Switchboard Services Agreement - Switchboard Inc. and YP.Net Inc.
SWITCHBOARD SERVICES AGREEMENT
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THIS SWITCHBOARD SERVICES AGREEMENT (the "Agreement) is made and entered into as
of this 1st day of April, 2003 (the "Effective Date") by and between Switchboard
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Incorporated, a Delaware corporation having its principal place of business at
120 Flanders Road, Westboro, MA 01581 ("Switchboard"), and YP.Net, Inc. a Nevada
corporation having its principal place of business at 4840 E. Jasmine #110,
Mesa, Arizona 85205 ("YP.Net").
WHEREAS, Switchboard operates an online, interactive yellow pages directory
service (the "Switchboard Yellow Pages Services," as further defined herein)
accessible via the Internet at www.switchboard.com, as such web site may be
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modified during the Term of this Agreement, or any successor site thereto as may
be designated by Switchboard and approved by YP.Net from time to time; which
approval shall not be unreasonably withheld (the "Switchboard Site"); and
WHEREAS, through the Switchboard Site and other means, Switchboard offers to
merchants a variety of Internet advertising services ("Directory Ads," as
further defined herein); and
WHEREAS, YP.Net owns and operates an online yellow pages directory service
accessible via the Internet at www.yp.net (and accessible through other
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forwarded urls including www.Yellow-Page.Net) as such web site may be modified
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during the Term of this Agreement or any successor site thereto as may be
designated by YP.Net and approved by Switchboard from time to time, which
approval shall not be unreasonably withheld (the"YP.Net Site"); and
WHEREAS, through the YP.Net Site and other means, YP.Net offers to its merchant
customers ("YP.Net Merchants," as further defined herein) certain Internet
advertising services; and
WHEREAS, YP.Net desires to market, promote, offer, provide and/or sell to YP.Net
Merchants the Directory Ads, as provided herein; and
WHEREAS, Switchboard desires to expand its base of Directory Ad subscribers
through this Agreement, pursuant to which YP.Net may market, promote, provide,
offer and sell the Switchboard Directory Ads to YP.Net's merchant customers
through sales efforts by YP.Net's sales force, through YP.Net's telemarketing
efforts and through other means as described herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Switchboard and YP.Net agree as follows:
<PAGE>
1.0 TERMS AND CONDITIONS
The terms and conditions set forth in the following Schedules (and the
Exhibits thereto) are attached hereto and incorporated herein by reference,
and shall govern the provision of such Switchboard Directory Ads:
SCHEDULE A SWITCHBOARD DIRECTORY ADS
SCHEDULE B GENERAL TERMS AND CONDITIONS
IN WITNESS WHEREOF, Switchboard and YP.Net have caused this Agreement to be
executed by their duly authorized representatives as of the Effective Date.
SWITCHBOARD INCORPORATED YP.NET DIRECTORIES, INC.
By: /s/ Mark Canon By: /s/ Debra Johnson
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Name: Mark Canon Name: Debra Johnson
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Title: VP Business Development Title: V.P. corp image
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SCHEDULE A
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SWITCHBOARD DIRECTORY ADS
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1.0 DEFINITIONS
"Directory Ad" shall mean an advertisement to be sold and or provided by YP.Net
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to YP.Net Merchants hereunder, for display in the "Featured Listing" section
(sometimes referred to as "Local Advertiser" section) or comparable area of the
Switchboard Yellow Pages Service displayed in all cases before the "All
Businesses", or Free Listing Section; which may be hyperlinked to a web site of
a YP.Net Merchant; which shall be searchable by such criteria as category and
geographic locations, and by business attributes that are provided; with
placement in one (1) Yellow Pages category; and shall appear when the respective
YP.Net Merchant's location is within the city or town specified in the User
query. Directory Ads shall appear when the respective advertiser's listing
results is shown within the category search, proximity search and business name
search, if applicable, in the Switchboard Yellow Pages Service. Additional
functions and features, including size of Directory Ads and quantity of enhanced
data attributes displayed in the ads shall be subject to Switchboard's
determination and subject to such modifications to such advertisements as
Switchboard may implement from time to time, but shall be no less than other
Directory Ads in the same section. Directory Ads sold and or placed by YP.Net
pursuant to this Agreement shall be distributed and displayed through the
Switchboard Site, and also through such Switchboard Affiliated Sites that
display enhanced directory content as may be determined by Switchboard.
Directory ads shall appear in the form of a business Featured Listing, including
business name, business address, business telephone number, and optional
Directory elements such as web site address, e-mail address, toll free numbers,
fax number, one (1) line of promotional text to appear under the business name,
hours of operation, Enhanced Data, and may include a link to a "mini Web Page"
service hosted by YP.net, with placement in the Featured Listing section of the
Yellow Pages results screen, substantially as depicted in the screen shot
attached hereto as EXHIBIT "A".
