Distribution and License Agreement - Ask Jeeves International Inc., Ask Jeeves KK, Ask Jeeves Inc. and Trans Cosmos Inc.
FIRST AMENDED AND RESTATED
DISTRIBUTION AND LICENSE AGREEMENT
THIS FIRST AMENDED AND RESTATED DISTRIBUTION AND LICENSE AGREEMENT (the
"AGREEMENT"), dated as of June 1, 2003 by and between Ask Jeeves International,
Inc., a Delaware corporation ("AJI"), Ask Jeeves Kabushiki Kaisha (in Japanese)
(A.J.J. Co., Ltd. in English) (the "KK"), and Ask Jeeves, Inc., a Delaware
corporation ("ASK JEEVES") (only with respect to the provisions of Sections 8,
10, 12(b) and 15, subject to the limitation of liability set forth in Section
13, (and no other provisions)) and Trans Cosmos, Inc. ("TCI") (only with respect
to the provisions of Sections 3(j), 8, 11 and 15 subject to the limitation of
liability set forth in Section 13, (and no other provisions)), subject to
termination set forth in Section 14, amends and restates that Distribution and
License Agreement dated as of August 31, 2000, by and between AJI, the KK, Ask
Jeeves and TCI.
WHEREAS, AJI and TCI have entered into a Joint Venture Agreement as of
August 31, 2000, pursuant to which they established the KK.
WHEREAS, the parties entered into a Distribution and License Agreement
dated as of August 31, 2000 to (i) cause the adaptation, localization,
maintenance and update of the Ask Jeeves natural language search engine in the
Japanese language, and, subject to the terms and conditions of this Agreement,
all current and future Ask Jeeves products, services, technology, trademarks,
designs, page layouts and other visual elements used by Ask Jeeves and its
subsidiaries for the KK's exclusive use (as described herein) in the Territory;
and (ii) to exploit the Ask Jeeves' proprietary technology licensed through AJI
in the Territory, and to serve as the exclusive vehicle in the Territory for the
implementation and distribution of all (except as provided herein) current and
future products, services and technology employed by Ask Jeeves and its
subsidiaries.
WHEREAS, AJI wishes to amend certain of the terms under which it has
granted to the KK an exclusive right license to the KK to use all current and
future proprietary technology of Ask Jeeves and its subsidiaries for the purpose
of operating, marketing and distributing such proprietary technology of Ask
Jeeves to consumers and Corporate Customers in the Territory only, and the KK
has agreed to such amendment.
NOW, THEREFORE, in consideration of the foregoing and the representations,
warranties, covenants and agreements contained herein, the parties hereto,
intending to be legally bound hereby, agree as follows:
1. DEFINITIONS.
"AJ" means, collectively, AJI and Ask Jeeves and its subsidiaries.
"AJ ASSETS" shall have the meaning given to it in Section 2 of this
Agreement.
"AJ CONTENT" means all knowledge bases and other data and information, in
any medium, created and/or maintained by AJ using the AJ Software, including
without limitation any
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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improvements, additions, modifications and enhancements to the U.S.
Knowledgebase and any text, music, sound, photographs, video or graphics.
"AJ ENTITY" shall have the meaning given to it in Section 5(k)(iii) of
this Agreement.
"AJ MARKS" means the domain names, trademarks, service marks and logos
used by AJ, to (1) operate the "Ask.com" Web site and the Web site(s) operated
by the KK using the URL and provide services to consumers and (2) render the
services to Corporate Customers, together with associated Web site elements and
other design elements deemed important by AJ to maintain and enhance its unique
look and feel, and listed on EXHIBIT A hereto as may be modified by AJ from time
to time in accordance with Section 3(i) below. AJ Marks does not include (i) the
domain names, trademarks, service marks and logos of any third-party partners of
AJ or any of the third-party partners' affiliates or (ii) the domain names,
trademarks, service marks and logos which AJ, for any reason, becomes unable to
use or license.
"AJ SOFTWARE" means the English language version of the AJ proprietary
software listed in EXHIBIT B and all software created, licensed and otherwise
owned by AJ, now and in the future (other than JeevesOne and all Updates to
JeevesOne).
"AJURL" shall have the meaning given to it in the Joint Venture Agreement.
"APPROVED SUB-CONTRACTOR" shall mean a sub-contractor previously approved
by AJI in writing to perform Internationalization and/or Localization of the
Source Code to the AJ Software.
"BUSINESS DAY" means as to a party hereto whose action is required to take
place within a number of Business Days (whether the giving of notice or the
making of a payment or otherwise), any day of the week which is not a Saturday
or Sunday and not a bank holiday in the state or country from which such action
is required to be made (as the case may be in the state of California or in
Japan).
"BUSINESS PLAN" means the business plan of the KK completed in accordance
with the Joint Venture Agreement.
"CHANGE IN CONTROL" shall be deemed to have occurred if any of the
following occurs with respect to a Party (unless otherwise noted in the context
below):
(a) the direct or indirect sale or exchange in a single series of related
transactions by the controlling shareholders or other holders of controlling
ownership interest in a Party, of more than fifty percent (50%) of the voting
stock or other voting ownership interests of such Party: or
(b) the sale, exchange or transfer of all or substantially all of the assets
of a Party by such Party; or
(c) a liquidation or dissolution of a Party;
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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provided, however, that any transaction or series of transactions that are
effected solely in connection with a (i) grant of equity interests in connection
with a bona fide employee benefit arrangement, (ii) re-incorporation, (iii) a
reorganization, recapitalization or financing not in connection with the sale of
all or substantially all of the assets or stock ownership interests of a Party,
or (iv) an underwritten public offering of common stock of a Party, is not a
Change in Control.
"CONFIDENTIAL INFORMATION" means any data or information disclosed
hereunder (whether written, oral or graphical) that relates to the disclosing
party's products, financial information, technology, research, development,
customers or business activities, and which is confidential or proprietary to or
a trade secret of the disclosing party, provided that either the information is
marked or identified as confidential at the time of disclosure, or that it is
reasonably apparent to the recipient that the information is confidential.
Confidential Information includes, without limitation, any data, programs,
program decks, routines, subroutines, translators, compilers, assemblers,
operating systems, object and Source Codes, and updates thereto and any other
information related to the AJ Assets and KK Assets, the fact of the KK's payment
to AJI pursuant to Section 5 and the amount of the capital contribution made by
TCI to the KK pursuant to the JV Agreement. The scope of the Confidential
Information may also include information, data or material which AJ is holding
in confidence for a third party or third parties. Confidential Information shall
not include any information, data or material which: (1) the disclosing party
expressly agrees in writing is free of any non-disclosure obligations; (2) at
the time of disclosure to the receiving party was known to the receiving party
(as evidenced by documentation in the receiving party's possession) to be free
of any non-disclosure obligations; (3) is independently developed by the
receiving party (as evidenced by documentation in the receiving party's
possession); (4) is lawfully received by the receiving party, free of any
non-disclosure obligations, from a third party having the right to so furnish
such Confidential Information; or (5) is or becomes generally available to the
public without any breach of this Agreement or unauthorized disclosure of such
Confidential Information by the receiving party.
"CORPORATE CUSTOMERS" means all persons who are not living individuals
which have or seek agreements to receive products and services included in the
AJ Assets that assist such entities in their real time customer interactions
over the Internet within a specific Web site.
"DERIVED KK CONTENT" shall have the meaning given to it in Section 2(e).
"DEVELOPMENT TOOLS" means the Development Tools listed on EXHIBIT B
including all Updates thereto and used for implementation of AJ Software.
"DOCUMENTATION" means the documentation for the AJ Software (including all
Updates thereto) created or otherwise owned by AJI, now and in the future, that
are used to render services to Corporate Customers.
"EFFECTIVE DATE" means the date of closing of the JV Agreement.
"FIELD OF USE" means, offering the AJ Software in Japanese (i) customized
for and targeted primarily at consumers in the Territory, including use of
idiomatic Japanese as used in
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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the Territory, and (ii) offering the provision of question answering services
customized for and targeted primarily to Corporate Customers for use by
employees, customers, consumers or other third parties to assist such employees,
customers, consumers or other third parties in their real time customer
interactions over the Internet within a specific Web site.
"GROSS REVENUES" means the accrued revenues from all exploitation of the
AJ Assets (less sales and use taxes, freight charges and returns), whether the
revenues are in cash, services, merchandise or in kind, recognized by the KK in
accordance with Japanese generally accepted accounting principles consistently
applied, unless another accounting method is specified by the Parties.
"INTELLECTUAL PROPERTY RIGHTS" or "IP RIGHTS" means all current and future
copyrights, database rights, trade secrets, patents, mask works and other
intellectual property rights, including applications continuations, extensions,
re-examinations and registrations with respect thereto, now known or hereafter
recognized in any medium in any jurisdiction worldwide, but excluding
trademarks, service marks, trade names and other product, service or company
identifiers.
"INTERNATIONALIZATION" or "INTERNATIONALIZE" means the conversion of
software or data into double byte/Unicode encoding of data (ISO 10646), which
supports localization to various international character sets and languages,
from which the Localized version can be prepared, modifying it in a consistent
way so that it can operate in the same integrated way in which it currently
operates but in an international or localized setting (as the case may be).
"IPLEARN SUIT" means the suit filed by IPLearn, LLC in the United States
District Court, Northern District of California, Oakland Division, Action No. C
99-03352 SBA (ENE).
"JAPANESE NATURAL LANGUAGE SEARCH ENGINE" means the Localized version of
the Ask Jeeves natural-language question answering search engine technology.
"JAPANESE KNOWLEDGE BASE" means the database(s) created by AJI or its
licensors especially for the Japanese speaking marketplace (and indexing
Japanese language sites), including all Updates thereto, the development and
maintenance of which is the exclusive responsibility of the KK. "Japanese
Knowledge Base" shall not be deemed to include the file format developed by AJ,
which shall remain proprietary and owned by AJ and licensed as part of the AJ
Software hereunder.
"JEEVES ANSWERS" means the original question answering service that
provides an editorial approach to indexing documents. It is based on visual C++,
MFC, SQL Server and IIS with ASP. It includes the components set forth on
EXHIBIT B to the Agreement, and all Updates through the date of this Agreement.
"JEEVESONE" means Ask Jeeves' next generation question answering software
that replaced Jeeves Answers. JeevesOne includes JeevesOne Standard, JeevesOne
Search and JeevesOne Enterprise versions and is available to customers for
customer's in-house operation or offered via an ASP model.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
"JOINT VENTURE AGREEMENT" or "JV AGREEMENT" means the Joint Venture
Agreement, dated as of August 31, 2000, by and between AJI and TCI establishing
the KK.
"KATZ SUIT" means the suit filed by Patrick H. Winston and Boris Katz in
the United States District Court, District of Massachusetts, Civil Action No.
99-CV-012584-MLW.
"KK ASSETS" shall have the meaning given to it in Section 2 of this
Agreement.
"KK CONTENT" means the Japanese Knowledge Base and all other knowledge
bases and other data and information, in any medium created and/or maintained by
the KK, whether or not derived from the AJ Content, including without limitation
any improvements, additions, modifications and enhancements to the Japanese
Knowledge Base(s) and any text, music, sound, photographs, video or graphics.
"KK Content" also includes all user data, including website popularity data
collected by the KK pursuant to the activities contemplated or permitted by this
Agreement. (Special provisions regarding ownership of Derived KK Content are set
forth in Section 2(e).)
"KK TECHNOLOGY" shall have the meaning given to it in Section 2(c).
"KNOWLEDGE BASE" means an Ask Jeeves proprietary file format containing
questions paired with URLs which are intended to contain content answering those
questions.
"LICENSED SOFTWARE" means the Japanese language version of AJ Software.
"LOCALIZATION" or "LOCALIZE" means the conversion of any Internationalized
software or AJ Content into the Japanese language.
"LOGOS" mean Ask Jeeves' copyrighted and trademarked butler logo,
copyrighted and trademarked "Ask" logo and other logos as set forth on EXHIBIT
A, and other logos copyrighted and/or trademarked, and owned or licensed by AJ,
as they may change from time to time.
"NEW AJ ASSET" shall have the meaning given to it in Section 2(a)(ii).
"OBJECT CODE" means the fully-compiled, machine-readable version of a
software program that can be executed by a computer without further compilation.
"PARTY" means each of AJI, KK, AJ and TCI. "PARTIES" means collectively
AJI, KK, AJ and TCI.
"PATENT SUITS" means, collectively, the Katz Suit and the IPLearn Suit,
and any further suits involving the AJ Software (whether brought within the
United States or within the Territory) that may be filed during the term of this
Agreement and which Ask Jeeves or AJI shall promptly report to the KK.
"POPULARITY DATABASE" means AJ's proprietary information and data format
used to select
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
and prioritize answers to user questions.
"POPULARITY ENGINE" means Ask Jeeves' proprietary technology which
analyzes user questions and selects and prioritizes answers according to the
frequency that prior users have selected such answers associated with the
question.
"QUERY PROCESSING ENGINE" or "QPE" means Ask Jeeves' proprietary natural
language parsing engine, which is used to tokenize the relevant elements in user
questions and analyze the resulting terms for matching with appropriate question
and answer templates.
"QUOTE AMOUNT" shall have the meaning given to it in Section 5(k)(iii).
"REVENUE BASED FEE" means a fee based on a percentage of Gross Revenues in
an amount set forth in Section 5(c) of this Agreement.
"RUNTIME SOFTWARE" means the Japanese language version of the software
that is distributed to the Corporate Customer to enable it to run the services
included in the AJ Assets.
"SOURCE CODE" means the human-readable version of a software program that
requires compilation or other manipulation before it can be executed by a
computer and all corresponding source documentation, including application
programming interface (API) specifications, release notes and build procedures.
