Master Venture Agreement - Quokka Sports Inc., NBC Olympics Inc. and NBC/Quokka Ventures LLC
CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT UNDER RULE 406 OF THE SECURITIES ACT OF 1933. A COMPLETE
COPY OF THIS EXHIBIT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION.
MASTER VENTURE AGREEMENT
THIS MASTER VENTURE AGREEMENT (the "Agreement") is entered into as of February
9, 1999 (the "Effective Date") by and among QUOKKA SPORTS, INC., a Delaware
corporation with its principal place of business at 525 Brannan Street, Ground
Floor, San Francisco, CA 94107 ("Quokka"); NBC OLYMPICS, INC., a Delaware
corporation with its principal place of business at 30 Rockefeller Plaza, New
York, NY 10112 ("NBC"); and NBC/QUOKKA VENTURES, LLC, a Delaware limited
liability company with its principal place of business at 30 Rockefeller Plaza,
New York, NY 10112 ("NQV").
RECITALS
WHEREAS, Quokka is a digital sports media company specializing in the
development of technology for and the production of coverage of international
sporting events via the Internet and other digital media;
WHEREAS, NBC is a subsidiary of a leading television company with a major
broadcast television network, several cable television networks, and television
production facilities;
WHEREAS, NBC has acquired from the International Olympic Committee ("IOC") the
U.S. rights to broadcast the Olympic Games in 2000 and 2004, and the Winter
Olympic Games in 2002;
WHEREAS, NBC and Quokka have formed NQV for the purpose of utilizing their
respective capabilities in the creation and operation of interactive media
coverage of the Events (as defined below) via the Internet and other digital
media; and
WHEREAS, the parties desire to memorialize their obligations and undertakings in
connection with the organization and operation of NQV.
NOW THEREFORE, the parties hereby agree as follows:
AGREEMENT
1. DEFINITIONS
The following terms used in this Agreement will have the following
meanings:
1.1. "CHANNEL" shall mean the specific Site (as defined below)
developed by NQV hereunder which may include, among other
things, Highlight Video and Other Material (as defined in the
NBC Rights and Services Terms).
1.2. "CURRENT CONTENT PLAN" shall have the meaning specified in the
Operating Agreement.
1.3. "EVENTS" shall mean the Games and all events (i) the Interactive
Media rights to which are owned or otherwise controlled by a
U.S. National Governing Body that has
1.
<PAGE> 2
controlling jurisdiction over the selection of the participants
from a sport in an Olympic Games and (ii) which occur during the
term of this Agreement to which NBC has broadcast television and
Internet Medium rights (as hereinafter defined).
1.4. "EXPIRATION DATE" shall mean the date occurring on the
expiration of the Extension Negotiation Period (as defined in
Section 7.1 of this Agreement) unless the parties agree to
extend the Agreement during such Extension Negotiation Period.
1.5. "GAMES" shall mean each of the international sporting events
commonly known as the Olympic Games currently planned to be held
in Sydney, Australia in 2000; Salt Lake City, USA in 2002;
Athens, Greece in 2004; and such other succeeding Olympic Games
as the parties may agree pursuant to Section 7.1.
1.6. "GAMES PERIOD" shall mean, with respect to each Games other than
the 2000 Games, the period commencing sixty (60) days after the
conclusion of the prior Games and continuing through the period
ending sixty (60) days after the conclusion of such Games. For
the 2000 Games, the Games Period shall commence upon the
Effective Date and continue through the period ending sixty (60)
days after the conclusion of such Games.
1.7. "INITIAL CONTENT PLAN" shall mean the first Content Plan
developed with respect to the first Games.
1.8. "INTERNET MEDIUM" shall include: (i) the Internet and World Wide
Web as are in existence as of the Effective Date and their
successor or related networks; (ii) any Internet Protocol-based
methods of transmission and/or delivery or any Internet
protocol-based networks and their successors; and (iii) any
medium involving the delivery of content (e.g., text, computer
code, still images, audio, motion video, tactile, olfactory or
other sensory impressions) for use by an end user by means of a
monitor, television screen, viewing screen or other display
device where delivery of such content occurs by any transmission
modality (e.g., copper wire, fiber optic or coaxial cable,
satellite or terrestrial wireless transmission systems) now or
hereafter devised, provided that the end user has the capacity
to manipulate the content during its use to enhance, change
delete or otherwise alter the specific content that is being
provided. In applying the foregoing definition, if content is
disseminated by means of any two or more media that are intended
primarily to be displayed to the end user concurrently and in an
integrated way through a single display device, the two or more
media will be considered in the aggregate as a single medium,
which will be considered Internet Medium if the combined media
in the aggregate satisfy the above definition.
1.9. "LIMITED ACTIVITIES" shall mean those areas of activity set
forth on the Limited Activity List delivered contemporaneously
herewith, as it may be updated from time to time in accordance
with Section 3.2.
1.10. "NBC COMPETITOR" shall have the meaning specified in the
Operating Agreement.
1.11. "NBC RIGHTS AND SERVICES TERMS" shall mean the terms set forth
in Exhibit A.
2.
<PAGE> 3
1.12. "OPERATING AGREEMENT" shall mean that certain Operating
Agreement of NQV between NBC and Quokka of even date herewith,
as such may be amended from time to time.
1.13. PRINCIPLES OF COMPENSATION" shall mean the terms set forth in
the Principles of Compensation delivered contemporaneously
herewith, as such may be amended from time to time.
1.14. "QUOKKA RIGHTS AND SERVICES TERMS" shall mean the terms set
forth in Exhibit B.
1.15. "QUOKKA WARRANTS" shall mean the warrants to purchase stock in
Quokka in the form delivered by Quokka to NBC.
1.16. "REDUCED SPENDING PLAN" shall have the meaning specified in the
Operating Agreement.
1.17. "SITE" shall mean any collection of content which may include
data, text, graphics, sound, video, images, photographs,
animation or any form of content hereafter developed which is
delivered for use by an end user to a monitor, television
screen, viewing screen or other display device via any
transmission modality now known or hereafter developed
(including the Internet Medium) and which provides the end user
with the capacity to manipulate the content during its use to
enhance, change, delete or otherwise alter the specific content
that is being provided.
1.18. "TERMINATION DATE" shall mean the effective date of any
termination of the either the NBC Rights and Services Terms or
the Quokka Rights and Services Terms.
