Facilities and Administrative Support Agreement - CMGI Inc. and NaviSite Inc.
FACILITIES AND ADMINISTRATIVE SUPPORT AGREEMENT
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THIS FACILITIES AND ADMINISTRATIVE SUPPORT AGREEMENT dated as of
October 27, 1999 is made between CMGI, Inc. ("CMGI"), a Delaware corporation,
and NaviSite, Inc. ("NaviSite"), a Delaware corporation.
Preliminary Statement
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NaviSite desires to obtain administrative and other services from CMGI, and
CMGI is willing to furnish or make such services available to NaviSite.
By this Agreement, CMGI and NaviSite desire to set forth the basis for
CMGI's provision of services of the types referred to herein.
Agreements
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IT IS MUTUALLY agreed by CMGI and NaviSite (collectively, the "Parties")
as follows:
1. Provision of Services. Beginning on the date of this Agreement, CMGI will
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provide or otherwise make available to NaviSite those CMGI-supplied
services and third-party-supplied services paid for by CMGI on the bases
set forth on Schedule A and Schedule B attached hereto and consistent with
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the parties' practices as of the date hereof (collectively, the
"Services").
2. Billing and Payment. CMGI shall submit monthly invoices to NaviSite for
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the Services, and NaviSite shall make payment within 30 days after its
receipt of such invoices. Each invoice shall be itemized by the Service
provided.
3. Term and Termination. The initial term of this Agreement shall begin on the
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date of this Agreement and continue for a period of one year. This
Agreement shall automatically renew at the end of the initial term for
successive one-year periods unless terminated or modified in accordance
with the following provisions:
(a) Entire Agreement. Either party may elect not to renew this Agreement,
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except for the Services set forth on Schedule A, upon 180 days'
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written notice the other party prior to the expiration of the initial term
or any renewal period.
(b) Individual Services. Either party may terminate an individual Service
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or Services, except for the services set forth on Schedule A, upon 90
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days' written notice to the other party.
(c) Rent and Related Services. Either party may terminate those Services
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set forth on Schedule A upon 30 days' written notice to the other
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party prior to the expiration of the end of the initial term or any
renewal period. In addition, those services set forth on Schedule A
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shall terminate effective upon the last day of the month in which
NaviSite notifies CMGI that either (i) NaviSite's new facility at 400
Minuteman Road, Andover, Massachusetts is ready to be occupied by
NaviSite or (ii) NaviSite has vacated completely CMGI's facility at
100 Brickstone Square, Andover, Massachusetts, whichever is later.
(d) Material Breach. Either party may terminate this Agreement in the
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event of a material breach of this Agreement by the other party that
is not cured within 30 days of written notice thereof from the other
party.
(e) Automatic Termination. This Agreement, other than the services set
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forth on Schedule A, shall automatically terminate upon the date on
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which the ownership by CMGI of the outstanding voting capital stock of
NaviSite shall first be less than 50% of the then outstanding voting
capital stock of NaviSite.
4. Limitation on Liability. Neither party shall be liable to the other for
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any amount in excess of the amount invoiced to NaviSite for the 12-month
period preceding any event giving rise to liability. Neither party shall be
liable to the other for consequential damages except for those arising out
of intentional misconduct or gross negligence.
5. Force Majeure. CMGI shall be excused for failure to provide the Services
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hereunder to the extent that such failure is directly or indirectly caused
by an occurrence commonly known as force majeure, including, without
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limitation, delays arising out of acts of God, acts or orders of a
government, agency or instrumentality thereof (whether of fact or law),
acts of public enemy, riots,
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embargoes, strikes or other concerted acts of workers (whether of CMGI or
other persons), casualties or accidents, delivery of materials,
transportation or shortage of cars, trucks, fuel, power, labor or materials
or any other causes, circumstances or contingencies within or without the
United States of America that are beyond the control of CMGI; provided,
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however, that CMGI shall use its best efforts to resume provision of the
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Services as soon as possible. Notwithstanding any events operating to
excuse performance by CMGI, this Agreement shall continue in full force for
the remainder of its term and any renewals thereof.