"SOURCE CODE WORK FACILITY" shall have the meaning given to it in Section
4(b).
"SPECIAL MATERIAL BREACH" shall have the meaning given to it in Section
14(b).
"TERRITORY" means Japan and speakers of the Japanese language worldwide.
"UPDATES" means the modifications, new versions, new releases and
enhancements, and of all bug fixes of the AJ Assets whether to correct errors,
add functionality, improve performance or otherwise, and any revisions of the
Documentation.
"URL" means the URL "www.askjeeves.co.jp" and its permutations, such as
"aj.co.jp", and "askj.co.jp", "ask.ne.jp", and "ask.co.jp" (as and when acquired
for or on behalf of AJI) and such placeholder URL(s) as AJI may designate prior
to securing the main URL (and its permutations).
"U.S. KNOWLEDGEBASE" means the U.S. databases, which may include a
popularity database created by AJI or its licensors.
2. INTELLECTUAL PROPERTY OWNERSHIP AND USAGE.
a. AJ Assets. AJ Assets means all AJ Software, Licensed Software,
AJ Content, Updates and Documentation and all other current and future products,
services, technology and content developed by or for AJ and/or contained in the
English-language version of the Ask.com
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
Web Site, both during and after the term of the JV Agreement, including without
limitation all Localized and Internationalized versions thereof, but excluding
the Japanese Knowledge Base. AJI or Ask Jeeves, as the case may be, shall retain
full ownership of all AJ Assets and all IP Rights therein, at all times during
and after the term of the JV Agreement. Nothing in the JV Agreement or this
Agreement is intended by the parties or shall operate in any way to transfer any
ownership interest of any kind in the AJ Assets to the KK. Notwithstanding the
foregoing, "AJ Assets" shall not include the current or future products,
services, technology and content owned by an Acquirer of Ask Jeeves or any
current product or service of Ask Jeeves that is sold to a third party after the
date hereof (notwithstanding any agreement entered into by Ask Jeeves relating
to a license back to Ask Jeeves of all or any part of such service or technology
following such sale).
(i) List of Current AJ Assets. During the term of this
Agreement, AJI shall provide a list of all current AJ Assets that it has the
right to deliver to the KK on an ongoing basis, at a minimum quarterly, by any
means, such as by download or by dial-up login, or as mutually agreed.
(ii) Option. Subject to the terms of Section 3(b)(ii), AJ
hereby grants to the KK an option to take an exclusive, perpetual, fee-free
license in the Territory to any future AJ Asset which is not identified in
Exhibit B (herein "NEW AJ ASSET"), subject to the following provisions: Each
time that AJI shall have notified the KK of any New AJ Asset, the KK shall have
one (1) year to request additional information (including, without limitation
any then existing Object Code and documentation) with respect to such New AJ
Asset and elect to take a license to such New AJ Asset or appoint a sublicensee,
subject to AJ's approval (which shall not be unreasonably withheld), for the
Territory. Upon such election, the parties shall enter into an exclusive,
perpetual (for so long as AJ has not sold such Asset as set forth in Section
3(b)(ii)), fee-and royalty-free license agreement to such New AJ Asset, which
agreement will include such further terms and conditions as the parties may
reasonably and in good faith agree to enter into. If the KK has not elected to
take a license or appoint a sublicensee within the one-year period, the option
for such New AJ Asset granted by this subsection will expire. To comply with
this Section, all notices of a New AJ Asset provided by AJ and any such election
by KK to distribute (or to decline to distribute) a New AJ Asset shall occur at
a duly convened meeting of the KK Board of Directors and formally recorded in
the minutes thereof. Any failure of the Board of Directors of the KK to make the
election within such time period shall be deemed an election not to distribute
the New AJ Asset
b. Enforcement of Rights. In the event it is necessary for AJI to
enforce its rights against an infringer of any AJ Asset during the term of this
Agreement, and in the event said enforcement requires the filing of any
applications for protection and registration of the IP Rights represented
therein, or whenever AJI believes such documentation is otherwise necessary or
desirable, the KK hereby agrees to execute any documentation reasonably
necessary to evidence All's ownership of any Internationalized and/or Localized
version of such AJ Assets, at AJI's cost and expense. The KK hereby appoints AJI
as attorney-in-fact to execute any such documents on its behalf in the event
that the KK does not execute or deliver any such documents, provided that
whenever AJI will execute any such documents pursuant to the power of attorney
granted hereby, it shall first notify the KK of its intention to do so.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
c. KK Assets. KK Assets means all technology not derived from the
AJ Assets (which may include "plug-ins" to the extent they are useable apart
from the AJ Assets) but rather created independently by or on behalf of the KK
during the term of the JV Agreement (the "KK TECHNOLOGY"), all KK Content and
all tools developed independently by the KK without any reference to the
Development Tools or Licensed Software. For the avoidance of doubt, it is agreed
that KK developed non-derivative, independent plug-ins to any AJ Asset will
constitute the KK Technology. All KK Assets and the IP Rights represented
therein shall become the sole property of the KK upon creation, and shall remain
wholly owned by the KK. The KK shall have the sole right to pursue any IP
filings for the KK Assets. The KK will have the right to use the U.S.
Knowledgebase only for the purpose of facilitating the creation of the Japanese
Knowledge Base.
d. AJ Marks. All use by the KK of the AJ Marks at all times under
the JV Agreement and this Agreement shall be subject to the license from AJI set
forth in Section 3(i). During the term of this Agreement and thereafter, only
AJ, AJ's affiliates and/or their licensors, as appropriate, shall have the right
to pursue mark registration(s) for the AJ Marks. The KK shall not form any
combination marks with the AJ Marks or the Logos except as expressly permitted
in this Agreement. Without limiting the foregoing, the KK hereby assigns to AJI
any rights it may obtain in the AJ Marks or the Logos or in such combination
marks or marks derived from the AJ Marks and Logos, and any trademark or
copyright rights created by the KK's use of the AJ Marks or the Logos, together
with the goodwill attaching thereto. The KK agrees to execute and deliver to AJI
such documents as AJI reasonably requires formalizing its ownership rights or
other rights in such marks or copyrights, at AJI's cost and expense. The KK
hereby appoints AJI as attorney-in-fact to execute any such documents on its
behalf in the event that the KK does not execute or deliver any such documents,
provided that whenever AJI will execute any such documents pursuant to the power
of attorney granted hereby, it shall first notify the KK of its intention to do
so. The KK shall not use the AJI Marks or the Logos in any way as an endorsement
or sponsorship of any third party without the prior written consent of AJI.
e. Joint Ownership of KK Content Derived from AJ Content. Upon
creation of KK Content that has been derived from Localization of AJ Content
(the "DERIVED KK CONTENT"), ownership of the Derived KK Content shall be jointly
owned by the KK and AJI. The Intellectual Property Rights in the Derived KK
Content shall automatically vest equally in the KK and AJI, subject to
restrictions agreed upon by the KK and AJI. Each of the KK and AJI shall own an
undivided one-half interest in the Derived KK Content. To the extent AJI might
be presumed to retain any ownership interest in the Derived KK Content or the
Intellectual Property Rights therein (based upon the theory that the Derived KK
Content constitutes a derivative work based upon the AJ Content), AJI. hereby
assigns an undivided one-half interest in all of its right, title and interest
in and to all Derived KK Content created during the Term, provided that in no
event will such assignment transfer any rights in any AJ Assets. Each Party
agrees to execute any documentation reasonably necessary to evidence the other's
undivided one-half ownership interest in the Derived KK Content, subject to
Section 2(d), at its own expense.
f. Restrictions on Derived KK Content. AJI and the KK agree to
the following restrictions on use of the Derived KK Content by them:
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
i. the KK agrees not to use the Derived KK Content outside the
Territory;
ii. the KK agrees not to translate the Derived KK Content into any
language other than Japanese;
iii. the KK agrees not to export the Derived KK Content outside the
Territory, except that AJI acknowledges that the use of Derived KK Content
on the Internet shall not constitute "export". The Derived KK Content
shall on reside on servers located within Japan; and
iv. Each of the KK and AJI agrees that it shall not grant a
license to any third party to modify or distribute the Derived KK Content,
incorporate it into products, or bundle it with other products, except as
otherwise permitted by this Agreement.
3. LICENSE GRANTS TO THE KK.
a. AJ Assets : Object Code. (i) Subject to the terms and
conditions of this Agreement, AJI hereby grants to the KK, under all of AJI's
Intellectual Property Rights in the Japanese language version of the AJ
Software, a fee-bearing, exclusive, non-transferable (except as permitted
herein), license to use, operate, distribute, display, reproduce, exploit,
market and offer to consumers and Corporate customers, and license to Corporate
Customers, the AJ Assets and the Object Code for the AJ Software, for the sole
purpose of developing, operating, providing, marketing and maintaining the
products and services included in the AJ Assets to consumers and Corporate
Customers in the Field of Use. Such license does not include any ownership right
to the Source Code for any AJ Software or Licensed Software. The exclusivity of
such license shall be within the Territory including with respect to AJI and
AJI's licensors, except to the extent that any application hosted or customized
for use outside the Territory by the nature of the Internet is available to end
users accessing the Internet in the Territory.
(ii) Distribution License. Subject to the terms and
conditions of this Agreement, AJI hereby (A) appoints the KK as the exclusive
distributor of the products and services included in the AJ Assets to Corporate
Consumers and (B) grants to the KK a limited, non-sublicensable (except as
provided in Section 3(a)(iii) with respect to Resellers and Section 3(a)(iv)
with respect to Corporate Customers), non-transferable, exclusive (as described
in Section 3(a)(iii)), fee-bearing (solely as described in Section 5 of this
Agreement) right to market, offer, license and distribute the Runtime Software
and the related AJ Assets to Corporate Customers in the Territory (in order to
enable such Corporate Customers to provide end-users of their site(s) access to
the AJ Assets' functionality on such site(s)) and to use the Runtime Software
and use and modify the corporate Knowledge Bases so as to provide services to
such Corporate Customers. Such license does not include any ownership right to
the Source Code for any technology comprising or relating to the AJ Assets.
(iii) Right to Appoint Resellers. The KK shall have the right
to appoint resellers ("RESELLERS"), provided that AJI shall have the right to
approve in advance in writing the form of agreement proposed to be used by the
KK from time to time between itself and its
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
Resellers. The KK shall require all Resellers to adhere to terms that are at
least as protective of AJI's intellectual property rights as, and do not exceed,
the terms of this Agreement and shall obtain from the KK's board approval, so
long as AJI has equal representation on the board, of a Reseller which is not
established primarily in Japan. AJI shall not unreasonably withhold or delay the
grant of any of its approval required by this subsection (iii). The KK shall
promptly provide AJI with a copy of all agreements appointing Resellers into
which it enters.
(iv) Terms of Corporate Customer Sublicenses. The KK shall
have the right to sublicense the Runtime Software and the related AJ Assets to
Corporate Customers, provided that the KK will do so only under terms at least
as protective of AJ's rights as those attached hereto as EXHIBIT C hereto. AJI
shall have the right to approve in advance in writing the form of corporate
customer agreement used by the KK (and any reseller) in each jurisdiction within
the Territory to ensure adequate protection of its Intellectual Property Rights.
AJI shall have the right to require additional licensing restrictions for
Corporate Customers as reasonably necessary for the protection of those rights.
The KK shall not license the Runtime Software and the related AJ Assets to any
customer for a period of longer than two (2) years without the prior written
approval of AJI, provided that any customer agreement may renew on expiration
upon agreement by the KK and its customer if this Agreement is then in effect;
and provided further that in the event such license relates to a product or
service that has been sold by Ask Jeeves, no such license shall extend for more
than three years following the date of consummation of such sale by Ask Jeeves.
b. Modification of AJ Assets.
(i) Not Associated with Product Sale. Whenever there is a modification,
elimination or supplement of the products and services offered by AJI, which is
not associated with Ask Jeeves' sale of substantially all its assets related to
that product or service (a "DISCONTINUED PRODUCT"), AJI shall notify the KK and
the KK and its Resellers (as appointed under subsection (a)(iii) above) shall
have the right to determine whether it will continue to market and distribute
the Discontinued Product. The KK shall notify AJI of its election to continue
such marketing and distribution within thirty (30) Business Days of the date of
the notice by AJI. The KK shall have the right to so market and distribute for
an unlimited time period, subject to Section 3(b)(ii). If the KK elects to
continue marketing a Discontinued Product, AJI shall have no obligation to
provide support for that Discontinued Product after the expiration of one (1)
year from the date of the KK's election.
Source Code of Discontinued Products. If AJI ceases to provide support for a
Discontinued Product for whatever reason, AJI shall deliver the most recent
version of the applicable Source Code to the Source Code Facility and, in
addition to the licenses granted to KK under Section 4, the KK shall have the
right to access and use the Source Code for purposes of support, maintenance,
and the creation of modifications and derivative works of the Discontinued
Product. All such derivative works shall constitute KK Technology under this
Agreement and be subject to the license back provisions of Section 3(c).
