Premier Sports Information and Commerce Agreement [Amendment No. 3] - America Online Inc. and SportsLine.com Inc.
THIRD AMENDMENT TO PREMIER SPORTS INFORMATION AND COMMERCE
AGREEMENT
This Third Amendment to Premier Sports Information and Commerce
Agreement (this "Amendment"), effective as of July 6, 2001 (the "Amendment
Date"), is made and entered into by and between America Online, Inc. ("AOL"), a
Delaware corporation, with its principal offices at 22000 AOL Way, Dulles, VA
20166 and SportsLine.com, Inc. (f/k/a SportsLine, USA, Inc.) ("ICP"), a Delaware
corporation, with its principal offices at 2200 West Cypress Creek Road, Fort
Lauderdale, Florida 33309 (each a "Party", collectively, the "Parties"). The
Parties entered into a Premier Sports Information and Commerce Agreement,
effective as of October 1, 1998, as subsequently amended (the "Agreement"). AOL
and ICP now desire to renew the Agreement on the terms and conditions set forth
herein. All terms used in this Amendment but not defined herein shall have the
meanings given thereto in the Agreement. AOL and ICP hereby agree to amend the
Agreement as follows:
1. General. References in the Agreement to "this Agreement" or "the
Agreement" (including indirect references such as "hereunder,"
"hereby," "herein" and "hereof") shall be deemed to be references to
the Agreement as previously amended and as amended by this Amendment.
References to the Effective Date in the Agreement shall be deemed to be
a reference to October 1, 2001 during the Renewal Term (as defined
below).
2. Renewal. Notwithstanding the provisions of Section 8.1 A ("Term") and
8.1B ("AOL Option") of the Agreement, the Parties agree to renew the
Agreement upon the terms and conditions set forth in this Amendment.
All terms and conditions set forth in the Agreement shall apply to the
Renewal Term (as defined below) as such terms and conditions are
amended in this Amendment. Unless otherwise expressly set forth herein,
all terms and conditions set forth herein shall be applicable to the
Renewal Term and not the Initial Term. Beginning on October 1, 2001,
Section 8.1 shall be replaced in its entirety with the following:
8.1 Term. This Agreement shall commence on October 1, 1998, and
continue until September 30, 2001 ("Initial Term"), unless
earlier terminated as provided herein. The Agreement shall be
renewed for a period of five (5) years, beginning on October
1, 2001 (the "Renewal Term"), unless earlier terminated as
provided herein.
8.1.1 The Parties have entered into that certain Interactive Media
Rights Agreement dated as of July 6, 2001 by and among the
Parties, CBS Broadcasting, Inc. ("CBS") and NFL Enterprises
("NFLE") with respect to the production, hosting and
monetization of NFL.com (the "NFL Agreement").
8.1.2 AOL shall have the immediate right to terminate the Agreement
at any time during the Renewal Term in the event (a) of an
expiration or earlier termination of the NFL Agreement and/or
the CBS Agreement attached as Exhibit E-1, or (b) in the event
that AOL, CBS, NFLE or ICP individually or collectively is/are
no longer a party to the NFL Agreement; provided that AOL
gives ICP *** prior written notice thereof which, if
applicable, must be delivered no later than *** after such
expiration or termination of the NFL Agreement or such date on
which AOL, CBS, NFLE or ICP, as applicable, is/are no longer a
party to the NFL Agreement. In the event AOL withdraws from
the NFL Agreement pursuant to Section 24.8 of the NFL
Agreement (but not pursuant to any other provision of the
Agreement, including Section 29), the restrictions on ICP's
use of User Information set forth in this Agreement shall not
apply to ICP.
8.1.3 Notwithstanding anything to the contrary in this Agreement, in
the event AOL or CBS withdraws from the NFL Agreement because
of a Change of Control of Viacom or one of the other parties
to the NFL Agreement as provided under
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Section 29 of the NFL Agreement, such termination shall effect
an automatic and contemporaneous termination of this
Agreement.
8.1.4 In the event that the Agreement is still in effect as of July
31, 2004, but the NFL Agreement is not in effect or AOL or ICP
is no longer a party to the NFL Agreement, as of July 31,
2004, AOL shall have the right to terminate this Agreement,
effective September 30, 2004, by giving ICP written notice
thereof prior to ***.
3. Section 1.1 Beginning on October 1, 2001, Section 1.1 ("Carriage;
Placements; Promotions") shall be deleted in its entirety and replaced
with the following:
1.1 Carriage; Placements; Promotions. Beginning on October 1,
2001, AOL shall provide ICP with the promotions (the
"Promotions") set forth on Exhibit H, which Promotions shall
link to an ICP Internet Site(s). None of the Promotions may be
used to promote Fantasy Sports Products which are
substantially similar to the AOL Fantasy Sports Products as
defined in Exhibit E.
4. Section 1.1.2 and 1.1.3. Beginning on October 1, 2001, Sections 1.1.2
("ROS Advertisements") and 1.1.3 ("AOL Promotion of ICP Commerce")
shall be deleted in their entireties.
5. New Section 1.1.2. Beginning on October 1, 2001, the following new
section 1.1.2 shall be added to the Agreement:
1.1.2. Fantasy Sports Products. ICP shall provide the AOL Fantasy
Sports Products for the AOL Property(ies) as set forth in
Exhibit E. In the event the NFL Agreement expires, terminates
or AOL withdraws from the NFL Agreement (each an "NFL
Expiration") but provided AOL does not exercise its right to
terminate this Agreement, ICP shall provide Commissioner,
Fantasy and Challenge for Fantasy Sports Products for each NFL
playing season on the same terms and conditions as the AOL
Fantasy Sports Products (provided that, in the event there are
less than four (4) months between the NFL Expiration and the
commencement of the next NFL season, ICP shall provide a
framed version of each of the Commissioner, Fantasy and
Challenge Fantasy Sports Products for such season only);
except that, if the Fantasy Sports Products are offered for a
whole season, the Annual Registration Target shall be
increased by *** (which may be decreased by *** for
Commissioner, *** for Fantasy and *** for Challenge in the
event such games are subscription-based and AOL exercises its
right pursuant to Sub-section 7.4(b) or 7.4(c) herein). ICP
shall have the sole and exclusive right to sell all Fantasy
Advertising Inventory. ICP hereby grants AOL the right to sell
*** of the Fantasy Advertising Inventory. ICP shall have the
sole and exclusive right to sell all Fantasy Sponsorship
Inventory. The Parties acknowledge that as of June 15, 2001,
AOL has a valid and binding commitment to ***. (***
impressions per year during the Renewal Term) ("Preexisting
Third Party Fantasy Commitment"), with respect to Fantasy
Sponsorship Inventory. ICP agrees to make "feature" (e.g.
