REGARDLESS OF THE FORM OF ACTION, WHETHER BASED ON
CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY, PRODUCTS LIABILITY OR OTHERWISE,
EVER EXCEED THE FEES PAYABLE BY CUSTOMER TO CNP UNDER THIS AGREEMENT OR IN THE
CASE OF DAMAGES ARISING UNDER AN ATTACHMENT TO THIS AGREEMENT, THE FEES PAYABLE
BY CUSTOMER TO CNP UNDER SUCH ATTACHMENT.
10. CNP Indemnification for Infringement. CNP shall defend and indemnify
Customer and hold Customer harmless against any losses, expenses, damages,
penalties, actions, claims, suits, or proceedings (including court costs and
reasonable attorneys' fees) (each, an "CNP INDEMNIFIED CLAIM," to which Customer
may become subject, brought by or as a result of a third party action to the
extent that any such CNP Indemnified Claim is based upon Customer's use of the
Deliverables or the Technology in accordance with the terms of this Agreement
constitutes an infringement of any valid claim of any U.S. patent, any valid
copyright, or any other intellectual property right recognized in the U.S. In
the event that any CNP Indemnified Claim is initiated, Customer shall notify CNP
within ten (10) days after it learns of the commencement of same, shall
cooperate fully in the defense of any such CNP Indemnified Claim, at CNP's
expense, and permit CNP or its insurance carrier to defend any CNP Indemnified
Claim; provided, however, that CNP will not effect any settlement of any CNP
Indemnified Claim for which Customer seeks indemnification hereunder without the
prior written consent of Customer (which consent will not be unreasonably
withheld or delayed) unless such settlement includes an unconditional release of
Customer. Customer shall not compromise or settle any CNP Indemnified Claim,
that is the subject of CNP's defense obligations without the prior written
consent of CNP. Customer will have the right, at its cost, to participate in the
defense of any claim, suit, or proceeding for which it seeks indemnification
hereunder, with counsel of its choosing. Customer's failure to perform its
obligations hereunder shall relieve CNP of its obligations hereunder. In the
event of the commencement of such an action or if the commencement thereof
appears likely to CNP, CNP shall have the right to: (i) attempt to obtain for
Customer the right to continue using the Deliverables; (ii) modify or replace
the Deliverables, provided that any modification or replacement does not result
in a material degradation in performance or capabilities of the Deliverables;
and (iii) require the return of the Deliverables, and give Customer a refund or
credit only as otherwise provided in an Attachment to this Agreement. In the
event that none of the aforementioned options are reasonably attainable, CNP
shall have the right to terminate the applicable Attachment or schedule thereto.
Except as otherwise specifically and unambiguously stated in an Attachment, the
foregoing states CNP's sole responsibility and liability in respect to
infringement. The provisions of this Section 10 relating to indemnification
shall survive termination of this Agreement and the Attachments.
11. Customer Indemnification for Infringement. Customer shall defend and
indemnify CNP and hold CNP harmless against any losses, expenses, damages,
penalties, actions, claims, suits, or proceedings (including court costs and
reasonable attorneys' fees) (each, a "CUSTOMER INDEMNIFIED CLAIM," to which CNP
may become subject, brought by or as a result of a third party action to the
extent that any such Customer Indemnified Claim is based upon the Customer
Content constitutes an infringement of any valid claim of any U.S. patent, any
valid copyright, or any other intellectual property right recognized in the U.S.
In the event that any Customer Indemnified Claim is initiated, CNP shall notify
Customer within ten (10) days after it learns of the commencement of same, shall
cooperate fully in the defense of any such Customer Indemnified Claim, at
Customer's expense, and permit Customer or its insurance carrier to defend any
Customer Indemnified Claim; provided, however, that Customer will not effect any
settlement of any Customer Indemnified Claim for which CNP seeks indemnification
hereunder without the prior written consent of CNP (which consent will not be
unreasonably withheld or delayed) unless such settlement includes an
unconditional release of CNP. CNP shall not compromise or settle any Customer
Indemnified Claim, that is the subject of Customer's defense obligations without
the prior written consent of Customer. CNP will have the right, at its cost, to
participate in the defense of any claim, suit, or proceeding for which it seeks
indemnification hereunder, with counsel of its choosing. CNP's failure to
perform its obligations hereunder shall relieve Customer of its obligations
hereunder. Except as otherwise specifically and unambiguously stated in an
Attachment, the foregoing states Customer's sole responsibility and liability in
respect to infringement. The provisions of this Section 11 relating to
indemnification shall survive termination of this Agreement and the Attachments.
12. (a) Customer General Indemnification. Customer shall defend and indemnify
CNP and hold CNP harmless against any Customer Indemnified Claim arising from
(i) the activities of Customer's users' of the Deliverables ("End
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Users"), including without limitation, unauthorized disclosure of CNP's or third
party proprietary information, so long as CNP has notified Customer of any such
restrictions, (ii) any willful misconduct or fraud committed by Customer
(including Customer's employees, agents or representatives) or End Users; (iii)
any employment agreement, or other agreement, or state or federal law, with
respect to current and past employees or independent contractors of Customer; or
(iv) any prior or current agreement between Customer and third parties with
respect to the types of services provided by CNP to Customer hereunder. All
other procedural provisions set forth in Section 12 shall apply.
(b) CNP General Indemnification. CNP shall defend and indemnify Customer
and hold Customer harmless against any Claim arising as a result of any willful
misconduct or fraud committed by CNP (including CNP's employees, agents or
representatives). All other procedural provisions set forth in Section 11 shall
apply.
13. Termination Generally. This Agreement will commence on the date this
Agreement is signed by both parties and will remain in effect until terminated
as provided herein. The parties acknowledge that certain Attachments will
terminate from time to time as expressly provided in this Agreement or the
Attachment without otherwise affecting the rights and obligation of the parties
under this Agreement.
14. Termination of Agreement. If there are no outstanding Attachments under
which Deliverables are being provided or made available to Customer, upon thirty
(30) days written notice to the other, either party may terminate this Agreement
as of the date specified in such notice of termination.
15. Termination of Attachment. If either party violates its obligations under
any Attachment, then the other party may terminate such Attachment by sending
written termination notice describing the noncompliance to the non-complying
party. For noncompliance caused by failure to pay any sums due hereunder, the
non-complying party shall have ten (10) calendar days, after the non-complying
party's receipt of such notification, to cure any such noncompliance. For
noncompliance caused by any other reason, the non-complying party shall have
thirty (30) calendar days, after the non-complying party's receipt of such
notification, to cure any such noncompliance. If noncompliance is not cured
within the required period, the party providing termination notice shall have
the right to terminate such Attachment, and any and all related schedules
thereto.
16. Effect of Termination. Within thirty (30) days after the termination of an
Attachment for any reason, (i) Customer will pay CNP for all Services performed
by CNP in accordance with this Agreement up to the effective date of such
termination and all other amounts owed by Customer to CNP under such Attachment
not disputed in good faith; and (ii) except as otherwise set forth in this
Agreement or the Attachments, Customer will return or destroy (as requested by
CNP) all copies of the Technology, including Deliverables not otherwise owned or
licensed under the Agreement, provided to Customer under such Attachment,
including all documentation related thereto; and (iii) except as otherwise set
forth in this Agreement or the Attachments, each party will return or destroy
(as requested by CNP) all confidential information provided to such party under
such Attachment by the other party. Upon the destruction or return of such
materials, the complying party will provide the other party with a signed
written statement certifying that it has destroyed or returned all the other
party's property. Except as otherwise set forth in this Agreement or in the
Attachments, upon termination of this Agreement for any reason, all rights and
licenses granted by each party to the other party will immediately cease.
17. Trademarks And Trade Names. Nothing in this Agreement confers upon either
party any right to use the other party's trade names and trademarks except as
set forth under this Agreement. All use of such marks by either party will inure
to the benefit of the owner of such marks, use of which will be subject to
specifications controlled by the owner.
18. Press Release and Publicity. Customer agrees to (i) provide a quote and to
authorize an announcement made by CNP of Customer's selection of the Technology;
(ii) assist and participate in a success story upon the successful
implementation of the Technology; (iii) accept occasional reference calls from
prospective customers; and (iv) allow site visits by prospective CNP customers
with prior notification and approval by Customer during the term hereunder.
Notwithstanding the foregoing, CNP will not issue a press release or public
statement regarding this Agreement without the prior written consent of
Customer, which consent shall not be unreasonably withheld or delayed.
19. Notices. All notices, requests, demands, and determinations under this
Agreement (other than routine operational communications), shall be in writing
and shall be deemed duly given (i) when delivered by hand; (ii) two days after
being given to an express courier with a reliable system for tracking delivery;
(iii) when sent by confirmed facsimile with a copy sent by another means
specified in this Section, or (iv) six days after the day of mailing, when
mailed by United States mail, registered or certified mail, return receipt
requested, postage prepaid, and addressed as follows:
If to CNP: CNP, Inc.
5750 Wilshire Blvd., Suite 501
Los Angeles, CA 90036
Attn: Bishop Leatherbury, CFO
Facsimile: (323) 556-8710
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with a copy to
CNP, Inc.
5750 Wilshire Blvd., Suite 501
Los Angeles, CA 90036
Attn: Legal Department
Facsimile: (323) 556-8710
If to Customer: ARTISTdirect, Inc.
5670 Wilshire Boulevard
Suite 200
Los Angeles, California 90036
Attn: Legal & Business Affairs Department
Facsimile: (323) 634-4299
A party may from time to time change its address or designee for notification
purposes by giving the other prior written notice of the new address or designee
and the date upon which it will become effective.
20. Assignments. Neither party may assign or delegate this Agreement or any of
its licenses, rights or duties under this Agreement, directly or indirectly, by
operation of law or otherwise, without the prior written consent of the other
party, except in the event of a sale or other transfer of all or substantially
all of the assigning party's assets or equity; provided, however, that the
assignee has agreed to be bound by all the terms and condition of this
Agreement, and such assignee is not a direct competitor of the non-assigning
party.
21. Contractors. Any rights and obligations of CNP may, in CNP's reasonable
discretion, be exercised through their employees and contractors, provided that
such employees and contractors shall be under an obligation to maintain the
confidentiality of, and to protect Customer's proprietary rights respecting, the
confidential information of Customer, including without limitation, Customer
Content, and provided that CNP shall be responsible for breach by any such
contractor.