2. ADDITIONAL VENTURE AGREEMENTS
Upon execution of this Agreement, NBC and Quokka will enter into the
Operating Agreement. NBC and Quokka shall have the further obligation to
negotiate in good faith to develop, for approval by a Supermajority of
the Directors, an Initial Content Plan and the Principles of
Compensation no later than the Drop-Dead Date (as defined in the
Operating Agreement). When such Principles of Compensation are agreed
upon, they shall be deemed adopted contemporaneously with this
Agreement. In the event a Mutual Termination Event (as defined in
Section 11.4) occurs and this Agreement, including without limitation
Exhibits A and B, is terminated by NBC, then NBC shall reimburse Quokka
for one half (1/2) of the reasonable costs of the services of Paul
Gudelis, Tom Feuer, Lisa Rubarth, Kent Schacht, Bill Murray, Joe
McQueeney and Robert Vermeolen in preparing the Content Plan and other
work solely associated with the Channel, in each case, as conducted from
January 1, 1999 through the Drop-Dead Date.
3. OPERATIONS OF NQV
3.
<PAGE> 4
3.1. NQV will, at its sole cost and expense, except as provided for
herein, create, develop, produce, host, maintain and market the
Channel at all times in accordance with the Current Content Plan
with respect to such Games, as approved in accordance with the
terms of the Operating Agreement.
3.2. NQV will not participate or engage in the Limited Activities
unless NBC and Quokka mutually agree in writing to permit NQV to
do so. Subsequent to the Effective Date, either NBC or Quokka
may add Limited Activities to the Limited Activity List
delivered contemporaneously herewith; provided, however, that
neither NBC nor Quokka may add Limited Activities that would
prevent NQV from participating in any activity reasonably
related to exercising its rights or carrying out its obligations
as set forth in this Agreement, the NBC Rights and Services
Terms or the Quokka Rights and Services Terms.
4. PROCEDURES FOR SALES OF ADVERTISEMENTS AND SPONSORSHIPS
NQV will be entitled to sell advertisements or sponsorships on the
Channel (collectively "Advertising") only in accordance with, and subject to the
limitations set forth in, the Advertising Sales Procedures delivered
contemporaneously herewith. Moreover, NBC and Quokka shall only be entitled to
sell Advertising in accordance with such Advertising Sales Procedures.
5. GRANT OF QUOKKA WARRANTS.
Concurrently with the execution and delivery of this Agreement, Quokka
shall issue to NQV the Quokka Warrants and each of Quokka, NBC and NQV shall
execute and deliver a Warrant Issuance Agreement in such form as shall be agreed
among the parties.
6. INVOLVEMENT OF OTHER PARTIES
6.1. For the 2000 Games only, to the extent that NQV determines to
enter into any transaction [ * ], NQV shall make the first
approach to [ * ] with respect to the right to enter into such
transaction, and shall, if [ * ] is interested in such a
transaction, negotiate exclusively with [ * ] for a period of
[ * ] days after making such offer.
6.2. The parties acknowledge and agree that it would be desirable for
the [ * ] to have its websites located within the Channel and
that NBC has entered into an agreement with [ * ] to provide
certain hosting, design and marketing services, a copy of the
pertinent provisions of which has been delivered to Quokka. NQV
agrees to assume at its cost all obligations of NBC with respect
to such hosting, design and marketing as contained in such
agreement.
7. RIGHTS OF FIRST NEGOTIATION
7.1. [ * ] NQV shall have a Right of First Negotiation with respect
to continuation of the NBC Rights and Services Terms for the
[ * ] Confidential Treatment Requested
4.
<PAGE> 5
Games Periods after the 2004 Games (and for all Events during
such Games Periods) for which NBC has acquired Internet Medium
rights as of the Effective Date. The "Right of First
Negotiation" means that prior to negotiating with any third
party with respect to rights identical to those that NBC has
granted to NQV pursuant to the NBC Rights and Services Terms,
NBC shall first negotiate in good faith exclusively with NQV for
a period of [ * ] days (the "Extension Negotiating
Period"). Thereafter, NBC shall have no further obligation to
NQV or Quokka with respect to such rights unless the parties
shall otherwise agree in writing.
7.2. No later than June 1, 1999, NBC shall have a right of first
negotiation with respect to conventional broadcast rights (to
the extent Quokka secures such rights) for competitive
"adventure" sporting events covered by Quokka, and Quokka will
negotiate exclusively with NBC with respect to such rights for a
period of sixty (60) days thereafter. Thereafter, Quokka shall
have no further obligation to NBC with respect to such rights
unless the parties shall otherwise agree in writing.
8. BRANDING
The parties acknowledge that one of the goals of this venture is to
maximize the revenue of NQV. The parties also acknowledge that the
Channel will be the official and exclusive location for NBC's Site
coverage of the Games and will, accordingly, bear the composite
NBC/Olympic branding, subject in each case to the restrictions contained
in the NBC Rights and Services Terms, the terms of which are
incorporated herein by reference. Furthermore, any brands, marks and
logos licensed to NQV pursuant to the Quokka Rights and Services Terms,
the terms of which are incorporated herein by reference, shall be used
to add value to NQV in a manner to be mutually determined in accordance
with the Current Content Plan.
9. CONFIDENTIALITY AND NON-DISCLOSURE
9.1. Each party agrees that during the term of this Agreement that
such party may come into possession of Confidential Information
of the other party(ies). For the purposes of this Agreement,
"Confidential Information" means any information which the party
disclosing the information (the "Discloser") identifies orally,
visually or in writing as confidential or which the party
receiving the information (the "Receiver") knows or has reason
to know is confidential to the Discloser. The terms and
conditions of this Agreement, the Operating Agreement, the NBC
Rights and Services Terms, the Quokka Rights and Services Terms,
the Warrants and the Warrant Issuance Agreement shall be
considered Confidential Information of each party. Confidential
Information does not include information which is: (a) already
known by the Receiver at time of disclosure; (b) is or becomes,
through no act or fault of Receiver, publicly known; (c)
received by Receiver from a third party without a restriction on
disclosure or use; (d) independently developed by Receiver
without reference to Discloser's Confidential Information; or
(e) required or reasonably necessary to comply with laws,
statutes, regulations, orders, and other governmental rules,
including, without limitation, any voluntary filing under the
Securities Act of 1933, as amended, or the Securities and
Exchange Act of 1934, as
[ * ] Confidential Treatment Requested
5.
<PAGE> 6
amended. The foregoing notwithstanding, prior to making any
filing under either the Securities Act of 1933, as amended, or
the Securities Exchange Act of 1934, as amended, which discloses
the existence or terms of this Agreement, the Operating
Agreement, the NBC Rights and Services Terms, the Quokka Rights
and Services Terms, the Warrants or the Warrant Issuance
Agreement, Quokka shall, to the extent permitted by law,
disclose to NBC in advance any portion of such anticipated
filing and shall provide NBC a reasonable opportunity to review
and comment on such portion of any such anticipated filing.
