OVERTURE SEARCH SERVICES AGREEMENT
Exhibit 10.27
EXECUTION CONFIDENTIAL
OVERTURE SEARCH SERVICES AGREEMENT
This Overture Search Services Agreement (the “Agreement”) is effective as of May 1, 2002 (“the “Effective Date”) and entered into by and between Overture Services, Inc. (“Overture”), a Delaware corporation with offices at 74 North Pasadena Avenue, 3d Floor, Pasadena, CA 91103, and Yahoo! Inc. (“Yahoo”), a Delaware corporation with offices at 701 First Avenue, Sunnyvale, CA 94089, and hereby supercedes in its entirety the Overture Search Services Agreement entered into as of November 13, 2001 by and between Overture and Yahoo, as amended by the letter agreement regarding the treatment of [*]-related search queries entered into as of December 14, 2001, the letter agreement regarding the treatment of search queries submitted by AU/NZ Users entered into as of April 2, 2002 and the letter agreement regarding the treatment of “Search in other Search Engines” links entered into as of April 2, 2002, and as clarified by the clarifying letter regarding the parties’ intent with respect to Impressions dated February 14, 2002 (collectively, the “Prior Agreement”).
RECITALS
WHEREAS, Overture has developed certain technology and functionality for matching particular keyword requests with a set of search results, for providing the results of that match via the Internet and then enabling users to follow a link to a designated page for advertisers which comprise the results of such match; and
WHEREAS, Yahoo is a global Internet media company that offers a branded network of media, communications and commerce services to more than 220 million users worldwide; and
WHEREAS, Overture and Yahoo desire to enter into a strategic relationship whereby Overture will provide Yahoo with search results in response to search queries conducted through Yahoo’s principal directory to the World Wide Web, and the parties will share revenue generated from these search results, as further described in this Agreement.
NOW, THEREFORE, in consideration of the mutual promises and conditions contained herein, and for good and valuable consideration, the parties agree as follows:
AGREEMENT
1. Definitions. The following capitalized terms have the meanings set forth
below.
1.1 Actual Click means any click on an Overture Result by a U.S. User
derived from an Impression, including but not limited to all
Fraudulent Clicks, as measured by Overture.
1.2 Above the Fold means placement within the visible portion of a page,
when viewed via Microsoft’s principal “Internet Explorer” browser
product (U.S. versions 4.0 and higher) under the default Internet
Explorer browser settings in a maximized browser window on a
computer screen at a resolution of 800 pixels wide by 600 pixels
high, such that the user need not scroll down or to the right or to
the left in order to see an item so placed.
1.3 Advertiser means any third party or an agent thereof (e.g., an
advertising agency), excluding [*] and any agents thereof, who has
entered into a contractual relationship with Overture that obligates
the third party to pay Overture (whether cost per click, cost per
action, cost per impression, paid inclusion, pay-for-placement or
other means of cash compensation) every time a user clicks on a link
to that third party’s web site.
1.4 Affiliate means any entity worldwide, including but not limited to
corporations, partnerships, joint ventures and limited liability
companies, in which another party directly or indirectly
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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holds at least a majority ownership, equity, or financial interest.
1.5 Bidded Click means an Actual Click other than a Fraudulent Click, as
measured by Overture.
1.6 Click-Through Rate or CTR means (i) when calculating Overture’s CTR,
the percentage of all Impressions on which Overture Results are
displayed that receive a Bidded Click and (ii) when calculating
Yahoo’s CTR, the percentage of all impressions of Yahoo Search
Results Pages on which Yahoo Results are displayed that receive a
click, excluding all clicks that are determined by Yahoo to be Fraudulent
(e.g., a user repeatedly clicking on a particular Yahoo Result
within a finite period of time, or an activity by a bot, macro
program, Internet agent or any other automatic means), which Yahoo
shall calculate in a substantially consistent manner across the
Yahoo Network.
1.7 Confidential Information has the meaning set forth in Section 12.1
below.