22. Nonsolicitation. During the term hereof and for a period of one (1) year
after its termination or expiration, each party agrees that, without the prior
written consent of the other party, it will not, directly or indirectly itself
or by or through others, for any reason solicit for employment, or affirmatively
assist any other person or entity in employing or soliciting for employment, any
person who is an employee of or is otherwise utilized as a consultant or
contractor by the other party during the two (2) years preceding such
termination or expiration. Notwithstanding the foregoing, the parties
acknowledge and agree that certain employees and/or contractors of Customer
shall be retained as employees or engaged as contractors of CNP pursuant to a
separate written agreement between CNP and such employee or contractor. The
hiring and engaging of such personnel shall be subject to the written consent of
CNP and Customer.
23. Compliance with Laws. Each party shall be responsible for compliance with
all applicable laws, rules, and regulations. Customer agrees to keep such books
and records and to take such other actions as may be required by applicable
laws, rules, and regulations, and to comply with any applicable United States
export laws, rules, and regulations. Notwithstanding anything to the contrary,
Customer shall be solely responsible for obtaining any approvals, public
performance rights or other licenses for display, distribution, performance and
other uses of the Customer Content, including without limitation, payment of all
royalties and other amounts owed third parties in connection therewith.
24. Force Majeure. Neither CNP nor Customer will be liable for failure to
perform any of its respective obligations under this Agreement (other than the
payment of fees) if such failure is caused by an event outside its reasonable
control, including but not limited to, an act of God, war, or natural disaster.
25. Governing Law. This Agreement shall be exclusively construed, governed and
enforced under the laws of the State of Georgia (without regard to rules
governing conflict of laws). The parties agree that the United Nations
Convention on Contracts for the International Sale of Goods shall not apply in
any respect to this Agreement or the parties.
26. Venue. The parties agree that the exclusive venue for all actions, relating
in any manner to this Agreement, shall only be in a federal or state court of
competent jurisdiction located in Los Angeles County, California. Each party
consents and submits to the personal jurisdiction of such courts and irrevocably
waives any and all defenses inconsistent with this Section.
27. Survival. Any and all provisions, promises and warranties under this
Agreement which by their nature or effect are required or intended to be
observed, kept or performed after termination of this Agreement will survive the
termination of this Agreement and remain binding upon and for the benefit of the
parties hereto.
28. Miscellaneous. This Agreement, including the Attachments and any addendum
hereto signed by the parties, constitutes the entire agreement between the
parties regarding the subject matter hereof and supersedes all prior or
contemporaneous agreements, negotiations, representations and proposals, written
or oral, including without limitation that Letter of Intent between the parties
dated on or about May 7, 2001. This Agreement does not operate as an acceptance
of any conflicting or additional terms and conditions and will prevail over any
conflicting or additional provision of any purchase order or any other
instrument of Customer, it being understood that any purchase order issued by
Customer will be for Customer's convenience only. This Agreement will not be
construed to create any employment relationship, partnership, joint venture or
agency relationship or to authorize any party to enter into any commitment or
agreement binding on the other party. No delay or failure in exercising any
right hereunder and no partial or single exercise thereof will be deemed to
constitute a waiver of such right or any other
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rights hereunder. If any provision hereof is declared invalid by a court of
competent jurisdiction, such provision will be ineffective only to the extent of
such invalidity, so that the remainder of that provision and all remaining
provisions of this Agreement will be valid and enforceable to the fullest extent
permitted by applicable law. No modifications, additions, or amendments to this
Agreement will be effective unless made in writing and signed by duly authorized
representatives of the parties. This Agreement may be executed in any number of
counterparts, each of which will be deemed an original but all of which together
will be deemed for all purposes to constitute one and the same instrument.
Signatures transmitted and received via facsimile or other electronic means will
be treated as original signatures for all purposes of this Agreement.
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HOSTED PLATFORM LICENSE AGREEMENT
CNP, INC.
1465 Northside Drive, Suite 222
Atlanta, Georgia 30318
Agreement Number: _______
Date: __________
Customer Name: ARTISTdirect, Inc.
Address: 5670 Wilshire Boulevard, Suite 200
City, State, Zip: Los Angeles, California 90036
THIS HOSTED PLATFORM LICENSE AGREEMENT (this "HOSTED LICENSE AGREEMENT") is
between CNP, INC. ("CNP") and the undersigned Customer. This Agreement and the
Master Agreement establishes the general terms applicable to Customer's
utilization of CNP's technology platform providing publishing, content and
e-commerce solutions as more fully described in EXHIBIT A (the "CNP PLATFORM").
STANDARD TERMS AND CONDITIONS
1. CNP Obligation to Furnish Hosting Services; Customer Responsibilities. CNP
will furnish to Customer the hosting services described more particularly in
EXHIBIT A ("HOSTING SERVICES") in accordance with this Hosted License Agreement
and the Service Level Agreement set forth in EXHIBIT E.
2. CNP Platform. Customer and its users END USERS (as defined in EXHIBIT C) may
only access and use the CNP Platform in accordance with the CNP Platform License
Terms and Conditions attached hereto as EXHIBIT C.
3. Payment. Customer shall pay CNP the fees described in EXHIBIT B ("FEES").
Transaction fees (if any) shall be set forth in EXHIBIT B and shall be
calculated according to the transactions recorded by CNP's computer system,
which shall be presumed correct. Such fees shall be payable to CNP by wire
transfer or other reasonable method specified by CNP on or before the fifteenth
(15th) day of each calendar month for all Hosting Services performed by CNP
during the immediately preceding calendar month.
4. Customer's Responsibilities. Customer is solely responsible for: (a)
Customer's own data processing and transmission equipment including without
limitation the requirements set forth in EXHIBIT D; (b) establishing and
maintaining Customer's own data communication lines and equipment necessary to
transmit data between Customer's equipment and the CNP Platform; (c) utilizing
such data encryption procedures as are mutually agreed upon for the transmission
of data to the CNP Platform; (d) providing at a reasonable time and in such
format as may be reasonably requested by CNP, all Customer Content and other
data or information required by CNP for the CNP Platform and related Hosting
Services; (e) preserving the confidentiality of any identification numbers and
passwords assigned and validated by CNP; (g) notifying CNP if Customer discovers
a breach of CNP's security, but in no event will the preceding sentence obligate
Customer to monitor CNP's security; (h) performing its obligations in connection
with implementing the specific applications of Customer for the CNP Platform as
mutually agreed to by the parties from time to time in project meetings and
other communications; and (i) obtaining any and all necessary third party
consents in connection with materials provided by Customer.
5. Confidentiality. All information, whether oral, visual or in physical form,
received by Customer under this Hosted License Agreement shall be subject to the
confidentiality terms agreed to by the parties under the Master Agreement. The
CNP Platform shall be deemed confidential and proprietary information of CNP.
The Customer Content shall be deemed confidential and proprietary information of
Customer.
6. Title. CNP or its suppliers retain title and all proprietary and other rights
in and to the systems, programs, operating instructions, documentation and
proprietary information utilized in or by the CNP Platform. Customer and its
suppliers retain title and all proprietary and other rights in and to the
Customer Content.
7. SERVICES WARRANTY. CNP WARRANTS TO CUSTOMER THAT: (A) CNP SHALL MAINTAIN A
BACK-UP SERVER TO CNP'S PRIMARY SERVER TO REDUCE THE RISK OF DELAYS AS A RESULT
OF EQUIPMENT MALFUNCTION; (B) CNP WILL EMPLOY DUE CARE AND
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ATTENTION IN THE PREPARATION AND MAINTENANCE OF CNP'S PROGRAMS; (C) CNP WILL
PERFORM ANY SERVICES IN A TIMELY AND WORKMANLIKE MANNER AND OF A QUALITY
CONFORMING TO GENERALLY ACCEPTED INDUSTRY STANDARDS AND PRACTICES; AND (D) THE
HOSTED PLATFORM SHALL PERFORM IN ACCORDANCE WITH THE SPECIFICATIONS SET FORTH IN
EXHIBIT A AND THE SERVICE LEVEL AGREEMENT SET FORTH IN EXHIBIT E. THE WARRANTIES
SET FORTH HEREIN ARE IN LIEU OF ALL OTHER WARRANTIES, AND CNP SPECIFICALLY
DISCLAIMS ALL OTHER WARRANTIES WITH RESPECT TO THE SERVICES OR THE CNP PLATFORM
PROVIDED OR MADE AVAILABLE HEREUNDER EXPRESSED OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
STATEMENTS MADE BY CNP'S SALES REPRESENTATIVES OR IN PROMOTIONAL MATERIALS DO
NOT CONSTITUTE WARRANTIES.
8. LIMITATIONS OF LIABILITY. NEITHER PARTY IS LIABLE FOR INDIRECT, SPECIAL,
CONSEQUENTIAL, OR PUNITIVE DAMAGES. EXCEPT AS OTHERWISE SET FORTH HEREIN, AND IN
THE MASTER AGREEMENT, IN NO EVENT, SHALL THE TOTAL AGGREGATE LIABILITY OF EITHER
PARTY FOR ANY CLAIMS, LOSSES OR DAMAGES ARISING UNDER THIS HOSTED LICENSE
AGREEMENT OR SERVICES PERFORMED HEREUNDER EXCEED THE TOTAL AMOUNTS PAYABLE BY
CUSTOMER TO CNP PURSUANT TO THIS HOSTED LICENSE AGREEMENT, EVEN IF SUCH PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH POTENTIAL CLAIM, LOSS OR DAMAGE.