(ii) Ask Jeeves Sale of Product Line. Whenever there is a modification,
elimination or supplement of the products and services offered by AJI which is
associated with Ask Jeeves' sale of substantially all of its assets related to
that product or service, AJI shall notify the KK and the
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
KK shall have the right to continue to market and distribute the product or
service in question (regardless, in the case of a New AJ Asset, of whether the
KK has commenced such marketing and distribution of such product or service
prior to the sale) under the terms of this Agreement for a period of three (3)
years and at the end of such time shall cease all marketing and distribution of
those products and services (the "SUNSET PERIOD"). The KK may honor any
long-term agreements existing at the time of notification by AJ even if those
contracts do not terminate until a date after the expiration of the Sunset
Period; provided that the KK may not enter into new agreements following
notification by AJ if the term of such new agreement extends beyond the
expiration of the Sunset Period. In the event the KK has a valid business reason
for entering into a new agreement that would extend beyond the expiration of the
Sunset Period, the KK shall notify AJI of the proposed agreement and the
business reasons for the proposed term and may enter into an agreement with a
term extending beyond the expiration of the Sunset Period upon AJI's prior
written consent, such consent not to be unreasonably withheld. The KK shall
notify AJI of its election to continue such marketing and distribution within
thirty (30) Business Days of the date of the notice by AJI. AJI shall continue
to provide support for the product or service in question for one (1) year
following such sale or other disposal.
Source Code for Support Purposes Only. If AJI ceases for whatever reason to
provide support for a product or service sold or otherwise disposed of under
Section 3(b)(ii) above, AJI shall deliver the most recent version of the
applicable Source Code to the Source Code Facility and, in addition to the
licenses granted to KK under Section 4, KK shall have the right to access and
use the Source Code solely for purposes of support and maintenance in accordance
with 3(b)(ii) above.
(iii) Teoma. In the event of a modification, elimination or supplement of
the products and services offered by AJI as set forth in Sections 3(b)(i) and
(ii) with respect to the Ask Jeeves proprietary search engine technology known
as "Teoma", AJI shall notify the KK and the KK shall have the right to continue
to market and distribute the product or service in question (regardless, in the
case of a New AJ Asset, of whether the KK has commenced such marketing and
distribution of such product or service prior to the sale) under the terms of
this Agreement for a period as set forth in this Subsection. If the
modification, elimination or supplement of the products and services offered by
AJI as set forth in Sections 3(b)(i) and (ii) occurs on or prior to December 31,
2004, the Sunset Period shall extend to December 31, 2007 (rather than the three
(3) year term set forth in Section 3(b)(ii)). If the modification, elimination
or supplement of the products and services offered by AJI as set forth in
Sections 3(b)(i) and (ii) occurs after December 31, 2004, the Sunset Period
shall be three (3) years as set forth in Section 3(b)(ii). AJI shall continue to
provide support for Teoma for one (1) year following such modification,
elimination or supplement.
(iv) Notices and Elections. All notices and elections to be made under
this Section 3(b) shall be accomplished through duly convened meetings of the KK
Board of Directors and formally recorded in the minutes thereof; provided that
such meeting shall be convened and the election to distribute or to decline to
distribute, if applicable, shall be made within thirty (30) Business Days of the
date of the notice by AJI. Any failure of the Board of Directors of the KK to
make the election within such time period shall be deemed an election not to
distribute the
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
New AJ Asset
c. License Back of KK Asset. The KK hereby grants to AJI a
non-exclusive, fee-bearing, irrevocable, perpetual, worldwide license to all
current and future KK Technology. In addition, the KK hereby grants to AJI a
non-exclusive, fee-bearing, irrevocable, perpetual, worldwide license back to
use, for internal purposes only, that part of the KK Content pertaining to the
any AJ Asset and the tools developed independently by the KK without any
reference to the Development Tools or the Licensed Software. The fee for the
licenses described in this section shall be an amount determined in good faith
by the Parties.
d. Services. Subject to the previous Section 3(c), the KK agrees to
render all reasonable cooperation to AJI, at AJI's request and expense, to
enable it to exercise AJI's rights to the KK Technology and/or the KK Content,
including without limitation by timely delivering materials embodying such KK
Technology and/or Content (and by executing all documents reasonably necessary
or desirable to evidence AJI's rights). The KK will deliver to AJI notification
and necessary information about all KK Technology and all KK Content that it has
developed so that AJI can determine whether it wants to obtain such KK
Technology or KK Content. If AJI so elects to obtain it, the KK shall deliver
the KK Technology or KK Content to AJI within ninety (90) days following
implementation of any such KK Technology and/or KK Content, but in no event less
often than twice each calendar year.
e. Development Tools License. Subject to the terms and conditions of
this Agreement, AJI hereby grants to the KK a fee-bearing (solely as described
in Section 5 of this Agreement) non-transferable, non-sublicensable except as
permitted herein, exclusive license to use the Development Tools on its internal
systems solely for the purpose of (i) developing and maintaining the AJ Assets
as permitted under this Agreement, and (ii) rendering services to Corporate
Customers as permitted under this Agreement. The KK may not make the Development
Tools available to any third party including, without limitation, customers and
Resellers, and agrees that only employees and independent contractors of the KK
which have signed confidentiality agreements at least as protective as the terms
of this Agreement may use the Development Tools. Such license does not include
any ownership right to the Source Code for any technology comprising or relating
to any AJ Assets. In the event any software engines, applications or tools are
utilized by AJ in its delivery of the AJ Assets and such software would
similarly be required to enable the KK to perform within the scope of this
Agreement, AJI shall supply such software to the KK on a fee-free basis
throughout the term of this Agreement. In the event any of these software tools
have not been developed or are not owned by AJI but rather are licensed by AJI,
then at the expense of AJI, AJI shall use all commercially reasonable efforts to
obtain pass-through licenses sufficient to enable the KK to make use of the
tools during the term of this Agreement. Furthermore, in the event that any
third party license is needed, either in connection with AJ Assets or otherwise,
AJ will be responsible for the negotiation of such license. Notwithstanding the
foregoing, the KK shall be responsible for the payment of any sublicense fees
therefor. Whenever possible, AJI shall obtain such pass-through licenses at no
extra cost. All derivative works of the Development Tools developed by or on
behalf of KK shall be the sole property of AJI, and upon AJI's request, the KK
agrees to execute and deliver to AJI such documents as AJI reasonably requires
to formalize its ownership rights or other rights in such derivative works of
the Development Tools at AJI's cost and expense.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
f. Documentation License. Subject to the terms and conditions of this
Agreement, AJI hereby grants to the KK, under all of AJI's Intellectual Property
Rights in the Documentation, a fee-free, fully-paid up, exclusive,
non-transferable except as provided herein, license to use, display, reproduce
and modify (including translate) the Documentation for the purposes of
developing, operating, marketing, maintaining and exploiting AJ Assets in the
Field of Use in the Territory. The KK has a limited right to create, use and
distribute derivative works (including translation into Japanese) of those
portions of the Documentation intended for Corporate Customer use to the extent
that the KK adapts that Documentation to local cultural requirements. AJI shall
be the sole owner of any such modified Documentation, and upon AJI's request,
the KK agrees to execute and deliver to AR such documents as AJI reasonably
requires to formalize its ownership rights or other rights in such modified
Documentation, at AJI's cost and expense.
g. Proprietary Notices. The KK will not obfuscate, remove or alter any
copyright and other proprietary notices contained on or in the AJ Assets as
delivered to the KK, and all such markings shall be included on or in all copies
of any portion of the AJ Assets.
h. Additional Restrictions. The KK has only the license rights
expressly granted under this Agreement, and whatever rights are not expressly
granted in this Agreement are reserved by AJI. Except as expressly permitted by
applicable law or this Agreement, the KK will not, and will not permit or
encourage others to, (1) reverse engineer, decompile, disassemble or otherwise
attempt to derive the Source Code for any AJ Software or the Licensed Software,
or (2) modify the AJ Software or the Licensed Software. The KK shall be
permitted to use the KK Technology and KK Content for any purpose as long as it
does not compete with an AJ product or service. Any technology derived from AJ
Technology shall not be used beyond the scope of the terms of the Distribution
and License Agreement. No KK employee shall be permitted to work on competing
products, internally or externally, for a period of twelve (12) months following
the employee's most recent access to the Source Code, and this requirement shall
survive termination of employment.
i. Trademark And Copyright License.
(i) License Grant. Subject to the terms and conditions hereof; AJI
hereby grants to the KK a fee-bearing (solely as described in Section 5 of this
Agreement), exclusive as defined herein, non-transferable (except as provided
herein), license to use the AJ Marks and the Logos solely in connection with the
development, maintenance, marketing, operation, promotion and provision of
services in the Field of Use in the Territory. The KK shall have the right to
grant sublicenses of its rights under this Section 3(i) to Resellers and
Corporate Customers, subject to the restrictions set forth in the minimum
customer license terms attached hereto as EXHIBIT C.
(ii) Requirements. The KK shall at all times comply with all
written AJI trademark and copyright guidelines that AJI supplies, from time to
time, to the KK. The KK acknowledges the importance of maintaining a common look
and feel and feature set for all sites and services powered by Ask Jeeves'
technology and services worldwide. The KK shall promptly update all sites and
services in the Field of Use operated, licensed or controlled by-the KK to
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
reflect any changes in the look and feel, or functionality or features,
resulting from the implementation, modification or discontinuation of any AJ
Marks or the Logos on the Ask.com site. In no case later than thirty (30) days
after the delivery of any new or modified AJ Marks or Logos, or notice of
discontinuation thereof by AJI; the KK shall implement, modify or discontinue
its use of such AJ Marks or the Logos, as the case may be to the extent approved
by the KK Board of Directors (but only so long as AJI has a representation on
such Board of Directors equal to one-half of its members). Without limiting
anything to the contrary herein provided, the KK shall (i) use the AJ Marks or
the Logos exactly in the form provided; (ii) not alter the size, placement,
rotation, typeface, font, color or any other attribute of any AJ Mark or Logo
without the prior written consent (not to be unreasonably delayed) of AJI, on a
case by case basis; (iii) mark its use of the AJ Marks and the Logos with the
symbol "'tm", "(R)' or "(C)," and/or local equivalents, if any, as appropriate;
(iv) include the appropriate trademark or copyright attribution in reasonably
close proximity to its first use of the AJ Marks or the Logos, as the case may
be, in any document or on any screen display, or in a location to which users
are directed for statements concerning the ownership of Intellectual Property
Rights -- the terms and wording of the trademark or copyright attribution shall
be as requested by AJI; (v) provide AJI in advance with specimens of all of the
KK's proposed uses of any AJ Mark or any Logo (including without limitation, in
the form of Web Site page mockups, draft versions of marketing material, etc.)
before any such use, together with a brief statement setting forth the proposed
use and the proposed time period of such use; and not commence such use without
AJI's express prior written consent, which may be withheld in AJI's sole
discretion, and which consent shall be given or withheld within five (5) but in
no case later than ten (10) Business Days from the date of notice to AJI. At any
time when AJI representatives do not constitute one half of the Board of
Directors of KK, AJ may terminate the license granted above with respect to any
particular AJ Mark if in its sole discretion, it determines that the KK's use of
the AJ Mark or Logo tarnishes, blurs or dilutes the quality associated with such
AJ Mark or Logo or the associated goodwill, such use being in breach of this
Agreement or the AJI trademark guidelines that AJI supplies to the KK in
writing, and such problem is not cured within ten (10) Business Days of notice
of breach with respect to "top level" Web pages, currently the KK's site home
page, the response page and the results page frame, and within thirty (30)
Business Days of notice of breach with respect to all other media.
(iii) Ownership. The KK acknowledges that title to and ownership of
the AJ Marks and Logos shall remain with AJI or its licensors, as shall the
renown of the AJ Marks and Logos worldwide. All use of the AJ Marks and Logos by
the KK shall inure to AJI's benefit or that of its licensors. The KK shall not
take any action inconsistent with AJI's or its licensors' ownership of the AJ
Marks and Logos, and any benefits accruing from use of such AJ Marks and Logos
shall automatically vest in AJI or its licensors. The KK shall not use the AJ
Marks or Logos in any way as an endorsement or sponsorship of any third party
without the prior written consent of AJI (not to be unreasonably delayed). The
KK shall not adopt, use or attempt to register any trademarks or trade names
that are confusingly similar to the AJ Marks or Logos.
(iv) Right to Modify. Subject to subsections (A) and (B) below AJI
may modify the AJ Marks from time-to-time in its sole discretion, whereupon it
will promptly notify the KK of any such modification. Notwithstanding the
foregoing:
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
(A) The KK shall have the right to continue to use any old AJ Mark or
use a new one, except in the event (I) of an alleged infringement by such AJ
Mark of a third party trademark, (II) a judgment obtained against AJ because of
trademark infringement which enjoins the further use of such AJ Mark, (III) AJI
has obtained a written legal opinion that the continued use of such old AJ Mark
or the use of the new AJ Mark presents a material substantial risk of being
deemed to constitute the infringement of a third party trademark or servicemark
or other intellectual property right, or (IV) in AJI's good faith and reasonable
opinion, the continued use of the old AJ Mark or the use of a new one is likely
to substantially diminish the value of the AJ Marks and/or Logos on a worldwide
basis.
(B) The KK may request that AJI grant the KK permission (which AJI will
not unreasonably withhold or delay) to delay the introduction of the
modification of the AJ Marks into the Territory by up to six (6) months where
the KK reasonably considers either (A) that it requires this time to allow it to
incorporate the revised marks in promotional material, or (B) that it has
recently spent substantial amounts in promoting the previous AJ Marks.
(C) The KK may notify AJI within ten (10) Business Days that, in its
reasonable opinion, the proposed change to the AJ Marks would be unsuitable in
the Territory on the grounds that the revised AJ Marks would be offensive,
illegal, libelous, amount to an infringement of a trademark or passing-off, or
bear a derogatory or unintended meaning, or amount to a sexual innuendo
(hereafter all referred to as "UNSUITABLE"), in which case AJI shall consider
whether it agrees with the KK (in which case it shall not introduce the modified
AJ Mark(s) in the Territory.) AJI shall advise the KK of its decision within ten
(10) Business Days. AJI's decision shall be final and binding upon the KK unless
the KK elects to contest such decision by demonstrating to the satisfaction of
an arbitration panel appointed under Section 15(d) that the proposed change to
the AJ Marks would be Unsuitable in the Territory. In such event, the KK shall
not be obligated to implement the proposed change in the AJ Marks until the
arbitrator's final decision has been issued.