9.2. The Receiver shall hold the Confidential Information in
confidence and shall not disclose the Confidential Information
to third parties nor use the Confidential Information for any
purpose other than as permitted in this Agreement and the other
agreements executed contemporaneously herewith. The Receiver
shall not, at any time during or after the term of this
Agreement, disclose the Confidential Information to any person
except its employees, consultants and other agents who have a
need to know such Confidential Information and who have agreed
to be bound by terms and conditions substantially similar to,
and no less restrictive with respect to limitations on use and
disclosure than, those of this Agreement. Notwithstanding the
foregoing, Quokka may disclose the terms of Agreement to
bankers, investment counselors and potential investors or
acquirors in connection with any potential investment in or
acquisition of Quokka, provided that prior to receiving such
information such entities have agreed to limit access to only
those persons within their organization who have a need to know
such Confidential Information for the purpose of evaluating such
potential investment or acquisition or similar transaction and
who have agreed to be bound by terms and conditions
substantially similar to, and no less restrictive with respect
to limitations on use and disclosure than, those of this
Agreement. Furthermore, notwithstanding the foregoing, NBC may
disclose the terms of the Agreement to [ * ] in connection with
[ * ] in connection with the potential acquisition of up to
[ * ] of NBC's economic interest in the Class B Interests,
provided that prior to receiving such information such entity
has agreed to limit access to only those persons within their
organization who have a need to know such Confidential
Information for the purpose of evaluating such potential
investment or acquisition or similar transaction and who have
agreed to be bound by terms and conditions substantially similar
to, and no less restrictive with respect to limitations on use
and disclosure than, those of this Agreement.
9.3. Upon termination or expiration of this Agreement for any reason,
at Discloser's direction, a Receiver shall return or destroy all
copies of Confidential Information in its possession that is
received exclusively from the other party.
9.4. NBC and Quokka agree to issue a mutually agreeable press release
relating to the creation of NQV promptly as practicable after
the Effective Date.
[ * ] Confidential Treatment Requested
6.
<PAGE> 7
10. LIMITATIONS OF LIABILITY
EXCEPT TO THE EXTENT EXPRESSLY SET FORTH IN EITHER THE NBC RIGHTS AND
SERVICES TERMS OR THE QUOKKA RIGHTS AND SERVICES TERMS, AS APPLICABLE, IN NO
EVENT SHALL ANY PARTY BE LIABLE TO ANY OTHER FOR ANY CONSEQUENTIAL, SPECIAL,
INDIRECT OR INCIDENTAL DAMAGES ARISING FROM OR RELATING TO THIS AGREEMENT,
INCLUDING ITS EXHIBITS. THE FOREGOING IS NOT INTENDED TO LIMIT NQV'S
INDEMNIFICATION OBLIGATIONS AS SET FORTH IN ARTICLE 8 OF THE OPERATING
AGREEMENT.
11. TERM AND TERMINATION
11.1. This Agreement, including without limitation Exhibits A and B,
shall continue in effect from the Effective Date until the
earlier of the Termination Date or the Expiration Date unless
terminated earlier in accordance with Section 11.2, 11.3 or 11.4
11.2. This Agreement, including without limitation Exhibits A and B,
may be terminated by: (1) either party upon the dissolution of
NQV; (2) either NBC or Quokka due to a material breach of the
Operating Agreement, Warrants or Warrant Issuance Agreement by
the other party which has not been cured by such party within
thirty (30) days of the receipt of written notice of such
breach; (3) by NQV or Quokka due to a material breach by NBC of
the terms hereof, including without limitations Exhibits A and
B, which has not been cured by NBC within thirty (30) days of
the receipt of written notice of such breach by NBC; (4) by NQV
or NBC due to a material breach by Quokka of the terms hereof,
including without limitation Exhibits A and B, which has not
been cured by Quokka within thirty (30) days of the receipt of
written notice of such breach by Quokka; or (5) by Quokka
(solely in the case where there are two Class A Directors) or
NBC due to a material breach by NQV of the terms hereof or of
the Operating Agreement which has not been cured by NQV within
thirty (30) days of the receipt of written notice of such breach
by NQV. The foregoing notwithstanding, in each of cases (2) -
(5) above, in the event that the breach in question is not
curable, then the breaching party shall only be entitled to a
forty-eight (48) hour notice period prior to termination by the
other party.
11.3. NBC shall have thirty (30) days from the date it receive notice
of approval of a Reduced Spending Plan to terminate this
Agreement, including without limitation Exhibits A and B. Notice
of approval of a Reduced Spending Plan shall be deemed to have
been received by NBC on the date of approval of a Reduced
Spending Plan if any Class B Director is present at the vote on
approval of a Reduced Spending Plan.
11.4. Either NBC or Quokka shall have the right to terminate this
Agreement, including without limitation Exhibits A and B, at any
time within ten (10) days after a Mutual Termination Occasion. A
"Mutual Termination Occasion" arises under either of the
following circumstances: (i) in the event that a Supermajority
of the Directors fails to approve an Initial Content Plan by the
Drop-Dead Date; or (ii) in the event that a Supermajority of the
Directors fails to approve Principles of Compensation by the
Drop
7.
<PAGE> 8
Dead Date. Termination of this Agreement, including without
limitation Exhibits A and B, pursuant to the terms of this
Section 11.4 by either NBC or Quokka shall be deemed a "Mutual
Termination Event."
12. GENERAL PROVISIONS
12.1. This Master Venture Agreement, and the application of
interpretation hereof, shall be governed exclusively by its
terms and by the laws of the State of Delaware (without giving
effect to principles of conflicts of laws).
12.2. If any provision of this Master Venture Agreement or the
application thereof to any person or circumstance shall be held
to be invalid, illegal or unenforceable to any extent, the
remainder of this Master Venture Agreement and the application
thereof shall not be affected and shall be enforceable to the
fullest extent permitted by law.
12.3. The headings in this Master Venture Agreement are inserted for
convenience only and in no way intended to describe, interpret,
define, or limit the scope, extent or intent of this Master
Venture Agreement or any provision hereof.
12.4. Any notice, demand or communication required or permitted to be
given by any provision of this Master Venture Agreement shall be
in writing and shall be deemed effectively given: (i) upon
personal delivery to the party to be notified, (ii) when sent by
confirmed telex or facsimile if sent during normal business
hours of the recipient; if not, then on the next business day,
(iii) five (5) days after having been sent by registered or
certified mail, return receipt requested, postage prepaid, (iv)
one (1) day after deposit with a nationally recognized overnight
courier, specifying next day delivery, with written verification
of receipt, or (v) if earlier, upon receipt. All communications
shall be delivered to the Company's address or facsimile number
as such appears in the Company's records as of the date hereof
or to such other address or facsimile number as the Company may
designate by ten (10) days advance written notice to the other
parties hereto.
