Sponsorship Agreement - Ford Motor Media and iVillage Inc.
SPONSORSHIP AGREEMENT
This Sponsorship Agreement ("Agreement") is entered into as of December
18, 1998, by and between Ford Motor Media, a division of J. Walter Thompson
("FMM") with offices at 300 Renaissance Center, Detroit, Michigan 48243 and
iVillage, Inc., ("iVillage") with offices at 170 Fifth Avenue, New York, New
York 10010. FMM and iVillage may be referred to generically as a "Party", or
collectively as "Parties".
WHEREAS, iVillage operates a site on the World Wide Web and America
Online (the "Network"), which contains channels including Parent Soup,
ParentsPlace, Better Health and Armchair Millionaire as well as career, fitness
& beauty, relationships, work from home, travel, money and food channels.
WHEREAS, FMM seeks to promote the sale of its automotive products
across the Network.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, iVillage and FMM hereby agree as
follows:
1. Term and Termination.
A. Term. The initial production period shall be for a period of two (2)
months to commence on November 4, 1998 (the "Production Period"), and the
remaining term of this Agreement shall be for a period of twenty four (24)
months to commence on the tentative launch date of January 4, 1999, unless
terminated earlier as provided herein (the "Promotion Period"), (The Production
Period and the Promotion Period shall be collectively referred to as the
"Initial Term"). The Parties agree that prior to July 1, 2000, iVillage will
provide FMM with the opportunity to renew this Agreement (the "Renewal Term") on
terms set forth in a proposal (the "Proposal) to be presented to FMM. FMM shall
indicate its acceptance or rejection of the Proposal no later than August 31,
2000. If iVillage does not receive FMM's acceptance or rejection of the Proposal
by August 31, 2000, iVillage may interpret FMM's non response as a rejection of
the Proposal. The Proposal shall include maximum payment fees by FMM with
respect to the Renewal Term.
B. Termination. In the event of a material breach by either Party of
any term of this Agreement, the non-breaching Party may terminate this Agreement
by written notice to the breaching Party if the breaching Party fails to cure
such material breach within thirty (30) days of receipt of written notice
thereof. In addition, either Party may terminate this Agreement effective upon
written notice stating its intention to terminate in the event the other Party
(i) ceases to function as a going concern or to conduct operations in the normal
course of business, or (ii) has a petition filed by or against it under any
state or federal bankruptcy or insolvency law which petition has not been
dismissed or set aside within sixty (60) days of its filing. In addition to the
foregoing, if on or after January 31, 2000, either Party determines, based upon
reasonable and mutually agreed upon measurable standards, that (x) the other
Party has materially underperformed its obligations pursuant to this Agreement
or (y) the expectations of such Party have been materially unfulfilled, such
Party may terminate this Agreement upon ninety (90) days written notice to the
other Party. Additionally, in the event of a prolonged and/or substantial
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strike which materially and adversely affects Ford's ability to produce and sell
cars, the Parties will work together in good faith to amend or terminate this
Agreement.
2. Promotion.
A. During the Production Period, iVillage will design, develop,
construct and host a Ford bridge site (the "Bridge Site") which shall include
approximately sixty (60) pages of content and other interactive material such as
a travel planner or a car design feature. During the Promotion Period, iVillage
will continue to host, maintain and update the Bridge Site. Upon receipt from
iVillage of the proposed Bridge Site design and content, FMM shall have no more
than five (5) business days in which to provide iVillage with its acceptance or
rejection of the design and content. If iVillage does not receive FMM's
acceptance or rejection of such within the allotted time, iVillage shall deem
FMM's silence as acceptance. The Parties shall work together to determine the
content mix and delivery deadlines in order to maximize the effectiveness of the
sponsorship campaign.
B. During the Initial Term, iVillage will design, create and deliver
fifty (50) Ford-branded advertising units. The advertising units shall be
subject to FMM's final approval. iVillage will deliver approximately two (2) new
advertising units each during the Promotion Period. For purposes of this
Agreement, an advertising unit can include but shall not be limited to banners
in the form of rich media, java-based, animated, daughter and/or pull-down
banners, or a combination of appropriate technologies, and which shall represent
and be defined by industry standards.
C.
(i) During the Promotion Period, iVillage will deliver a
minimum of seventy million (70,000,000) advertising impressions, in an
equal proportion each month. Subject to reasonable written notice to
iVillage, FMM may request a reasonable reallocation of impressions as
determined by FMM. The advertising units of Ford Division and other
Ford Motor Company entities shall be served by a third party
advertisement server, which shall be compliant with Net gravity, or
Doubleclick or other compatible technology.
(ii) During the Promotion Period, iVillage traffic shall be
audited by a third party traffic auditor listed on Exhibit A and
iVillage shall provide FMM with relevant reports on a biweekly basis.
iVillage will provide ongoing marketing, creative, technical and
editorial consultation to FMM.