(v) Moral Rights. The KK hereby irrevocably transfers and
assigns to AJI any and all Moral Rights (as defined below) that the KK may have
in or with respect to all AJ Marks or the Logos. To the extent the KK cannot
assign such rights, the KK hereby waives and agrees never to assert such rights
against AJI, its affiliates or any of their licensees or assignees. If the KK
has any right to any AJ Marks or the Logos that cannot be assigned to AJI or
waived by the KK, the KK unconditionally and irrevocably grants to AJI, during
the term of such rights, an exclusive, irrevocable, perpetual, worldwide, fully
paid and fee-free license, with rights to sublicense throughout multiple levels
of sublicensees, to reproduce, adapt, modify, create derivative works of,
distribute, publicly perform and publicly display by all means now known or
later developed such rights. In addition, the KK agrees to use commercially
reasonable efforts to obtain such assignment, waiver, covenant not to assert
such rights, or license from any subsidiary, subcontractor, or employee who
creates, either in whole or part, AJ Marks or Marks derived from AJ Marks, at
AJI's cost and expense. "MORAL RIGHTS" means any right to (i) retract any AJ
Marks or the Logos from the public; (ii) claim creation of or be accredited as
creator of any AJ Marks or the Logos; (iii) object to any distortion, mutilation
or other modification of any AJ Marks or the Logos; or (iv) any and all similar
rights, existing under judicial or statutory law of any country or jurisdiction
in the world, or under any treaty regardless of whether or not such
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
right is called or generally referred to as a moral right.
(vi) Registration. AJI shall obtain and maintain registration
of the AJ Marks as utilized by the KK within the country of Japan. AJI shall
file all appropriate applications to register the AJ Marks in Japan within sixty
(60) days of the Effective Date. AJI shall bear all costs of obtaining and
maintaining such registration.
j. URLs. AJI shall license to the KK the URL. The KK will
register and own any and all additional URLs that serve the KK. The KK
acknowledges that the URL, or any portion of it, may be registered in the name
of one or more entities not owned or controlled by AJI. The parties further
acknowledge that the URL, or any portion of it, may be registered in the name of
one or more entities not owned or controlled by TCI and the KK. Notwithstanding
anything to the contrary provided in this Agreement, each of TCI and the KK
undertakes that (at such time when such assignment and transfer shall be
permitted under Japanese law) upon AJI's request, at its cost and expense, it
shall cause such. entity or entities controlled by TCI or the KK (as the case
may be) to freely assign and transfer to AJI (or such entity or entities as AJI
may designate for that purpose). The KK will register and own any and all
additional URLs that serve the KK. The KK acknowledges that the URL, or any
portion of it, may be registered in the name of one or more entities not owned
or controlled by AJI.
4. SOURCE CODE LICENSE.
a. Source Code License. Solely in order to enable the KK to
perform the Internationalization and Localization of the AJ Software in
accordance with its obligations under Section 5(e) below, AJI will provide the
KK with the AJ Software, all Updates and Documentation in accordance with
Sections 6(a) and 6(b). Therefore, subject to the terms and conditions of this
Agreement, AJI hereby grants to the KK a limited, non-exclusive,
non-transferable (except as herein provided) license to the Source Code in order
to reproduce and make derivative works of the AJ Software and Licensed Software
and such Updates solely for purposes of performing the Internationalization and
the Localization (collectively, the "WORK"), and solely so long as the Work is
being performed. All other rights in or to the AJ Software and the Updates are
reserved to AJ. The KK understands and agrees that, notwithstanding anything
herein to the contrary, AJI will have no obligation to deliver the Source Code
to the Source Code Work Facility (as defined below) or otherwise give the KK
access to the Source Code if no Work is required to be performed by the KK.
b. Source Code Work Facility. The Source Code shall only be
kept at, and all work performed on the Source Code shall be done solely at, the
facilities of an AJI Subsidiary in Tokyo, Japan or the Tokyo facilities of an
Approved Sub-contractor (the "SOURCE CODE WORK FACILITY"). All access to the
Source Code shall be managed by the Source Code Work Facility. At a minimum, AJI
shall require that the Source Code Work Facility permit the KK to have all free
access to the Source Code at the Source Code Work Facility, during normal
business hours or as needed in case of emergency. The KK agrees not to reproduce
the AJ Software, Licensed Software or relevant Updates except as reasonably
necessary to perform the Work and shall use the Source Code for the AJ Software,
Licensed Software and the relevant Updates only at the Source Code Work
Facility, subject always to the Source Code Restrictions set forth in EXHIBIT
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
D. If the KK (or the relevant Approved Sub-contractor) wishes to move the Source
Code to another Source Code Work Facility, the KK shall seek AJI's prior written
approval of transfer and demonstrate that it is being moved to the new facility
for the sole purpose of performing the Work. Only the Chief Executive Officer of
Ask Jeeves may grant such permission, not to be unreasonably withheld, and
actual transportation of the Source Code shall be managed and performed by the
current Source Code Work Facility.
c. Delivery of Internationalized Code. As soon as the
Internationalization is completed, or at such other times as the Parties may
agree, the KK will deliver a copy to AJI of the Internationalized AJ Software,
Licensed Software or Update (as the case may be) in both Object Code and Source
Code, along with related technical documentation.
d. Custody; Duty of Care. The KK shall treat the Source
Code as Confidential Information in accordance with Section 8. Without limiting
the foregoing, the KK shall at all times comply with the Source Code
Restrictions attached hereto as EXHIBIT D. Whenever possible, the KK shall
cooperate with AJI to take all necessary measures to protect the security of the
Source Code, both in the United States and in the event that the Source Code is
moved to Japan pursuant to Section 6(b). The KK may copy only such portions of
the Source Code as are necessary for the Internationalization, Localization
and/or use of the AJ Software or Licensed Software in Japanese.
e. Termination of President of KK. In the event the Source
Code is released to an unauthorized person by reason of the KK's breach of the
provisions of this Section 4 and of EXHIBIT D the president of the KK shall be
terminated immediately. A new president shall then be appointed in accordance
with Section 10.3 of the Joint Venture Agreement.
5. PAYMENT OBLIGATIONS OF THE KK.
a. Initial Agreed Fee. In consideration of the rights
granted to the KK in this Agreement, the KK shall pay to AJI a non-refundable
initial agreed fee (the "INITIAL AGREED FEE") of [*] Dollars ($[*]) which shall
be payable as follows:
(i) [*] Dollars ($[*]) upon closing of this Agreement;
(ii) [*] Dollars ($[*]) thirty (30) days from the Effective Date;
and
(iii) [*] Dollars ($[*]) sixty (60) days from the Effective Date.
Notwithstanding anything herein provided to the contrary, the KK expressly
understands and agrees that the KK's payment obligation of the entire Initial
Agreed Fee shall be subject only to AJI's compliance with its obligation to
deliver the Source Code.
b. AJI Knowledgebase Service Fees. The KK acknowledges that
AJI has performed Japanese Knowledge Base development services for the KK prior
to the Effective Date. AJI shall present one or more invoices to the KK for such
services at its regular rates for these services limited to salary (including
payroll taxes, if any), airfare from and to Japan and accommodation, but in no
event shall the KK be obligated to pay more than $[*]. The KK shall pay such
invoice(s) to AJI promptly upon receipt, provided such invoiced amounts are
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
reasonable. If timely presented, the first such invoice shall be payable on the
Effective Date.
c. Revenue Based Fee. The KK shall pay to AJI a Revenue
Based Fee on Gross Revenues, payable quarterly within thirty (30) days following
each calendar quarter, subject to year-end adjustment for returns and Gross
Revenues that are booked as uncollectible, in consideration of the KK's
continued use of all AJ Marks and AJ Assets. Payments shall be made as follows:
(i) Before the initial public offering of the KK securities, the
KK shall pay to AJI a Revenue Based Fee of [*] of the KK's Gross Revenues,
payable quarterly, except that no such Revenue Based Fee shall be due with
respect of any Gross Revenues accrued during the first 12-month period
following the first date on which revenue was recognized. It is understood
that for the Revenue Based Fees payable after such initial twelve-month
period, the first payment period shall begin on a partial quarter,
(ii) After the initial public offering of the KK securities, the KK
shall pay to AJI a Revenue Based Fee of [*] of the KK's Gross Revenue,
payable quarterly;
(iii) Revenues shall be attributed to the date on which it is
accrued for accounting purposes;
(iii) AJI shall have the right examine the KK's books and records in
accordance with Section 13.2 of the JV Agreement.
In the event of a dissolution of the KK by mutual agreement of the parties
pursuant to the JV Agreement, the KK's obligation to pay such Revenue Based Fees
shall terminate and AJI shall have no further obligation to provide Updates and
support.
d. Taxes. The KK shall be responsible for any taxes owing
or assessed against all payments under this Agreement paid or received by the KK
under the laws of the Territory. In addition, the KK shall pay, and indemnify
and hold AJI harmless from and against, any and all sales, use, excise,
value-added or similar tax, fee or duty, including any penalties and interest
levied on the income, sales and operations of the KK, including the rendering of
services to consumers and Corporate Customers anywhere in the Territory. The
KK's obligations in the preceding sentence shall also apply to any tax on funds
restricted from expatriation to Japan by the KK under the laws of any
jurisdiction within the Territory. The KK shall withhold any applicable
withholding taxes from the Initial Agreed Fee and the Revenue Based Fee (i.e. if
the relevant Fee is $100 and 10% taxes are to be withheld, then the KK will
remit $90 to AJI); provided however, that the KK shall notify AJI at least ten
(10) days prior to the withholding.
e. Internationalization and Localization. In consideration
of AJI's obligations hereunder, the KK shall be solely responsible for all
Internationalization and Localization of the AJ Software and Localization of
Updates licensed hereunder. Internationalization and Localization shall be
performed either by personnel of the KK or by Approved Sub-contractors engaged
by the KK, at the Source Code Work Facility. Any agreement with any such
Approved Sub-contractor shall be subject to AJI's prior written
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
approval and shall at least include the Source Code Restrictions set forth in
EXHIBIT D. The KK shall bear all costs of the Localization of the AJ Software
and the AJ Assets.
f. Development and Promotion of the Services. The KK will
use commercially reasonable efforts to actively develop, deploy and promote the
services included in the AJ Assets in the Field of Use in the Territory at the
KK's sole cost, subject to the terms and conditions of this Agreement and in
accordance with the Joint Venture Agreement and the Business Plan. The KK shall
be solely responsible for all costs associated with the creation of the KK
Assets, all operational costs for the KK Web site, and all advertising and
promotional costs associated with the operation of the KK site. The KK shall
bear sole responsibility for all marketing, promotion, sales, business
development and engineering activities of the KK site, as well as the offering
of services included in the AJ Assets in the Field of Use. The parties
acknowledge and agree that the KK shall develop the KK Assets for the site, and
obtain by license appropriate third-party content for the site. Any such
licenses to third party content shall run to the KK, and shall terminate upon
dissolution of the KK.
g. Synchronization with Ask.com Site. The KK acknowledges
the importance of maintaining a common look and feel and feature set for all
natural language question answering sites and services powered by Ask Jeeves'
technology worldwide. The KK shall ensure that the initial launch of all Web
sites and services in the Field of Use shall reflect the look and feel and
features of the Ask.com Web site and its related sites. The parties anticipate
that the KK's sites and services may use variations on the "Ask Jeeves" name and
butler logo and enter into various co-branding arrangements for specific pages
on such sites via the display of sponsor's banners and other means. All such
variations on the "Ask Jeeves" name or the Logos, and all proposed co-branding
arrangements, must be consistent with AJI's trademark and copyright guidelines
and must be approved in writing in advance by AJI in its reasonable discretion.
h. Service Levels. The KK will operate all sites and
services in the Field of Use in a manner which is consistent with the current
and future quality standards, of the Ask.com site and which meets uptime and
response times and other performance standards for users of the KK's services as
recommended by AJI to and approved by the KK Board of Directors as long as AJI
has representation on the KK Board equal to one-half of its members.
i. Compliance With Laws. The KK shall comply with all
applicable laws, regulations, rules, directives, ordinances and orders regarding
the marketing and performance of services in the Field of Use in the Territory
and the creation and dissemination of content. The KK will immediately notify
AJI of any investigation, inquiry or other issue with respect to the laws of any
jurisdiction in which the KK operates or intends to operate. Without limiting
the foregoing, the KK covenants that at all relevant times: (i) it will promptly
obtain or have obtained all governmental approval, permits and licenses, and
will promptly make or will have made all governmental filings and registrations,
necessary or prudent for the marketing and performance of services included in
the AJ Assets and the creation and distribution of content in the Territory,
(ii) it will be in compliance with the Foreign Corrupt Practices Act of the
United States, and (iii) AJI is not required to obtain any governmental
approval, permits or licenses as a result of this Agreement, AJI's performance
hereunder or any payments made by the KK
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
hereunder. Without limiting its other remedies, if after having given notice to
the KK that it is in breach of any of the foregoing provisions, (if the breach
is capable of being cured) the KK has failed to cure such breach within sixty
(60) days, and if AJI reasonably believes there is a risk of potential criminal
sanctions against any officer or employee of either the KK or AJI, then AJI may
suspend its performance of any or all obligations herein, including without
limitation, AJI's obligation to deliver Updates to the KK, for so long as AJI
reasonably believes that the KK is in breach of this Section 5(i).
j. Content Standards. The KK shall not provide any content
to users that to the KK's knowledge: (i) infringes any third party's copyright,
patent, trademark, trade secret or other proprietary rights or rights. of
publicity or privacy; (ii) violates any law, statute, ordinance, directive, or
regulation (including, without limitation, the laws and regulations governing
export control, unfair competition, antidiscrimination or false advertising);
(iii) is defamatory, trade libelous, unlawfully threatening or unlawfully
harassing; (iv) is obscene, harmful to minors or child pornographic; (v)
contains any viruses, Trojan horses, worms, time bombs, cancelbots or other
computer programming routines that are intended to damage, detrimentally
interfere with, surreptitiously intercept or expropriate any system, data or
personal information; or (vi) is materially false, misleading or inaccurate.
k. Global Provisions.