"Directory Ad Management Tool" shall mean Switchboard's proprietary online Order
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insertion tool to which YP.Net will be granted access for the purpose of
creating and managing Directory Ads hereunder, and YP.Net's use of which shall
be solely pursuant to the terms and conditions of Switchboard's or its
licensor's standard terms of use for such Tool.
"Order" shall mean a YP.Net Merchant's order to obtain a Switchboard Directory
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Ad that is generated pursuant to YP.Net's Marketing Efforts established
hereunder.
"Switchboard Affiliated Sites" shall mean third party web sites linking to and
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displaying content from the Switchboard Site through private label, co-branded,
or sub-branded interfaces or otherwise pursuant to written agreements with
Switchboard.
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businesses and other entities located in the United States, such as names,
addresses, telephone numbers, and advertisements, as such service may be
modified from time to time during the Term.
"YP.Net Merchant" shall mean merchant customers of YP.Net, to which YP.Net may
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market, promote, provide, offer and or sell Switchboard Directory Ads as
provided herein; however YP.Net may not intentionally market, promote, provide,
offer or sell to YP.Net merchants that are also existing Switchboard Directory
Ad customers.
"YP.Net Merchant Content" shall mean such trademarks, trade names, service
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marks, logos, advertising collateral and other content or materials provided by
YP.Net or their Merchants for the creation of Directory Ads hereunder.
2.0 PROMOTION AND SALE OF SWITCHBOARD DIRECTORY ADS
2.1 Right to Market and Sell Directory Ads. During the Term, YP.Net shall
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have the non-exclusive, non-assignable (except as provided in Section 11.1
of SCHEDULE B attached hereto) right to independently solicit, enter into
agreements with and or provide YP.Net Merchants which result in such YP.Net
Merchants receiving the benefit of the YP.Net purchased Directory Ads from
Switchboard. YP.Net shall not misrepresent to any YP.Net Merchant the
operation and functions of the Directory Ads. Notwithstanding the
foregoing, Switchboard shall reframe itself, and its contractors, agents,
represents and other third parties engaged for that purpose from
intentionally soliciting orders from YP.Net Merchants, for Directory Ads.
2.2 Marketing Effort. Throughout the Term, YP.Net shall use commercially
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reasonable efforts to market, promote, offer and sell the Directory Ads
though the YP.Net Site, YP.Net's sales force, telemarketing efforts, direct
mail and/or such other methods as the parties may mutually agree upon form
time to time during the Term (the "Marketing Efforts"). In no event,
however, shall YP.Net knowingly market, promote, provide, offer sell
Directory Ads to existing Switchboard Directory Ad customers. In the event
that it is discovered that YP.Net has placed an Order that involves an
existing Switchboard Directory Ad customer, such Order shall be cancelled
and removed immediately.
2.3 Miscellaneous. Switchboard shall provide YP.Net with such technical
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specifications, documentation and such other information and assistance as
may be reasonable necessary to assist YP.Net with the Marketing Effort,
including necessary and sufficient documentation for YP.Net to accurately
represent to each YP.Net Merchant the operation and functions of the
Switchboard Directory Ads as required by Section 2.1, above.
3.0 ORDERS FOR SWITCHBOARD DIRECTORY ADS; GENERAL
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3.1 Advertising Content Policy. All orders for Switchboard Directory Ad
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Orders generated by YP.Net are subject to acceptance by Switchboard.
Switchboard reserves the right, in its reasonable discretion, to reject any
Order that is, or contains a link to any content that is, offensive,
defamatory, indecent, obscene, trade libelous, threatening or harassing,
harmful to minors, child pornographic or that contains illegal content as
defined by applicable federal, state, county and local laws, or that may
violate Switchboard's Content Policy, as the same may be modified or
updated by Switchboard from time to time, the current version of which is
set forth in EXHIBIT B attached hereto.
Switchboard shall notify YP.Net of any Order so rejected within five (5)
business days of such rejection. YP.Net shall have the option to remedy the
rejected Order with a substitute Order that complies with the standards set
forth in this Section 3.1. Any substitute Orders placed by YP.Net shall be
subject to further review by Switchboard as provided in this Section 3.1.
3.2 Customer Support. Through the use of the Directory Ad Management Tool
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or such other means as YP. Net may determine, YP.Net shall be responsible
for handling and responding to all YP.Net Merchant inquiries relating to
Orders for Directory Ads sold pursuant to this Agreement.