(iii) In the event that iVillage fails to deliver the
advertising impressions during the Promotion Period, FMM shall have the
option of either (a) extending the Initial Term of this Agreement for
an additional three (3) month period to "make good" the undelivered
impressions or (b) requiring iVillage to refund to FMM an amount equal
to fifty dollars ($50) for each one thousand (1,000) impressions which
were not delivered.
(iv) However, if iVillage falls to deliver the advertising
impressions during the Promotion Period and FMM desires that iVillage
"make good" the undelivered impressions and extend the Initial Term
pursuant to option (a) set forth in Section 2.C.(iii), if the Parties
have decided not to renew the Initial Term and iVillage desires to
enter into an agreement with an entity whose business(es) would pose a
conflict to FMM
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or Ford Motor Credit, then iVillage, at iVillage's option, may refund
the remaining impression deficiency to FMM, and immediately upon
pavement of such, the "make good" obligation shall terminate.
D. During the Initial Term, iVillage will design and administer, (i) a
minimum of ten (10) online conferences which shall include live chats and the
archiving of conference transcripts (dates of such conferences shall be
determined by FMM and shall occur approximately once every two months, but not
earlier than March 1, 1999 and FMM shall provide iVillage with not less than
forty five (45) days advance notice of any conference); (ii) a minimum of
eighteen (18) online polls; (iii) a minimum of six (6) sixty-second surveys;
(iv) a minimum of two (2) online focus groups; and (v) a minimum of two (2)
customized turn-key Network sweepstakes (iVillage shall be responsible for all
aspects of the sweepstakes other than the prize(s) which shall be provided by
Ford Motor Company ("FMC")). FMM and FMC's respective advertising agencies shall
be free to provide input with respect to the aforementioned promotional efforts
set forth in this section and shall have the opportunity to reasonably approve
such efforts.
E. During the Initial Term, iVillage will develop and administer ten
(10) message boards pertaining to topics mutually determined by the Parties. The
first message board shall be live on or about January 4, 1999, or in conjunction
with the launch of the Bridge Site.
F. During the Promotional Period, iVillage will place special
Ford-branded text links, newsletter mentions, hotlinks and taglines throughout
the Network. FMC shall have prior approval over all iVillage uses of any, Ford
Mark, as defined below. In the event that any of the Ford-branded links and/or
mentions set forth in this Section 2.F. are, in FMC's reasonable judgment,
materially injurious to FMC. FMC shall provide written notice of such offense to
iVillage. iVillage shall then have one (1) business day in which to cure said
offense.
3. Reporting. During the Promotion Period, iVillage agrees to provide FMM
with biweekly reports in connection with the promotional obligations set forth
in this Agreement in addition to semi-annual executive reviews with iVillage
management. All traffic reports shall be audited by the third party traffic
auditor selected pursuant to Section 2.C.(ii). iVillage shall also provide, on a
timely basis, impression tracking reports from a third party tracking system,
confirming guaranteed impression delivery.
4. Exclusivity. For the Initial Term of this Agreement, iVillage agrees
that Ford shall be the exclusive automobile manufacturer sponsor and advertiser
throughout the Network, with respect to entities whose primary business is that
of an automotive manufacturer and/or retailer. For purposes of this Agreement,
the term "retailer" shall refer to an entity which sells new and/or used
vehicles. In addition, in the event that iVillage desires to form a sponsorship
relationship with an automobile rental company during the term of this
Agreement, iVillage shall notify Hertz and provide Hertz with an opportunity to
enter into such a relationship with iVillage, on not less favorable terms than
those offered to any other automobile rental company. Once presented with an
opportunity, Hertz shall have five (5) business days in which to accept or
reject such terms. If iVillage does not receive Hertz's acceptance or rejection
of such within the allotted time, iVillage shall deem Hertz's silence as
rejection. The terms of any such relationship shall be mutually determined by
the Parties. Notwithstanding the foregoing, FMC shall, on a non-exclusive basis,
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be permitted to offer Ford Motor Credit car financing products related to the
purchase of Ford vehicles.
5. Fee.
A. FMC agrees to pay iVillage, upon signing of this Agreement, an
upfront, non-refundable, non-recoupable production and set up fee in the amount
of Two Hundred Fifty Thousand Dollars ($250,000). In addition, FMM shall pay
iVillage One Million Seven Hundred Fifty Thousand Dollars ($1,750,000) in equal
quarterly payments of Four Hundred Thirty Seven Thousand Five Hundred Dollars
($437,500) each, within ten (10) days after the end of each calendar quarter
during 1999.