NEITHER PARTY SHALL BE RESPONSIBLE FOR DELAYS IN RECEIPT OF INFORMATION FROM THE
OTHER PARTY, PROCESSING OF SUCH PARTY'S INFORMATION BECAUSE OF CAUSES BEYOND
SUCH PARTY'S REASONABLE CONTROL, INCLUDING, WITHOUT LIMITATION, EQUIPMENT
MALFUNCTION, LIMITATIONS ON THE AVAILABILITY OF TELEPHONE OR OTHER TRANSMISSION
FACILITIES, FAILURES OF COMMUNICATIONS EQUIPMENT, OR CUSTOMER'S FAILURE TO
PROPERLY FORMAT AND TRANSMIT INFORMATION. CNP SHALL ALSO NOT BE RESPONSIBLE FOR
ERRORS IN DATA ENTRY OR OTHER SERVICES, PROGRAMS, HARDWARE, DATA FILES, OR
OUTPUT PROVIDED TO, OR MAINTAINED FOR, CUSTOMER RESULTING FROM ERRORS IN
CUSTOMER'S INPUT DATA OR FROM CUSTOMER'S FAILURE TO COMPLY WITH THE TERMS AND
CONDITIONS OF THIS AGREEMENT.
9. DISCLAIMER. ALL OTHER WARRANTY DISCLAIMERS, LIMITATIONS OF REMEDY AND
LIMITATIONS OF LIABILITY IN THE MASTER AGREEMENT SHALL APPLY TO THIS AGREEMENT.
10. Indemnification. The indemnification obligations of the Master Agreement
will apply to this Hosted License Agreement.
11. Infringing Materials. In the event CNP reasonably determines that any
materials used by or in connection with the CNP Platform, including without
limitation, Customer Content are infringing or otherwise violate applicable law
or third party rights, CNP shall have the right to disable access to and/or
remove such materials from the CNP Platform, while (when possible) still
allowing end-users to access Customer's web sites; provided, however, that CNP
will notify Customer immediately of any such disablement or removal, and, in the
event that the infringing materials are Customer Content, Customer will have the
right to substitute the infringing materials. The foregoing provision shall not
otherwise affect any other rights and obligations of the parties under this
Agreement or applicable law.
12. Term. This Agreement shall have an initial term of one (1) years ("INITIAL
TERM"), which term shall be automatically extended for successive one (1) year
terms (each a "RENEWAL TERM"), provided, however, that either party may
terminate this Hosted License Agreement at any time after the Initial Term
without cause and without breach of this Hosted License Agreement upon sixty
(60) days prior written notice. The effective date for any such termination
shall be the end of the Initial Term or Renewal Term (as applicable). The
Initial Term and each Renewal Term are collectively, referred to herein as the
"TERM". Any termination of this Hosted License Agreement under this Section 12
shall be subject to the Transition Option more particularly described in Section
14.
13. Termination For Cause. Either party may terminate this Hosted License
Agreement if the other party shall have materially breached this Hosted License
Agreement and not cured such breach within thirty (30) days after written notice
with respect thereto specifying such breach. Notwithstanding the foregoing, all
termination rights and remedies related to a breach by CNP of the Services Level
Agreement shall be set forth exclusively in Exhibit E.
14. Transition Option: Upon (i) termination of this Agreement by either party as
provided in Section 12; (ii) termination of the Hosted License Agreement for
cause by Customer under Section 13; (iii) termination of the Hosted License
Agreement by Customer pursuant to the Service Level Agreement; or (iv)
termination of this Hosted Level Agreement under Section 15 in the event of a
wind-down , and upon further election of Customer as provided herein, Customer
shall have the right to use the CNP Platform in executable form, subject to the
terms and conditions of the Platform License and Maintenance Agreement
("TRANSITION OPTION"). In the event Customer elects to exercise its Transition
Option, Customer shall submit written notice to CNP of such election, no later
than ten (10) days following the effective date of termination for this Hosted
License Agreement. Such written notice shall specify the effective date of
Customer's election (the "TRANSITION OPTION DATE") which date shall be no later
than ninety (90) days following the effective date of termination for this
Hosted License Agreement.
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15. Termination Based on Wind-Down. Customer may terminate this Agreement in the
event that CNP, or a successor, fails to continue to do business in the ordinary
course. Termination of this Hosed License Agreement by Customer pursuant to this
Section 15will be deemed to be a "Release Condition" under the Escrow Agreement
between CNP and Customer.. All terms and conditions of the Platform License and
Maintenance Agreement shall apply, provided; however, Customer, shall have not
obligation to pay the license and maintenance fees set forth therein.
16. Effect of Termination. Upon any termination of this Hosted License
Agreement, Customer and End Users shall immediately cease all use of the CNP
Platform and return to CNP (or destroy if requested by CNP) any and all copies
of any related documentation in any form whatsoever and any and all copies of
other proprietary information of CNP in Customer's or End Users possession or
control; provided, however, that in the event Customer properly exercises its
Transition Option, CNP shall, upon written request by Customer, continue to
provide access to the CNP Platform for a period of thirty (30) days, subject to
the terms and conditions of this Hosted License Agreement, including all fee
provisions. All termination fees owed by either CNP or Customer shall be set
forth in EXHIBIT B.
17. Transition of Hosting Services and License. Upon termination of this
Agreement, CNP agrees to reasonably cooperate with Customer in transitioning to
another data center; provided, however, all charges reasonably incurred by CNP
in so cooperating will be reimbursed by Customer at CNP fees prevailing at the
time of such services.
18. Source Code Rights. All rights and obligations of the parties in connection
with source code for the Platform shall be set forth in the Preferred Agreement
by and among CNP, Customer and DSI Technology Escrow Services ("ESCROW
AGREEMENT"). Within sixty (60) days of the Commencement Date, the parties shall
execute the Escrow Agreement in the form attached to this Master Agreement. The
Escrow Agreement shall be effective as of the date the Escrow Agreement is
executed by all parties thereto. All release conditions, fee obligations, and
other terms and conditions relating to the source code shall be set forth in the
Escrow Agreement. A copy of the Fee Schedule for the Escrow Agreement as of the
Commencement Date is attached hereto as EXHIBIT F.
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IN WITNESS WHEREOF, the parties hereto have executed this Hosted License
Agreement as of the ____ day of July, 2001.
ACCEPTED AND AGREED:
ARTISTDIRECT, INC. CNP, INC.
By: /s/ KEITH YOKOMOTO By: /s/ CHRIS MELTON
------------------------------- -------------------------------
Name: Keith Yokomoto Name:
------------------------------- -------------------------------
Title: President Title: CEO
------------------------------- -------------------------------
Date: 8/14/01 Date: 8/10/2001
------------------------------- -------------------------------
EXHIBITS:
EXHIBIT A Description of CNP Platform and Hosting Services
EXHIBIT B Fee Schedule
EXHIBIT C CNP Platform License Terms and Conditions
EXHIBIT D Customer Hardware and Software Requirements
EXHIBIT E Level Agreement
EXHIBIT F Source Code Escrow Fees
EXHIBIT G Existing Equipment
EXHIBIT H Warrant
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EXHIBIT A
DESCRIPTION OF PLATFORM AND HOSTED SERVICES
GENERAL DESCRIPTION
THE CNP PLATFORM was built specifically for the media and entertainment
industry. It includes commerce, publishing and reporting features. The Platform
offers retail and content sites the ability to concentrate on the principal
elements of their businesses: brand development, merchandising and customer
service. The system includes:
o Technology foundation
o A complete production management system
o A content management system
o A flexible publishing system
o An advanced personalization framework
o Detailed reporting and analysis
o Commerce engine
TECHNOLOGY FOUNDATION - leverages industry standard solutions including Oracle,
Solaris, iPlanet and Vignette. The system is high-speed, fault tolerant and
scalable. The system includes digital download technology, streaming
capabilities and online media storage features.
PRODUCTION MANAGEMENT SYSTEM - includes management tools to do promotions,
offers/couponing, pricing administration and shopping cart up-sell features.
Also includes automated workflow systems and a content scheduling system, which
allows for manual editing and adjustment of both internal and external content
displayed on site.
CONTENT MANAGEMENT SYSTEM - allows for the integration of content, in a variety
of formats, from both external and internal sources. Content can be edited and
adjusted and the aggregated content is then displayed on site.
PUBLISHING SYSTEM - is built on top of Vignette and iPlanet. The system is
optimized for speed and efficiency. Multi-layer caching (disk, memory and
application level) maximizes publishing speed. The system also includes a
special customization layer written to allow flexibility in look of all content.
The publishing systems can publish to a variety of display formats, allowing
in-store kiosks and online stores to share content.
PERSONALIZATION FRAMEWORK - has the capability to store a user's demographic
data, preferences, click streams and purchase history, allowing for the return
of targeted content and recommendations instantly. The personalization framework
is integrated with the publishing environment to allow all published pages to
have content personalized for individual users.
The framework includes:
Database - Stores user demographic data, user preferences, click streams and
purchase history
In-memory caching for user profiles
Algorithms and systems - In-house system which stores data in a distributed
multi layer cache and applies a variety of algorithms to return best
recommendations, targeted content and up-sell opportunities
Segmentation engine - Spots trends and performs clustering, enabling
identification of affinity groups and user segmentations
Collaborative filtering - Compares individual user demographics and activity to
other user behavior
REPORTING AND ANALYSIS - utilizes cluster technology to create custom a
reporting system, which allows full access to all activity on the site. A
web-based interface provides full information on sales, traffic, financials,
demographics, trend analysis, site performance, inventory management,
advertising, etc. Additionally, order, invoice and shipping data can be
integrated to back-end ERP/financial systems (PeopleSoft, SAP, etc.) or exported
in raw data format.
COMMERCE ENGINE - supports multiple third party fulfillers and cascaded
fulfillment, handles a full range of coupons and supports a broad range of
payment brands and agents. The order pipeline also allows control over order
flow.
THIS EXHIBIT INCLUDES A GENERAL DESCRIPTION OF THE CNP PLATFORM. ALL FEATURES
AND FUNCTIONS SPECIFIC TO CUSTOMER'S IMPLEMENTATION OF THE CNP PLATFORM SHALL BE
SET FORTH IN A SEPARATE
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STATEMENT OF WORK AND SHALL BE SUBJECT TO PAYMENT OF
ADDITIONAL FEES (IF ANY) SET FORTH THEREIN.
PLATFORM SPECIFICATIONS
The CNP Platform shall include the equipment and other infrastructure necessary
to support the following:
(i) Customer's scope of activities, and end user access (including seasonal and
peak-time access), as measured during the twelve (12) month period
preceding the Commencement Date; and
(ii) The scope of activities contemplated by the initial statement of work under
the Professional Services Agreement, excluding any related increase in end
user access in excess of the end user access (including seasonal and
peak-time access) occurring during the twelve (12) month period preceding
the Commencement Date.