3.3 Payment of Invoices. Switchboard invoices for Orders shall be paid by
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YP.Net within thirty (30) days of the date of invoice. Invoices not paid
within such period shall be subject to a late payment charge of 1.5% per
month (or the maximum rate permitted by law, whichever is lower) on the
outstanding balances thereof, accruing from the due date. Payment of a late
payment charge by YP.Net shall not affect any other remedy available to
Switchboard. In the event an invoice by Switchboard to YP.Net remains
unpaid, in whole or in part, for a period of sixty (60) days past its due
date, Switchboard may, at its option and in addition to any right or remedy
available to Switchboard under this Agreement, cancel any or all unpaid
Orders submitted by YP.Net.
3.4 Taxes. Any pricing for Orders provided herein may not include any
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applicable sales or use taxes that may be levied thereon. If applicable,
the invoicing and collecting party shall, in addition to the payments
required hereunder, pay all sales, use, transfer or other taxes, whether
federal, state or local, however designated, which are levied or imposed on
an Order, excluding however designated, which are levied or imposed on an
Order, excluding however, income taxes on profits which may be levied
against the other party. The invoicing and collecting party shall be
responsible for providing, in a timely manner, all reasonable documentation
in the nature of exemption certificates or otherwise, necessary to allow
the other party to refrain from collections such as sales tax, that it
would otherwise be obligated to make.
4.0 ORDERS FOR DIRECTORY ADS
<PAGE>
4.1 Directory Ad Pricing. YP.Net shall be responsible for and shall have
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sole discretion in determining the prices to be charged to YP.Net Merchants
from time to time for Orders for Directory Ads placed hereunder (the
"Directory Ad Pricing").
4.2 Contracts with YP.Net Merchants. YP.Net shall be solely responsible for
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having each YP.Net Merchant execute any necessary written agreement (or an
enforceable equivalent) permitting the placement of a Directory Ad Order
hereunder which, when executed, shall be a contract between YP.Net and the
respective YP.Net Merchant. YP.Net hereby grants to Switchboard (and all
Directory Ad agreements between YP.Net and YP.Net Merchants shall include)
a worldwide, non-exclusive license and right to copy, display, transmit,
and publish the Directory Ads, including all YP.Net Merchant Content,
submitted to Switchboard hereunder, for display to users of the Switchboard
Site and the Switchboard Affiliated Sites. The following provisions shall
apply to all Directory Ad Orders:
SWITCHBOARD'S SOLE OBLIGATION TO YP.NET OR TO YP.NET MERCHANTS WITH RESPECT
TO ANY ERROR OR OMISSION RELATING TO THE ACCEPTANCE OF ANY ORDER AND
PUBLICATION OF ANY CONTENT THEREING SPECIFIED, INCLUDING THE PROVISION OF
ANY REPORT OR CATEGORY LISTINGS, SHALL BE THE CORRECTION OF SUCH ERROR OR
OMISSION.
SWITCHBOARD RESERVES THE RIGHT TO REFUSE OR TO CANCEL PUBLICATION OF THE
CONTENT OF ANY ORDER FOR DEFAULT BY YP.NET UNDER YP.NET'S AGREEMENT WITH
SWITCHBOARD.
4.3 Insertion and Submission of Orders. Directory Ad Orders shall be
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inserted and/or submitted by YP.Net directly through the use of the
Directory Ad Management Tool or by the transfer of such listing data and
elements to Switchboard, also through the Directory Ad Management Tool, in
a database format outlined in the Merchant Management Tool User's Guide,
for batch Directory Ad insertion and or removal at yp.net discretion.
YP.Net shall be solely responsible for correcting any Directory Ads which
are excepted (that is, do not match exactly with Switchboard listing
information for the same merchant) during the initial database load and any
subsequent loadings.
4.4 Placement and Hosting of Directory Ads. YP.Net shall ensure that each
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Directory Ad is correctly placed within the applicable Yellow Pages
category. If, in Switchboards; reasonable judgment, a Directory Ad is not
correctly placed YP.Net shall, upon notice form Switchboard, replace such
Directory Ad to the correct category or categories. Switchboard shall
maintain and control the Switchboard Yellow Pages Service. All Directory
Ads placed hereunder shall be hosted on Switchboard's servers.
<PAGE>
4.5 Directory Ad Management Tool License, Training and Support. Switchboard
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will provide YP.Net with a single session of telephone training or on-line
training on the use of the Directory Ad Management Tool, no to exceed
training for two (2) individuals or four (4) total hours of training each
year during the Term of this Agreement, or for such additional number of
people and with such other scheduling at Switchboard may agree upon in its
reasonable discretion. To assist YP.Net with any questions on the use of
the Directory Ad Management Tool, Switchboard will provide support, via
e-mail, as outlined in the Merchant Management Tool User's Guide.
Switchboard hereby grants to the YP.Net a non-exclusive, royalty free,
object code only license to use the Directory Ad Management Tool solely for
the purposes of this Agreement and solely pursuant to Switchboard's or its
licensor's terms of use for the Tool.