12.5. Each party hereby agrees to execute such other and further
instruments necessary to comply with any laws, rules or
regulations or in connection with perfecting or protecting or
enforcing any provision of this Agreement including assignments
or rights granted to such party hereunder.
12.6. This Agreement may not be assigned in whole or in part by any
party without the other parties' prior written consents or as
set forth in the Operating Agreement.
12.7. Whenever the singular number is used in this Master Venture
Agreement and when required by the context, the same shall
include the plural, and the masculine gender shall include the
feminine and neuter genders and vice versa. This Master Venture
Agreement is prepared and executed in the English language only
and any translation of this Master Venture Agreement into any
other language shall have no effect.
8.
<PAGE> 9
12.8. The failure of any party to seek redress for violation of or to
insist upon the strict performance of any covenant or condition
of this Master Venture Agreement shall not prevent a subsequent
act, which would have originally constituted a violation, from
having the effect of an original violation.
12.9. The rights and remedies provided by this Master Venture
Agreement are cumulative, and the use of any one right or remedy
by any party shall not preclude or waive the right to use any or
all other remedies. Such rights and remedies are given in
addition to any other rights the parties may have by law,
statute, ordinance or otherwise.
12.10. Except for the Operating Agreement for this venture, the Warrant
Issuance Agreement, the Warrants, the NBC Rights and Services
Terms and the Quokka Rights and Services Terms and such other
documents referenced herein, this Agreement and the Exhibits
attached hereto set forth the entire and exclusive understanding
and agreement of the parties as to the subject matter hereof,
and supersede any and all prior or contemporaneous oral or
written agreements or understandings among the parties as to the
subject matter of this Agreement. This Agreement may be changed
only by a document in writing signed by both parties. Waiver by
any party of a breach of any provision contained herein must be
in writing, and no such waiver shall be construed as a waiver of
any succeeding breach of such provision or a waiver of the
provision itself.
12.11. This Master Venture Agreement may be executed in counterparts,
each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
9.
<PAGE> 10
IN WITNESS WHEREOF, the parties hereto have executed this Master Venture
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
QUOKKA SPORTS, INC
By: /s/ LES SCHMIDT
-------------------------------------
Name: Les Schmidt
Title: Chief Financial Officer
NBC OLYMPICS, INC.
By: /s/ RANDEL FALCO
-------------------------------------
Name: Randel Falco
Title: President
NQV/QUOKKA VENTURES, LLC
By: /s/ G. MICHAEL NOVELLY
-------------------------------------
Name: G. Michael Novelly
Title: Chief Financial Officer
10.
<PAGE> 11
EXHIBIT A
NBC RIGHTS AND SERVICES AGREEMENT
Unless otherwise defined herein, capitalized terms have the meaning ascribed to
them in the Master Venture Agreement.
1. DEFINITIONS:
"Event Video" shall mean moving video and accompanying synchronous audio
of the Events, including Opening and Closing Ceremonies, whether derived from
the NBC Television Network feed, the host feed, or any other feeds ("Other
Feeds") available to NBC at the Events, provided that NQV shall reimburse NBC
for any additional costs associated with obtaining such Other Feeds.
"Highlight Video" shall mean moving video clips and accompanying
synchronous audio of the Events, including Opening and Closing Ceremonies, which
do not exceed in the aggregate: (i) for any individual match, round of
competition, race or game substantively broadcast (i.e., more than a [*] second
clip) by the NBC Television Network in Primetime (as defined hereafter), the
lesser of [*] minutes or [*] of the duration of the particular individual match,
round of competition, race or game being reported upon; (ii) for any individual
match, round of competition, race or game substantively broadcast (i.e., more
than a [*] second clip) by NBC Television in any time period that is not
Primetime, the lesser of [*] minutes or [*] of the duration of the particular
individual match, round of competition, race or game being reported upon; and
(iii) for any individual match, round of competition, race or game not broadcast
in any substantive part (i.e., more than a [*] second clip) by NBC Television,
the lesser of [*] minutes or [*] of the duration of the particular individual
match, round of competition, race or game being reported upon; provided, that
notwithstanding the foregoing, no single clip of such video shall be more than
[*] seconds in length; and, provided, further, that NQV may not aggregate such
clips, or provide a means for end users to aggregate such clips, from any single
event in a manner which would avoid the limitations contained in this paragraph.
"NBC Television" shall mean the NBC Television Network, CNBC, MSNBC or any
other NBC-produced coverage on a network broadcast, cable or DBS service.
"Other Video" shall mean historical Event footage as well as any
non-competition video consisting of segments, features and other programming
(e.g., "Up Close and Personal") related to the Events, whether occurring prior
to, during or after the Events.
"Primetime" shall mean the hours of 7 p.m. to 12 a.m. in each U.S. time
zone.
"United States Broadcast Territory" shall mean the United States and its
territories and possessions, excluding Puerto Rico.
[*] Confidential Treatment Requested
1.
<PAGE> 12
2. GUIDING PRINCIPLES REGARDING EVENT VIDEO
a) NBC represents and warrants that it has been granted a license for the
exclusive Internet Medium rights in the United States Broadcast
Territory in and to the Games for at least [*] and that it has been
granted a license for the exclusive broadcast, cable and Internet
Medium rights in the United States Broadcast Territory in and to each
associated U.S. Olympic Trials to which NBC has the broadcast rights
for at least [*] and the [*] day period following each such Games. NBC
shall use commercially reasonable efforts to extend the duration of
the foregoing rights on either an exclusive or non-exclusive basis.
Quokka acknowledges and agrees that notwithstanding anything to the
contrary contained herein or in any other document or agreement
contemplated hereby, no rights with respect to Event Video are
conveyed herein to Quokka or NQV other than as expressly set forth in
Sections 3 hereof, and that all rights to Event Video owned or held by
NBC shall remain NBC's except as otherwise granted.
b) Quokka further acknowledges and agrees that NBC may use, promote,
market, sell, display, perform, distribute, incorporate interactive
elements in its broadcast signal for distribution by broadcast, cable
or DBS and otherwise exploit the Event Video, or sell, license or
otherwise transfer such rights to third parties other than NQV, in
any medium (including the Internet Medium) via any transmission
modality now known or hereafter developed, subject to the constraints
of Section 2(c) hereof. Quokka further acknowledges that NBC will
have the right to incorporate interactive elements within its
broadcast video signal for distribution through normal broadcast,
cable or DBS channels.
c) In order to protect the rights granted to NQV herein, NBC represents
and warrants that it has not and shall not use or distribute, nor
shall it license the use or distribution of, Event Video, for use
either in whole or in part whether including Other Material and still
photographs taken from Event Video or not, over the Internet Medium
except in such circumstance where such Event Video is used and/or
available to the end user solely by itself, or with limited value
added elements "Value Added Elements", such that the Value Added
Elements would be [*]
3. RIGHTS GRANTED TO NQV
a) NBC grants to NQV an exclusive non-transferable license to produce,
distribute, promote and market the Channel as the "official" and
exclusive location for NBC's Site coverage of the Events.
b) Subject to Sections 2(b) and 2(c), NBC grants to NQV for use in the
creation and operation of the Channel the exclusive, non-transferable
license to incorporate
[*] Confidential Treatment Requested
2.