ADDITIONAL HOSTING FEES AND CHARGES MAY APPLY FOR USAGE THAT EXCEEDS THE ABOVE
SPECIFICATIONS.
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EXHIBIT B
HOSTED PLATFORM FEE SCHEDULE
I. HOSTING FEES
A. HOSTING FEE AMOUNT. Customer shall pay to CNP the amount of $170,000
(the "Hosting Fee") per month starting on the Commencement Date and
continuing for the term of this Hosted License Agreement. For usage or
requirements of customer in excess of the specifications identified in
Exhibit A, additional fees and expenses may apply.
CUSTOMER ACKNOWLEDGES AND AGREES THAT ALL FEATURES AND FUNCTIONS
SPECIFIC TO CUSTOMER'S IMPLEMENTATION OF THE CNP PLATFORM WILL NOT BE
AVAILABLE AS OF THE COMMENCEMENT DATE. SUCH FEATURES AND FUNCTIONS
SHALL BE PROVIDED TO CUSTOMER IN ACCORDANCE WITH THE STATEMENT OF WORK
AGREED TO BY THE PARTIES UNDER THE PROFESSIONAL SERVICES AGREEMENT.
THE AVAILABILITY OR NON-AVAILABILITY OF SUCH FEATURES AND FUNCTIONS
SHALL NOT OTHERWISE IMPACT THE HOSTING FEE OBLIGATIONS OF CUSTOMER
STATED ABOVE; PROVIDED, HOWEVER, THE FOREGOING SHALL NOT OTHERWISE
LIMIT THE REMEDIES OF CUSTOMER UNDER THIS AGREEMENT.
B. COMMENCEMENT DATE. For purposes of this Hosted License Agreement, the
"COMMENCEMENT DATE" shall mean August 1, 2001.
II. TRANSITION AND TERMINATION
A. COSTS OF TRANSITION TO CNP PLATFORM
(i) ***** Transition Costs. ***** will have the right to ***** for
hosting services accruing on or after the Commencement Date and
actually paid by ***** pursuant to ***** hosting services
agreement with ***** and ONLY through the end of the calendar
month in which CNP ceases to require ***** hosting facilities.
(ii) ***** Transition Costs. ***** will have the right to ***** for
hosting services accruing on or after the Commencement Date and
actually paid by ***** pursuant to ***** hosting services
agreement with *****.
(iii) ***** Transition Costs. ***** will have the right to ***** for
hosting services accruing on or after the Commencement Date and
actually paid by ***** pursuant to ***** hosting services
agreement with ***** ONLY in the event that CNP is unable to
begin hosting of the ***** platform prior to such date.
(iv) ***** Transition Costs. ***** will have the right to ***** for
hosting services accruing on or after July 15, 2001 and
actually paid by ***** pursuant to ***** hosting services
agreement with ***** during the existing term of such
agreement.
(v) Additional Transition Terms. The Agreements identified above
shall collectively be referred to as the "THIRD PARTY
AGREEMENTS". Upon written request by CNP, Customer shall
provide notice of termination for the Third Party Agreements to
such third parties. Except as otherwise provided herein, CNP
shall have no obligation to pay any amounts arising from
Customer's failure to provide a termination notice as requested
in writing by CNP. All services requested by Customer under the
Third Party Agreements shall be subject to review and approval,
in writing, by CNP.
(vi) Direct Costs. For purposes of this Section, the term "DIRECT
COSTS" shall mean only those direct costs of hosting required
by Customer for the transaction contemplated by this Hosted
License Agreement. Direct costs shall not include any finance
charges, late fees, fees for optional services, fees for excess
usage, termination fees or fees for services beyond the scope
of this Hosted License Agreement.
(vii) Record Keeping. Customer shall maintain accurate business
records of all costs incurred by Customer under the Third Party
Agreements. Customer shall provide to CNP receipts evidencing
all costs under the Third Party Agreements, in connection with
Customer offsetting such costs against the Hosting Fee.
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[*] Confidential information has been omitted and separately filed with the
Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>
B. COSTS OF TERMINATING CUSTOMER'S EXISTING HOSTING SERVICES AGREEMENTS
(i) Termination Fees: Customer shall pay all Termination Fees arising
under the Third Party Agreements. For purposes of this Hosted
License Agreement, the term "Termination Fees" shall mean all costs
or claims arising under the Third Party Agreements for early
termination of such agreements and all costs approved by CNP in
connection with negotiating such terminations. Customer agrees to
make good faith efforts to reduce any fees and/or payments
associated with termination of the Third Party Agreements.
(ii) Reimbursement Amount: If the duration of this Hosted License
Agreement is less than three (3) years as a result of (i)
termination of the Hosted License Agreement for cause by Customer
under Section 13 of the Hosted License Agreement; (ii) termination
of this Hosted License Agreement by Customer pursuant to the Service
Level Agreement; or (iii) termination of this Hosted License
Agreement because CNP, or a successor, ceases to do business in the
ordinary course, CNP shall pay to Customer an amount equal to the
Reimbursement Amount within thirty (30) days of any termination set
forth in (i), (ii), or (iii) above, or Customer will have the right
to offset the Reimbursement Amount against any Hosting Fees due CNP,
which determination will be in Customer's sole and exclusive
discretion.
For purposes of this Hosted License Agreement, the term
"REIMBURSEMENT AMOUNT" shall be calculated as follows:
(Total of all Termination Fees) * ((36 - Duration in Months) / 36)
where "Duration in Months" is equal to the duration of the Agreement
in calendar months, or portion thereof.
Example: If the total of all Termination Fees is $900,000 and this
Hosted License Agreement is terminated on the 12th month following
the Commencement Date as a result of one or more of the conditions
described above, the Reimbursement Amount shall be calculated as
follows:
($900,000) * (36-12)/ 36) = $600,000
C. COSTS OF EQUIPMENT CONTRIBUTED BY CUSTOMER
(i) Subject to further written approval of CNP (a "TRANSFERRED EQUIPMENT
AUTHORIZATION"), Customer will have the right to transfer to CNP
additional equipment of Customer for use in connection with the CNP
Platform ("TRANSFERRED EQUIPMENT"). CNP shall own all right, title
and interest in the Transferred Equipment. As consideration for the
Transferred Equipment, CNP will have the right to issue to Customer
a Stock Warrant, on terms mutually agreed to by CNP and Customer,
for the fair market value of the Transferred Equipment, up to the
amount of $50,000 ("WARRANT"). In the event the fair market value of
the Transferred Equipment exceeds $50,000, Customer will have the
right to offset such excess amount against the Hosting Fees, or be
reimbursed by CNP for such excess amount, as more particularly
described in the Transferred Equipment Authorization. Each request
by Customer for a Transferred Equipment Authorization shall include
receipts or other documents evidencing the fair market value of the
Transferred Equipment.
(ii) Customer shall have a right to repurchase the Transferred Equipment
at fair market value by providing written notice to CNP within ten
(10) days of termination or expiration of this Hosted License
Agreement for any reason.
D. ADDITIONAL TERMS
(i) In the event the Termination Fees exceed $500,000, Customer shall
have the right to defer payment of the Hosting Fee due for calendar
month 13 until the earlier of (i) termination or expiration of this
Hosted License Agreement for any reason; or (ii) calendar month 24
of this Hosted License Agreement.
(ii) CNP hereby agrees to grant Customer a security interest in the
assets of CNP for purposes of securing payment of the Reimbursement
Amount as more particularly described in a security agreement to be
executed by the parties within sixty (60) days of the Commencement
Date. ("SECURITY AGREEMENT"). The terms and conditions of the
Security Agreement shall provide that Customer shall have a first
priority lien on all of CNP's accounts receivable due from Customer
("CUSTOMER RECEIVABLES") and
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that, to the extent the Reimbursement Amount exceeds the Customer
Receivables, Customer shall participate on a pari-passu basis with
the first priority secured interests of the following CNP creditors:
Noro-Mosely Partners IV, L.P., Psilos Group II, L.P., Constellation
Venture Capital, L.P., and Constellation Venture Capital Offshore,
L.P. (collectively, the "Creditor Group"). The final terms and
conditions of the Security Agreement shall be subject to the
approval of CNP, Customer and the Creditor Group; provided, however,
that such approval shall not be unreasonably conditioned, withheld
or delayed.
(iii) Each month during the term of this Hosted License Agreement, CNP
shall pay to Customer the Transition Assistance Fee. For purposes of
this Hosted License Agreement the "Transition Assistance Fee" shall
mean an amount equal to the monthly interest charges that would be
incurred by Customer if Customer financed the Termination Fees at an
annual percent rate of 7.5% compounded monthly. Customer shall
invoice CNP monthly for the Transition Assistance Fee on net thirty
(30) day terms. Upon request, Customer shall provide business
records to CNP to support any and all amounts comprising the
Termination Fees and to support calculation of the Transition
Assistance Fee.
III. SUPPORT SERVICES COSTS.
***** will have the right to ***** the Transition Service Costs (as defined
hereinafter) incurred by ***** in providing certain services to CNP as
requested by CNP in the exclusive discretion of CNP in connection with the
transition of ***** to the hosting facilities of CNP ("Transition
Services"). The term "Transition Service Costs" shall mean only contractor
fees, wages, vacation accrual, payroll taxes, health insurance premiums,
parking costs and severance amounts (up to 4 weeks pay, unless otherwise
agreed to by the parties) accruing and paid by ***** on or after July 1,
2001 to Transition Personnel (as defined hereinafter) for the Transition
Services. The term "Transition Personnel" shall mean, as of the Effective
Date, the following employees of *****.
Michel Delory
Manny Hernandez
Cory Hill
James Sabelis
Wolf Wirth
Mira Laksana
Deborah Runkle
Michael Wallace
Amy Tallcott
All Transition Personnel shall provide services to CNP on behalf of *****
as employees or independent contractors of *****. All Transition Personnel
shall provide services on a full-time, forty-hour per week, dedicated and
exclusive basis; provided, that no Transition Personnel shall provider
services to CNP for a period longer than one year.
Notwithstanding the ***** by CNP, ***** shall be solely responsible for all
obligations as an employer or contractor in connection with such personnel,
including (without limitation) all tax payment and withholding obligations,
unemployment insurance obligations and workers' compensation obligations.