(i) No Solicitation. Each party hereby undertakes that
it will not (A) solicit orders for any services from Corporate Customers
headquartered outside its territory, (B) engage in any advertising or marketing
activity for any services for Corporate Customers outside its territory, (C)
take any actions to place any services for Corporate Customers in any market
outside its territory, or (D) maintain any marketing facilities geared for
Corporate Customers for services outside its territory. AJI expressly reserves
all its and its Affiliates' rights in relation to marketing, sales and licensing
of services to Corporate Customers outside the Territory. AJI shall have no
obligation to provide service support for any customers of the KK outside its
territory.
(ii) Whenever the KK wants to solicit any potential
Corporate Customer headquartered outside Japan to provide services to it in
Japanese, the KK shall first notify AJI of such intention, whereupon the KK and
AJI shall coordinate their selling efforts (together with other Distributors if
appropriate or desirable).
6. AJI OBLIGATIONS.
a. Initial Delivery. At the Effective Date, AJI shall
deliver to the KK all the AJ Software and Development Tools in both Object Code
and Source Code, and Documentation, solely for the purposes set forth in Section
4(a). The Source Code shall be delivered to the KK by delivery to the Source
Code Work Facility, which the KK agrees constitutes delivery of the Source Code
to the KK. AJI shall provide the KK with notice of the delivery and its
location.
b. Delivery of Updates. AJI shall update a delivery
schedule every
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
calendar quarter to indicate which Updates are expected or contemplated for the
next year. AJI shall provide to KK the Updates in both Object Code and Source
Code quarterly, with comments as are customary in the industry, together with
special notes AJI determines are appropriate, solely for the purpose of
Localization by the KK; provided that AJI will have no obligation to provide
Source Code for any Update that does not require Localization or
Internationalization. All delivery of the Updates Source Code shall be made to
the Source Code Work Facility, but only so long as no company listed on EXHIBIT
F to the JV Agreement is a shareholder of the KK who has access to the Source
Code. In the event AJI fails to deliver the Update quarterly as scheduled, AJI
shall have ten (10) days to cure such default following the KK's notice of
breach. If at the end of such 10-day period AJI still falls to comply with its
delivery obligation with respect to such Update, the KK shall as its sole
remedy, at AJI's expense, send up to two engineers to AJ's site to retrieve the
Source Code in order for to KK to carry out the Internationalization, it being
understood that the KK engineers shall be subject to the Source Code
Restrictions set forth in EXHIBIT D, and shall bring the Source Code directly to
the Source Code Work Facility.
c. Development of Alternative Technology. At such time as
AJI in its sole discretion deems it prudent, AJI shall, at its sole expense,
pursue independent research and development of alternative technology to the
technology at issue in the current existing Patent Suits.
d. Support. AJI agrees to provide, either itself or by
subcontracting to Ask Jeeves or such other entity as AJI deems reasonably
appropriate in consultation with the KK, the technical support, training and
installation described in EXHIBIT E attached hereto.
e. Compliance With Laws. AJI shall comply with all
applicable laws, regulations, rules, directives, ordinances and orders regarding
the development of the AJ Software and the creation and dissemination of
Updates. AJI will immediately notify the KK of any investigation, inquiry or
other issue with respect to the laws of any jurisdiction in which AJ operates or
intends to operate. Without limiting the foregoing, AJI covenants that at all
relevant times: (i) it will have obtained all governmental approval, permits and
licenses, and will have made all governmental filings and registrations,
necessary or prudent for the Localization and development of the AJ Software and
the creation and dissemination of Updates in the Territory, and (ii) it is in
compliance with the Foreign Corrupt Practices Act of the United States. Without
limiting its other remedies, if after having given notice to AJI that it is in
breach of any of the foregoing provisions, (if the breach is capable of being
cured) AJI has failed to cure such breach within sixty (60) days, and if the KK
reasonably believes there is a risk of potential criminal sanctions against any
officer or employee of either the KK or AJI, then the KK may suspend its
performance of any or all obligations herein, including without limitation, the
KK's obligation to pay Revenue Based Fees pursuant to Section 5(c), for so long
as the KK reasonably believes that AJI is in breach of this Section 6(e).
f. Contract with TCI for Advertising. AJI shall use
commercially reasonable efforts to cause the KK to contract with TCI or an
affiliate of TCI for advertising purposes and back office support regarding the
services included in the AJ Assets if such support is offered at no more than
arms-length prices.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
g. Taxes. AJI shall be responsible for any taxes owing or
assessed against all payments under this Agreement under the laws of the United
States. AJI shall pay, and indemnify and hold the KK harmless from and against,
any and all sales, use, excise, value-added or similar tax, fee or duty
(including for the avoidance of doubt withholding taxes which shall be deducted
by the KK if applicable and taxes based on AJI's net income), including any
penalties and interest, as well as all costs associated with the collection or
withholding thereof levied on AJI's income, sales and operations, including the
delivery of the Updates to the KK, or any payments made by the KK to AJI
hereunder.
7. INFRINGEMENT CLAIMS,
a. Notice of (Threatened) Infringement. In the event that
the KK or AJI learns of any infringement or threatened infringement of the AJ
Marks or of any allegation or claim by any person that an AJ Mark is liable to
cause deception or confusion to the public, or is liable to dilute or infringe
any right of any person, the KK or AJI, as the case may be, shall notify the
other Party. AJ shall take action against any such unauthorized use or
infringement. AJ shall promptly notify the KK of its determination and shall
briefly describe the action, if any, which it shall take.
b. Litigation Control. In the event that AJ initiates
litigation against any person in connection with the foregoing, AJ shall choose
the attorneys, control the litigation, pay the litigation expenses, and retain
any damages recovered as a result of any judgment in favor of AJ.
8. CONFIDENTIALITY.
a. Standard of Care. Each Party agrees to do the following
with respect to any Confidential Information: (i) exercise the same degree of
care to safeguard the confidentiality of, and prevent the unauthorized use of,
such information as that Party exercises to safeguard the confidentiality of its
own Confidential Information of a like nature, but in no event less than a
reasonable degree of care, and (ii) instruct and require such advisors,
employees, sublicensees, and agents to maintain the confidentiality of such
information, and not to use such Confidential Information except as expressly
permitted herein. Each Party further agrees not to remove or destroy any
proprietary or confidential legends or markings placed upon any documentation or
other materials. Notwithstanding the foregoing, regardless of (1) whether any
Source Code or other information contained within the AJ Software, the Licensed
Software and Documentation was known to the KK or TCI (or employees, contractors
or consultants of either) before the date of delivery to the KK, or (2) any
components of the AJ Software, the Licensed Software, the Documentation and the
U.S. Knowledgebase are confidential and proprietary and the Confidential
Information of AJI and its licensors. Similarly, regardless of (1) whether any
Source Code or other information contained within the KK Technology was known to
AJI or its employees before the date of delivery to AJI or (2) any components of
the KK Technology or the accompanying documentation is labeled confidential or
proprietary when delivered to AJI by the KK, the Japanese Knowledge Base and the
KK Technology are confidential and proprietary and are the Confidential
Information of the KK.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
b. Proprietary Agreement. The foregoing confidentiality
obligations shall also apply to the contents of this Agreement and the JV
Agreement,
c. Government Disclosures. The obligations under this
Section 8 shall not prevent the Parties from disclosing the Confidential
Information or terms of this Agreement and the JV Agreement to any governmental
authority as required by law or regulation (including those requiring filing of
documents in connection with registrations under the Securities Act of 1933) or
as ordered by a court (provided that the Party intending to make such disclosure
in such circumstances: (i) has given the appropriate other Party prompt notice
prior to making such disclosure so that the other Party may seek a protective
order or other appropriate remedy prior to such disclosure, and (ii) cooperates
fully with the other Party in seeking such order or remedy), and seeks
confidential treatment of the Confidential Information, this Agreement and the
JV Agreement when disclosed to a governmental authority. In the event the
governmental authority denies confidential treatment, the Parties will use their
best efforts to seek a protective order to redact Confidential Information,
financial information and payment schedules from this Agreement and the JV
Agreement.
9. DISCLAIMER OF WARRANTIES.
EXCEPT AS EXPRESSLY PROVIDED IN SECTION 10, THE AJ SOFTWARE, THE LICENSED
SOFTWARE, THE JAPANESE KNOWLEDGE BASE, THE AJ MARKS AND THE DOCUMENTATION ARE
LICENSED ON AN "AS IS" BASIS, WITHOUT ANY WARRANTY OF ANY KIND. WITHOUT LIMITING
THE FOREGOING, AJI MAKES NO WARRANTIES, WHETHER EXPRESS, IMPLIED OR STATUTORY,
WITH RESPECT TO THE AJ SOFTWARE, THE LICENSED SOFTWARE, THE JAPANESE KNOWLEDGE
BASE, THE AJ MARKS OR THE DOCUMENTATION, INCLUDING, WITHOUT LIMITATION, ANY
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.
10. WARRANTIES AND REPRESENTATIONS OF AJ AND ASK JEEVES.
Each of AJI and Ask Jeeves (but only as to the paragraphs which relate to
it) hereby warrants and represents to the KK that:
a. Good Standing. Each of AJI and Ask Jeeves is duly
organized, validly existing, and in good standing under the laws of the State of
Delaware and is duly qualified to do business and is in good standing in each
jurisdiction in which it is required to be so qualified;
b. Authority. Each of Ask Jeeves and AJI has the power and
authority to enter into this Agreement;
c. Agreement Enforceable. This Agreement is enforceable
against Ask Jeeves and AJI in accordance with its terms, except as such
enforceability (i) is limited as to Ask Jeeves to the provisions with respect to
which it has executed this Agreement and (ii) may be limited by bankruptcy or
other laws affecting the enforcement of creditors' rights generally or by
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
general equity principles, and does not violate or create a default under any
instrument or agreement binding on Ask Jeeves or AJI;
d. Ownership of AJ Marks. Ask Jeeves (i) is and will be the
owner of the AJ Assets and the AJ Marks, except that it does not yet own the
domain names listed on EXHIBIT A, (ii) has full right, title and interest in and
to the AJ Assets and the AJ Marks, and (iii) AJI has full power and authority to
grant the license to the AJ Assets licensed hereunder and the AJ Marks, as well
as the limited license to the Source Code granted under this Agreement;
e. No Infringement. So far as either Ask Jeeves or AJI is
aware, the AJ Assets, and the AJ Marks, and the usage rights granted under this
Agreement do not infringe on, or constitute an unauthorized use of, the rights,
title or interests of any other person. Further, on the Effective Date, no
person has made any such material claim of infringement or unauthorized use
against AJI or Ask Jeeves except for the Katz Suit and the IPLearn Suit;
f. No Litigation. So far as either Ask Jeeves or AJI is
aware, on the Effective Date, there are no pending or threatened actions or
proceedings before any court or administrative agency that could have a material
adverse effect on AJI or Ask Jeeves to perform AJI's obligations under this
Agreement, except for the Katz Suit and the IPLearn Suit;
g. No Conflict. The execution, delivery and performance by
AJI of this Agreement does not conflict with or create a default under AJI's
articles of incorporation or bylaws or any material provision of any indenture,
note, bond, security agreement or other agreement of AJI or under which AJI or
any of its properties is bound, except that it conflicts with AJI's obligations
under the Global Agreement with Ask Jeeves and the Ask Jeeves UK Partnership;
h. Trademark Registration. AJI has filed all appropriate
application in Japan to register the AJ Marks or will initiate such filings
within sixty (60) days of the Effective Date; and
i. Governmental Approval. AJI shall obtain all governmental
approvals necessary for it to enter into and perform this Agreement, and TCI
shall provide reasonable assistance in obtaining such approvals.
11. WARRANTIES AND REPRESENTATIONS OF THE KK AND TCI.
Each of TCI (but only as to the paragraphs which relate to it) and the KK
warrants and represents to AJI that:
a. Good Standing. Each of TCI and the KK is duly organized,
validly existing, and in good standing under the laws of Japan and is duly
qualified to do business and is in good standing in each jurisdiction in which
it is required to be so qualified;
b. Authority. Each of TCI and the KK has the power and
authority to enter into this Agreement;
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
c. Agreement Enforceable. This Agreement is enforceable
against TCI and the KK in accordance with its terms except as such
enforceability (i) is limited as to TCI to the provisions with respect to which
it has executed this Agreement and (ii) may be limited by bankruptcy or other
laws affecting the enforcement of creditors' rights generally or by general
equity principles and does not violate or create a default under any instrument
or agreement binding on the KK;
d. Ownership of KK Assets. The KK (i) except as set forth
in this Agreement is and will be the owner of the KK Assets and (ii) has full
right, title and interest in and to such KK Assets;
e. No Infringement. So far as the KK is aware, the KK
Assets, do not infringe on, or constitute an unauthorized use of, the rights,
title or interests of any other person and no person has made any such claim of
infringement or unauthorized use against the KK; excepted from this warranty and
representation and any attendant indemnification shall be any instance or
finding, in any Patent Suit, of infringement by the AJ Assets, which finding is
extended to include infringement by any derivatives of that technology developed
pursuant to this Agreement, including without limitation, infringement by the KK
Assets (to the extent such infringement arises from the underlying AJ Assets);
f. No Litigation. So far as the KK is aware, there are no
pending or threatened actions or proceedings before any court or administrative
agency that could have a material adverse effect on the KK's ability to perform
its obligations under this Agreement;
g. Governmental Approval. The KK shall obtain all
governmental approvals necessary for it to enter into and perform this
Agreement; and
h. No Conflict. The execution, delivery and performance by
the KK of this Agreement does not conflict with or create a default under the
KK's articles of incorporation or by-laws or any material provision of any
indenture, note, bond, security agreement or other agreement of the KK or under
which the KK or any of its properties is bound.