4.6 Merchant Invoices and Collection. YP.Net shall be solely responsible
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for invoicing and collecting all Directory Ad Pricing from YP.Net Merchants
with respect to Orders hereunder.
4.7 Directory Ad Hosting Fees. Commencing as of the Effective Date, YP.Net
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shall pay Switchboard a guaranteed monthly fee of twenty thousand dollars
($20,000) for up to 250,000 Directory Ad Orders in place, and additional
fees for any additional Directory Ad Orders (the "Directory Ad Hosting
Fees"), as follows:
NUMBER OF DIRECTROY ADS DIRECTORY AD HOSTING FEE
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HOSTED DURING THE MONTH
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YP.Net shall pay a guaranteed minimum
monthly Hosting Fee of $20,000, whether
all 250,000 Directory Ads are used or not.
Such guaranteed minimum Hosting Fee
shall be invoiced by Switchboard as the fist
Between 0 and 250,000 Directory Ads day of each month.
An additional Hosting Fee of $0.08 per
Directory Ad per month. Such additional
Hosting Fees shall be invoiced by
Switchboard in the month following the
For additional Directory Ads in excess month in which such additional Hosting
Of 250,000 Fees are accrued.
<PAGE>
Such Directory Ad Hosting Fees shall apply to each Directory Ad as of the
date of its creation as provided herein until its deletion. Such Directory
Hosing Ad Fees shall be due and payable as provided in Section 3.3 above,
Each invoice shall be categorized by YP.Net Merchant.
4.8 Directory Ad Terms. Each Directory Ad place hereunder and outstanding
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at the time of the expiration or termination of this Agreement shall be
removed and deleted from the Switchboard Yellow Pages Service of the
Switchboard Site and Switchboard Affiliated Sites at the time of such
expiration or termination.
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SCHEDULE B
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GENERAL TERMS AND CONDITIONS
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1.0 DEFINITIONS
"Term" shall have the meaning set forth in Section 9.0 hereof.
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Capitalized terms not defined in this Schedule B but used herein shall have the
meaning ascribed to them elsewhere within this Agreement.
2.0 EXCLUSIVITY
2.1 No Exclusivity Provided by Switchboard. YP.Net acknowledges and agrees
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that Switchboard may contract with-other marketing representatives or any
third party with respect to the marketing, promoting, offering or selling
of any of the Switchboard Directory Ads or services similar thereto,
including without limitation competitors of YP.Net. In the case of a
dispute YP.Net and other third party sellers of Switchboard Directory Ads
involving overlapping or conflicting Orders with respect to the same
merchant, the first Order submitted to and received by Switchboard shall be
deemed the sole Order. Switchboard reserves the right to implement new
sales channels using different terms and conditions, offer new and
different products, subject to the terms of this Agreement, as Switchboard
may deem necessary.
3.0 INTELLECTUAL PROPERTY
3.1 Technology. YP.Net acknowledges and agrees that Switchboard or its
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licensors own all right, title, and interest in and to all patents,
copyright, trademarks, trade secrets and other intellectual property rights
in the Switchboard Site, the Switchboard Yellow Pages Serviced, and the
Switchboard Directory Ads (excluding YP.Net Merchant Content), the
Directory Ad Management Tool, and any software provided to YP.Net in
connection with this Agreement. YP.Net shall take no action inconsistent
with such ownership and shall not attempt to register any intellectual
property described above in any jurisdiction. Similarly, Switchboard
acknowledges and agrees that YP.Net or its licensors own all right, title,
and interest in and to all patents, copyright, trademarks, trade secrets
and other intellectual property rights in the Yp.Net Site. Switchboard
shall take no action inconsistent with such ownership and shall not attempt
to register any intellectual property described above in any jurisdiction.
3.2 Trademarks. Each party hereby grants to the other, for the terms of this
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Agreement, a non-exclusive, royalty-free license to use any trademarks or
logos provided to the other party, subject to the respective owner's prior
approval and revisions in each instance, only for the purposes permitted by
this Agreement and further subject to the respective owner's right to
control the quality of any service
<PAGE>
offered under its trademark or logo, such that the service meets the standards
the public has come to associate with such party's trademarks and logos.
Neither party, by virtue of this Agreement, shall obtain or claim any right,
title, or interest in or to the other party's name, trademarks, service marks or
logos, except the right of use as specified herein, and the parties hereby
acknowledge and agree that all such use shall inure to the benefit of the
respective owner.
3.3 Proprietary Notices. Neither party shall alter or remove any printed or
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on-screen copyright, trademark, or other proprietary or legal notices place
by the other party in its web site or as other wise provide herein.
3.4 Ownership and Use of User Data. As between the parties, Switchboard
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shall be the sole and exclusive owner of all right, title and interest in
any and all data compiled or obtained by either party in connection with
the User's use of the Switchboard Site, the Switchboard Affiliated Sites
and the Switchboard Yellow Pages Services as provided herein.