1.8 Effective Date has the meaning set forth in the preamble above.
1.9 Estimated Clicks means the following amounts during the Quarters
shown below (Q1 means the Quarter beginning on May 1, 2002):
—------------------------------------------------------------
Q1 [*] Bidded Clicks
—------------------------------------------------------------
Q2 [*] Bidded Clicks
—------------------------------------------------------------
Q3 [*] Bidded Clicks
—------------------------------------------------------------
Q4 [*] Bidded Clicks
—------------------------------------------------------------
Q5 [*] Bidded Clicks
—------------------------------------------------------------
Q6 [*] Bidded Clicks
—------------------------------------------------------------
Q7 [*] Bidded Clicks
—------------------------------------------------------------
Q8 [*] Bidded Clicks
—------------------------------------------------------------
Q9 [*] Bidded Clicks
—------------------------------------------------------------
Q10 [*] Bidded Clicks
—------------------------------------------------------------
Q11 [*] Bidded Clicks
—------------------------------------------------------------
Q12 [*] Bidded Clicks
—------------------------------------------------------------
Each Quarter of any Extension
Term [*] Bidded Clicks
—------------------------------------------------------------
1.10 Estimated Yahoo Payments means the following amounts during the
Quarters shown below (Q1 means the Quarter beginning on May 1,
2002):
—------------------------------------------------------------
QUARTER ESTIMATED YAHOO PAYMENT
—------------------------------------------------------------
Q1 $[*]
—------------------------------------------------------------
Q2 $[*]
—------------------------------------------------------------
Q3 $[*]
—------------------------------------------------------------
Q4 $[*]
—------------------------------------------------------------
Q5 $[*]
—------------------------------------------------------------
Q6 $[*]
—------------------------------------------------------------
Q7 $[*]
—------------------------------------------------------------
Q8 $[*]
—------------------------------------------------------------
Q9 $[*]
—------------------------------------------------------------
Q10 $[*]
—------------------------------------------------------------
Q11 $[*]
—------------------------------------------------------------
Q12 $[*]
—------------------------------------------------------------
Each Quarter of any Extension
Term $[*]
—------------------------------------------------------------
1.11 Equivalent Search Product means a search listings product or
service, including but not
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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limited to any updates, upgrades and enhancements made by Yahoo or a
Yahoo Affiliate thereto, that (a) [*] equivalent to a search
listings product or service operated by Overture at any time during
the Term to supply Overture Results or other Overture-supplied
search results under this Agreement; (b) is developed [*] Yahoo or a
Yahoo Affiliate by [*]; and (c) is operated and used by Yahoo or a
Yahoo Affiliate.
1.12 Excluded Terms means those terms set forth in Exhibit G, as updated
from time to time [*] in writing pursuant to Section 4.5 below,
for which Overture is precluded from delivering Overture Results to
Yahoo.
1.13 Extension Term means either of the two extension periods set forth
in Section 10 below.
1.14 Featured Sections means the rectangular graphical areas on the Yahoo
Search Results Pages in which Overture Results are displayed (and,
according to Section 4.4, in which the Yahoo Result might be
displayed), which comprises the Featured Top Section and the
Featured Bottom Section, as further described in Section 5.2 below.
1.15 Fraudulent Clicks means any Actual Click that is determined by Overture’s
“click protection system” to be Fraudulent (e.g., a user repeatedly
clicking on a particular Overture Result within a finite period of
time, or an activity by a bot, macro program, Internet agent or any
other automatic means), which “click protection system” shall
calculate Fraudulent Clicks in a substantially consistent manner across all
implementations of Overture’s search results and, subject to
reasonable modifications made by Overture, throughout the Term.
1.16 Gross Revenue means amounts earned by Overture from Bidded Clicks,
less (i) [*]% to account for bad debt and credit card processing
fees; and (ii) any refunds Overture pays to its Advertisers derived
from Fraudulent Clicks. For purposes of clarity, Overture does not
recognize amounts for Fraudulent Clicks.