***** warrants and represents that all services shall be performed in a
timely and workmanlike manner and of a quality conforming to generally
accepted industry standards and practices.
In the event any Transition Personnel leave the employ or hire of *****,
***** shall make available to Amplified, replacement personnel with
substantially the same qualifications and skill level as the previous
personnel. After completion of the Transition Services, ***** shall have
the right to reassign such personnel in ***** exclusive discretion.
Amplified shall have the right, in its exclusive discretion, to amend the
above list of Transition Personnel by written notice to *****, for purposes
of reducing the number of Transition Personnel required by Amplified. Any
such amendments to the above lists shall be subject to 4 weeks notice to
*****. Notwithstanding any contrary provision of this Section, Transition
Service Costs shall be measured as of the effective date of this Hosted
License Agreement and shall not include any salary increases occurring
sixty (60) days prior to the Commencement Date or any other increases in
personnel costs of ***** arising after the Commencement Date.
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[*] Confidential information has been omitted and separately filed with the
Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>
EXHIBIT C
HOSTED PLATFORM LICENSE TERMS AND CONDITIONS
THESE HOSTED PLATFORM LICENSE TERMS AND CONDITIONS ("TERMS AND CONDITIONS") are
attached and made a part of that certain Hosted License Agreement between CNP,
INC. ("CNP") and CUSTOMER. The Terms and Conditions, the Hosted License
Agreement and the Master Agreement between CNP and Customer establish the
general terms applicable to Customer's use of the CNP Platform. All capitalized
terms not defined herein shall have the same meaning as set forth in the Hosted
License Agreement and shall be incorporated herein by reference.
STANDARD TERMS AND CONDITIONS
1. Grant of License. CNP hereby grants to Customer a limited non-exclusive,
non-transferable right and license to access and use, during the term hereof,
the CNP Platform (in object code format only) and the related documentation more
particularly described in EXHIBIT A as follows:
(a) Customer shall have the right to access the CNP Platform on and through the
Internet for the internal use of Customer in operating the web sites of Customer
and Artists. For purposes of this Agreement the term, "ARTIST" shall mean an
artist who has entered into an agreement with Customer ("ARTIST AGREEMENT") for
purposes of allowing Customer to operate a web site offering information, goods
and services relating to such Artist on and through the Internet. All Artist
Agreements shall contain terms and conditions that are least as protective of
third party technology as the terms and conditions are protective of Customer's
technology.
(b) Except as provided in Section 1(c), Customer shall have the right to grant
third parties access to certain administrative functions of the Platform
designated by CNP from time to time, solely for purposes otherwise authorized
under this Hosted License Agreement. Customer shall require all such third
parties to execute agreements with terms and conditions at least as protective
as the terms and conditions of the Master Agreement and related attachments.
(c) Customer shall have the right to enter into co-branded promotional or
marketing relationships with third parties (collectively, "Third Party
Promotion") that include, among other things, access to the CNP Platform and the
Technology pursuant to the terms of the Agreement. Notwithstanding the
foregoing, Customer shall obtain the prior written approval of CNP, which
approval may be withheld, in CNP's exclusive discretion. for any Third Party
Promotion which results in (i) an unreasonable increase in equipment and other
resources required under the Hosted License Agreement; or (ii) Customer acting
as an application services provider, service bureau, time-sharing or outsourcing
service, as determined in the reasonable discretion of CNP. Customer shall
obtain the prior written consent of CNP prior to granting third parties access
to the CNP Platform in connection with Third Party Promotion.
(d) Customer shall have the right to grant access to the CNP Platform to users
on and through the Internet (collectively, "END USERS") for the limited purposes
of allowing such End Users to access the websites of Customer and Artists in the
ordinary course of viewing such websites on the Internet.
2. Ownership; Reservation of Rights. The CNP Platform is licensed and not sold
to Customer. CNP reserves all rights not expressly granted herein. Without
limiting the foregoing, all ownership rights in and to the CNP Platform and/or
related documentation (and all copies thereof) shall solely vest in and be the
property of CNP. No implied license or right of any kind is granted to Customer
regarding the CNP Platform and/or related documentation. Except as expressly
provided in this Hosted License Agreement, Customer shall not and shall not
allow third parties to use, reproduce, copy, market, sell, distribute, transfer,
translate, modify, adapt, disassemble, decompile or reverse engineer the CNP
Platform and/or related documentation. Except as expressly provided in this
Hosted License Agreement, Customer shall not use the CNP Platform and/or related
documentation in an application services provider, service bureau, time-sharing
or outsourcing capacity for the benefit of third parties.
3. Installation, Training and Support. Except as expressly provided under the
Hosted License Agreement, CNP shall have no obligation to provide installation,
training or support services for the CNP Platform.
4. CNP Platform Warranties. CNP warrants to Customer that the CNP Platform will
conform to the user documentation provided to Customer in all material respects
during the Term of the Hosted License Agreement.
5. DISCLAIMER. THE WARRANTIES SET FORTH UNDER THIS HOSTED LICENSE AGREEMENT ARE
IN LIEU OF ALL OTHER WARRANTIES, AND CNP SPECIFICALLY DISCLAIMS ALL OTHER
WARRANTIES WITH RESPECT TO THE PLATFORM AND SERVICES PROVIDED UNDER THIS HOSTED
LICENSE AGREEMENT, EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. STATEMENTS MADE
BY CNP'S SALES REPRESENTATIVES OR IN PROMOTIONAL MATERIALS DO NOT CONSTITUTE
WARRANTIES.
6. Customization. If Customer requests that CNP perform any modification or
customization work for Customer and wishes to have the work product conform to
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particular specifications, the same must be agreed to by CNP in writing;
provided, however, that CNP will not unreasonably withhold or delay such
agreement. All such work shall be performed by CNP pursuant to the Professional
Services Agreement as signed by CNP and Customer.
7. Other Products. If the CNP Platform requires Customer to use a third party
product (such as a database), Customer acknowledges that the continued utility
of the CNP Platform is dependent on that product and that if that product
requires an ongoing subscription fee, Customer must maintain such subscription
and pay all applicable fees; provided, however, that CNP will notify Customer
immediately of any such fees as of the execution of this Hosted License
Agreement, and, after the execution of this Hosted License Agreement, CNP will
obtain Customer's prior written approval before incorporating additional third
party products that require Customer's payment of any fees. Customer's rights
with respect to any third party product shall be as specified by the third
party, not this Hosted License Agreement. CNP makes no representation or
warranty whatsoever with respect to third party products. If such a product
becomes unavailable to Customer (for any reason other than Customer's default)
CNP will use CNP's best efforts to assist in obtaining a substantially
equivalent product.
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EXHIBIT D
CUSTOMER HARDWARE AND SOFTWARE REQUIREMENTS
The recommended minimum workstation configuration for administration of the CNP
Platform is as follows:
Pentium III
650 Mhz
128 MB RAM
10 GB hard rive
24X D-ROM
3.5" Floppy drive
56k Modem
10/100 Network Card
Mouse
Keyboard
17" monitor.
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EXHIBIT E
SERVICE LEVELS
AMPLIFIED SERVICE LEVELS
1. Service Level Goal; Service Level Agreement. CNP shall use all reasonable
commercial efforts to ensure that "Customer Web Site" is operating and
available to End Users *****% of the time in any calendar month ("Uptime
Commitment")."In the event that Customer experiences any of the service
performance issues defined below due to CNP's failure to provide Services,
Customer will be eligible to receive the Service Credits described below
(the "Service Level Agreement").
2. Definitions. The following definitions shall apply to the Service Level
Agreement.
a. "Hours of Operation" shall mean twenty-four (24) hours per day, seven
(7) days per week.
b. "Downtime" shall mean that period of time, expressed in hours, when
"Customer Web Site" is not accessible by End Users due to an equipment
failure or service outage, subject to the qualifications and further
definition set forth below. A "Downtime Event" only includes
unscheduled maintenance outages and non-maintenance related outages
that are a direct result of a failure of CNP to make " Customer Web
Site" accessible by End Users. Downtime shall not include the period
of time when "Customer Web Site" is not accessible by End Users as a
result of (i) scheduled network or service upgrades; (ii) the acts or
omissions of Customer, Customer employees, agents, contractors, or
vendors, or anyone gaining access to CNP's network or "Customer Web
Site" by means of Customer's passwords or equipment; (iii) Customer
Content on "Customer Web Site"; or (iv) the occurrence of any event
that is beyond CNP's control.
c. "Availability" is defined using the formula below:
Availability = Hours of Operation minus Downtime
---------------------------------
Hours of Operation
d. "Allowable Downtime" shall mean that amount of downtime that is
allowable before becoming a Performance Problem, defined as:
Allowable Downtime = (1 - Uptime Commitment) (expressed in hours)
x 24 x # of days in the applicable month.
e. "Performance Problem" shall mean that (i) Downtime has exceeded
Allowable Downtime cumulatively, resulting in Availability less than
the Uptime Commitment during any one month, (ii) each Downtime Event
that exceeds the Allowable Downtime, or (iii) any single Downtime
Event that exceeds four (4) hours.
f. "Service Credit" shall mean an amount equal to *****% of the recurring
monthly service fee set forth in Exhibit B.
g. "Severity 1" shall mean highest priority; production is down.
h. "Severity 2" shall mean major site or client tool functionality
problem, such as ordering, shopping, registration, no access to tool,
tool does not function, etc.
i. "Severity 3" shall mean a minor site or client tool functionality
problem.
j. "Severity 4" shall mean a problem not affecting production.
3. System Performance. CNP's system performance will be measured against the
Keynote Business 40 (www.keynote.com) and measured performance will be
within *****% of the weekly index benchmark within any 1 hour period.
Availability, performance and download time distribution are the key
metrics used to analyze performance. Pages used for measurement will be
measured without any elements served outside the CNP Network. The Keynote
US 25 NT01 Agent Group will be used as the metropolitan areas from which
your site is measured. At present, these cities include Atlanta, Boston,
Chicago, Cincinnati, Cleveland, Dallas, Denver, Detroit, Houston, Kansas
City, Los Angeles, Miami, Milwaukee, Minneapolis, New York, Philadelphia,
Phoenix, Pittsburgh, Portland, San Diego, San Francisco, Seattle, St.