3.5 YP.Net Merchant Data. Each party will treat merchant data (that is,
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information given by YP.Net Merchants in connection with placing Orders)
provided by the other party or jointly collected ("YP.Net Merchant Data")
strictly in accordance with all applicable laws, their respective terms of
use and privacy policies and with the same level of confidence that it
treats its own merchant data. As between the parties, YP.Net Merchant Data
and marketing methods, whether collected by YP.Net or Switchboard pursuant
to the terms of this Agreement. Nothing in this Section 3.5 shall obligate
either party to track, maintain or compile information that is not
customarily tracked by such party in the ordinary course of its business.
4.0 PUBLICITY
Each party shall have the right to create and publish its own press release
announcing the execution of this Agreement and the relationship between the
parties established hereunder, subject to the prior written approval of the
other party, which approval shall not be unreasonably withheld. The parties
may, but shall not have the obligation to, create and publish a joint press
release announcing the execution of this Agreement and the relationship
between the parties. Each party shall have the right to publish any such
initial press releases, or portions thereof, in trade publications,
magazines and other publications of its choice. The parties agree that
thereafter, except as otherwise mutually agreed, or as required by law,
neither party shall make any written public statement, including without
limitation in marketing materials or press releases, using the other
party's trade name or trademarks or referring to this Agreement or the
relationship created hereunder, without the prior approval of the other
party, which approval shall not be unreasonably withheld. Switchboard and
YP.Net will not disclose the material terms of this Agreement in any
circumstance, unless
<PAGE>
required by law. This provision shall not limit or prevent YP.Net from
using or disclosing non-confidential information, such as the distribution
that YP.Net Merchants will receive as a result of a purchasing Switchboard
Directory Ads.
5.0 DISCLAIMER OF WARRANTIES
NEITHER PARTY MAKES ANY REPRESENTATIONS, WARRANTIES, OR GUARANTEES OF ANY
KIND AS TO ANY MATTER, EITHER EXPRESS OR IMPLIED, WHICH ARE NOT EXPRESSLY
MADE IN THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, THE IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
6.0 CONFIDENTIALITY
6.1 Confidential Information. Notwithstanding any non-disclosure or
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confidentiality agreement signed by the parties with respect to any initial
discussions prior to the Effective Date, Switchboard and YP.Net each agrees
and acknowledges that in order to further the performance of this
Agreement, they may be required to disclose to each other certain
confidential information, including but not limited to information
concerning either party's online services and web sites, technology,
software, tools, business, or plans and methods, financial information
other confidential information, all of which shall be deemed "Confidential
Information" for the purposes of this Section if, with the respect to such
information disclosed in tangible form, it is marked "Confidential" or its
equivalent, and, with respect to such information disclosed orally, it is
identified as confidential at the time of disclosure. Marketing methods
used by YP.Net in connection with the Marketing Efforts, and the results of
the Marketing Efforts, as well as Merchant Data as provided in Section 3.5,
above, shall be deemed the Confidential Information of YP.Net.
6.2 Protection of Confidential Information. During the term of this
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Agreement and for a period of two years after the expiration or termination
thereof, the receiving party agrees to protect the confidentiality of the
disclosing party's Confidential Information with at least the same degree
of care that it utilize with respect to its own similar proprietary
information, but in no even less than a reasonable standard of care,
including without limitation agreeing:
a. Not to disclose or otherwise permit any other person or entity access
to, in any manner, the Confidential Information, or any part thereof
in any form whatsoever, except such disclosure or access shall be
permitted to (i) an employee of the receiving party (or wholly owned
or wholly owing affiliated entity of the receiving party) requiring
access to the Confidential Information in the course of his or her
employment in connection with this
<PAGE>
Agreement and who has signed an agreement obligating the employee to
maintain the confidentiality of the confidential information of third
parties in the receiving party's possession; or (ii) a director, legal
advisor, or financial advisor of the recipient party hereunder,
provided that such parties are bound to maintain the confidentiality
of such information and provided further that they are permitted to
use such Confidential Information only for the purposes of carrying
out their fiduciary or other advisory responsibilities on behalf of
the pry hereto from which it received such Confidential Information;
b. To notify the disclosing party promptly and in writing of the
circumstances surrounding any suspected possession, use or knowledge
of the Confidential Information or any part thereof at any location or
by any person or entity other that those authorized by this Agreement;
and
c. Not to use the Confidential Information for any purpose other than as
explicitly set forth herein.