sponsorship of standings page) Fantasy Sponsorship Inventory
available to AOL to allow AOL to fulfill Preexisting Third
Party Fantasy Commitment (under no circumstances shall such
Fantasy Sponsorship Inventory include any "presenting" Fantasy
Sponsorship Inventory). The Parties shall coordinate with each
other their respective sales efforts in order to avoid
conflicts and/or confusion in the marketplace. AOL shall be
prohibited from running any Fantasy Advertising Inventory
which conflicts with any category exclusivity granted by ICP
with respect to Fantasy Sponsorship Inventory of which AOL has
been given written notice by ICP. ICP, exclusively, will
manage all Fantasy Advertising Inventory and Fantasy
Sponsorship Inventory through proprietary ICP or third party
advertising management software and tools as determined by ICP
in its sole discretion, unless ICP
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elects, in its sole discretion, to permit AOL to serve and
manage its respective share of Fantasy Advertising Inventory.
6. Section 1.1.4. Beginning on October 1, 2001, Section 1.1.4
("Guarantee") shall be replaced in its entirety with the following:
During the Renewal Term, AOL shall provide ICP with at least ***
Impressions from ICP's presence on the AOL Network (the "Aggregate
Impressions Guarantee") and AOL shall use commercially reasonable
efforts to deliver the Aggregate Impressions Guarantee Impressions
evenly from year to year over the Renewal Term. At least *** of the
Aggregate Impressions Guarantee shall be delivered on the Targeted
Screens. For purposes of this Agreement, ICP's presence on an AOL
screen shall conform to the specifications set forth on Exhibit D
(each, an "ICP Presence"), provided that only screens that contain a
Link to the ICP Internet Site(s), the Private Store or the AOL Fantasy
Sports Products will count against the Aggregate Impressions Guarantee.
In the event there is (or will be in AOL's reasonable judgement) a
shortfall in the Aggregate Impressions Guarantee as of the end of the
Renewal Term (a "Final Shortfall"), AOL shall provide ICP, by no later
than *** following the expiration of the Renewal Term, as ICP's sole
remedy, with Impressions on the AOL Network which are equal to or
greater than the number of undelivered Impressions comprising the Final
Shortfall (with allocation between Targeted Screens and Impressions, as
applicable).
7. Exhibit H. Beginning on October 1, 2001, Exhibit H ("Carriage") shall
be deleted in its entirety and replaced with the amended Exhibit H set
forth in Attachment 1.
8. Section 1.2. Beginning on October 1, 2001, Section 1.2.1 ("Comparable
Commerce Placements in the Event of a Redesign") shall be deleted in
its entirety and the following shall be added after the proviso
contained in the third sentence of Section 1.2.2 ("Content of
Promotions") ("provided, however...Premier Products as a whole"):
"Notwithstanding the foregoing, AOL may, upon payment by AOL to ICP of
***, delete the preceding proviso (which would have the affect of
revoking (A) ICP's right to sell the Premier Products or Other
Products, and (B) ICP's ability to promote the Premier Products and
Other Products on the AOL Properties).
The following shall be added to the end of Section 1.2.3:
"ICP shall ensure that the Licensed Content within the ICP Internet
Site (as defined herein), in the aggregate, is equal to the Content
distributed by ICP, in the aggregate, in the same or similar
category(ies) through any ICP Interactive Site(s) in all material
respects, including without limitation, quality, breadth, depth,
timeliness, functionality, features, prices of products and services
and terms and conditions; provided that, such requirement shall not
supercede other terms and conditions applicable to the ICP Internet
Sites or Licensed Content under this Agreement."
9. Sections 1.3, 1.4, 1.5. Except as provided for herein, during the
Renewal Term, ICP shall not be entitled to any Premier Status or other
exclusive or premier rights under the Agreement. As such, beginning on
October 1, 2001, Sections 1.3 ("Premier Status"), 1.4 ("Permissible AOL
Activities") and 1.5 ("No Bad Faith Circumvention") and any other terms
and conditions of the Agreement related to ICP's Premier Status or any
exclusive or premier right of ICP, shall be deleted in its entirety and
of no further force or effect (the parties agree that nothing in this
Section 9 shall be construed to limit ICP's right to sell Premier
Products, subject to AOL exercising its option to revoke such right to
sell pursuant to Section 1.2.2 of the Agreement as amended pursuant to
Paragraph 8 of this Amendment). The following shall be added as a new
Section 1.3 ("Premier Status"):
"ICP shall be the Premier Fantasy Sports Game Provider on the Fantasy
Channel (as defined in Exhibit E). As used herein, "Premier Fantasy
Sports Game Provider" means that: (A) If AOL decides to have a new AOL
branded Fantasy Sports Game built by a third party for inclusion in the
Fantasy Channel ("New Games"), (i) AOL shall notify ICP thereof and ICP
shall have the
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exclusive right to negotiate with AOL regarding such opportunity for a
period of *** after the provision of such notice, and (ii) AOL will not
enter into a definitive written agreement with any third party
regarding such opportunity during such *** period, (B) AOL may not
promote third party Fantasy Sports Products on the AOL Service Sports
Channel which substantially replicate the interactive user game play
experience of the AOL Fantasy Sports Products ("Competitive Fantasy
Sports Products"), and (C) in the Fantasy Channel, the AOL Fantasy
Sports Products, in the aggregate, shall be the most prominently
promoted (i.e., in terms of size, position and number of Permanent
placements on an aggregate basis) Fantasy Sports Products. Nothing
contained herein shall limit in any way AOL's ability to promote
Fantasy Sports Products developed, distributed and provided by ***
and/or *** anywhere on the AOL Network, including without limitation,
the Fantasy Channel.