6. Notices. All notices, billings, requests, demands, approvals, consents and
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other communications which are required or may be given under this
Agreement shall be in writing and will be deemed to have been duly given if
delivered person ally or sent by registered or certified mail, return
receipt requested, postage prepaid to the parties at their respective
addresses set forth below:
If to NaviSite: If to CMGI:
NaviSite, Inc. CMGI, Inc.
100 Brickstone Square 100 Brickstone Square
Andover, MA 01810 Andover, MA 01810
Attn: Chief Financial Officer Attn: Chief Financial Officer
7. No Assignment. This Agreement shall not be assignable except with the prior
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written consent of the other party to this Agreement.
8. Applicable Law. This Agreement shall be governed by and construed in
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accordance with the laws of the Commonwealth of Massachusetts applicable to
contracts made and to be performed therein.
9. Amendments. This Agreement and all attachments hereto constitute the entire
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agreement between the parties as to the subject matter hereof and supercede
all prior negotiations, undertakings, representations and agreements, if
any, of the parties hereto as to the subject matter hereof. This Agreement
may not be amended orally but may be amended only by a written instrument
signed by all of the parties hereto.
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10. Waivers. The failure of either party to require strict performance by the
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other party of any provision in this Agreement will not waive or diminish
that party's right to demand strict performance thereafter of that or any
other provision hereof.
11. Paragraph Titles. The paragraph titles used in this Agreement are for
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convenience of reference only and will not be considered in the
interpretation or construction of any of the provisions thereof.
12. Counterparts; Facsimile Signatures. This Agreement may be executed in two
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counterparts, each of which shall be deemed to be an original and both of
which together shall constitute one and the same document. This Agreement
may be executed by facsimile signatures.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
CMGI, INC. NAVISITE, INC.
By: /s/ Andrew J. Hajducky III By: /s/ Joel B. Rosen
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Name: Andrew J. Hajducky III Name: Joel B. Rosen
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Title: Chief Financial Officer Title: Chief Executive Officer
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Schedule A
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Rent and Related Services
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<TABLE>
<CAPTION>
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Services Provided by CMGI to NaviSite Allocation of Cost to NaviSite
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<S> <C>
1. Brickstone Square Rent. Provision Allocated based on headcount for
of space located at the Andover NaviSite located at the Andover
Premises (approximately 17,800 Premises divided by headcount for
square feet). the CMGI Companies located at the
Andover Premises.
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2. Facilities. Salary, fringe Allocated based on both: (a)
benefits, payroll taxes for the percentage of time that the
entire facility department. facilities department devotes to
the Federal Street Premises and
(b) headcount for NaviSite located
at the Andover Premises divided by
headcount for the CMGI Companies
located at the Andover Premises.
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3. Mass Electric. Utilities provided Allocated based on headcount for
by Massachusetts Electric. NaviSite located at the Andover
Premises divided by headcount for
the CMGI Companies located at the
Andover Premises.
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4. Office Cleaning/Plant Maintenance. Allocated based on headcount for
NaviSite located at the Andover
Premises divided by headcount for
the CMGI Companies located at the
Andover Premises.
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</TABLE>
Defined Terms:
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Andover Premises -- those premises located at 100 Brickstone Square,
Andover, MA 01810 leased by CMGI.
CMGI Companies -- the companies which are controlled by CMGI or in which
CMGI holds an equity interest.
Federal Street
Premises -- those premises located at 300 Federal Street, Andover,
MA 01810 occupied by NaviSite.
headcount -- the number of employees employed by a particular CMGI
Company on the last day of a given month.
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Schedule B
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Provision of Other Services
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<TABLE>
<CAPTION>
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Services Provided by CMGI to NaviSite Allocation of Cost to NaviSite
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<S> <C>
1. CMG Europe. All overhead costs for NaviSite is charged 5% of all costs
CMGI's European office of Marcus associated with the European office.
Bicknell, his assistant and accountant.
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2. Internet Marketing. Salary, fringe NaviSite is one of nine CMGI
benefits and payroll taxes for Bill Companies that benefits from these
White and his assistant (both at CMGI). services and absorbs 11% of total
costs.
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3. Internet Development. Salary, NaviSite is one of nine CMGI
fringe benefits and payroll taxes for Companies that benefits from
Dave Andonian and his staff (all at these services and absorbs
CMGI). 11% of total costs.
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4. Marketing Research. Access to NaviSite is charged $2,000 per
research agencies such as Forrester month for access to marketing
Research, Inc. and Jupiter. research information.