Louis, Tampa, and Washington, D.C.
4. Service Representative. CNP will provide a 24/7/365 toll-free number to
report problems. Through this facility problems may be escalated via pager,
dependent upon the severity of the problem.
5. Performance Problems. In the event Customer experiences a Performance
Problem, Customer shall be entitled to receive from CNP one (1) Service
Credit for each Performance Problem. Examples: If Customer experiences one
Performance Problem, it shall be eligible to receive one Service Credit. If
Customer experiences two Performance Problems, either from a single event
or multiple events, it shall be eligible to receive two Service Credits.
6. Downtime Event. In the event that CNP discovers or is notified by Customer
that Customer is experiencing a Downtime Event, CNP will take all actions
necessary to determine the source of the Downtime Event.
a. Time to Discover Source of Downtime Event; Notification of Customer.
CNP will handle Downtime Events according to the following schedule:
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i. Severity 1: CNP will communicate with Customer within twenty
(20) minutes of discovering, or being notified of such a
Downtime Event. Subsequently, CNP will communicate at least
once with Customer within two (2) hours with a notification of
resolution of the Downtime Event or a schedule for resolution.
ii. Severity 2: CNP will communicate with Customer within
forty-five (45) minutes of discovering, or being notified of
such a Downtime Event. Subsequently, CNP will communicate at
least once with Customer within four (4) hours with a
notification of resolution of the Downtime Event or a schedule
for resolution.
iii. Severity 3: CNP will communicate with Customer within two (2)
hours of discovering, or being notified of such a Downtime
Event. Subsequently, CNP will communicate at least once with
Customer within eight (8) hours with a notification of
resolution of the Downtime Event or a schedule for resolution.
iv. Severity 4: CNP will communicate with Customer within eight (8)
hours of discovering, or being notified of such a Downtime
Event. Subsequently, CNP will communicate at least once with
Customer within one (1) calendar day with a notification of
resolution of the Downtime Event or a schedule for resolution.
b. Resolution of Downtime: CNP will use commercially reasonable efforts
to resolve all Downtime Events based on the severity levels set forth
above and in accordance with the commercial impact to Customer caused
by the Downtime Event, and which resolution period will not materially
adversely affect Customer's benefits set forth in this Agreement.
c. If the source of and remedy to the Downtime Event reside outside of
the CNP LAN or WAN, CNP will use commercially reasonable efforts to
notify the party(ies) responsible for the source of the Downtime Event
and cooperate with such party(ies) to resolve such problem as soon as
possible.
d. Failure to Determine Source and/or Remedy. In the event that CNP (i)
is unable to determine the source of the Downtime Event in a timely
manner and/or; (ii) is the sole source of the Downtime Event and is
unable to remedy such Downtime Event in a timely manner, CNP will
deliver a Service Credit to Customer for each two (2) hour period in
excess of the Allowable Downtime per month.
7. Customer Cooperation. Customer shall notify CNP immediately of any
equipment failure or Downtime that it discovers. Customer shall cooperate
with CNP to the fullest extent possible in order to determine the cause of
and resolve any equipment failure or Downtime. An equipment failure shall
be measured from the minute CNP becomes aware that the equipment has failed
until the minute CNP notifies Customer that the equipment is functioning,
but shall not include minutes during which Customer is uncooperative. A
Downtime Event shall be measured from the minute CNP becomes aware of such
Downtime until the minute CNP notifies Customer that the service has been
restored, but shall not include minutes during which Customer is
unavailable or uncooperative.
8. Customer Must Request Service Credit. In order to receive any of the
Service Credits described above, Customer must notify CNP within fourteen
(14) days from the time Customer becomes eligible to receive a Service
Credit. Failure to comply with this requirement will forfeit Customer's
right to receive a Service Credit.
9. Remedies Shall Not Be Cumulative; Maximum Service Credit. The aggregate
maximum number of Service Credits to be issued by CNP to Customer for any
and all Downtime periods and Performance Problems that occur in a single
calendar month shall not exceed ***** Service Credits. A Service Credit
shall be issued in the CNP invoice in the month following the Performance
Problem, unless the Service Credit is due in Customer's final month of
Service. In such case, a refund for the dollar value of the Service Credit
will be mailed to Customer.
10. Service Credit Exclusions. With respect to Performance Problems caused by
application code written by non-CNP personnel, CNP will respond in
accordance with Section 6(a). However, with respect to such problems, no
Service Credits will be applied. For MarketFirst, Data Warehouse,
Vbulletin, WebFactory, and DigiChat ("Non-Critical Application(s)"), CNP
will meet the uptime and availability commitments consistent with such
technology. However, for system problems related to Non-Critical
Applications, no Service Credits will be applied.
CNPCNP
11. Termination Option for Chronic Problems. Customer may terminate this
Agreement for cause and without penalty, by notifying CNP within five (5)
business days following the end of a calendar month in the event either of
the following occurs:
(i) Customer experiences more than ***** Performance Problems resulting
from ***** or more nonconsecutive materially different, unrelated
Performance Problems during a ***** consecutive week period; or
(ii) Customer experiences more than ***** consecutive hours of Downtime
due to any single event during an ***** consecutive week period.
Such termination will be effective thirty (30) days after receipt of
such notice by CNP.
(iii) Customer experiences more than ***** consecutive hours of Downtime
due to any single event during a single ***** consecutive week
period.
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12. SERVICE LEVEL EXCLUSIONS. THE SERVICE LEVEL AGREEMENT DOES NOT APPLY TO ANY
SERVICE (S) THAT EXPRESSLY EXCLUDE THIS SERVICE LEVEL AGREEMENT AND ANY
PERFORMANCE ISSUES (1) CAUSED BY FACTORS OUTSIDE OF AMPLIFIED'S REASONABLE
CONTROL, INCLUDING ANY THIRD PARTIES ACTING ON AMPLIFIED'S BEHALF; (2) THAT
RESULTED FROM ANY ACTIONS OR INACTIONS OF CUSTOMER OR ANY THIRD PARTIES;
OR(3) THAT RESULTED FROM CUSTOMER'S EQUIPMENT AND/OR THIRD PARTY EQUIPMENT
(NOT WITHIN THE PRIMARY CONTROL OF AMPLIFIED). THIS SERVICE LEVEL AGREEMENT
STATES CUSTOMER'SSOLE AND EXCLUSIVE REMEDY FOR ANY FAILURE BY AMPLIFIED TO
PROVIDE SERVICE(S).
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<PAGE>
EXHIBIT F
SOURCE CODE ESCROW FEES
CNP Beneficiary
Description Total Fees Fees
----------- ----- ---- -----------
First Year $***** $***** $*****
Renewal Years $*****/year $*****/year $*****/year
Each Additional Beneficiary $*****/each $***** $*****
Unlimited deposit updates/replacements +
one additional storage unit $*****/year $*****/year $*****/year
Custom Agreements See Note 1 *****% *****%
Release filing fee See Note 2 *****% *****%
Notes:
1. A $***** annual customization fee will be added when contract changes
increase DSI's risk or modify our release, termination or update processes.
2. Direct expenses in excess of $***** will be chargeable.
Any discounts granted by DSI Technology Escrow Services shall be applied equally
between CNP and Customer.
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PROFESSIONAL SERVICES AGREEMENT
CNP, INC.
1465 Northside Drive, Suite 222
Atlanta, Georgia 30318
Agreement Number: _______
Date: __________
Customer Name: ARTISTdirect, Inc.
Address: 5670 Wilshire Boulevard, Suite 200
City, State, Zip: Los Angeles, California 90036
THIS PROFESSIONAL SERVICES AGREEMENT ("PROFESSIONAL SERVICES AGREEMENT") is
between CNP, INC. ("CNP") and the undersigned CUSTOMER whereby CNP will provide
professional services to be performed in accordance with the Master Agreement
and the terms and provisions below.
STANDARD TERMS AND CONDITIONS
1. Master Agreement. The terms of the Master Agreement are made a part of this
Professional Services Agreement by their reference herein. In the event of a
conflict between this Professional Services Agreement and the terms of the
Master Agreement, the terms of Master Agreement shall control and govern, unless
expressly stated to the contrary.
2. Requests for Professional Services. CNP agrees to provide professional
services ("PROFESSIONAL SERVICES") to Customer as set forth in a Request for
Professional Services or other written statement of work (each a "REQUEST")
signed by CNP and Customer, an example of which is attached as EXHIBIT A. The
Requests will specify the nature of work to be performed, the specific
responsibilities and activities required, the date on which the Professional
Services will begin, and the type, length and location of the Professional
Services. The Requests will also specify the nature of and specifications for
any software, customizations, documentation, information or other materials
(collectively "DELIVERABLES") developed by CNP or otherwise provided to Customer
under this Professional Services Agreement. After execution by Customer, the
Request will be attached to this Professional Services Agreement and made a part
hereof.
3. Change Order. Any modifications to the specifications in a Request will
require execution of a written and mutually agreed upon change order by CNP and
Customer ("CHANGE ORDER"). Each Change Order complying with this section shall
be deemed an amendment to the Request.
a) Modifications. In the event that CNP in good faith, uncovers unforeseen
factors in the development of such Change Order and determines that the same
materially increases CNP's cost of performance hereunder, CNP shall notify
Customer immediately in writing of such factors and seek Customer's approval in
mitigating the factors by revising the specifications or price associated with
the current Request.
b) Rejection of Change Order. In the event that the parties cannot mutually
agree, after using their best efforts, respectively, upon the Change Order, CNP
reserves the right to terminate the Request. Upon such termination, Customer
shall pay to CNP all fees for any Professional Services or Deliverables provided
by CNP to Customer pursuant to a Request up to the point of such termination.
4. Customer Responsibilities. Customer shall cooperate with CNP during the term
of this Professional Services Agreement and shall perform all duties and
obligations of Customer identified in a Request. Customer shall designate an
employee or agent as project manager who shall be assigned the primary
responsibility for communicating with and providing necessary assistance to
Customer during the term of this Professional Services Agreement.
5. Facilities. Upon reasonable advance notice by CNP and as set forth in a
Request, Customer agrees to provide reasonable working space, computer machine
time, materials and any other services and materials which may be necessary in
connection with the performance of the Professional Services.