10. Sections 2.2(ii) and (iv), 2.4. and 2.5. Beginning on October 1, 2001,
section 2.2(ii) and (iv), 2.4 and 2.5 shall be deleted in their
entireties.
11. Section 3.3. Beginning on October 1, 2001, Sections 3.3.1 through 3.3.5
("Carriage and Promotional Fee") shall not be applicable to the
Promotions provided during the Renewal Term. Beginning on October 1,
2001, the following Sections 3.3.6 and 3.3.7 shall apply to Promotions
provided during the Renewal Term:
3.3.6 In-Kind Programming and Promotion. ICP shall provide AOL with
the programming and promotional commitments specified on
Exhibits E and E-1 (the "ICP In-Kind Commitments"). Without
limiting any other rights or remedies available to AOL, AOL's
carriage, promotion and impressions commitments specified in
Section 1.1 herein are and will be contingent, upon provision
by ICP of the ICP In-Kind Commitments in accordance with
Exhibit E and Exhibit E-1.
3.3.7 Renewal Term Carriage and Promotional Fee. ICP shall pay AOL
the following consideration (collectively, the "Renewal Term
Consideration"):
(a) On or before July 18, 2001, ICP shall pay to AOL one million
dollars ($1,000,000) in cash (the "Initial Cash Payment"), provided
further that, if the Initial Cash Payment is not paid to AOL by July
20, 2001, then AOL may terminate this Agreement, with no further
liability or obligation on the part of either party;
(b) On or before July 18, 2002, provided that notice of termination of
this Agreement has not been given by AOL to ICP pursuant to Section 8.1
prior to such date, ICP shall perform one of the following three
obligations (ICP shall, in its sole option, elect which option it will
perform, subject to the limitations set forth in Section 3.3.7(e)): (i)
issue irrevocable instructions to its transfer agent to issue to AOL as
soon as reasonably possible a number of shares of ICP Common Stock
having a Fair Market Value (as defined herein) equal to $2,000,000;
(ii) pay to AOL an amount in cash equal to $2,000,000; or (iii) a
combination of (x) paying to AOL an amount in cash and (y) issuing
irrevocable instructions to its transfer agent to issue to AOL as soon
as reasonably possible a number of shares of ICP Common Stock having a
Fair Market Value equal to $2,000,000 less the amount of cash paid
pursuant to (iii)(x) (any shares of ICP Common Stock issued to AOL by
ICP pursuant to this Section 3.3.7(b) shall be referred to herein as
the "First Anniversary Shares");
(c) On or before July 18, 2003, provided that notice of termination of
this Agreement has not been given by AOL to ICP pursuant to Section 8.1
prior to such date, ICP shall perform one of the following three
obligations (ICP shall, in its sole option, elect which option it will
perform, subject to the limitations set forth in Section 3.3.7(e): (i)
issue irrevocable instructions to its transfer agent to issue to AOL as
soon as reasonably possible a number of shares of ICP Common Stock
having a Fair Market Value of $1,000,000; (ii) pay to AOL an amount in
cash equal to $1,000,000; or (iii) a combination of (x) paying to AOL
an amount in cash and (y) issuing irrevocable instructions to its
transfer agent to issue to AOL as soon as reasonably possible a number
of shares of ICP Common Stock having a Fair Market Value equal to
$1,000,000 less the amount of cash paid
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pursuant to (iii)(x) (any shares of ICP Common Stock issued to AOL by
ICP pursuant to this Section 3.3.7(c) shall be referred to herein as
the "Second Anniversary Shares");
(d) For purposes of this Section 3.3.7, "Fair Market Value" shall mean
the average of the closing prices of the ICP Common Stock on the Nasdaq
National Market (or if the ICP Common Stock is listed on a nationally
recognized securities exchange, on the primary stock exchange on which
it is listed) for the five (5) trading days ending on July 17, 2002 (or
if such date is not a trading day, the next preceding trading day),
with respect to the First Anniversary Shares or July 17, 2003 (or if
such date is not a trading day, the next preceding trading day), with
respect to the Second Anniversary Shares, as applicable;
(e) In no event shall ICP issue to AOL pursuant to either Section
3.3.7(b) or Section 3.3.7(c) (i) a number of shares of ICP Common Stock
which would result in AOL becoming the beneficial holder of more than
*** of the outstanding shares of ICP Common Stock on a fully diluted
basis as of the date of such issuance, including the shares of ICP
Common Stock to be issued to AOL on such date and assuming the
conversion or exercise of all securities held by AOL that are
convertible into or exchangeable for ICP Common Stock; provided,
however, that in making such determination only securities issued to
AOL by ICP shall be considered in making such calculation or (ii) any
shares of ICP Common Stock if the ICP Common Stock is not admitted for
quotation on the Nasdaq National Market or listed and traded on a
nationally recognized securities exchange.