6.3 Exceptions. Nothing in this Section 6.0 shall restrict the receiving
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party with respect to information or data, whether or not identical or
similar to that contained in the Confidential Information, if such
information or data: (a) was rightfully possessed by the receiving party
before it was received from the disclosing party: (b) is independently
developed by the receiving party without reference to the disclosing
party's information or data: (c) is subsequently furnished to the receiving
party by a third party not under any obligation of confidentiality with
respect to such information or data, and without restrictions on use or
disclosure: or (d) is or becomes public or available to the general public
otherwise than through any act or default of the receiving party. Each
party reserves to itself its proprietary marketing method rights.
7.0 INDEMNIFICATION
7.1 Indemnification by Switchboard. Switchboard shall indemnify, defend,
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and hold YP.Net harmless from and against any and all losses, expensed,
damages, liabilities, taxes, penalties, assessments, judgments, and costs
(including reasonable attorneys' fees) (collectively, "Liabilities")
arising out of any third party claims, actions or proceedings brought
against YP.Net so far as same are based upon (i) a claim that all or any
portion of or content within the Switchboard Site, the Switchboard Yellow
Pages Services, the Directory Ads (excluding any YP.Net Merchant Content),
the Directory Ad Management Tool, or any software provided by Switchboard
to YP.net hereunder (in each case, in the form provided by Switchboard)
infringes any U.S. patent, copyright, trade secret, trademark or other
intellectual property right, or any other personal or property right, or
(ii) a material breach by Switchboard of this Agreement; provided that
YP.Net provides Switchboard with prompt written notice of any
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claims and reasonable assistance and sole authority to defend or settle
such claims. Switchboard shall have no
<PAGE>
obligation pursuant to this Section 7.1 to the extent that such Liabilities
arise out of the material breach, gross negligence or willful misconduct of
YP.Net. If any portion of or content within the Switchboard Site, the
Switchboard Yellow Pages Serviced, the Directory Ads (excluding any YP.Net
Merchant Content), the Directory Ad Management Tool, or any software
provided hereunder is, or in Switchboard's reasonable opinion is likely to
become, the subject of an injunction preventing its use as contemplated
herein, Switchboard may, at its option, (1) procure for YP.Net the right to
continue using such software or services; (2) replace or modify such
software or services so that it becomes non-infringing; or, if the remedies
in (1) or (2) are not reasonably available to Switchboard despite
Switchboard's commercially reasonable efforts, terminate YP.Net's right to
use such software or services. This Section 7.1 set forth Switchboard's
sole liability and YP.Net's and the sole remedy with respect to any claims
of intellectual property infringement relating to this Agreement.
7.2 Indemnification by YP.Net. YP.Net shall indemnify, defend, and hold
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Switchboard harmless from and against any and all losses, expenses,
damages, liabilities, taxes, penalties, assessments, judgments, and costs
(including reasonable attorneys' fees) (collectively, "Liabilities")
arising out of any third party claims, actions or proceedings brought
against Switchboard so far as same are based upon (i) a claim that all or
any portion of or content within the YP.Net Site or the YP.Net Merchant
Content (in each case, in the form provided by YP.Net) infringes any U.S.
patent, copyright, trade secret, trademark or other intellectual property
right, or any other personal or property right, (ii) a material breach by
YP.Net of this Agreement; provided that Switchboard
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provides YP.Net with prompt written notice of any claims and reasonable
assistance and sole authority to defend or settle such claims. YP.Net shall
have no obligation pursuant to this Section 7.2 to the extent that such
Liabilities arise out of the material breach, gross negligence or willful
misconduct of Switchboard. This Section sets forth YP.Net's sole liability
and Switchboard's sole remedy with respect to claims of intellectual
property infringement relating to this Agreement.
8.0 LIMITATION OF LIABILITY
EXCEPT AS PROVIDED IN SECTION 6.0 (CONFIDENTIALITY) AND IN SECTION 7.0
(INDEMNIFICATION), IN NO EVENT SHALL EITHER PARTY HEREUNDER BE LIABLE TO
THE OTHER, OR TO ANY PARTY CLAIMING THROUGH SUCH OTHER PARTY, FOR ANY
CONSEQUENTIAL, INCIDENTAL, SPECIAL, OR INDIRECT DAMAGES, OR FOR ANY LOSS O
PROFITS OR SALES OR LOSS OF OR DAMAGE TO DATA, REGARDLESS OF THE FORM OF
ACTION, WHETHER IN CONTRACT, TORT, OR OTHERWISE, EVEN IF A PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR LOSS.
<PAGE>
EXCEPT AS PROVIDED IN SECTION 6.0 (CONFIDENTIALITY) AND SECTION 7.0
(INDEMNIFICATION), AND EXCEPT WITH RESPECT TO AMOUNTS OWED TO THE OTHER
PARTY UNDER THE REVENUE SHARING PROVISIONS CONTAINED HEREIN, THE MAXIMUM
LIABILITY OF EITHER PARTY HEREUNDER SHALL BE THE GREATER OF FIFTY THOUSAND
DOLLARS ($50,000) OR THE AGGREGATE AMOUNT RECEIVED BY SWITCHBOARD PURSUANT
TO THIS AGREEMENT IN THE TWELVE (12) MONTH PERIOD PRIOR TO THE DATE UPON
WHICH THE CAUSE OF ACTION AROSE.