<PAGE> 13
into the Channel and distribute by means of the Internet Medium throughout
the United States Broadcast Territory Highlight Video from all Event Video
owned by NBC or licensed to NBC where NBC has the right to sublicense such
rights to the Event Video. To the extent that during the Term NBC is
granted a license or is otherwise permitted to distribute by means of the
Internet Medium Highlight Video outside the United States Broadcast
Territory, then the license granted hereunder shall automatically expand to
match such corresponding territory. Subject to Sections 2(b) and 2(c), NBC
further grants to NQV for use in the creation and operation of the Channel
the exclusive, non-transferable license to incorporate into the Channel and
distribute by means of the Internet Medium throughout the world still
photographs and sequential still photographs taken from Highlight Video
from all Event Video owned by NBC or licensed to NBC where NBC has the
right to sublicense such rights to the Event Video. Notwithstanding the
foregoing, NQV's rights hereunder with respect to the Event Video
(including still photographs therefrom) shall be subject to the right of
NBC, in its sole discretion, to impose restrictions on the display or other
use of Event Video (including still photographs therefrom) due to: (i)
NBC's inability to grant such rights to NQV as a result of contractual
limitations or restrictions imposed by, or conflicts with any legal rights
held by the IOC or any other person or entity possessing intellectual
property or other rights in such Event Video; (ii) any conflicts with NBC's
current sponsors or advertisers or the IOC's, United States Olympic
Committee's ("USOC"), Sydney Organizing Committee of the Olympic games
("SOCOG"), Salt Lake Olympic Organizing Committee's ("SLOOC"), the 2004
Games Organizing Committee's sponsors or advertisers; (iii) transactions by
NQV or Quokka with NBC Competitors; (iv) competition with NBC's broadcast,
cable or direct broadcast satellite ("DBS") coverage; or (v) violations of
NBC's, NBC Sports', the IOC's, the USOC's or other Olympic organizations'
editorial policies and practices. In the event that NBC shall be obligated
to pay any non de minimis amounts to third parties (other than the IOC,
USOC or any U.S. NGB with respect to the Games and U.S. Olympic Trials) by
reason of the licensing or use of any Event Video to or by NQV, then NBC
shall, to the extent practicable, promptly notify NQV of such amounts, and
if NQV elects to use (or has used) such Event Video, then it shall be
solely responsible for any such charges. NBC will use commercially
reasonable efforts to make all Event Video available to NQV regardless of
whether NBC uses such Event Video in any broadcast coverage of Events. NBC
will provide NQV with reasonable and timely means of technical access to
all Event Video, but in no event by a quality of method and/or timeliness
no less than the quality of method and/or timeliness provided to NBC's
local affiliates and any company which may license any Internet Medium
rights to the Event Video.
(c) NBC grants to NQV for use in the creation and operation of the Channel the
non-exclusive, non-transferable license to incorporate into the Channel and
distribute by means of the Internet Medium throughout the United States
Broadcast Territory all Other Video owned by NBC or licensed to NBC where
NBC has the right to sublicense such rights to the Other Video. NBC grants
to NQV for use in
3.
<PAGE> 14
the creation and operation of the Channel the non-exclusive,
non-transferable license to incorporate into the Channel and distribute by
means of the Internet Medium throughout the world all research and other
materials whether text, audio, video, still footage, written or fixed in
any other medium owned by NBC or licensed to NBC (collectively with the
Other Video sometimes referred to herein as the "Other Material") where NBC
has the right to sublicense such rights to the Other Material. To the
extent that during the Term NBC is granted a license or is otherwise
permitted to distribute by means of the Internet Medium the Other Video
outside the United States Broadcast Territory, then the license granted
hereunder shall automatically expand to match such corresponding territory.
Subject to Sections 2(b) and 2(c), NBC further grants to NQV for use in the
creation and operation of the Channel the exclusive, non-transferable
license to incorporate into the Channel and distribute by means of the
Internet Medium throughout the world still photographs and sequential still
photographs taken from Other Material owned by NBC or licensed to NBC where
NBC has the right to sublicense such rights to the Other Material.
Notwithstanding the foregoing, NQV's rights hereunder with respect to the
Other Material (including still photographs therefrom) shall be subject to
the right of NBC, in its sole discretion, to impose restrictions on the
display or other use of Other Material (including still photographs
therefrom) due to: (i) NBC's inability to grant such rights to NQV as a
result of contractual limitations or restrictions imposed by, or conflicts
with any legal rights held by the IOC or any other person or entity
possessing intellectual property or other rights in such Other Material;
(ii) any conflicts with NBC's current sponsors or advertisers or the IOC's,
USOC's, SOCOG's, SLOOC's, the 2004 Games Organizing Committee's sponsors or
advertisers; (iii) transactions by NQV or Quokka with NBC Competitors; (iv)
competition with NBC's broadcast, cable or DBS coverage; or (v) violations
of NBC's, NBC Sports', the IOC's, the USOC's or other Olympic
organizations' editorial policies and practices. In the event that NBC
shall be obligated to pay any non de minimis amounts to third parties
(other than for the specific Event rights granted by the IOC, USOC or any
U.S. NGB) by reason of the licensing or use of any Other Material to or by
NQV, then NBC shall, to the extent practicable, promptly notify NQV of such
amounts, and if NQV elects to use or has used such Other Material, then it
shall be solely responsible for any such charges. NBC will use commercially
reasonable efforts to make all Other Material available to NQV regardless
of whether NBC uses such Other Material in any broadcast coverage of
Events. NBC will provide NQV with reasonable and timely means of technical
access to all Other Material, but in no event by a quality of method and/or
timeliness no less than the quality of method and/or timeliness provided to
NBC's local affiliates and any company which may license any Internet
Medium rights to the Event Video.
d) Recognizing the priority of its broadcast needs, NBC shall use reasonable
commercial efforts to provide at no additional cost to NQV the following:
4.