(f) ICP covenants and agrees that the ICP Common Stock which ICP issues
pursuant to this Section 3.3.7 will, upon issuance, be (i) validly
issued, fully paid and non-assessable and free from all taxes,
preemptive rights, liens and charges with respect to the issuance
thereof, (ii) admitted for quotation on the Nasdaq National Market or
listed on the nationally recognized securities on which the ICP Common
Stock is then listed and traded and (iii) will be represented by a duly
authorized and executed certificate or certificates bearing no legend
other than the one described in paragraph (g)(ii) below. ICP further
covenants and agrees that ICP will at all times have authorized and
reserved a sufficient number of shares of its Common Stock to provide
for the issuance of the shares of ICP Common Stock to AOL (less any
number of shares already issued pursuant to this Agreement). In the
event ICP elects to issue shares of ICP Common Stock to AOL pursuant to
either Section 3.3.7(b) or Section 3.3.7(c), it shall use its best
efforts to deliver, or cause its transfer agent to deliver, to AOL
certificates representing the shares of ICP Common Stock to be so
issued as soon as reasonably possible after issuing the irrevocable
instructions referred to in Section 3.3.7(b) or 3.3.7(c), as the case
may be, but in any event no later than five business days after the
issuance of such instructions, and shall treat AOL as the holder of
such shares for all purposes from the date of the issuance of such
instructions.
(g) AOL Representations, Warranties and Covenants
(i) AOL covenants and agrees that any shares of ICP Common Stock it
acquires pursuant hereto shall be acquired solely for its own
account and not for the account or beneficial interest of any other
person, and the ICP Common Stock will not be acquired with a view to
any distribution in violation of the Securities Act of 1933, as
amended (the "Securities Act") or the securities laws of any state
of the United States or any other applicable jurisdiction;
(ii) AOL acknowledges that to the extent ICP issues any shares of
ICP Common Stock pursuant hereto (a) the offer and sale of such ICP
Common Stock will not have been registered under the Securities Act
or applicable state securities laws and that the ICP Common Stock so
issued may not be sold, transferred, pledged or otherwise disposed
of unless subsequently so registered or unless registration under
the Securities Act and any applicable state securities laws is not
required; and (b) any certificate evidencing the ICP Common Stock
shall bear a customary legend regarding the foregoing; and
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(iii) AOL represents that it is an "accredited investor" as defined
in Rule 501 of Regulation D promulgated under the Securities Act and
has such knowledge and experience in business, financial and
investment matters that it is capable of evaluating the merits and
risks of an investment in the ICP Common Stock.
(h) Forfeiture upon Termination. In the event that this Agreement is
terminated by AOL prior to July 18, 2004 for any reason other than as a result
of a material breach of the Agreement by ICP, then AOL shall pay to ICP within
fifteen (15) days after the date this Agreement is so terminated (a "Termination
Date") an amount in cash as specified below:
(i) In the event this Agreement is terminated at any time prior to
July 18, 2002, an amount in cash equal to the product of (i) the
amount of the Initial Cash Payment times (ii) a fraction the
numerator of which is the difference between 365 and the number of
days from and including July 18, 2001 to but excluding the date of
any such termination and the denominator of which is 365.
(ii) In the event this Agreement is terminated at any time after
July 18, 2002 and prior to July 18, 2003, an amount in cash equal to
the product of (i) $2,000,000, times (ii) a fraction the numerator
of which is the difference between 365 and the number of days from
and including July 18, 2002 to but excluding the date of any such
termination and the denominator of which is 365.
(iii) In the event this Agreement is terminated at any time after
July 18, 2003 and prior to July 18, 2004, an amount in cash equal to
the product of (i) $1,000,000, times (ii) a fraction the numerator
of which is the difference between 366 and the number of days from
and including July 18, 2003 to but excluding the date of any such
termination and the denominator of which is 366.
(i) Incidental Registration Rights.
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(i) If, at any time, ICP proposes to file any registration statement
under the Securities Act for sale to the public, whether for its own
account or for the account of other security holders or both (except
with respect to registration statements on Form S-8 or its then
equivalent, Form S-4 or its then equivalent, or any form that is not
available for registering the Registrable Securities (as defined
below) for sale to the public), each such time it will notify AOL in
writing at least fifteen (15) days prior to such filing and will
afford AOL an opportunity to include in such registration statement
all or any part of the Registrable Securities then held by AOL. Upon
the written request of AOL, received by ICP within ten (10) days
after the giving of any such notice by ICP, to include in the
registration all or any part of the Registrable Securities, ICP will
use best efforts to cause the Registrable Securities as to which
registration shall have been so requested to be included in the
securities to be covered by the registration statement proposed to
be filed by ICP, all to the extent and under the condition such
registration is permitted under the Securities Act.
(ii) If a registration statement under which ICP gives notice under
this Section to AOL is for an underwritten offering, then ICP shall
so advise AOL and the right of AOL to be included in such
registration statement shall be conditioned upon AOL's participation
in such underwriting and the inclusion of the Registrable Securities
in the underwriting to the extent provided herein. AOL, if proposing
to distribute any portion of the Registrable Securities through such
underwriting, shall enter into an underwriting agreement in
customary form for unaffiliated selling shareholders with the
managing underwriter(s) selected for such underwriting by ICP.
Notwithstanding anything herein to the contrary, if such managing
underwriter(s) determine in good faith that marketing factors
require a limitation of the number of shares to be underwritten,
then the managing underwriter(s) may exclude shares (including the
Registrable Securities) from the
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registration and underwriting, and the number of shares that may be
included in the registration and underwriting shall be allocated,
first, to a party exercising any contractual right to cause the
preparation of the registration statement by ICP; second, to ICP;
and third, pro rata among all existing holders of registration
rights, including AOL.
(iii) All expenses incurred by ICP in connection with a registration
pursuant to this Section, including all federal and "blue sky"
registration and qualification fees, printing expenses and fees and
disbursements of counsel and accountants for ICP shall be borne by
ICP. If AOL participates in a registration pursuant to this Section,
it shall bear the fees and expenses, if any, of its own counsel and
any and all underwriters' or brokers' discounts, sales commissions
or other selling expenses in connection with the sale of any
Registrable Securities.
(iv) For purposes of this Section, the term "Registrable Securities"
shall mean any shares of ICP Common Stock issued by ICP to AOL (and
any other securities received in exchange or upon conversion thereof
(whether issued by ICP or a successor or otherwise)).