9.0 TERM AND TERMINATION
9.1 Term; Renewal. This Agreement shall commence as of the Effective Date
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and shall remain in full force and effect for an initial period of one (1)
year (the "Initial Term") unless earlier terminated as provided herein.
After the Initial Term, this Agreement shall renew for successive one (1)
year periods (each a "Renewal Term"), unless either party provides notice
of termination to the other party no later than thirty (30) days prior to
the expiration of the then current Term. The Initial Term and any and all
Renewal Terms shall be collectively referred to herein as the "Term."
9.2 Termination. This Agreement may be terminated prior to the expiration
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of its term:
a. By either party in the event the other party materially breaches this
Agreement and the breaching party fails to cure such breach within
thirty (30) days of written notice of such breach from the
non-breaching party; or
b By either party immediately in the event any assignment is made by the
other party for the benefit of creditors, or if a receiver, trustee in
bankruptcy or similar officer shall be appointed to take charge of any
or all of the other party's property, or if the other party files a
voluntary petition under federal bankruptcy laws or similar state
statutes or such a petition is filed against the other party and is
not dismissed within ninety (90) days.
9.3 Return of Confidential and Proprietary Materials. In the event of
------------------------------------------------
termination of this Agreement, each party shall immediately either (a)
destroy and certify the same, or (b) return to the other party, all of the
disclosing party's confidential or proprietary materials provided
hereunder.
9.4 Fulfillment of Orders. Each Directory Ad placed hereunder and
---------------------
outstanding at the time of such expiration or termination shall be removed
and deleted from the Switchboard Yellow Pages Service of the Switchboard
Site and Switchboard Affiliated Sites at the time of such expiration or
termination.
<PAGE>
10.0 NOTICES
Any notice or communication from one party to the other shall be in writing
and either personally delivered or sent (a) via certified mail, postage
prepaid and return receipt requested, (b) via overnight carrier with a
national reputation which tracks receipt, or (c) via facsimile with
confirmation sent via one of the other allowable means, in each case,
addressed to such other party at the address specified below or such other
address as either party may from time to time designate in writing to the
other party. All notices shall be effective upon receipt.
If to Switchboard: Switchboard Incorporated
120 Flanders Road
Westboro, Massachusetts 01581
Fax: (508) 898-8222
Attn: President
With a copy to: Switchboard Incorporated
120 Flanders Road
Westboro, Massachusetts 01581
Fax: (508) 898-8222
Attn: General Counsel
If to YP.Net: YP.Net, Inc.
4840 E. Jasmine #110
Mesa, AZ 58205
Fax: 480-860-0800 &
Fax: 602-532-7813
Attn: Greg Crane
With a copy to: Law Offices of Lewis & Rocca, LLP
40 N. Central Ave.
Phoenix, AZ 85004
Fax: 602-734-3865
Attn: Randy Papetti
11.0 GENERAL PROVISIONS
11.1 Assignment. This Agreement and the rights and responsibilities
----------
hereunder may not be assigned or otherwise transferred, in whole or in
part, by either party without the prior written consent of the other, which
shall not be unreasonably withheld, except that either party may assign
this Agreement in its entirety to an entity purchasing all or substantially
all of the equity or assets of such party.
11.2 Force Majeure. Except for the obligation to pay all charges when due
-------------
and owing hereunder, either party shall be excused from performance
hereunder if its
<PAGE>
performance is prevented by acts or events beyond the party's reasonable
control including, but not limited to, acts of God, strikes or other labor
unrest, failures of any telecommunications service provider, power failure,
civil or military emergencies, or acts of legislative, judicial, executive,
or administrative authorities.
11.3 Waiver. The waiver by either party of a breach or default of any
------
provision of this Agreement by the other party shall not be construed as a
waiver of any succeeding breach of the same or any other provision, nor
shall any delay or omission on the part of either party to exercise or
avail itself of any right, power or privilege that it has, or may have
hereunder, operate as a waiver of any right, power, or privilege by such
party
11.4 Governing Law. This Agreement shall be construed and enforced in
-------------
accordance with the laws, excluding the conflict of laws provision, of the
Commonwealth of Massachusetts.
11.5 Independent Contractors. This Agreement is not intended, nor should
-----------------------
anything herein be construed, to create the relationship of partners, joint
ventures, principal and agent, employer and employee, or any other
fiduciary relationship between Switchboard and YP.Net. The relationship of
the parties hereto shall be that of independent contractors.