<PAGE> 15
(i) Reasonable access on a twenty-four hour basis to NBC's television
production, transmission archive and storage facilities, wherever
located, for purposes of retrieving the Event Video and Other
Material in a timely manner for the Channel, subject to NBC's
reasonable rules and policies regarding such access and
availability of space;
(ii) Reasonable and timely access to the Commentator Information
System (CIS);
(iii) Access to and timely assistance from such production personnel as
shall be reasonably necessary to facilitate the retrieval of
Event Video and Other Material for the Channel;
(iv) The participation of a reasonable variety of on-air personnel,
selected by NBC in its sole discretion, during the Games and from
time to time prior to and after the Games, such participation to
include appearances on the Channel on a live or delayed basis;
(v) Reasonable access to venues, athletes, coaches, Event officials
and spectators (to the extent NBC is able to facilitate the
same), for appearances on the Channel.
(e) NBC grants to NQV a non-exclusive, non-transferable license during the
term of the Master Venture Agreement to use the composite NBC/Olympic
logo on the Channel in connection with the production, operation,
promotion, marketing and distribution of the Channel pursuant to the
Master Venture Agreement, in all media in connection with all third
party promotion, advertising and sponsorship of the Channel and in
connection with Derivative Products (as herein defined). The rights
granted herein are solely for the use of the NBC/Olympic logo and do
not include any right to use the NBC mark (in any variation) or the
Olympic mark (in any variation) standing alone. Notwithstanding the
foregoing, the use of the composite NBC/Olympic logo shall be subject
to the right of NBC, in its sole discretion, to impose restrictions
due to: (i) NBC's inability to grant such rights to NQV as a result of
contractual limitations or restrictions imposed by, or conflict with
any legal rights held by the IOC, the USOC or any other person or
entity possessing intellectual property or other rights in the
composite NBC/Olympic logo; (ii) any conflicts, as may be applicable,
with NBC's current sponsors or advertisers or the IOC's, USOC's,
SOCOG's, SLOOC's, the 2004 Games Organizing Committee's sponsors or
advertisers; (iii) transactions by NQV or Quokka with NBC Competitors;
(iv) competition with NBC's broadcast, cable or DBS coverage; or (v)
violations of NBC's, NBC Sports', the IOC's, the USOC's or other
Olympic organizations' editorial policies and practices. NQV
acknowledges that this is a license and that no ownership interest in
and to the NBC/Olympic logo is transferred, and that the NBC/Olympic
logo used alone or with other elements together with the goodwill
of the entities symbolized thereby shall remain the property of NBC
and the IOC, respectively. To the extent that any
5.
<PAGE> 16
goodwill is generated by the activities of NQV with respect to the
composite NBC/Olympic logo, the parties agree that all such goodwill shall
accrue to and be owned by NBC and the IOC. NQV agrees not to challenge or
contest NBC or the IOC's ownership interest respectively, in the NBC and
Olympic marks, the rights of NBC and the IOC in the NBC/Olympic logo, the
validity of the NBC and Olympic marks and the NBC/Olympic logo, and agrees
that it will do nothing inconsistent with such ownership and all use of the
NBC/Olympic logo shall accrue to and benefit and be on behalf of NBC and
the IOC. NQV agrees that it will not set up any adverse claim against NBC
or the IOC, their parents, affiliates or subsidiaries, as a result of the
use of the NBC/Olympic logo and that it will fully cooperate with NBC in
any and all activities necessary to maintain NBC's and IOC's rights in the
NBC/Olympic logo, including cooperating with NBC in recording this
agreement with appropriate governmental entities, where necessary. NQV
shall comply with all applicable laws and regulations and shall not
authorize use by third parties of the NBC/Olympic logo without NBC's
permission. NQV is subject to all the restrictions imposed on the use of
the NBC/Olympic logo mark by agreements between NBC and third parties,
including but not limited to the IOC, the USOC, SOCOG, SLOOC, the 2004
Games Organizing Committee or NBC's current sponsors or advertisers. All
rights to the NBC/Olympic logo not expressly granted are hereby reserved by
NBC. NQV's use of the composite NBC/Olympic logo will be subject to the
prior written approval of NBC, which approval shall not be unreasonably
withheld or delayed. NQV agrees to maintain the quality of the Channel at a
level that meets or exceeds industry standards and is at least commensurate
with the quality of NBC's interactive services. NQV agrees to supply NBC
with specimens of all uses of the NBC/Olympic logo. NQV agrees to correct
promptly, to the extent practicable, all deficiencies in its use of the
NBC/Olympic logo and to take measures reasonably designed to correct
objective defects in the availability and delivery of the NBC/Olympic logo
on the Channel. NQV shall comply with all guidelines provided by NBC with
respect to the reproduction and use of the composite NBC/Olympic logo
including conformance with NBC's various trademark and logo guidelines
provided to NQV which may be amended from time to time, including if
required by the use of said guidelines use of appropriate trademark symbols
after the first and most prominent use of the marks on each page or panel
of materials, and inclusion of NBC's standard trademark attribution legends
in all such materials. This license cannot be sub-licensed, assigned or
otherwise transferred by NQV to any third person without the prior written
consent of NBC. The license granted by NBC hereunder shall automatically
and immediately terminate upon the expiration or termination of the Master
Venture Agreement or this agreement, as it may be extended, provided
however that with respect to Derivative Products only, the license granted
by NBC hereunder shall automatically and immediately terminate on the
earlier of the sale of the last of the remaining Derivative Products
inventory or six (6) months after the expiration or termination of the
Master Venture Agreement.
6.
<PAGE> 17
f) In addition, in order to protect the rights granted to NQV herein, NBC
represents and warrants that it has not and shall not license a
substantial portion of the rights set forth in Section 3(c) to any
entity for use in connection with the Internet Medium.
g) Subject to the reservation of rights to NBC set forth in Section 2
hereof, NBC hereby grants to NQV an exclusive right to produce,
promote, market, sell and distribute Derivative Products as well as a
non-exclusive, non-transferable license to use Highlight Video as well
as the Other Material in connection with production, marketing,
promotion, and distribution of any Derivative Products; provided, that
prior to engaging in any such activities, NQV must provide a notice to
NBC describing any such Derivative Products and any marketing,
promotion or distribution plans therefor in reasonable detail and
obtain the prior written consent of NBC. "Derivative Products" shall
mean goods or services derived specifically from the Channel or any
portion thereof to which NQV can, in NBC's reasonable judgment,
provide significant added value. In the event that NBC intends to use
Highlight Video in any product to which NBC, in its reasonable
judgment believes, NQV can add significant value, NBC will notify the
Operating Venture and will discuss in good faith the possibility of
NQV producing and distributing any such product. Nothing contained in
this Section 3(g) shall be construed to preclude NBC from using Event
Video or Other Material in the production, marketing or sale of
products by NBC, provided that NBC does not use portions of the Event
Video or Other Material that actually incorporate enhancements made by
the Operating Entity.