12. INDEMNITY.
a. KK Indemnity.
(i) Basic Indemnity. The KK shall indemnify and hold
AJI and its licensors harmless from and against any and all liabilities, claims,
losses, costs and expenses, including without limitation reasonable attorneys'
fees which AJI, its affiliates or their licensors may incur as a result of any
third party claims in any form arising from, relating to or in connection with
(A) any KK Content, services related to the AJ Assets offered by the KK
(including, without limitation, any acts or omissions relating to the KK's sales
practices), or (B) from the KK's use of any AJ Mark or Logo other than in
accordance with this Agreement, or (C) from any breach by the KK of Section 5(i)
("Compliance with Laws"), Section 5(j) ("Content Standards") or Section 11
("Warranties and Representations of the KK").
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
(ii) Reseller Indemnity. In addition, the KK agrees to
indemnify, defend and hold harmless AJI and its licensors from and against any
and all liabilities, claims, losses, fines, penalties, costs and expenses,
including without limitation reasonable attorneys' fees which AJI or its
licensors may incur as a result of any third party claims in any form arising
out of (A) any statement made by or on behalf of the KK or any reseller of the
KK regarding the function or operation of the AJ Assets, and (B) any terns
agreed to between the KK and its Corporate Customers, where in each case, such
terns do not comply with the minimum license terms set forth in EXHIBIT C.
(iii) Conditions. As a condition to the KK's obligations
under this Section 12(a), All will provide prompt written notice of any claim
giving rise to an obligation of the KK hereunder, will tender the sole control
of the defense and settlement of such claim to the KK, and will provide the KK
with all assistance that the KK reasonably requests in connection with such
defense or settlement.
b. AJ Indemnity.
(i) Basic Indemnity. Each of AJI and Ask Jeeves,
jointly and severally, shall indemnify and hold the KK harmless from and against
any and all liabilities, claims, losses, costs and expenses, including without
limitation reasonable attorneys' fees which the KK or its affiliates or
licensees may incur as a result of any third party claims in any form arising
from, relating to or in connection with any AJ Assets or from any breach by Ask
Jeeves or AJI of Section 10 ("Warranties and Representations of AJ") including
in the event of any instance or finding of infringement as recited in Section
10(e) above. For the avoidance of doubt, the foregoing indemnity shall apply if
as a direct result of any such instance or finding of AJI or Ask Jeeves'
infringement the KK is also held by a court of competent jurisdiction to have
infringed upon any third party's Intellectual Property Rights (whether in an
action brought by such third party or by a Corporate Customer of the KK).
(ii) Special Remedies in Event of Infringement. In
addition to the foregoing, if AJI or Ask Jeeves is held by a court of competent
jurisdiction to have infringed upon a third party's intellectual property
rights, or if such court suspends AJ's use of any services included in the AJ
Assets, then AJ, at its sole expense, shall use all commercially reasonable
efforts to (x) obtain a license from the rightful technology owner to permit the
KK to use the infringed technology, (y) obtain licenses to alternative, similar
technologies to enable the KK to continue its operations as contemplated under
this Agreement, or (z) develop alternative, noninfringing technologies for
licensing to the KK to continue its operations as contemplated under the JV
Agreement and this Agreement, or failing those remedies take such other action
as AJI in consultation with the KK may deem to be appropriate.
(iii) Limitations of Liability. Notwithstanding anything
to the contrary provided in this Agreement, if a modification or substitution in
accordance with item (x) of the preceding paragraph is not possible so as to
avoid the infringement, or AJI has been unable to procure a license in
accordance with item (y) of the preceding paragraph, and All elects to
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
proceed with item (z) of the preceding paragraph, AJI shall be liable for (A)
all additional costs incurred in implementing and maintaining such alternative,
non-infringing technologies, and (B) actual losses (including attorneys' fees),
subject to the limitation of liability provided in Section 13 below, incurred by
the KK in the event that a customer of the KK sues the KK for the KK's inability
or failure' to provide services included in the AJ Assets due to the finding of
infringement.
(iv) Conditions. As a condition to AJI's obligations
under Section 12(b)(i), the KK will provide prompt written notice of any claim
giving rise to an obligation of AJI hereunder, will tender the sole control of
the defense and settlement of such claim to AJI, and will provide AJI with all
assistance that AJI reasonably requests in connection with such defense or
settlement, including any arising from a suit filed by any plaintiff to the
Patent Suits.
13. LIMITATION OF LIABILITY.
a. EXCEPT IN THE EVENT OF A BREACH OF SECTION 8 ("CONFIDENTIALITY"), THE
KK'S EXCEEDING THE SCOPE OF THE LICENSES GRANTED PURSUANT TO SECTION 3 ("LICENSE
GRANTS") ASK JEEVES' OR AJI'S BREACH OF EXCLUSIVITY GRANTED IN SECTION 3, OR
PAYMENTS MADE AS A RESULT OF A CLAIM UNDER SECTION 12 ("INDEMNITY"), NEITHER
PARTY SHALL BE LIABLE FOR SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES OR LOST
PROFITS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT (HOWEVER ARISING,
INCLUDING NEGLIGENCE).
b. EXCEPT IN THE EVENT OF A BREACH OF SECTION 8 ("CONFIDENTIALITY"), THE
KK'S EXCEEDING THE SCOPE OF THE LICENSES GRANTED IN SECTION 3 ("LICENSE GRANTS")
OR ASK JEEVES' OR AJI'S BREACH OF EXCLUSIVITY PROVISIONS GRANTED IN SECTION 3,
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR CLAIMS MADE IN
AN AMOUNT GREATER THAN:
(i) [*] DOLLARS ($[*]) FOR CLAIMS MADE DURING THE FIRST YEAR AFTER THE EFFECTIVE
DATE;
(ii) [*] DOLLARS ($[*]) FOR CLAIMS MADE DURING THE SECOND YEAR AFTER THE
EFFECTIVE DATE;
(iii) [*] DOLLARS ($[*]) FOR CLAIMS MADE DURING THE THIRD YEAR AFTER THE
EFFECTIVE DATE; AND
(iv) FOR CLAIMS-MADE MORE THAN THREE YEARS AFTER THE EFFECTIVE DATE, THE DOLLAR
LIMITATION SHALL BE EQUAL TO THE AMOUNT [*] (THE "GENERAL FINANCIAL CAP"). THE
EXISTENCE OF ONE OR MORE CLAIMS WILL NOT ENLARGE THE LIMIT. THE GENERAL
FINANCIAL CAP FOR A PARTICULAR YEAR OR TIME PERIOD SHALL APPLY TO A CLAIM FOR
WHICH THE COMPLAINING PARTY HAS GIVEN NOTICE PURSUANT TO SECTION 12(A)(III) OR
12(B)(IV) (AS THE CASE MAY
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
BE) ON A DATE WITHIN THAT PARTICULAR YEAR OR TIME PERIOD.
c. THE FOREGOING PROVISIONS OF THIS SECTION 13 SHALL NOT APPLY TO
LIABILITY FOR (I) PERSONAL INJURY OR DEATH RESULTING FROM NEGLIGENCE OR. WILLFUL
MISCONDUCT, (II) FRAUD OR FRAUDULENT MISREPRESENTATION; AND (III) ANY OTHER
LIABILITY WHICH CANNOT BY LAW BE EXCLUDED OR LIMITED.
d. THE FOREGOING PROVISIONS OF THIS SECTION 13 SHALL APPLY TO
INDEMNIFICATION OF THE KK FOR ANY CLAIM(S) OF INFRINGEMENT PURSUANT TO SECTION
12(B) EXCEPT THAT (INSTEAD OF THE GENERAL FINANCIAL CAP) THERE SHALL BE A
SPECIAL FINANCIAL CAP OF [*] DOLLARS ($[*]).
14. TERM AND TERMINATION.
a. Term. This Agreement will commence on the Effective Date and
will remain in effect indefinitely unless terminated by the mutual agreement of
the parties or as specified in Section 14(b).
b. Termination of JV Agreement for Special Material Breach.
Without limiting any other remedies for material breach of any provision of this
Agreement, the JV Agreement may be terminated by either Party on [*] written
notice to the other only if the other Party commits a Special Material Breach of
this Agreement and such breach is not cured within the applicable cure period.
For purposes of this Section, "SPECIAL MATERIAL BREACH" means:
(i) as to the KK: (A) a failure to pay any fee hereunder for [*]
after the date of AJI's notice of breach, or (B) breach of Section 15(j); and
(ii) as to AJI: (A) breach of the exclusivity of the licenses set
forth in Section 3 which has not been cured after [*] following the KK's notice
of breach, or (B) breach of Section 15(j).
c. Effect of Termination of JV Agreement.
(i) Dissolution of KK by Material Breach. Notwithstanding the foregoing,
in the event of dissolution of the KK by reason of material breach of the JV
Agreement, the KK shall assign this Agreement to the Terminating Shareholder (as
defined in the JV Agreement) and all licenses granted hereunder shall continue
in full force and effect as set forth in this Agreement. The Terminating
Shareholder shall have ongoing exclusive use of the Localized version of the AJ
Assets and KK Assets. The KK shall assign ownership of the KK Assets to the
Terminating Shareholder. The KK shall assign its undivided one-half interest in
and to the Derived KK Content to the Terminating Shareholder, subject to all
restrictions set forth in Section 2(f) of this Agreement, which shall continue
in frill force and effect. The License to the AJ Marks shall be transferred to
the Terminating Shareholder, and the Terminating Shareholder shall obtain all
rights, and assume all obligations of the KK for all purposes, including without
limitation, this Agreement. Without limiting the KK's obligations under Section
4, (A) the Defaulting Party shall
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
otherwise return or destroy all Confidential Information to the nonbreaching
party and certify in writing that it has done so, provided that the Defaulting
Party shall not be required to (I) destroy items which it requires to continue
operating its business in the ordinary course (so long as such items remain
Confidential) or (II) purge backup and archival copies of its information made
in the ordinary course of business which may contain the nonbreaching party's
Confidential Information; and (B) the nonbreaching party will return or destroy
all of Defaulting Party's Confidential Information and certify that it has done
so, provided that the nonbreaching party shall not be required to (I) destroy
items which it requires to continue operating its business in the ordinary
course (so long as such items remain Confidential) or (II) purge backup and
archival copies of its information made in the ordinary course of business which
may contain the Defaulting Party's Confidential Information.
(ii) Dissolution by Mutual Agreement. In the event of dissolution of the
KK by reason of mutual agreement, the KK shall assign equal and concurrent
ownership to both TCI and AJI of all KK Assets and any other technology,
content, and property owned by it, and the KK shall assign equal and concurrent
ownership to both TCI and AJI of all of its undivided one-half interest in the
Derived KK Content. In the event any IP protective filings have been made by the
KK (as to KK Assets or such other technology), under this section, formal
assignments to TCI and AJI as co-owners of said filings shall be made, and
authorized officers of the KK shall execute any other documentation necessary to
evidence the co-ownership of the KK Assets and such other technology by the
parties. Concurrently therewith, AJI shall grant to TCI a perpetual, fee-free,
worldwide non-exclusive license to use the then existing Localized version of
the AJ Assets. Thereafter, each of TCI and AJI shall be free to utilize such
Localized version of the AJ Assets, KK Assets, Derived KK Content and such other
technology in the Territory, either themselves or through third parties, without
restriction of any kind as against one another. All shall then provide technical
support to TCI at the then-current market rate for AJI's support services, for
at least six (6) months following the dissolution date, in accordance with
EXHIBIT E. AJI shall have exclusive use of the AJ Marks and the AJURL. AJI shall
pay, in proportion to its ownership share in the KK, to TCI the fair market
value of the goodwill built up in the AJURL. TCI shall have exclusive use of all
other URLs registered by the KK, and All shall take any steps necessary to
effectuate such exclusive use. TCI shall pay to AJI the fair market value of the
goodwill built up in such other URLs.
(iii) Buy-out of Defaulting Shareholder. In the event of a buy-out of a
Defaulting Shareholder's interest in the KK by the Terminating Shareholder
pursuant to the JV Agreement, the KK and all the licenses, rights and
obligations granted to the KK under- this Agreement shall remain in full force
and effect. The Terminating Shareholder shall be entitled to purchase the
Defaulting Shareholder's interest at either (a) price per share equal to [*], or
(b) a purchase price of' [*] per share.
(iv) [INTENTIONALLY OMITTED]
d. Effect of Termination of Distribution and License Agreement. Upon termination
of this Agreement for any reason (i) all future usage rights of the KK to the AJ
Assets and (unless specifically herein provided to the contrary) the Localized
version of the AJ Assets shall cease, as shall AJI's obligations to provide any
additional AJ Assets (including Updates) to the other.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
Following termination, AJI shall become free to Localize and distribute AJ
Assets within the Territory.