B. In addition, FMM agrees to pay iVillage, Three Million Dollars
($3,000,000) in equal quarterly payments of Seven Hundred Fifty Thousand Dollars
($750,000) each, within ten (10) days after the end of each calendar quarter
during the year 2000.
6. Representations and Warranties. Each Party hereby represents and
warrants that: (a) it is a corporation duly organized and validly existing and
in good standing under the laws of the state of incorporation; (b) it has full
power and authority to enter into this Agreement and to perform its obligations
hereunder; (c) it has obtained all permits, licenses, and other governmental
authorizations and approvals required for its performance under this Agreement,
and (d) the services to be rendered and the materials provided by each Party
under this Agreement neither infringe nor violate any patent, copyright, trade
secret, trademark, or other proprietary right of any third party.
7. Proprietary Rights. Upon execution and delivery of this Agreement,
iVillage assigns to FMC all right, title and interest in and to the content,
design and intellectual property, rights created specifically for and unique to
the Bridge Site, advertising units, and other promotional elements set forth in
this Agreement (collectively, the "Materials"). Notwithstanding the foregoing,
iVillage expressly retains all right, title and interest in and to the programs
and software that are used in connection with the creation and operation of, but
are not created specifically, for and unique to the Materials (the "iVillage
Proprietary Materials"). FMC acknowledges and agrees that the iVillage
Proprietary Materials are used by iVillage in creating and developing Web sites
for itself and other parties. FMC further acknowledges and agrees that iVillage
will be using certain licensed programs and software owned by third parties for
portions of the development and creation of the Materials and that FMC will not
acquire any right in or to those copyrighted materials. iVillage agrees to
execute any and all necessary further documents that FMC may reasonably request
to fully vest the intellectual property rights related to the Materials in FMC
and, if requested, to reasonable assist FMC in registering such rights in the
name of FMC.
8. Publicity. iVillage, FMC and FMM agree to collaborate on a joint press
release ("Press Release") to include information regarding the subject matter of
this Agreement and quotes from iVillage, FMC and FMM sources. The distribution
list shall be approved by both Parties no less than five (5) business days prior
to the release date. The Press Release and any quotes from either Party's
sources must be approved by the other Party's public relations department, which
also must be made aware of any pre-briefings with outside parties at least five
(5) days in advance of any pre-briefing. In addition, the iVillage and FMM
public relations department, FMC and FMM must be informed, no less than five (5)
days before the release date, of any third party who expresses interest in the
Press Release.
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9. Licenses. FMM grants to iVillage, during the Initial Term of this
Agreement, a royalty-free, non-exclusive, worldwide license to use, reproduce
and display Ford's tradenames, trademarks, service marks and logos
(collectively, the "Marks") in connection with this Agreement. No right, title,
license, or interest in any Marks owned by Ford or any of its affiliates is
intended to be given to or acquired by iVillage by the execution of or the
performance of this Agreement. iVillage shall not use the Marks for any purpose
or activity except as expressly authorized or contemplated herein;
10. Confidentiality. Except as expressly set forth herein, iVillage and FMM
shall maintain in confidence the terms of this Agreement. It is expected that,
pursuant to discussions to date and to this Agreement, the Parties may disclose
to one another certain information ("Confidential Information"), as defined
herein, which is considered by the disclosing Party to be proprietary or
confidential information. Confidential Information is defined as any,
information, communication or data, in any form, including, but not limited to
oral, written, graphic or electromagnetic forms, models or samples, which the
disclosing Party desires to protect against unrestricted disclosure or use,
including without limitation, business information, financial data and marketing
data. All Confidential Information shall remain the sole property, of the
disclosing Party and its confidentiality shall be maintained and protected by
the receiving Party with the same degree of care as the receiving Party uses for
its own confidential and proprietary information and the receiving Party shall
not disclose such Confidential Information to any third party. The restrictions
of the use or disclosure of any Confidential Information shall not apply to any
Confidential Information: (i) after it has become generally available to the
public without breach of this Agreement by the receiving Party; (ii) is
rightfully in the receiving Party's possession prior to disclosure to it by the
disclosing Party; (iii) is independently developed by the receiving Party; (iv)
is rightfully received by the receiving Party from a third party, without a duty
of confidentiality; or (v) is required to be disclosed under operation of law.
11. LIMITATION OF LIABILITY. NEITHER PARTY SHALL HAVE ANY LIABILITY
HEREUNDER FOR ANY INDIRECT, SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES
INCLUDING, WITHOUT LIMITATION, LOSS OF PROFIT OR BUSINESS OPPORTUNITIES, WHETHER
OR NOT THE PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH.
EXCEPT AS EXPRESSLY SET FORTH HEREIN, NEITHER PARTY MAKES ANY, AND EACH
PARTY HEREBY SPECIFICALLY DISCLAIMS ANY REPRESENTATIONS OR WARRANTIES, EXPRESS
OR IMPLIED, REGARDING THE SERVICES CONTEMPLATED BY THIS AGREEMENT, INCLUDING ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE AND
IMPLIED WARRANTIES AFJSING FROM COURSE OF DEALING OR COURSE OF PERFORMANCE.