4. SERVICES TO BE PROVIDED BY NBC TO NQV
a) As set forth in the promotion commitment delivered by NBC to NQV, NBC
will provide meaningful on-air promotion for the Channel on its
broadcast and cable television networks (e.g., NBC, CNBC, MSNBC), and
to the extent that it engages in promotional efforts on behalf of its
broadcast or cable coverage, NBC shall use commercially reasonable
efforts to incorporate into such promotional efforts meaningful
promotion for the Channel other than on-air promotion which may
include each of the following elements (to such extent as NBC shall
determine in good faith):
(i) print advertisements;
(ii) radio promotions;
(iii) preparation of promotional materials through NBC's
Affiliate Promotion Services Department;
(iv) promotion through NBC's Press Department, which may, at
NBC's sole discretion, include satellite feeds,
appearances on THE TODAY SHOW or other NBC programs.
7.
<PAGE> 18
b) In addition to the personnel covered by Section 3(d) hereof, NBC will
provide reasonable access to NBC personnel to provide services as
reasonably requested by NQV. In keeping with the Principles of
Compensation which are attached to the Master Venture Document as
Exhibit D, NBC will charge NQV for such personnel providing services to
NQV, and will be reimbursed for reasonable expenses of such personnel
incurred in connection with providing services to NQV. Such amounts
will be invoiced monthly and will be payable 30 days after receipt of
invoice by NQV.
c) To the extent that NBC has any such relationships, NBC will use
commercially reasonable efforts to provide access to NQV to its
strategic partners and others with whom it has business relationships
[ * ] or editorial relationships (writers, newspapers, etc.) for the
purposes of furthering possible relationships or promotional
opportunities between NQV and such other entities or individuals.
d) NBC will use reasonable commercial efforts to assist in the
coordination and integration of programming between its broadcast and
cable properties' coverage of Events and the Channel.
e) NBC will use reasonable commercial efforts to assist NQV with all
Events-related operational needs and logistics at the sites of the
Events, including but not limited to, office and work space, wiring and
communications, transportation, housing, accreditation, clothing and
hospitality, it being understood that NQV will be responsible for any
incremental costs incurred in connection therewith.
5. OTHER TERMS AND CONDITIONS
a) These NBC Rights and Services Terms ("Terms") will remain in effect
until the earlier of the Expiration Date and the Termination Date (as
such terms are defined in the Master Venture Agreement) unless earlier
terminated by any party in accordance with Sections 11.2, 11.3 or 11.4
of the Master Venture Agreement.
b) NBC warrants and represents that it has the right to grant the licenses
granted herein, subject to all restrictions contained herein, in the
Master Venture Agreement and in the Operating Agreement. Except with
respect to any music, NBC will defend, indemnify and hold harmless NQV
and Quokka, and their respective affiliates, officers, directors,
employees and agents from and against any and all third party claims,
actions, suits or proceedings, as well as any and all losses,
liabilities, damages, costs and expenses (including, without
limitation, reasonable attorneys fees) arising out of or accruing from:
(i) with respect to Event Video only, the exercise of any of the rights
granted hereunder by NBC to NQV infringes the copyright, trademark or
other proprietary rights of any third party in any jurisdiction; (ii)
the use or distribution of any Event Video is defamatory or libelous,
or violates the rights of privacy or publicity of any third
[ * ] Confidential Treatment Requested
8.
<PAGE> 19
party; or (iii) relating to the breach of any warranty or representation
contained herein. Upon the assertion of any claim or the commencement of any
suit or proceeding against NQV or Quokka by any third party that may give rise
to liability of NBC hereunder, NQV and/or Quokka, as the case may be, shall
promptly notify NBC of the existence of such claim and shall give NBC reasonable
opportunity to defend and/or settle the claim at its own expense and with the
counsel of its own selection. NQV and/or Quokka shall cooperate with NBC and
shall at all times have the right to participate in, but not control, such
defense and/or settlement with its own counsel and at its own expense.
9.
<PAGE> 20
EXHIBIT B
QUOKKA RIGHTS AND SERVICES AGREEMENT
Unless otherwise defined herein, capitalized terms have the meaning ascribed to
them in the Master Venture Agreement and the NBC Rights and Services Terms.
1. RIGHTS GRANTED BY QUOKKA TO NQV
a) Quokka grants to NQV a worldwide, royalty free, non-exclusive,
non-transferable license to promote, and use in connection with
Channel, all Quokka Technology (as defined herein) and Quokka
Technology Improvements (as defined herein) owned by Quokka and/or
licensed to Quokka (where Quokka has the right to relicense without
payment of more than de minimis amounts to third parties); provided,
that Quokka shall not license any Quokka Technology or Quokka
Technology Improvements to any other person or entity for use in
connection with such portion of any Site which contains content
relating to the Games and which is promoted to a United States
audience. For purposes of clarification, the foregoing proviso shall
not apply to any portion of a Site which does not include content
related to the Games (i.e., NBA or NFL content) or which is targeted
to a non-United States audience and not promoted in the United States
(i.e., Yahoo U.K.). The term "Quokka Technology" shall mean any
technology now or hereafter developed, purchased, or licensed or
otherwise acquired by Quokka (including without limitation any idea,
concept, invention, device, design, research, apparatus, machine,
practice, process, method, product, improvement, formula, algorithm,
technical development or plan, production technique, schematic, block
diagram, flow chart, test procedure, mask work, software (including
all of the written materials prepared by or for Quokka for any such
software, including, but not limited to user manuals), software
systems, codes (including HTML formatting code, source code, object
code), utilities, design processes, program logic, interactive
program structures, retrieval software systems, user interface
designs, and any other procedures and methods or operation) which can
be or may be used in connection with the development and/or delivery
of content to an end user by means of the Internet Medium. In
connection with such right and license, Quokka shall provide at no
charge NQV with copies of all tangible materials other than hardware
constituting or relating to Quokka Technology necessary in order to
exploit such Quokka Technology.
b) Quokka hereby grants to NQV a non-exclusive, non-transferable license
to use Quokka Technology in connection with the production,
marketing, promotion and distribution of Derivative Products.
c) All improvements, alterations, and other changes to the Quokka
Technology made by or under the authority of Quokka ("Quokka
Technology Improvements"), shall be deemed assigned to and inure to
the sole benefit of Quokka; provided, that
1
<PAGE> 21
notwithstanding the foregoing, any improvements, alterations, and
other changes to the Quokka Technology made by NQV ("Operating Entity
Technology Improvements"), shall be deemed assigned to and inure to
the sole benefit of NQV. NQV shall grant Quokka a non-exclusive,
royalty free license to use NQV Technology Improvements during the
term of the Master Venture Agreement.