(ii) the license of the AJ Marks and all uses of the AJ Marks shall be extracted
from any version of the Localized version of the AJ Assets (to the extent the KK
has continued usage rights thereto pursuant to this Section 14) and the KK
Assets utilized by the KK, and with regard to the KK Assets, all uses of the AJ
Marks shall similarly be extracted. Nothing in this section shall operate to
grant any license in or to the AJ Marks to the KK or TCI outside of the
operation of the KK beyond the terms detailed above except per Section 14(d)(i).
15. MISCELLANEOUS.
a. Force Majeure. Each party will have no liability to the other
party as a result of any delay or failure in the performance of such party's
obligations under this Agreement if the delay or failure is caused by events or
circumstances beyond such party's control including earthquakes, fires, floods,
riots, wars, labor disputes, shortages of materials or supplies, changes in laws
or government requirements, and transportation difficulties. If either party is
prevented from performing any of its obligations hereunder due to any such event
or circumstance beyond its control, it will use reasonable efforts under the
circumstances to notify the other party and to resume performance as soon as
reasonably possible.
b. Survival. Each party's rights and obligations under the following
Sections will survive the expiration or termination of this Agreement for any
reason: Sections 1, 4(c), 4(d), 5(a); 5(c)(only with respect to payments accrued
prior to termination), 5(d), 7 through 13, 14(c), 14(d) and 15.
c. Notices. All notices, consents, waivers, and other communications
intended to have legal effect under this Agreement must be in writing, must be
delivered to the other party at the address set forth below by personal
delivery, telecopier or facsimile transmission, or a nationally recognized
overnight courier, and will be effective upon personal delivery or upon
acknowledgement of receipt of an electronic transmission. Each party may change
its address for receipt of notices by giving notice of the new address to the
other party.
To : AJI To the KK:
Ask Jeeves International, Inc. Ask Jeeves Japan, Inc.
5858 Horton Street 3-3-3 Akasaka Minato-ku
Emeryville, CA 94608 Tokyo, 107 JAPAN
Attention: Claudion Pinkus Telecopier:
Telecopier: [*] Telephone:
Telephone: [*]
With a copy required for any notice to: With a copy (which shall not constitute
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
notice) to:
Ask Jeeves, Inc. Trans Cosmos USA, Inc.
5858 Horton Street 777 108th Avenue NE, Suite 1500
Emeryville, CA 94608 Bellevue, WA 98004
Attn: Brett Robertson, Attention: Legal Notices
General Counsel Telecopier: [*]
Telecopier: [*] Telephone: [*]
Telephone: 510-985-7400
With a copy (which shall not constitute notice) to:
O'Melveny & Meyers LLP
990 Marsh Road
Menlo Park, CA 94025-1949
Attention: Karen Dreyfuss
Telecopier: (650) 473-2601
Telephone: (650) 473-2600
d. Arbitration.
(i) Subject to Section 15(d)(ii), any dispute, controversy or claim
arising out of or relating to this Agreement, or the breach, termination, or
invalidity thereof; shall be settled by arbitration in San Francisco,
California, U.S.A. in accordance with the rules of JAMS/ENDISPUTE by three (3)
arbitrators knowledgeable in the field of software licensing appointed in
accordance with such rules. The language of the arbitration shall be English
with Japanese translation as requested. California law shall govern any
arbitration proceeding arising from this Agreement. The arbitration award shall
be final and binding upon the parties, and judgment on such award may be entered
in any court having jurisdiction thereof. To the extent permitted by law, the
Parties shall keep proceedings and award confidential.
(ii) Any dispute, controversy or claim arising out of or relating to the
interpretation or the implementation of Section 14(c) shall be settled by
Arbitration in accordance with the rules then in effect of the Japan Commercial
Arbitration Association by three (3) arbitrators knowledgeable in the field of
software licensing appointed in accordance with such rules. One (1) of the three
(3) arbitrators shall be a U.S. national; one (1) arbitrator shall be a Japanese
national; and one (1) arbitrator shall be mutually appointed by the other two.
arbitrators. Any such arbitration shall be held in Tokyo, Japan and shall be
conducted in Japanese (with English translation to the extent requested by AJI
or an English-speaking arbitrator). The arbitration panel shall only have
authority to render a decision regarding (1) the breach of the Joint Venture
Agreement and (2) the disposition of the Joint Venture Agreement. The
arbitration panel shall have no authority to arbitrate the disposition of this
Distribution and License Agreement. Any disposition of this Agreement shall only
be made pursuant to Section 15(d)(i) above. The arbitration award shall be final
and binding upon the Parties and judgment on such award may be entered in any
court having jurisdiction thereof. The Parties shall keep proceedings and award
confidential.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
e. Provisional Relief. The parties agree that the arbitrator shall have
the authority to issue interim orders for provisional relief, including, but not
limited to, orders for injunctive relief attachment or other provisional remedy,
as necessary to protect either party's name, proprietary information, trade
secrets, know-how or any other proprietary right. The parties agree that any
interim order of the arbitrator for any injunctive or other preliminary relief
shall be enforceable in any court of competent jurisdiction. In addition,
nothing in this Agreement shall be deemed as preventing either party from
seeking provisional relief from any court of competent jurisdiction in
accordance with Section 15(1).
f. Governing Law. This Agreement will be governed by and interpreted in
accordance with the laws of the State of California, excluding any conflicts or
choice of law rule or principle that' might otherwise refer construction or
interpretation of this Agreement to the substantive law of another jurisdiction.
Section 14(c) will be governed by and interpreted in accordance with the laws of
Japan. The parties agree that the United Nations Convention on the Sale of
International Goods will not apply to this Agreement.
g. Injunctive Relief. It is understood and agreed by both parties that
a breach of the provisions of this Agreement by the other may cause irreparable
damage for which recovery of monetary damages would be inadequate, and that
either party may seek injunctive or other equitable relief to protect their
Confidential Information, Intellectual Property Rights and other rights under
the Agreement, in addition to any and all remedies available at law.
h. Waiver. The failure of either party to require performance by the
other party of any provision of this Agreement will not affect the full right to
require such performance at any time thereafter; nor will the waiver by either
party of a breach of any provision of this Agreement be taken or held to be a
waiver of the provision itself
i. Severability. If any provision of this Agreement is unenforceable or
invalid under any applicable law or is so. held by applicable court decision,
such unenforceability or invalidity will not render this Agreement unenforceable
or invalid as a whole, and such provision will be changed and interpreted so as
to best accomplish the objectives of such unenforceable or invalid provision
within the limits of applicable law or applicable court decisions.
j. Assignment. Neither this Agreement nor any rights or obligations of
the KK or AJI under this Agreement may be assigned (by operation of law or
otherwise) in whole or in part without the prior written consent of the other
party, which may be withheld in the other party's sole discretion. A Change In
Control shall be deemed to be an assignment (except as set forth in the Joint
Venture Agreement). Any attempted assignment without the prior written consent
of such other party will be null and void ab initio and will be a Special
Material Breach of this Agreement. This Agreement will bind and inure to the
benefit of the respective successors and permitted assigns of the parties.
Either party may assign, except in connection with a Change In Control, this
agreement to a wholly-owned subsidiary without consent of the other party.
Provided that (i) notice of such assignment is provided to the other party
within ten (10) days of such assignment, and (ii) that the assigning party shall
remain fully liable for all obligations incurred by it under this Agreement.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
k. Filings. Promptly after execution of this Agreement, the KK shall
file with the appropriate authorities of Japan, by the names of the Parties as
required by Japanese law, an application for approval of the business
contemplated by this Agreement.
1. Export Control. AJI shall, at its own expense, comply with all U.S.,
and other governmental laws and regulations, including those of all. countries
within the Territory, concerning the export or re-export of the AJ Software and
Licensed Software.
m. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be original as against any party whose
signature appears thereon, and all of which together shall constitute one and
the same instrument. This Agreement shall become binding when one or more
counterparts hereof individually or taken together, shall bear the signatures of
all of the parties reflected herein as signatories.
n. Currency. Unless otherwise noted, all dollar amounts refer to United
States Dollars. All yen amounts refer to Japanese Yen.
o. Decisionmaking. The KK's decisions regarding this Agreement will be
decided by board vote on which AJI directors have abstained.
[Signature pages follow.]
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
IN WITNESS WHEREOF, the parties, by their duly authorized representatives, have
executed this Agreement as of the Effective Date.
ASK JEEVES INTERNATIONAL, INC.
By: /s/ Claudio Pinkus
------------------------
Name: /s/ Claudio Pinkus
----------------------
Title:
-----------------------
A.J.J. Co., Ltd.
By: /s/ Kazuhiko Sugiara
--------------------------
Name: Kazuhiko Sugiara
Title: CEO
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
By the signature of its duly authorized officer, Ask Jeeves, Inc., a
Delaware corporation, with offices at 5858 Horton Street, Emeryville, California
94608, USA, hereby agrees to be bound, jointly and severally with Ask Jeeves
International, Inc., by the provisions of Sections 8, 10, 12(b) and 15, subject
to the limitation of liability set forth in Section 13 (and no other
provisions), of this Distribution and License Agreement (this "Agreement") by
and between Ask Jeeves International, Inc. and Ask Jeeves Kabushiki Kaisha (in
Japanese) and Ask Jeeves Japan, Inc. in English, Ask Jeeves, Inc. and Trans
Cosmos, Inc. as if fully set forth herein.
IN WITNESS WHEREOF, Ask Jeeves, Inc., by its duly authorized
representative, has executed this Agreement (only with respect to such Sections
8, 10 and 12(b), 13 and 15 subject to the limitation of liability set forth in
Section 13) as of the Effective Date.
ASK JEEVES, INC.
By: /s/ Brett Robertson
--------------------------
Name: Brett Robertson
Title: General Counsel
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
By the signature of its duly authorized officer, Trans Cosmos, Inc., a
Japanese corporation, having its principal place of business at 3-3-3 Akasaka,
Minato-ku Tokyo, 107, Japan, hereby agrees to be bound, jointly and severally
with Ask Jeeves Kabushiki Kaisha (Ask Jeeves Japan, Inc.), by the provisions of
Sections 3(j), 8, 11 and 15, subject to the limitation of liability set forth in
Section 13 (and no other provisions), of this Distribution and License Agreement
(this "Agreement") by and between Ask Jeeves International, Inc. and Ask Jeeves
Kabushiki Kaisha (in Japanese) and Ask Jeeves Japan, Inc. in English, Ask
Jeeves, Inc. and Trans Cosmos, Inc., as if fully set forth herein.
IN WITNESS WHEREOF, Trans Cosmos, Inc., by its duly authorized
representative, has executed this Agreement (only with respect to such Sections
3(j), 8, 11 and 15 subject to the limitation of liability set forth in Section
13) as of the Effective Date.
TRANS COSMOS, INC.
By:_________________________
Name:_______________________
Title:______________________
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
EXHIBIT A
LIST OF AJ MARKS
Ask Jeeves(SM)
Jeeves Live(SM)
Jeeves Answers(SM)
Jeeves Answers Suite(SM)
Jeeves Search(SM)
Jeeves Advisor(SM)
Jeeves Insight(SM)
Jeeves Compare(SM)
[ASK JEEVES LOGO]
TO BE COMPLETED
(LOGO'S, BUTLER LOGO, ETC.)
[ASK JEEVES LOGO]
[ASK LOGO]
[ASK LOGO]
DOMAIN NAMES
ask.co.jp;
askjeeves.co.jp;
aj.co.jp;
ask.ne.jp;
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
askjeeves.ne.jp;
aj.ne.jp; and
askj.co.jp
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
EXHIBIT B
The AJ Software includes the following and all Updates thereto:
- Jeeves Search, (formerly Direct Hit), provides enhanced search engine
facilities and is based on a Free BSD platform, with Oracle and BDB as
backend database components, and PERL, C++, and Java as runtime
components. Jeeves Search includes the following components:
- Jeeves Popularity Engine
- Jeeves OOSE (Search Engine)
- Jeeves Directory
- Jeeves Shopping
- Jeeves Text Sponsorship
- Jeeves Answers, the original question answering service, provides an
editorial approach to indexing documents; it is based on Visual C++, MFC,
SQL Server, and IIS with ASP. Jeeves Answers includes the following
components:
- Jeeves QAE (Question Answering Engine)
- Jeeves Research Assistant (Knowledgebase development tools)
- Jeeves Answer Exchange
- Jeeves Insight, offers reporting and data analysis relating to use
of the other Ask Jeeves products
- Jeeves Live, provides web-based CRM environments including chat and
co-browsing, and offers real time customer interaction with human
customer service representatives via the Web. It is a Java-based
development environment.
- Jeeves Advisor provides advice based on a decision support engine,
also mostly Java-based. Offers product selection and decision
support
- Octopus Software
NOTE: Some AJ Software is already substantially Internationalized by virtue of
the development paradigm chosen (e.g., Java and XML-based applications).
In these cases, the KK will review the source and develop code necessary
to demonstrate to AJI's satisfaction the operation of these programs in
the Asian character sets and languages ("CJK"). In other cases, the KK
will undertake to convert the programs to handle Unicode characters.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
EXHIBIT C
MINIMUM LICENSE TERMS FOR CORPORATE SERVICES
"Customer" below is the Corporate Customer
1. DEFINITIONS.
1.1. "ASK JEEVES" means Ask Jeeves Kabushiki Kaisha.
1.2. "SERVICE" means services rendered by Ask Jeeves and any software and
data files Ask Jeeves delivers for use with those services (including
knowledgebase files, which contain Ask Jeeves' proprietary syntactic and
semantic, and product selection networks), and other materials Customer may be
delivered from time to time for use with Ask Jeeves products and Services.
1.3. "SERVICE LOG FILES" are log files generated from the software
portion of the Services (not server logs themselves).