6. Fees. For each Request, prior to commencing any work, CNP will provide
Customer with either an hourly rate with estimated hours or a fixed fee as
specified in the Request.
a) Hourly Fees. If the Professional Services will be provided at an hourly
rate, the Professional Services will be performed at the published rates of CNP
prevailing at the time the Professional Services are provided to Customer unless
otherwise specified in a Request. A schedule of CNP's rates as of the effective
date of this Professional Services Agreement is attached hereto as Exhibit B.
Except for fixed fee Professional Services, any quantity of hours or dollar
amounts indicated on a Request shall be construed only as an estimate for the
Professional Services, but in the event that the actual hours or dollar amounts
exceed by *****% the amounts set forth in the applicable Request, CNP will
notify Customer immediately in writing and the parties will re-evaluate the
Request.
b) Fixed Fees. Except as otherwise provided in a Request, Customer shall pay
for all fixed fee Professional Services by paying *****% of the fixed fee upon
execution of the Request with the remainder payable upon the completion of the
Professional Services pursuant to such Request.
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c) Fee Increases. CNP reserves the right to revise its published rates from
time to time during the term of this Professional Services Agreement, but in no
event will CNP's fees charged to Customer increase by more than *****% of the
previous year's fees during each year of the Term.
7. Travel and Other Expenses. Customer will reimburse CNP for all reasonable,
actual, out-of-pocket travel, commuting, parking, lodging meals, costs of
courier services, photocopying, communications charges, long distance telephone
calls, materials and other expenses reasonably incurred by CNP in connection
with the Professional Services. All travel and other expenses must be authorized
in writing in advance by Customer and comply with Customer guidelines for such
expenses.
8. Invoices. For Professional Services provided on an hourly basis, CNP will
submit monthly invoices. For Professional Services provided on a fixed fee
basis, CNP will submit invoices as provided under this Professional Services
Agreement or as otherwise set forth in a Request. Invoices are payable in full
within fifteen (15) days after Customer's receipt of an invoice.
9. Warranties. Limited Warranty for Professional Services. For the Warranty
Period, CNP warrants that all Professional Services shall be performed in a
timely and workmanlike manner and of a quality conforming to generally accepted
industry standards and practices. Upon receipt of written notice from Customer
describing a breach of the foregoing warranty in such reasonable detail as is
requested by CNP, CNP shall, in CNP's sole discretion and expense, use
commercially reasonable efforts to re-perform the services described in such
written notice so as to conform to mutually agreed to specifications, or if no
specifications exists, generally accepted industry standards and practices. The
term "Warranty Period" shall mean a period of ninety (90) days commencing with
the delivery of the Professional Services or Deliverables. EXCEPT AS PROVIDED
UNDER THIS SECTION 9, CNP MAKES NO WARRANTY REGARDING THE SERVICES, EXPRESS,
IMPLIED OR STATUTORY, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
10. MAXIMUM LIABILITY. EXCEPT FOR CNP'S INDEMNIFICATION OBLIGATIONS SET FORTH
IN THE MASTER AGREEMENT, CNP'S LIABILITY ON ANY CLAIM OR LOSS OR LIABILITY
ARISING OUT OF OR CONNECTED WITH THIS PROFESSIONAL SERVICES AGREEMENT SHALL IN
ALL CASES BE LIMITED SOLELY TO CUSTOMER AND SHALL IN NO CASE EXCEED THE AMOUNTS
PAID TO CNP BY CUSTOMER WITH RESPECT TO SUCH SERVICES.
11. DISCLAIMER. ALL OTHER WARRANTY DISCLAIMERS, LIMITATIONS OF REMEDY AND
LIMITATIONS OF LIABILITY IN THE MASTER AGREEMENT SHALL APPLY TO THIS AGREEMENT.
12. Ownership.
(a) Platform Ownership: CNP, or its third party supplier, is the sole owner
of all right, title and interest in all interfaces, supplements, modifications
or enhancements to the CNP Platform developed by or on behalf of CNP ("Platform
Deliverables") ), including but not limited to all copyrights, patents,
trademarks, trade names, service marks, trade secrets, confidential information
or other proprietary rights, and all goodwill associated with the Platform
Deliverables will inure exclusively to the benefit of CNP.
(b) Customer Ownership: Customer is the sole owner of all right, title and
interest in the Customer Content and the Customer-Owned Deliverables, including
but not limited to all copyrights, patents, trademarks, trade names, service
marks, trade secrets, confidential information or other proprietary rights, and
all goodwill associated with the Customer Content and the Customer-Owned
Deliverables will inure exclusively to the benefit of the Customer. For purposes
of the Agreement, the term "Customer-Owned Deliverables" shall mean the
Deliverables (excluding the Platform Deliverables) developed by or on behalf of
CNP for Customer under a Request or other written statement of work.
(c) Residuals. Notwithstanding anything to the contrary, CNP shall retain
shall the perpetual right to use, on a royalty-free basis, with the right of
sublicense, to all ideas, concepts, tools, templates, methods, processes,
know-how, and organization techniques used by CNP personnel in the development
of the Customer-Owned Deliverables.
(d) Other Development. The parties may from time to time enter into
additional Requests. Except as otherwise agreed by the parties in such Request,
the ownership provisions of this Section 12 shall apply.
13. Confidential Information. All information, whether oral, visual or in
physical form, received by Customer under this Professional Services Agreement
shall be subject to the confidentiality terms agreed to by the parties under the
Master Agreement or otherwise in writing. Notwithstanding anything to the
contrary, the Deliverables shall be deemed confidential and proprietary
information of the owner of such Deliverables.
14. Termination. This Professional Services Agreement will commence on the
Effective Date and will remain in effect until terminated as provided herein.
a) Either party may terminate this Professional Services Agreement for
convenience upon ninety (90) days notice to the other party.
b) CNP may terminate this Professional Services Agreement upon ten (10)
days prior written notice to Customer for nonpayment of any invoice or other
amount owed to CNP hereunder.
c) Either party may terminate this Professional Services Agreement upon the
occurrence of a material breach hereof by the other party, which material breach
has not been cured within thirty (30) days after the date of written notice to
the breaching party.
d) If either party terminates this Professional Services Agreement then
Customer shall pay CNP for Professional Services performed and Deliverables
provided in accordance with this Agreement prior to the effective date of such
termination ("TERMINATION DATE"). If payment under a Request was on a fixed-fee
basis, then Customer shall pay CNP on a time-and-materials basis according to
CNP's then-current time-and-materials rates for Professional Services
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performed by CNP that were not paid for prior to the Termination Date; provided,
however, that all fees paid and owed under the Requests shall not exceed the
applicable fixed fee set forth in the Request. Customer shall make such payments
to CNP no later than thirty (30) days after the Termination Date.
ACCEPTED AND AGREED:
ARTISTDIRECT, INC. CNP, INC.
By: /s/ KEITH YOKOMOTO By: /s/ CHRIS MELTON
------------------------------- -------------------------------
Name: Keith Yokomoto Name:
------------------------------- -------------------------------
Title: President Title: CEO
------------------------------- -------------------------------
Date: 8/14/01 Date: 8/10/2001
------------------------------- -------------------------------
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<PAGE>
EXHIBIT A
PROFESSIONAL SERVICES AGREEMENT
REQUEST FOR SERVICES
SAMPLE
CNP, INC.
1465 Northside Drive, Suite 222
Atlanta, Georgia 30318
Agreement Number: _______
Request Number: _______
Date: __________
Customer Name:
Address:
City, State, Zip:
In accordance with the Professional Services Agreement ("PROFESSIONAL SERVICES
AGREEMENT") between CNP and CUSTOMER", Customer requests that CNP provide the
following professional services:
GENERAL DESCRIPTION OF INSTALLATION/ON-SITE ASSISTANCE TO BE PERFORMED BY CNP
FOR CUSTOMER:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SPECIFIC CNP RESPONSIBILITIES AND ACTIVITIES REQUIRED:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SPECIFIC CUSTOMER RESPONSIBILITIES AND ACTIVITIES REQUIRED:
--------------------------------------------------------------------------------
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ITEMS TO BE DELIVERED BY CNP:
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HOURLY RATE: ________________
PROJECT INITIATION DATE (INSTALLATION/ON-SITE ASSISTANCE):
Beginning _____ days from contract signing
ESTIMATED PROJECT DURATION PERIOD:
From:_______________________
To:_________________________
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<PAGE>
LOCATION OF ASSIGNMENT: ____________________________
OTHER COMMENTS:
--------------------------------------------------------------------------------
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--------------------------------------------------------------------------------
================================================================================
ACCEPTED AND AGREED:
ARTISTdirect, Inc. CNP, INC.
By: By:
------------------------------- -------------------------------
Name: Name:
------------------------------- -------------------------------
Title: Title:
------------------------------- -------------------------------
Date: Date:
------------------------------- -------------------------------
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<PAGE>
EXHIBIT B
CNP PROFESSIONAL SERVICES STANDARD HOURLY RATES SCHEDULE
DESCRIPTION RATE PER HOUR
ENGINEERING
Engineering Executive/Architect $250
Director, Engineering $200
Sr Software Engineer $140
Software Engineer $115
Technical Director $200
Sr Web Developer $140
Web Developer $100
Sr Database Administrator $165
Sr Database Engineer $140
QA Director $200
Sr QA Engineer $140
QA Engineer $100
OPERATIONS
Director, Operations $200
Network/Operations Engineer $140
Webmaster $100
DELIVERY SERVICES
Project Executive $190
Project Director $170
Project Manager $135
The rates listed above are subject to change in accordance with the terms and
conditions of the Professional Services Agreement.
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<PAGE>
PROFESSIONAL SERVICES AGREEMENT
REQUEST FOR SERVICES
CNP, INC.