Notwithstanding the foregoing, Registrable Securities shall not
include (i) any shares of ICP Common Stock which have been (i)
registered under the Securities Act pursuant to an effective
registration statement filed thereunder and disposed of in
accordance with the registration statement covering them, (ii)
shares of ICP Common Stock which have been publicly sold pursuant to
Rule 144 under the Securities Act, or (iii) securities which would
otherwise be Registrable Securities to the extent AOL is then
permitted to sell all of such securities within any three (3) month
period pursuant to Rule 144 if such securities constitute less than
one percent of the ICP's outstanding equity securities. At any time
that any shares of ICP Common Stock beneficially owned by AOL cease
to be Registrable Securities, cease to be restricted securities
under the Securities Act or shall be eligible for sale pursuant to
Rule 144(k), ICP shall remove any legend on the certificates
representing such securities.
(v) The rights granted pursuant to this Section shall terminate upon
any termination of this Agreement by AOL other than as a result of a
material breach by ICP.
12. Exhibits E and E-1. Beginning on October 1, 2001, Exhibit E ("Detailed
Schedule and Bona-Fide Value of ICP In-Kind Commitments"), Exhibit E-1
("ICP In-Kind Commitments") and Exhibit K ("Specimen Warrant
Agreement") shall be replaced in their entireties with amended Exhibits
E and E-1 as set forth in Attachments, 2 and 3 respectively.
13. Section 3.7. Section 3.7 ("Payments") of the Agreement shall be
replaced in its entirety with the following paragraph:
Payments; Payment Contact. ***
14. Section 4.3A. During the Renewal Term, Section 4.3A shall be deleted in
its entirety.
15. Section 5.2. During the Renewal Term, Section 5.2 shall be deleted in
its entirety and replaced with the following:
ICP shall create an ICP Internet Site(s) (i.e. framed versions of the
Private Store and the Generally Available Site(s)) for each of the AOL
Service, AOL.com, Digital City Service, the CompuServe Service,
Netscape and ICQ.com. ICP shall display the applicable standard header
and footer for each AOL Property on each page of the ICP Internet Site
for such AOL Property in accordance with the applicable AOL Property's
then-current header of footer specifications; provided that, AOL will
not require ICP to change such headers and footers more than every six
(6) months during the Renewal Term. Notwithstanding anything herein to
the contrary, there shall be no advertising or promotions of any kind
within the frames of the ICP Internet Site; .provided that, this
sentence shall not prevent AOL from inserting navigational elements
(associated with the
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applicable AOL Property) and links in such frames, which elements and
links shall link only to areas on the applicable AOL Property.
16. Sections 6.4, 6.5 and 6.6. Section 6.4 ("Real Fans"), 6.5 ("Interim
Production") and 6.6 ("AOL.com") shall be deleted in their entireties.
17. Section 7. Beginning on October 1, 2001, Section 7 ("Revenue Sharing")
shall be replaced in its entirety with the following:
7.1 Transaction Revenues. Commencing on February 1, 2002, ICP shall pay AOL
*** of Net Transaction Revenues. ICP shall pay AOL *** of all AOL
Fantasy Sports Products Subscription Revenue.
7.2 Advertising Revenues on Fantasy Sports Products. Each Party shall
retain one hundred percent of revenues generated from the respective
Party's sale of its respective share of Fantasy Advertising Inventory.
ICP shall retain one hundred percent of revenues generated from Fantasy
Sponsorship Inventory, except for Pre-Existing Third Party Fantasy
Commitments.
7.3 AOL Fantasy Sports Registrations. For each year during the Renewal Term
in which there are less than *** Registrations (the "Annual
Registration Target") for the AOL Fantasy Sports Products, beginning
with the twelve month period beginning on the date that the first AOL
Fantasy Sports Game is launched on the AOL Service(each an "Annual
Fantasy Shortfall"), AOL shall pay ICP an amount in accordance with the
following formula: *** less the actual number of Registrations) times
***; provided that, all of the AOL Fantasy Sports Products are launched
on the AOL Properties at least *** prior to the start of their
respective seasons with respect to Commissioner and Fantasy AOL Fantasy
Sports Products and at least *** prior to the start of their respective
seasons for all other AOL Fantasy Sports Products (unless such delay is
primarily attributable to AOL). For purposes of this Agreement, a
"Registration" means (a) a registration by each unique AOL User for the
free AOL Fantasy Sports Products with respect to each respective sport
regardless of the number of AOL Fantasy Sports Products with respect to
each respective sport for which such unique AOL User registers (e.g. a
registration for two separate AOL Fantasy Sports Products for baseball
and two separate AOL Fantasy Sports Products for basketball by the same
unique AOL User shall constitute two Registrations), and (b) with
respect to AOL Fantasy Sports Products Subscription Services, each ***
actually collected with respect to AOL Fantasy Sports Products
Subscription Services Revenue (as defined herein) (e.g. *** dollars
collected for a basketball AOL Fantasy Sports Products Subscription
Services shall comprise *** Registrations). The Annual Registration
Target shall be reduced for the applicable year in accordance with the
following:
-----------------------------------------------------------------
SPORT AOL FANTASY SPORTS REDUCTION IN ANNUAL
PRODUCT WHICH ICP REGISTRATION TARGET
ELECTS TO MIGRATE
TO AN AOL FANTASY
SPORTS PRODUCT
SUBSCRIPTION
SERVICES AND WHICH
AOL ELECTS NOT TO
OFFER TO AOL USERS
-----------------------------------------------------------------
Baseball Fantasy ***
-----------------------------------------------------------------
Baseball Challenge ***
-----------------------------------------------------------------
Baseball Commissioner ***
-----------------------------------------------------------------
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSION.