1.17 Guaranteed Fixed Payment means those payments set forth in Section
8.1 below.
1.18 Guaranteed Impressions means the following amounts during the
Quarters set forth below:
—------------------------------------------------------
Q1 [*] Impressions
—------------------------------------------------------
Q2 [*] Impressions
—------------------------------------------------------
Q3 [*] Impressions
—------------------------------------------------------
Q4 [*] Impressions
—------------------------------------------------------
Q5 [*] Impressions
—------------------------------------------------------
Q6 [*] Impressions
—------------------------------------------------------
Q7 [*] Impressions
—------------------------------------------------------
Q8 [*] Impressions
—------------------------------------------------------
Q9 [*] Impressions
—------------------------------------------------------
Q10 [*] Impressions
—------------------------------------------------------
Q11 [*] Impressions
—------------------------------------------------------
Q12 [*] Impressions
—------------------------------------------------------
Each Quarter of any Extension
Term [*] Impressions
—------------------------------------------------------
1.19 Impression means the display by Yahoo of each and every Yahoo Search
Results Page in response to a Yahoo Search Query, as measured by
Yahoo, except for those Yahoo Results Pages (a) for which Overture
does not deliver Overture Results as a result of (i) a Yahoo
Technical Lapse (as defined in the Service Level Agreement); (ii)
noncompliance by Yahoo with the Service Level Agreement attached as
Exhibit A (e.g., where Yahoo delivers too many Yahoo Search Queries
per second); or (iii) the suppression or removal of Overture
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect
to the omitted portions.
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Results according to Sections 4.2 or 4.5 below; (b) displayed in
response to Yahoo Search Queries submitted from “next” pages in
excess of [*]% of the total Yahoo Search Queries for the applicable
Quarter; (c) displayed in response to test queries submitted by
Yahoo in accordance with the Service Level Agreement (e.g., Yahoo
pinging Overture servers to ascertain performance), which queries
Yahoo will identify as such in accordance with Section 8.4(f) below;
or (d) failure by Overture to deliver Overture Results due to a
force majeure event as described in Section 16.7 below. For clarity,
the exclusions set forth in subsections (a)-(d) above set forth the
[*] which the display by Yahoo of a Yahoo Search Results Page in
response to a Yahoo Search Query will not constitute an Impression
under this Agreement (e.g., all Search Results Pages on which Yahoo
displays no Overture Results in accordance with a “no results
delivered” response from Overture will constitute Impressions under
this Agreement).
1.20 Initial Term means the period commencing on the Effective Date and
continuing until April 30, 2005.
1.21 [*]
1.22 Licensed Materials means the Overture API, the Overture Results and,
if any, the Overture Marks provided by Overture to Yahoo in
accordance with this Agreement.
1.23 Main Body Search Results means all search results displayed in the
Non-Featured Sections of the Yahoo Search Results Pages.
1.24 Measurement Period means the period from the first day of the first
Quarter in which the [*] is less than the [*] until the last day of
the first Quarter in which the [*] is less than the [*].
1.25 Modeled Metrics means the following amounts during the Quarters
shown below (Q1 means the Quarter beginning on May 1, 2002):
—----------------------------------------
QUARTER [*]
—----------------------------------------
Q1 [*]
—----------------------------------------
Q2 [*]
—----------------------------------------
Q3 [*]
—----------------------------------------
Q4 [*]
—----------------------------------------
Q5 [*]
—----------------------------------------
Q6 [*]
—----------------------------------------
Q7 [*]
—----------------------------------------
Q8 [*]
—----------------------------------------
Q9 [*]
—----------------------------------------
Q10 [*]
—----------------------------------------
Q11 [*]
—----------------------------------------
Q12 [*]
—----------------------------------------
Each Quarter of any Extension
Term [*]
—----------------------------------------
1.26 Non-Featured Section means the entire portion of each Yahoo Search
Results Page, excluding the Featured Sections.