1465 Northside Drive, Suite 222
Atlanta, Georgia 30318
Agreement Number: _______
Request Number: 1
Date: __________
Customer Name: ARTISTdirect
Address: 5670 Wilshire Blvd, Suite 200
City, State, Zip: Los Angeles, CA 90036
In accordance with the Professional Services Agreement ("PROFESSIONAL SERVICES
AGREEMENT") between CNP and CUSTOMER", Customer requests that CNP provide the
following professional services:
GENERAL DESCRIPTION OF INSTALLATION/ON-SITE ASSISTANCE TO BE PERFORMED BY CNP
FOR CUSTOMER:
SEE ATTACHED
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SPECIFIC CNP RESPONSIBILITIES AND ACTIVITIES REQUIRED:
SEE ATTACHED
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SPECIFIC CUSTOMER RESPONSIBILITIES AND ACTIVITIES REQUIRED:
SEE ATTACHED
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
ITEMS TO BE DELIVERED BY CNP:
SEE ATTACHED
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HOURLY RATE: Except as otherwise provided in the Agreement or in another
Request, all services are included in the Hosting Fee described in the Hosted
Platform License Agreement.
PROJECT INITIATION DATE (INSTALLATION/ON-SITE ASSISTANCE): Within ten (10) days
of the effective date of the Hosted Platform License Agreement
ESTIMATED PROJECT DURATION PERIOD:
SEE ATTACHED
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<PAGE>
LOCATION OF ASSIGNMENT: CNP facilities
OTHER COMMENTS:
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--------------------------------------------------------------------------------
ACCEPTED AND AGREED:
ARTISTDIRECT, INC. CNP, INC.
By: By:
------------------------------- -------------------------------
Name: Name:
------------------------------- -------------------------------
Title: Title:
------------------------------- -------------------------------
Date: Date:
------------------------------- -------------------------------
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<PAGE>
STATEMENT OF WORK FOR REQUEST FOR SERVICES NO. 1
PHASE I
*****
PHASE II
*****
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<PAGE>
*****
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*****
SCHEDULE AND CUSTOMER RESPONSIBILITIES
The estimated project schedule and Customer responsibilities shall be set forth
in a project plan mutually agreed to by the parties, as revised by the parties
from time to time.
FUTURE PHASES
*****
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requested with respect to the omitted portions.
<PAGE>
PLATFORM LICENSE AND MAINTENANCE AGREEMENT
CNP, INC.
1465 Northside Drive, Suite 222
Atlanta, Georgia 30318
Agreement Number: _______
Date: __________
This PLATFORM LICENSE AND MAINTENANCE AGREEMENT ("PLATFORM LICENSE AGREEMENT")
is between CNP, INC. ("CNP") and the undersigned CUSTOMER. This Platform License
Agreement and the Master Agreement establishes the general terms applicable to
Customer's utilization of certain CNP technology components providing
publishing, content and e-commerce solutions (the "LICENSED PLATFORM
COMPONENTS").
STANDARD TERMS AND CONDITIONS
1. Transition Option Date. This Platform License Agreement shall be effective
on the Transition Option Date. For purposes of this Platform License Agreement,
the term "TRANSITION OPTION DATE" shall have the meaning ascribed in the Hosted
Platform License Agreement for the term "Transition Option Date".
2. Delivery and Acceptance. Within ten (10) days of the Transition Option Date,
CNP shall deliver to Customer the most current version of those CNP Licensed
Platform Components identified in Exhibit A to this Platform License Agreement
(the "Licensed Platform Components"). Customer acknowledges and agrees that
Customer has had an opportunity to review the Licensed Platform Components and
has independently determined that Licensed Platform Components will meet its
requirements. The Licensed Platform Components shall be deemed accepted upon
delivery.
3. License Grant. Effective as of the Transition Option Date, CNP grants
Customer a limited, nonexclusive, and non-transferable license to use the
Licensed Platform Components only as follows:
(a) in executable code form (except as provided in Section 4);
(b) the number of copies specified in Exhibit B to this Platform License
Agreement;
(c) on servers owned or controlled by Customer; and
(d) for the internal business purposes of Customer as further described in
the Hosted Platform Agreement.
4. Source Code Rights. Upon the occurrence of a release condition under an
escrow agreement (if any) between CNP and Customer ("ESCROW AGREEMENT"),
Customer shall have the right to use the source code for the Licensed Platform
Components; provided, however, that such use shall be limited to internal
purposes for correcting defects and creating enhancements for use by Customer in
accordance with this Platform License Agreement, and not for purposes of
licensing, sublicensing, distributing or making available the Licensed Platform
Components, or any enhancements or other derivative works to third parties.
5. Use Restrictions. Customer may not decompile, reverse compile, or reverse
engineer the Licensed Platform Components. In addition, Customer may not copy
Licensed Platform Components, except for a single back-up copy of the Licensed
Platform Components, without the express written consent of CNP. Customer shall
not permit any third party access to Licensed Platform Components except as
otherwise permitted under the Hosted Platform License Agreement, and may use
Licensed Platform Components only at the facilities of Customer or at facilities
otherwise agreed to in writing by CNP. Customer may not assign, transfer, sell,
license, sublicense or grant any rights to or interest in Licensed Platform
Components to any third party. Customer will comply with all terms and
conditions packaged with or accompanying any third party software (if any)
furnished to Customer under this Platform License Agreement.
6. Term of Agreement. This Platform License Agreement shall commence on the
Transition Option Date and shall continue for so long as Customer complies with
the terms and conditions herein, including payment of all one-time fees or
recurring license fees, maintenance fees and other fees under this Platform
License Agreement.
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7. Maintenance.
a) New Versions. CNP may offer maintenance services for Licensed Platform
Components in its exclusive discretion ("Maintenance"). As part of Maintenance,
CNP may issue modifications to Licensed Platform Components in the form of
updates, enhancements or bug-fixes (the "New Versions"). So long as Customer has
paid the maintenance fees described herein and has not otherwise breached this
Platform License Agreement, CNP shall furnish to Customer any New Versions made
generally available to its customers without payment of additional license fees.
Customer shall be solely responsible for the implementation of and the
compatibility of all New Versions. All of the terms and conditions of this
Platform License Agreement shall apply to such New Versions.
b) Consulting. CNP may agree to provide software consulting services to
Customer in connection with Licensed Platform Components. All such services
shall be provided under the Professional Services Agreement at CNP's prevailing
rates in accordance with a written statement of work agreed to in advance by the
parties.
8. Payments to CNP.
a) License Fees. During the term of this Agreement, Customer shall pay to
CNP, as a monthly license fee for Licensed Platform Components, the amounts set
forth in Exhibit B to this Platform License Agreement. Additional sites or usage
may be added to this Platform License Agreement upon the mutual agreement of the
parties and at the then-current license and maintenance fees of CNP.
b) Maintenance Fees. Maintenance fees for Licensed Platform Components are
paid monthly in advance. The monthly fee for Maintenance for the first year
following the Transition Option Date is set forth in Exhibit B to this Platform
License Agreement. CNP shall invoice Customer for Maintenance on a monthly basis
for the first year following the Transition Option Date. Thereafter, maintenance
shall renew for an additional one-year term on each anniversary of the
Transition Option Date unless Customer provides at least thirty (30) days notice
of termination prior to such date. Reinstatement of Maintenance following
termination by Customer shall be subject to the exclusive discretion of CNP and
to payment of additional fees as determined by CNP.
9. Termination Rights. Either party shall have the right to terminate this
Platform License Agreement due to a material breach by the other that is not
cured within thirty (30) days after written notice of such breach.
10. Effect of Termination. Following termination of this Platform License
Agreement for any reason, Customer's right to use Licensed Platform Components
shall terminate, and Customer shall remove any and all copies of Licensed
Platform Components from its computer systems and, together with all associated
documentation, and return them to CNP.
11. Warranties. LICENSED PLATFORM COMPONENTS AND ALL SERVICES ARE PROVIDED "AS
IS" WITHOUT WARRANTY OF ANY KIND. CNP MAKES NO OTHER WARRANTY OF ANY KIND
WHATSOEVER, EXPRESS OR IMPLIED EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES,
INCLUDING WITHOUT LIMITATION, TITLE, SECURITY, NON-INFRINGEMENT, AVAILABILITY,
ACCURACY, MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
12. LIMITATIONS OF LIABILITY. CNP SHALL NOT BE LIABLE TO CUSTOMER OR ANY OTHER
PERSON OR ENTITY FOR ANY INDIRECT, CONSEQUENTIAL, EXEMPLARY, INCIDENTAL, OR
PUNITIVE DAMAGES UNDER THIS PLATFORM LICENSE AGREEMENT (INCLUDING BUT NOT
LIMITED TO LOST BUSINESS PROFITS AND LOSS, DAMAGE OR DESTRUCTION OF DATA)
REGARDLESS OF THE FORM OF THE ACTION, WHETHER IN CONTRACT OR IN TORT, INCLUDING
NEGLIGENCE, AND REGARDLESS OF WHETHER SUCH PARTY HAS BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES IN ADVANCE OR WHETHER SUCH DAMAGES ARE REASONABLY
FORESEEABLE. NOTWITHSTANDING THE FOREGOING, THE LIABILITY OF CNP FOR ANY REASON
AND FOR ANY CAUSE OF ACTION WHATSOEVER SHALL NOT EXCEED THE AMOUNTS PAID BY
CUSTOMER TO CNP UNDER THIS PLATFORM LICENSE AGREEMENT DURING THE TWELVE (12)
MONTHS PRECEDING THE EVENT GIVING RISE TO LIABILITY.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Platform License
and Maintenance Agreement as of the ____ day of July, 2001.
ACCEPTED AND AGREED:
ARTISTDIRECT, INC. CNP, INC.
By: /s/ KEITH YOKOMOTO By: /s/ CHRIS MELTON
------------------------------- -------------------------------
Name: Keith Yokomoto Name:
------------------------------- -------------------------------
Title: President Title: CEO
------------------------------- -------------------------------
Date: 8/14/01 Date: 8/10/2001
------------------------------- -------------------------------
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<PAGE>
EXHIBIT A
LICENSED PLATFORM COMPONENTS
The "LICENSED PLATFORM COMPONENTS" shall mean those certain components of the
CNP Platform licensed by CNP to Customer under the Hosted License Agreement,
including any Platform Deliverables developed by CNP under the Professional
Services Agreement, but excluding any Third Party Technology.
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<PAGE>
EXHIBIT B
LICENSE AND MAINTENANCE FEES
1. Licensed Platform Components License Fee: $***** per month
2. License Platform Components Maintenance Fee: $***** per month
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[*] Confidential information has been omitted and separately filed with the
Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.