Hockey Fantasy ***
--------------------------------------------------------------
Hockey Commissioner ***
--------------------------------------------------------------
Basketball Fantasy ***
--------------------------------------------------------------
Basketball Commissioner ***
--------------------------------------------------------------
NCAA Basketball Brackets Pool ***
Challenge
--------------------------------------------------------------
NCAA Basketball Brackets Pool ***
Manager
--------------------------------------------------------------
Golf Challenge ***
--------------------------------------------------------------
Auto Racing Challenge ***
--------------------------------------------------------------
AOL shall own the AOL Fantasy Sports Products database but hereby
grants ICP a perpetual license to such database to ICP to use for
any ICP business purpose so long as ICP's use and disclosure of
information contained within the database complies with the terms
and conditions set forth in this Agreement, including without
limitation, the applicable privacy policy under which such data was
collected.
7.4 As of the Amendment Date, it is anticipated that the AOL Fantasy
Sports Game shall be offered to the public without imposition of any
fees to end users of the AOL Fantasy Sports Game. Each of the AOL
Fantasy Sports Products listed in Exhibit E shall be offered to AOL
Users free of charge for *** such AOL Fantasy Sports Products are
offered to AOL Users pursuant to this Agreement. Subsequent to each
such ***, as applicable, ICP may, in its sole and exclusive
discretion, elect to migrate selected products of the AOL Fantasy
Sports Products (including, without limitation, all of the AOL
Fantasy Sports Products) to a fee-based product ("AOL Fantasy Sports
Products Subscription Services"); provided that, ICP (i) shall not
migrate any AOL Fantasy Sports Products in the middle of the
applicable sports season, and (ii) ICP will display AOL-provided
messaging with respect to notice of the change in pricing terms that
AOL believes is reasonably necessary for AOL to comply with its
legal obligations for a period of at least *** days prior to the
date any fee is charged for such AOL Fantasy Sports Subscription
Services. ICP agrees to provide AOL *** months prior written notice
(such notice may be given as of the Amendment Date) with respect to
which AOL Fantasy Sports Products ICP intends to migrate to AOL
Fantasy Sports Products Subscription Services and AOL shall have ***
days from such notice to elect: (a) to promote such AOL Fantasy
Sports Product on the AOL Service in accordance with this Agreement
by providing ICP written notice; (b) not to promote such AOL Fantasy
Sports Product on the AOL Service by providing ICP written notice
(in such event, ICP shall be excused from producing such AOL Fantasy
Sports Product, such AOL Fantasy Sports Product included in such
subscription service shall no longer be considered AOL Fantasy
Sports Products,(accordingly, ICP shall no longer be afforded the
rights of Premier Fantasy Sports Products Provider solely with
respect to such former AOL Fantasy Sports Products) and the Annual
Registration Target shall be reduced in accordance with this
Agreement); or (c) promote the comparable SPLN Fantasy Sports
Product in accordance with this Agreement by providing ICP written
notice (in such event, ICP shall be excused from producing such AOL
Fantasy Sports Product, such AOL Fantasy Sports Product included in
such subscription service shall no longer be considered AOL Fantasy
Sports Products and the Annual Registration Target shall be reduced
in accordance with this Agreement); provided that if AOL fails to
provide ICP with written notice of its election in accordance with
the foregoing within such *** day election period, AOL shall be
deemed to have elected option (a) in accordance with the foregoing
and shall, accordingly, promote such AOL Fantasy Sports Product on
the AOL Service. Notwithstanding the foregoing, with respect to any
AOL Fantasy Sports Product Subscription Services distributed on the
AOL Service, AOL may, during the Renewal Term, elect to cease
distributing such AOL Fantasy Sports Product Subscription Services
on the AOL Service by providing ICP *** months prior written notice
thereof (in such event, ICP shall be excused from producing such AOL
Fantasy Sports Product Subscription Services, AOL Fantasy Sports
Products included in such subscription
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSION.
service shall no longer be considered AOL Fantasy Sports Products
and the Annual Registration Target shall be reduced in accordance
with this Agreement. All fees for AOL Fantasy Sports Products
Subscription Services shall be determined in the sole and exclusive
discretion of ICP, provided that such fees shall in all events be
equivalent to fees for similar SPLN Fantasy Products; provided,
however, ICP may not charge for any AOL Fantasy Sports Product if
ICP offers a Competitive Fantasy Sports Product for free on any
interactive site or area.
18. Section 8.4. During the Renewal Term, the first sentence of Section 8.4
("Site and Content Preparation") shall be replaced with the following
sentence:
ICP shall achieve Site and Content Preparation on or before October 1,
2001.
19. Section 8.5. The third sentence of Section 8.5 ("Termination on Change of
Control"), including without limitation, clauses (a)-(d), shall be deleted
in its entirety. The following shall be added to the end of Section 8.5:
Without limiting any right of AOL hereunder, in the event of any Change of
Control of Sportsline, CBS or Viacom, or other transaction, in either case
which results in Sportsline, CBS or Viacom controlling or being controlled
by (a) ***, (b) any *** provider of internet access or connectivity, and
(c) any provider of internet access or connectivity with more than ***
users, AOL may terminate this Agreement by providing *** days prior
written notice of such intent to terminate. In addition, notwithstanding
anything to the contrary in this Agreement, ICP may not assign this
Agreement to an Interactive Service or any entity controlling or
controlled by an ***.
20. Section 8.6. Beginning on October 1, 2001, Section 8.6 ("Adjustment to
Consideration Upon Termination of Premier Status") shall be deleted in its
entirety.
21. Section 9. Section 9 ("Premier Relationship with ICP Competitors;
Broadband") shall be deleted in its entirety.
22. Section 10. Beginning on October 1, 2001, Section 10(a) ("Additional
Opportunities Defined Granted to ICP") shall be deleted in its entirety.
23. Exhibit B-Definitions. Beginning on October 1, 2001, the following
definitions, if they exist in Exhibit B, shall be replaced in their
entireties with the following applicable definitions, or, if they do not
exist in Exhibit B, they shall be added to Exhibit B:
AOL Fantasy Sports Product Subscription Services Revenue. Gross Revenues
actually collected by ICP for AOL Fantasy Sports Products Subscription
Services less applicable taxes, credit card processing fees, charge backs,
coupons, and customer discounts.