11.6 Entire Agreement; Amendment. This Agreement, including all Exhibits
---------------------------
hereto which are hereby incorporated by reference, represents the entire
Agreement between Switchboard and the YP.Net with regard to the subject
matter hereof, and any prior agreement, understanding, representation, or
past dealings between the parties with respect to the matters covered
hereunder, whether such prior activity had been in writing or expressed
verbally. This Agreement may be amended only by a written document signed
by authorized representatives of both parties.
11.7 Compliance with Laws. Each party shall be responsible for compliance,
--------------------
at its own expense, with all laws, statutes, regulations, rules,
ordinances, and orders of any judicial authority or governmental body,
department or agency, which apply to or result from its rights or
obligations under this Agreement.
11.8 Severability. If any provision of the Agreement is held to be invalid
------------
or unenforceable by any court or tribunal of competent jurisdiction, the
remaining provisions of this Agreement shall continue in full force and
effect.
11.9 Headings. Captions and headings contained in this Agreement have been
--------
included for ease of reference only and shall not be considered in
interpreting or construing this Agreement.
<PAGE>
11.10 Audit Rights. Each party obligated to make payments hereunder shall keep,
------------
during the Term of this Agreement and for one (1) year thereafter, proper
records and books of account relating to the computation of such payments.
No more frequently than once every six (6) months, the party receiving
payment, at its own cost and expense and through an independent, competent
auditor who signs a nondisclosure agreement reasonably acceptable to the
party subject to the inspection, may inspect such records for the sole
purpose of verifying reports. Any such inspection will be conducted in a
manner that does not unreasonably interfere with the inspected party's
business activities. The inspected party shall immediately make any over
due payments disclosed by such audit. If such overdue payments are more
than ten percent (10%) of the amount already paid for the particular time
period in question, then the inspected party shall also pay for the expense
of the auditor.
11.11 Survival. Upon the expiration or termination of this Agreement for any
--------
reason, the following provisions shall survive: PREAMBLE Section 1.0 (TERMS
AND CONDITIONS); SCHEDULE A, Section 1.0 (DEFINITIONS) and Section 4.8
(Directory Ad Terms); SCHEDULE B, Section 1.0 (DEFINITIONS), Section 2.0
(EXCLUSIVITY), Section 3.0 (INTELLECTUAL PROPERTY), Section 4.0
(PUBLICITY), Section 5.0 (DISCLAMIMER OF WARRANTIES), Section 6.0
(CONFIDENTIALITY), Section 7.0 (INDEMNIFICATION), Section 8.0 (LIMITATION
OF LIABILITY) Section 9.3 (Return of Confidential and Proprietary Materials
and Removal of Links), Section 9.4 (Fulfillment of Orders), Section 10
(NOTICES) and Section 11.0 (GENERAL PROVISIONS).
<PAGE>
EXHIBIT A
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DIRECTORY AD SCEEN SHOT
-----------------------
[GRAPHIC OMITTED]
<PAGE>
EXHIBIT B
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SWITCHBOARD CONTENT POLICY
--------------------------
1. Switchboard reserves the right to reject any Directory Ad Order, or to
remove, or to require that YP.Net remove, any Directory Ad placed by YP.Net
hereunder or any YP.Net Merchant Content which, contains, or contains links
to, content which Switchboard reasonable deems:
(a) Is patently offensive, including without limitation, bigotry, racism,
discrimination, hatred or profanity; is pornographic, obscene, or
sexually explicit; is disparaging defamatory or libelous, results in
an invasion of privacy; promotes gambling (including lotteries);
promotes or provides instructional information about illegal
activities or physical harm or injury to any group, individual,
institution or property; or infringes on a proprietary interest of any
third party, including without limitation, any copyright, trademark,
domain registration right, trade secret or paten right; or may violate
any federal, state, county, and municipal laws, regulation,
governmental agency orders, and court orders;
(b) States or implies an endorsement of the advertiser's products or
Services by Switchboard or any third party associated with
Switchboard.
2. In the event that Switchboard or a third party notifies YP.Net that a
Directory Ad sold by or on behalf of YP.Net hereunder is the subject of
complaints or concerns (e.g., from visitors to the Switchboard Site or any
Switchboard Affiliated Sites) regarding the content of such Directory Ad or
any material linked through such Directory Ad, YP.Net will use reasonable
efforts to respond, or cause its merchant customer to respond in good faith
to such complaints or concerns.
3. YP.Net acknowledges and agrees that, in certain local markets, Switchboard
may be required pursuant to contracts with third parties to reject or
remove Directory Ads and other forms of adverting promoting the following
types of products or services; cigarettes; hard liquor; massage parlors;
abortion clinics; firearms and ammunition; and head shops.