1.4. "SITE(S)" means specified parts of website(s) or parts of website(s)
on which Customer may make the Service available to users. The Site includes
co-branded (where Customer's branding is at least as prominent as the third
party's) or framed versions of the Site but does not include any customized
`private label' version of the Site not substantially branded as a Customer
site.
2. CONTENT AND CREATION OF SITE. Customer agrees that it shall be responsible
for the creation of all Customer Materials and all contents of the Site other
than the Services.
3. LIMITED LICENSES.
3.1. LICENSE. Subject to the terms of this Agreement, Ask Jeeves grants
Customer a limited, nonsublicensable, nontransferable, non-exclusive right to
use that Service solely to provide users of the Site(s) to access the end-user
functionality provided by that Service. Customer may distribute the software
portion of the Service only to the extent the portions of the software are
intended to be downloaded by end users in the course of the normal operation of
the Service. Customer may only make copies of the Service (i) for installation
and use on the Sites and (ii) backup copies of the Service made incidentally to
backing up the Sites. Customer must reproduce and include the copyright notice
and any other notices that appear on the Service, including on the copy's media.
Customer will only use the Service in the technical environment described in the
documentation to the Service. Ask Jeeves grants no implied license to its
intellectual property (including patents), and all rights not expressly granted
in this Section 3 are reserved by Ask Jeeves.
3.2. RESTRICTIONS. Customer will not, and will not allow any third party
to: (i) decompile, disassemble, or otherwise reverse engineer the Service by any
means whatsoever, including by using the Service Log Files; (ii) provide, lease,
lend, use for timesharing or service bureau purposes or otherwise use the
Service for or with a third party (except as end users may use the Service over
Customer's web site); (iii) modify the Service or incorporate it into software,
except to the extent that the Service is used on the Site in accordance with its
documentation; (iv) disseminate performance information or analysis relating to
the Service, except for Customer's internal evaluation of the effectiveness of
the Service; (v) use any portion of the Service to create a competitive service,
product or technology; or (vi) enter into any arrangement with a third party to
use the Service without displaying the Site itself (for instance, private
labeling the Site or issuing queries to the Service without displaying the
Site). Customer may not use the Service for any purpose or in any manner not
expressly permitted in this Agreement. Customer has no right to receive any
source code or design documentation relating to the Service. If the laws of any
applicable jurisdiction limit the enforceability of these restrictions, they
will be limited so that they prohibit the activity only to the maximum extent
permitted by law, and Customer agrees to negotiate in good faith with Ask Jeeves
the terms of a license prior to engaging in any of the above activities.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
3.3. CURRENT VERSION OF SOFTWARE. Customer acknowledges that the
functioning of the Service depends on Customer using the most current version of
the Service, and agrees to implement the most current version of the Service
delivered to Customer within 90 days. All bug fixes, updates and enhancements
provided will be Services for the purposes of this Agreement.
3.4. LICENSE TO CUSTOMER'S MATERIALS. Customer acknowledges that in order
to make the Service available Ask Jeeves may be required to have access to
certain Customer software, equipment, the web contents relevant to Ask Jeeves'
performance of Services, customer inputs to the Service and other material of
Customer or Customer's suppliers ("CUSTOMER MATERIALS"). Customer grants to Ask
Jeeves a non-exclusive, non-transferable license to use the Customer Materials
for the purpose of rendering the Services and improving the services Ask Jeeves
offers.
4. OWNERSHIP. Ask Jeeves retains ownership of the Service and all copies and
portions of the Service. All rights not expressly granted under this Agreement
are reserved by Ask Jeeves.
5. PAYMENT AND RECORDS.
5.1. RECORDS AND AUDIT. Customer agrees that it will maintain usage
records of the Service for a period of two years. Ask Jeeves will have the right
to examine these records from time to time to determine whether the Service is
being used in accordance with the requirements of this Agreement.
5.2. SERVICE LOG FILES. Customer agrees to provide the Service Log Files
to Ask Jeeves on the schedule listed in the Statement of Work. Customer agrees
that failure to timely deliver the Service Log Files will excuse Ask Jeeves from
rendering Services to the extent the Services utilize these files.
6. WARRANTY DISCLAIMER. THE SERVICE IS PROVIDED "AS IS" AND WITHOUT WARRANTY
OF ANY KIND AND ASK JEEVES EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES OF ANY
KIND OR NATURE, WHETHER EXPRESS, IMPLIED, OR STATUTORY, INCLUDING WITHOUT
LIMITATION THE IMPLIED WARRANTIES OF TITLE, NON-INFRINGEMENT, MERCHANTABILITY,
AND FITNESS FOR A PARTICULAR PURPOSE. ASK JEEVES DOES NOT WARRANT THAT THE
SERVICE WILL BE FREE FROM BUGS OR MAKE ANY OTHER REPRESENTATIONS REGARDING THE
UPTIME, USE, OR THE RESULTS OF USE OF THE SERVICE OR OTHER MATERIALS DELIVERED,
INCLUDING IN TERMS OF CORRECTNESS, ACCURACY, RELIABILITY, OR OTHERWISE. Customer
understands that Ask Jeeves is not responsible for and will have no liability
for hardware, software, or other items or any services provided by any persons
other than Ask Jeeves.
7. LIMITATION OF LIABILITY. ASK JEEVES WILL NOT BE LIABLE FOR ANY LOSS OF
USE, LOSS OF DATA, INTERRUPTION OF BUSINESS, DOWNTIME, LOST PROFITS, OR ANY
INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND REGARDLESS
OF THE FORM OF ACTION WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT
PRODUCT LIABILITY, OR OTHERWISE, EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY
OF DAMAGES. IN NO EVENT WILL ASK JEEVES' LIABILITY TO CUSTOMER UNDER THIS
AGREEMENT EXCEED PAYMENTS RECEIVED BY ASK JEEVES ATTRIBUTABLE TO CUSTOMER UNDER
THIS AGREEMENT WITHIN THE PRECEDING TWELVE MONTHS. THE EXISTENCE OF ONE OR MORE
CLAIMS WILL NOT ENLARGE THIS LIMIT. THE PARTIES ACKNOWLEDGE AND AGREE THAT THIS
SECTION IS AN ESSENTIAL ELEMENT OF THE AGREEMENT AND THAT IN ITS ABSENCE, ASK
JEEVES MAY ELECT NOT TO PROVIDE THE SERVICE AND THE ECONOMIC TERMS OF THIS
AGREEMENT WOULD BE SUBSTANTIALLY DIFFERENT. THIS SECTION IS SEVERABLE AND SHALL
SURVIVE ANY TERMINATION OR EXPIRATION OF THIS AGREEMENT. IF ASK JEEVES DECIDES
TO LIMIT THE LIABILITY OF CUSTOMER, THE CONSEQUENTIAL DAMAGES EXCLUSION SHALL
NOT APPLY TO BREACHES OF THE LICENSE GRANT BY CUSTOMER.
8. INDEMNITY. Customer agrees to indemnify, defend and hold harmless Ask
Jeeves from and against any and all liabilities, damages, loss, demands, fees,
expenses, fines, penalties and direct costs (including attorneys' fees) incurred
by Ask Jeeves and arising from any claims, suits, actions or proceedings brought
against Ask Jeeves by any third party arising out of the content of the Site or
alleging that all or any part of the Customer Materials or the Site,
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
including any recommendations or diagnoses on the site (other than the Service
itself) infringe any patent, copyright, trademark or other intellectual property
right of a third party or misappropriate any third party trade secret. Customer
agrees to indemnify and defend Ask Jeeves from and against any against any
claims of injury arising from Ask Jeeves' work on Customer's premises.
9. CONFIDENTIALITY. The Service Log Files contain certain confidential
information of Ask Jeeves and Customer, and both parties agree not to disclose
the Service Log Files, or data derived from these files, to third parties, or
use such files except for the purposes contemplated by this Agreement.
10. NO EXPORT. Customer acknowledges that the laws and regulations of the
United States restrict the export and re-export of commodities and technical
data of United States origin, including the software portion of the Services.
Customer agrees that it will not export or re-export the software from the
United States, Japan or the country originally shipped to by Ask Jeeves in any
form, without the appropriate United States, Japanese and foreign governmental
licenses. Customer agrees that its obligations pursuant to this Section will
survive and continue after any termination or expiration of rights under this
Agreement.
11. TRADEMARK. Customer acknowledges that Ask Jeeves has substantial interest
in maintaining its trademark rights in its "Ask" button and butler character,
and agrees that it will not use any button with the word "ask," except the Ask
Jeeves button, or any character which is a butler or may be confused with a
butler (such as a maid, chauffeur, etc.) or looks like Ask Jeeves' "Jeeves"
character, connected to any functionality of the Service. Customer agrees that
it will not use any character which uses the word "Ask" (such as "Ask Phil")
without prior written approval of Ask Jeeves on the name and on the rendition of
the character. Customer acknowledges that Ask Jeeves requires certain screen
layouts and graphic elements for the Service, and agrees that it will maintain
conformity with the requirements listed at
http://corp.ask.com/guidelines/index.html. Subject to the terms and conditions
of this Agreement, Ask Jeeves grants Customer a non-exclusive, non-transferable
license to use the Ask Jeeves marks and logos in those requirements on the Site,
solely in connection with the Service. Ask Jeeves has the right to terminate
Customer's right to use its marks and logos if, in Ask Jeeves' discretion,
Customer's use may result in damage to Ask Jeeves or its marks and logos.
12. ASSIGNMENT. This Agreement is assignable by Customer only in connection
with an assignment of all assets relating to the Site and if the assignee agrees
in writing to be bound by the terms of this Agreement.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
EXHIBIT D
SOURCE CODE RESTRICTIONS
1. Access to the Source Code will be managed solely by an engineering
manager at the Source Code Work Facility pursuant to restrictions agreed to by
AJI and the Source Code Work Facility, subject to Section 4(b).
2. The KK acknowledges and agrees that the disclosure and use of the
Source Code of the AJ Software warrants additional security precautions to those
set forth for Confidential Information generally. Therefore, the KK agrees to
protect all Source Code for the AJ Software, at a minimum, as follows:
(a) The KK agrees that it will comply with all restrictions on use
of the Source Code at the Source Code Work Facility, including at a minimum that
the KK will:
(i) not reproduce the Source Code or any portion of the
Source Code, in any form or medium, except as absolutely necessary to perform
the Work;
(ii) not allow hard copy printouts of any portion of the
Source Code to exist except within the Source Code Work Facility;
(iii) not use or disclose the Source Code for any purpose not
specifically authorized in this Agreement.
3. The KK employees may only access and use the Source Code at the
Source Code Work Facility.
4. No right to access any Source Code will be granted to a company
listed on Exhibit F to the Joint Venture Agreement.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
<PAGE>
EXHIBIT E
SUPPORT SERVICES TO BE RENDERED BY AJI
- TELEPHONE AND EMAIL: AJI shall use telephonic, voicemail and email means
to provide assistance and consultation for the purpose of resolving
implementation and performance issues with respect to the AJ Assets. AJI
shall name at least one designated e-mail contact person and one dedicated
contact to provide telephonic assistance to the KK.
- TRAINING: Training in the use of AJ Software. Training will be provided at
no additional charge (other than travel and hotel expenses and per diem
costs) to the KK, at the KK's offices in Japan. Training shall consist of
five (5) days of training, with an eight (8) hour work day being
considered one day of training, and shall be conducted within ten (10)
days of delivery of the AJ Software. Training shall be provided to up to
three (3) employees of the KK.
- ACCESS: Access to information on upcoming features.
- MAINTENANCE: AJI will use commercially reasonable efforts to maintain and
support the AJ Assets and all current and future technology, including
Updates, on behalf of the KK.
- SUPPORT HOURS: AJI technical support business hours will be from 9 a.m. to
5 p.m. Monday through Friday, Pacific Time. Technical support will be
closed on all scheduled AJI holidays (which generally coincide within U.S.
Federal holidays). Technical support may also be closed because of
unforeseen emergencies (e.g., weather conditions, power outages etc.).
- ISSUE ESCALATION: AJ will regard as a high priority issues regarding
availability and operations of the AJ Software and Updates. If the issue
is deemed to originate with the AJ Software or Updates, the AJI support
representative will promptly escalate the issue to AJI's Engineering
Group. Issues regarding general usage, bug reports, documentation, etc.,
will be handled using the escalation procedure below.
- ACCESS TO TRACKING SYSTEM: The KK engineers shall have full-time access
during AJI's normal business hours to the AJI status tracking system to
share data and report new bugs. AJI will appoint a contact person to
enable the KK to have access during emergencies. As soon as the tracking
system is available 24 hours a day on the Web, the KK shall have full-time
access to it.
- FIRST LEVEL SUPPORT: First Level Support is provided via email or by
telephone. First Level Support is also provided by technical support
representatives and includes answering general services questions.
First Level Support representatives may source AJI's internal
knowledge base, product documentation or other support
representatives for the KK. If the issue cannot be answered, it will
be escalated by AJI within a reasonable period of time to Second
Level Support.
The First Level support representative is responsible for selecting
the appropriate Second Level support personnel. If a Second Level
support representative is not available, the KK representative will
be contacted within [*] by a Second Level support representative.
- SECOND LEVEL SUPPORT: Second Level support consists of senior support
representatives and support management; these individuals will make every
reasonable attempt to answer the problem during the same business day, if
possible. If the issue has been investigated by Second Level Support for
more than [*] and it has not been resolved, Second Level support will
escalate the issue to the AJI Engineering Group or a third party vendor
depending on the problem. The KK will be notified by email and informed of
the estimated time of resolution. Follow-up messages will be sent as
deemed necessary to ensure the KK is properly informed.
[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
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[*] Indicates that certain information in this exhibit has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.
2