AOL Property(ies). The AOL Service, AOL.com, Digital City Service, the
CompuServe Service, Netscape, and ICQ.
Affiliate. Any distributor or franchisee of AOL, or an entity that,
directly or indirectly, controls, is controlled by, or is under common
control with AOL, including any entity in which AOL holds, directly or
indirectly, at least a *** equity interest.
Commerce Promotions. All Promotions for ICP's Products and/or the Private
Store pursuant to this Agreement.
Programming Content and Screens. The Content and screens comprising the
AOL Programming, the AOL.com Programming, the CompuServe Programming, the
Digital City Programming, the Netscape Programming and the ICQ
Programming.
10
<PAGE>
CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSION.
Fantasy Advertising Inventory. Banner advertising inventory, "sweet spots"
and other non-persistent advertising placements within the AOL Fantasy
Sports Products.
Fantasy Sports Products. Fantasy Sports Games and Fantasy Tools.
Fantasy Sponsorship Inventory. All non-rotating persistent (for the
duration of the flight) advertising placement within the AOL Fantasy
Sports Products.
Fantasy Sports Games. Team-management or athlete-management games in which
a player oversees real-life sports players, events or franchises for all
or any part of a simulated "season" of sports contests, but the gameplay
of which is not centered on graphical simulations of sports contests.
Fantasy Tools. Fantasy commissioner utilities and fantasy support
applications.
Generally Available Site(s). The Internet sites (or any successors
thereto), currently located at the following addresses:
http://cbs.sportsline.com, http://www.igogolf.com, http://www.golfweb.com,
http://www.sportsline.com, and http://www.commissioner.com and any other
mutually agreed upon sites which are managed, maintained or owned by ICP
or its agents or to which ICP licenses information, Content or other
materials, including, by way of example and without limitation, a channel
or area delivered through a "push" product such as the Pointcast Network
or interactive environment such as Microsoft's proposed "Active Desktop."
Gross Transaction Revenues. ***
ICP Interactive Site. Any interactive site or area (other than Programming
Content and Screens and the ICP Internet Site), which is managed,
maintained or owned by ICP or its agents or to which ICP provides and/or
licenses information, Content or other materials.
ICP Internet Site(s). Collectively, the Private Store and each version of
the Generally Available Sites that are framed with the appropriate header
and footer for each of the AOL Property(ies) in accordance with this
Agreement.
ICQ.com. ICQ's primary Internet-based English language interactive site
marketed under the "ICQ.com" brand, specifically excluding (a) the ICQ
brand communications and messaging service, (b) any international
/non-English language versions of such site, (c) "ICQ It!" or any other
independent product or service offered by or through such site or any
other ICQ Interactive Site, (d) any programming or Content area offered by
or through such site over which ICQ does not exercise complete operational
control (including, without limitation, Content areas controlled by other
parties and user-created Content areas), (e) any yellow pages, white
pages, classifieds or other search, directory or review services or
Content offered by or through such site or any other ICQ Interactive Site,
(f) any property, feature, product or service which ICQ or its affiliates
may acquire subsequent to the Effective Date and (g) any other version of
an ICQ Interactive Site which is materially different from ICQ's primary
Internet-based English language Interactive Site marketed under the
"ICQ.com" brand, by virtue of its branding, distribution, functionality,
Content and services, including, without limitation, any co-branded
versions and any version distributed through any broadband distribution
platform or through any platform or device other than a desktop personal
computer.
Interactive Service. ***
Netscape. Netscape Communications Corporation's primary Internet-based
Interactive Site marketed under the "Netscape NetcenterSM" brand,
specifically excluding (a) the AOL Service and the CompuServe Service, (b)
AOL.com and CompuServe.com, (c) any international versions of such site
and/or any non-English language based feature or area of such site, (d)
"ICQ," "AOLSearch," "You've Got Pictures," "Shop @," "My News," "AOL
PlusSM," "AOL Instant
11
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSION.
Messenger," "AOL NetMail," "AOL Hometown," "My News," "Digital City," or
any similar independent product or service offered by or through such site
or any other AOL Interactive Site, (e) any programming or Content area
offered by or through such site over which AOL does not exercise complete
operational control (including, without limitation, Content areas
controlled by other parties and member-created Content areas), (f) any
programming or Content area offered by or through the U.S. version of the
America Online brand service which was operated, maintained or controlled
by the former AOL Studios division (e.g., Electra), (g) any yellow pages,
white pages, classifieds or other search, directory or review services or
Content offered by or through such site or any other AOL Interactive Site,
(h) any property, feature, product or service which AOL or its affiliates
may acquire subsequent to the Effective Date and (i) any other version of
an AOL or Netscape Communications Corporation Interactive Site which is
materially different from Netscape Communications Corporation's primary
Internet-based Interactive Site marketed under the "Netscape
Netcenter(TM)" brand, by virtue of its branding, distribution,
functionality, Content or services, including, without limitation, any
co-branded versions and any version distributed through any broadband
distribution platform or through any platform or device other than a
desktop personal computer (e.g. Custom NetCenters built specifically for
third parties).
Net Transaction Revenues. ***
Online Playable Games. Games that can be played Online or which have
Online component. Online Playable Games will not include mere head-to-head
play of offline games without the necessity of any server-based
component(s) (i.e., where two people play a packaged goods Game by direct
dial connection, unless the direct dial information was provided by an
Online matching service). As used herein, (a) "Online" shall mean modes of
digital or analog communication in which two or more parties have
established a circuit (or virtual circuit) usable for two-way
transmissions. By way of example and not limitation, games that are
playable Online are games where multiple users are playing the same game
from different locations, or games where the client uses interaction with
a server or another client as a part of the game-playing experience. Games
which can be played completely offline, whose Online component is merely
incidental to the experience (e.g., for downloading, purchasing or
registering the product), are not Games playable Online, and "Game" shall
mean electronic forms of entertainment or sports played according to
rules. For purposes of clarity, Online Playable games do not include
Fantasy Sports Products.