12. Indemnification.
A. iVillage agrees to indemnify, defend and hold harmless FMM and its
client Ford Motor Company and their respective parents, subsidiaries,
affiliates, successors and assigns from any and all third party losses,
liabilities, damages, actions, claims, expenses and costs (including reasonable
attorneys' fees) which result or arise out of or in connection with the breach
of this
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Agreement by iVillage or which result or arise out of or in connection with any
material supplied by iVillage pursuant to this Agreement.
B. FMM agrees to indemnify, defend and hold harmless iVillage and its
parent, subsidiaries, affiliates, successors and assigns from any and all third
party, losses, liabilities, damages, actions, claims, expenses and costs
(including reasonable attorneys' fees) which result or arise out of or in
connection with the breach of this Agreement by FMM or which result or arise out
of or in connection with any material supplied by FMM or its client Ford Motor
Company pursuant to this Agreement.
13. General Provisions.
A. Relationship of the Parties. Nothing contained herein shall imply
any partnership, joint venture or agency relationship between the Parties and
neither Party shall have the power to obligate or bind the other in any manner
whatsoever, except to the extent herein provided.
B. Severability. If any provision of this Agreement shall be declared
by any court of competent Jurisdiction to be illegal, void or unenforceable, all
other provisions of this Agreement shall not be affected and shall remain in
full force and effect.
C. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
D. Notices. All notices, requests, demands, payments and other
communications which are required or may be given under this Agreement shall be
in writing and shall be deemed to have been duly given if delivered personally,
telecopied or sent by nationally recognized overnight carrier, or mailed by
certified mail, postage prepaid, return receipt requested, as follows:
If to FMM:
Ford Motor Media
500 Woodward Avenue
Detroit, Michigan 48226-3428
Attention: Carol Wright
Tel: (313) 964-2954
Fax: (313) 964-2315
If to iVillage:
iVillage, Inc.
170 Fifth Avenue
New York, New York 10010
Attention: Vice President Business/Legal Affairs
Tel: (212) 206-3106
Fax: (212) 604-9133
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E. Force Majeur. Except as otherwise expressly provided in this Agreement,
neither Party shall be liable for any breach of this Agreement for any delay or
failure of performance resulting from any cause beyond such Party's reasonable
control, including but not limited to the weather, strikes or labor disputes
(other than as set forth in Section 1.B), war, terrorist acts, riots or civil
disturbances, government regulations, acts of civil or military authorities, or
acts of God provided the Party affected takes all reasonably necessary steps to
resume full performance. In the event that the Network or the Bridge Site are
unavailable for a substantial period of time due an event of force majeur or
otherwise, iVillage agrees to use commercially reasonable efforts to "make good"
any impressions lost as a result of such circumstance.
F. Entire Agreement. This Agreement (i) constitutes the binding agreement
between the Parties, (ii) represents the entire agreement between the Parties
and supersedes all prior agreements relating to the subject matter contained
herein and (iii) may not be modified or amended except in writing signed by the
Parties.
G. Survival. The following sections shall survive any termination or
expiration of this Agreement: 6, 7, 10, 11, 12 and 13.
H. Governing Law. Agreement shall be governed by, and construed in
accordance with the laws of the State of New York without regard to the
conflicts of laws principles thereof.
I. Assignment. Neither Party shall sell, transfer or assign this Agreement
or the rights or obligations hereunder, without the prior written consent of the
other Party, such consent not to be unreasonably withheld or delayed.
Notwithstanding the foregoing, upon prior written notice by Ford Motor Company
to iVillage, this Agreement may be assigned by FMM to another advertising
agency, and in such event, FMM will be released from all financial and other
obligations under this Agreement.
J. Headings. The headings of the various sections of this Agreement have
been inserted for convenience of reference only.
IN WITNESS WHEREOF, the Parties hereto have executed and delivered this
Agreement as of the date first above written.
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FOR FORD CENTRAL MEDIA FOR iVILLAGE, INC.
/s/ Mark A. Kaline /s/ Steven Elkes
-------------------------------------- ---------------------------------------
(Name) (Name
Media Manager Vice President Business/]Legal Affairs
-------------------------------------- ---------------------------------------
(Title) (Title)
1/12/99 12/18/98
-------------------------------------- ---------------------------------------
(Date) (Date)
/s/ Mark A. Kaline /s/ Steven Elkes
-------------------------------------- ---------------------------------------
(Signature) (Signature)
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EXHIBIT A
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Third Party Traffic Auditors
ABC
I/PRO
PWC
DoubleClick
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