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5. Enterprise Services. Desktop and Allocated based on headcount for
network services support. NaviSite located at the Andover
Premises and the Federal Street
Premises divided by the
headcount for the CMGI Companies
using desktop and network services
support located at the Andover
Premises and the Federal Street
Premises.
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6. Trade show Booth Rental. NaviSite is charged $1,239.55 per
month for the amortization of the
trade show booth. The amortization
charge back started in October 1998
and will continue for 36 months
from that date. NaviSite may
continue to use the booth as long
as CMGI continues to own more than
50% of the outstanding voting
capital stock of NaviSite.
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</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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Services Provided by CMGI to NaviSite Allocation of Cost to NaviSite
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<S> <C>
7. Medical/Dental Life and Long-term CMGI will provide Medical, Dental
Disability and Life and Long-term disability
coverage to NaviSite employees
under CMGI's group plans. NaviSite
will be billed directly by the
insurance provider for all costs
associated with coverage for
NaviSite employees enrolled in the
medical or dental insurance plan or
covered by the life and long-term
disability policy.
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8. Federal Express/United Parcel CMGI's Accounts Payable department
Service. codes each individual charge based
on the identity of the sender.
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9. Postage Machine. Mailings from the NaviSite is charged actual postage
Andover Premises. costs for mail stamped by the CMGI
postage machine.
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10. Pepsi/Poland Springs. Allocated based on headcount for
NaviSite located at the Andover
Premises divided by headcount for
the CMGI Companies located at the
Andover Premises.
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</TABLE>
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<TABLE>
<CAPTION>
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Services Provided by CMGI to NaviSite Allocation of Cost to NaviSite
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<S> <C>
11. Telephone. Provision of common, Modem, fax and 800 lines are
modem, fax and 800 lines. charged to NaviSite or the
individual employee who is
designated to that particular line.
Common inbound and outbound lines
are allocated based on headcount
for NaviSite located at the Andover
Premises divided by headcount for
the CMGI Companies located at the
Andover Premises.
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12. MobilComm/Pagenet/Skytel/ Cellular Charged back to the person or
One. department which is assigned that
particular pager or cell phone.
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13. Maxout Fitness. Fitness club Allocated based on the number of
membership. employees at NaviSite who belong to
the fitness club. The cost is
offset by the fitness club dues
that are withheld from the paycheck
of each employee who is a member of
the fitness club.
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14. Legal Services. To the extent that legal fees and
expenses of NaviSite are paid for
by CMGI, such fees and expenses
will be allocated based upon the
actual use of the legal services.
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15. KPMG. Preparation of yearly income To the extent that legal fees and
tax returns. expenses of NaviSite are paid for
by CMGI, such fees and expenses
will be allocated based upon the
actual use of KPMG services.
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16. Funding Flex Spending. Charged for amounts reimbursed to
an employee through the flexible
spending account on a person by
person basis.
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</TABLE>
<PAGE>
<TABLE>
<CAPTION>
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Services Provided by CMGI to NaviSite Allocation of Cost to NaviSite
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<S> <C>
19. Benefit Administration. Salary, fringe Allocated based on number of
benefits and payroll taxes for one employees at NaviSite covered by
benefit administrator and 25% of the the life insurance policy
salary, fringe benefits and payroll divided by the number of employees
taxes for an assistant to the benefits at CMGI Companies covered by the
administrator. life insurance policy.
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20. 401(k) and 401(k) Match Funding. NaviSite credits the 401(k)
contribution and 401(k) matching
contribution each month from its
payroll entry to a 401(k)
withholding account. Upon funding
the 401(k), CMGI charges back the
funds to NaviSite. NaviSite then
charges those funds to the 401(k)
withholdings account. There is
usually a lag time of 15 days to 30
days for funding the 401(k).
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</TABLE>
Defined Terms
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Andover Premises -- those premises located at 100 Brickstone Square,
Andover, MA 01810 leased by CMGI.
CMGI Companies -- those companies that are controlled by CMGI or in which
CMGI holds an equity interest.
Federal Street -- those premises located at 300 Federal Street, Andover,
Premises MA 01810 occupied by NaviSite.
headcount -- the number of employees employed by a particular CMGI
Company on the last day of a given month.