Press Release. A press release or other public statement.
Product. A Premier Product, Other Product or any other product, good or
service which ICP (or others acting on its behalf or as distributors)
offers, sells, provides, distributes or licenses to AOL Users or AOL
Purchasers, including without limitation, club memberships, ICP Membership
or Premium Service, directly or indirectly through the ICP Internet
Site(s) (including through the Private Store and/or any ICP Internet Site
linked thereto.
SPLN Fantasy Sports Products. All SportsLine-branded Fantasy Sports
Products and all Fantasy Sports Products distributed on or through the
Generally Available Site(s).
Targeted Screens. Any screens upon which ICP receives placement pursuant
to Exhibit H and the following channels or screens on the AOL Service and
their counterparts on each of the AOL Properties: the Shopping Channel,
the Sports Channel, Women's Sports, Teen's Sports, Kid's Only Sports,
Men's, News and network level screens, including without limitation, "AOL
Today", "Thank You", "Welcome" (and specific successor channels and
screens) and any other channel or screen approved by ICP, which approval
will not be unreasonably withheld or delayed.
22. Exhibit C. Beginning on October 1, 2001, the following terms, if they
exist in Exhibit C, shall be replaced in their entireties with the
following applicable terms, or, if they do not exist in Exhibit C, they
shall be added to Exhibit C:
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSION.
Changes to AOL Service. AOL reserves the right to redesign or modify the
organization, structure, "look and feel," navigation and other elements of
the AOL Properties. In the event such redesign or modifications materially
affect the Promotions, AOL will, as ICP's sole remedy, consult with ICP
regarding such redesigns and work with ICP in good faith to provide ICP
with *** ("Make Good Placements").
Indemnity. The Parties agree to add the following sentence to this
provision at the end of the first paragraph: "In addition, ICP will
defend, indemnify, save and hold harmless AOL and AOL's officers,
directors, agents, affiliates, distributors, franchisees and employees
from any and all Liabilities arising out of or in any way related to a
third party claim (expressly excluding any and all Affiliate claims) with
respect to the Licensed Content (expressly excluding AP feeds,
SportsTicker feeds and AOL User generated content))and AOL's use of the
Licensed Content (expressly excluding AP feeds, SportsTicker feeds and AOL
User generated content)) in accordance with this Agreement. Without
limiting the foregoing, ICP shall not, in any event, be obligated to
indemnify AOL for any Licensed Content substantively modified by AOL to
the extent such third party claim results directly and solely from such
AOL modification.
Export Controls. Each Party shall comply with all applicable laws,
regulations and rules relating to the export of commodities, software or
technical data, and shall not export or re-export any commodities,
software or technical data, any products received from the other Party or
the direct product of such commodities, software or technical data, to any
proscribed country, party or entity listed in such applicable laws,
regulations and rules, unless properly authorized by the U.S. Government.
No Additional Warranties. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER PARTY MAKES, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS, ANY
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE AOL
NETWORK, ANY AOL PUBLISHING TOOLS, THE ICP INTERNET SITE(S) AND/OR THE
PRIVATE STORE, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE AND IMPLIED WARRANTIES ARISING FROM
COURSE OF DEALING OR COURSE OF PERFORMANCE OR NONINFRINGEMENT. WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, AOL SPECIFICALLY DISCLAIMS ANY
WARRANTY REGARDING THE PROFITABILITY OF AOL NETWORK OR THE ICP INTERNET
SITE(S) OR PRIVATE STORE.
Promotional Materials/Press Releases. The following shall be added to the
end of this section:
Notwithstanding anything to the contrary in this Agreement, each Party
will submit to the other Party, for its prior written approval, which will
not be unreasonably withheld or delayed, any Press Release regarding the
transactions contemplated hereunder, provided that, subsequent to the
initial Press Release, factual references by either Party to the existence
of a business relationship between the Parties in oral public statements
shall not require approval of the other Party. Notwithstanding the
foregoing, either Party may issue Press Releases and other disclosures as
required by law, rule, regulation or court order or as reasonably advised
by legal counsel without the consent of the other Party and in such event,
the disclosing Party will provide at least five (5) business days prior
written notice of such disclosure.
23. Section 8.6. The following new Section 8.6 shall be added to the
Agreement:
8.6 Termination of Netscape Agreement. ***
24. Attachments. Beginning on October 1, 2001, all Attachments attached hereto
are hereby incorporated by reference and made a part of the Agreement.
25. Co-branded Suite. ***
13
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSION.
26. Order of Precedence. This Amendment is supplementary to and modifies the
Agreement. The terms of this Amendment supersede provisions in the
Agreement only to the extent that the terms of this Amendment and the
Agreement expressly conflict. However, nothing in this Amendment should be
interpreted as invalidating the Agreement, and provisions of the Agreement
will continue to govern relations between the parties insofar as they do
not expressly conflict with this Amendment. All capitalized terms not
defined in this Amendment shall have the meaning given them in the
Agreement.
[END OF PAGE]
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CONFIDENTIAL INFORMATION OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE SUCH OMISSION.
27. Counterparts. This Amendment may be executed in counterparts, each of
which shall be deemed an original and all of which together shall
constitute one and the same document.
IN WITNESS WHEREOF, the parties hereto, each acting under due and proper
authority, have executed this Agreement as of the date first written above.
AMERICA ONLINE, INC. SPORTSLINE.COM, INC.
By: /s/ Jonathan Edson By: /s/ Michael Levy
-------------------------------- ---------------------------------
Print Name: Jonathan Edson Print Name: Michael Levy
------------------------ -------------------------
Title: VP - Business Affairs Title: President and CEO
----------------------------- ------------------------------
15