(d) Quokka grants to NQV a non-exclusive, non-transferable license during
the term of the Master Venture Agreement to use the Quokka logo on
the Channel in connection with the production, operation, promotion,
marketing and distribution of the Channel pursuant to the Master
Venture Agreement, in all media in connection with all promotion,
advertising and sponsorship of the Channel including by authorized
third parties and in connection with Derivative Products (as herein
defined). NQV acknowledges that this is a license and that no
ownership interest in and to the Quokka logo is transferred, and that
the Quokka logo used alone or with other elements together with the
goodwill of the entity symbolized thereby shall remain the property
of Quokka. To the extent that any goodwill is generated by the
activities of NQV in the Quokka logo, the parties agree that all such
goodwill shall accrue to and be owned by Quokka. NQV agrees not to
challenge or contest Quokka's ownership interest in the mark, the
rights of Quokka in the Quokka logo, the validity of the Quokka mark
and the Quokka logo, and agrees that it will do nothing inconsistent
with such ownership and all use of the Quokka logo shall accrue to
and benefit and be on behalf of Quokka. NQV agrees that it will not
set up any adverse claim against Quokka, its parents, affiliates or
subsidiaries, as a result of the use of the Quokka logo and that it
will fully cooperate with Quokka in any and all activities necessary
to maintain Quokka's rights in the Quokka logo, including cooperating
with Quokka in recording this agreement with appropriate governmental
entities, where necessary. NQV shall comply with all applicable laws
and regulations and shall not authorize use by third parties of the
Quokka logo without Quokka's permission. All rights to the Quokka
logo not expressly granted are hereby reserved by Quokka. NQV is
subject to all the restrictions imposed on the use of the Quokka logo
mark by agreements between Quokka and third parties. NQV's use of the
Quokka logo will be subject to the prior written approval of Quokka,
which approval shall not be unreasonably withheld or delayed. NQV
agrees to supply Quokka with specimens of all uses of the Quokka logo
upon request. NQV agrees to correct promptly, to the extent
practicable, all deficiencies in its use of the Quokka logo and to
take measures reasonably designed to correct objective defects in the
availability and delivery of the Quokka logo on the Channel. NQV
shall comply with all guidelines provided by Quokka with respect to
the reproduction and use of the Quokka logo including conformance
with Quokka's various trademark and logo guidelines provided to NQV
which may be amended from time to time, including if required by the
use of said guidelines use of appropriate trademark symbols after the
first and most prominent use of the marks on each page or panel of
materials, and inclusion of Quokka's standard trademark attribution
legends in all such materials. This license cannot be sub-licensed,
assigned or otherwise transferred by NQV to any third person without
2
<PAGE> 22
the prior written consent of Quokka. The license granted by Quokka
hereunder shall automatically and immediately terminate upon the
expiration or termination of the Master Venture Agreement or this
agreement, as it may be extended, provided however that with respect
to Derivative Products only, the license granted by Quokka hereunder
shall automatically and immediately terminate on the earlier of the
sale of the last of the remaining Derivative Products inventory or six
(6) months after the expiration or termination of the Master Venture
Agreement.
e) Any content created by Quokka related to the Events which is
customarily viewed directly by the end-user (i.e., not Quokka
Technology or Quokka Technology Improvements), including without
limitation, text, graphics, and photos, shall be owned and retained by
NQV.
2. SERVICES TO BE PROVIDED BY QUOKKA TO NQV
a) Quokka will provide all personnel necessary to create, develop,
operate, host and maintain the Channel in accordance with the Current
Content Plan and NQV's annual budget, as well as all related support
for NQV. In keeping with the "Principles of Compensation", Quokka will
charge NQV for such personnel providing services to NQV, and will be
reimbursed in accordance with NQV's annual budget for reasonable
expenses of such personnel incurred in connection with providing
services to NQV. Such amounts will be invoiced monthly and will be
payable 30 days after receipt of invoice by NQV.
b) For a period of at least fourteen (14) days prior to and during the
period of the Games, Quokka will provide meaningful Internet promotion
for the Channel through its principal website.
c) To the extent that Quokka has any such relationships, Quokka will use
commercially reasonable efforts to provide access to NQV to its
strategic partners and others with whom it has business relationships
or editorial relationships for the purposes of furthering possible
relationships or promotional opportunities between NQV and such other
entities or individuals.
3. OTHER TERMS AND CONDITIONS
a) These Quokka Rights and Services Terms ("Terms") will remain in effect
until the earlier of the Expiration Date and the Termination Date
unless earlier terminated by any party in accordance with Sections
11.2, 11.3 or 11.4 of the Master Venture Agreement.
b) Quokka warrants and represents that it has the right to grant the
rights granted herein. Quokka will defend, indemnify and hold harmless
NQV and NBC, and their respective affiliates, officers, directors,
employees and agents from and
3
<PAGE> 23
against any and all third party claims, actions, suits or proceedings, as well
as any and all losses, liabilities, damages, costs and expenses (including,
without limitation, reasonable attorneys fees) arising out of or accruing from
breach of any warranty or representation made by Quokka herein. Quokka will
defend, indemnify and hold harmless NQV and NBC, and their respective
affiliates, officers, directors, employees and agents from and against any and
all third party claims, actions, suits or proceedings, as well as any and all
losses, liabilities, damages, costs and expenses (including, without
limitation, reasonable attorneys fees) arising out of any claim, suit, action
or proceeding alleging that any Quokka Technology or Quokka Technology
Improvements infringe any copyright, trademark, trade secret, trade dress,
patent or other intellectual property right or proprietary right of any third
party. In the event that some or all of the Quokka Technology or Quokka
Technology Improvements are held by a court of competent jurisdiction to
infringe, then Quokka shall have the option, at its expense, to (i) modify such
Quokka Technology or Quokka Technology Improvements to be non-infringing , or
(ii) obtain for NQV a license to continue using such Quokka Technology or
Quokka Technology Improvements. Upon the assertion of any claim or the
commencement of any suit or proceeding against NQV or NBC by any third party
that may give rise to liability of Quokka hereunder, NQV and/or NBC, as the
case may be, shall promptly notify Quokka of the existence of such claim and
shall give Quokka reasonable opportunity to defend and/or settle the claim at
its own expense and with the counsel of its own selection. NQV and/or NBC shall
cooperate with Quokka and shall at all times have the right to participate in,
but not control, such defense and/or settlement with its own counsel and at its
own expense.
4