1.27 Overture Affiliate means any entity worldwide, including but not
limited to corporations,
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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partnerships, joint ventures and limited liability companies, in
which Overture directly or indirectly holds at least a majority
ownership, equity, or financial interest.
1.28 Overture Affiliate IP means any patents that are owned or controlled
by an Overture Affiliate at any time during the applicable term of
any of the licenses granted in Section 2.5 below. Overture Affiliate
IP shall not mean patent claims found not to be valid in a final
determination by a court of competent jurisdiction.
1.29 Overture API means any proprietary XML application programming
interfaces of Overture, and any successors thereto or replacements
thereof, that enable the exchange of Yahoo Search Queries and
Overture Results between the parties in accordance with this
Agreement.
1.30 Overture Disqualified Entity means those entities listed in Exhibit
J, which list will [*] and may be updated by Overture according to
Section 2.5(d) below, with which Overture [*].
1.31 Overture Licensed IP means any patents that are owned or controlled
by Overture at any time during the applicable term of any of the
licenses granted in Section 2.5 below. Overture Licensed IP shall
not mean patent claims found not to be valid in a final
determination by a court of competent jurisdiction.
1.32 Overture Marks means any or all of the following, as provided by
Overture and in which Overture has prior rights: (a) the mark
“Overture” in typed form and stylized formats; (b) a circular
center, surrounded by three concentric circular rings (the “Overture
Logo,” as modified from time to time by Overture); (c) any words or
phrases in which Overture has intellectual property rights; (d) any
word, symbol or device, or any combination thereof, used or intended
to be used by Overture to identify, to indicate the source of origin
or to distinguish Overture’s products or services from the products
or services of others; and (e) any updates to the foregoing.
1.33 Overture Reports means all information and data that falls within
the categories set forth in Exhibit F, which information and data
Overture will provide to Yahoo according to Section 8.4(b).
1.34 Overture Results means the search results provided by Overture in
response to a Yahoo Search Query under this Agreement, which search
results (a) include only those search results provided by
Advertisers; (b) do not include search results that are not capable
of generating Gross Revenue (e.g., search results included as a
bonus or a charitable donation); and (c) contain a title and
description for display by Yahoo according to Section 4.3(a) below.
1.35 Overture Site means the web site operated by or on behalf of
Overture, which is dedicated to the display by Overture of paid
search results and currently located at http://www.overture.com.
1.36 Paid Advertising means any form of on-line advertising or promotion
for which Yahoo receives compensation in the form of cash or barter
from either the party being promoted or a third party acting on
behalf of the promoted party.
1.37 Paid Inclusion means that, in exchange for a cash payment from a
third party, a search engine will guarantee to index (but not
necessarily to display) pages from that third party’s web site.
1.38 Price Per Click or PPC means the average price per click that
Overture earned from its Advertisers on the Yahoo Search Results
Pages during the Quarter.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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1.39 Quarter means the three calendar month periods beginning May,
August, November and February of each year of the Term.
1.40 Redesign means any change to any element of a Yahoo Search Results
Page implemented by Yahoo.
1.41 Required Number of Overture Results means, with respect to the
Featured Top Section, three Overture Results (where such number is
subject to reduction under Sections 4.4 and 4.5) and, with respect
to the Featured Bottom Section, two Overture Results. The numbers
for both the Featured Top Sections and the Featured Bottom Sections
are subject to increase under Section 4.3(b).
1.42 Restricted Search Results means any [*] search results that are (a)
[*] the Overture Results or to the Main Body Search Results (e.g.,
[*]); (b) displayed by Yahoo on [*] in response to a user’s [*]
search query [*] comprised of a keyword or phrase, which search
query is submitted [*] for the provision of search results; and (c)
assembled on the basis of a [*] administered process in which
advertisers pay to [*] their search results for a particular keyword
or phrase, where payment can take the form of cost per click, cost
per action, cost per impression, Paid Inclusion, pay-for-placement
or any other means of cash compensation paid by the advertiser [*].
1.43 Revenue Share Payment has the meaning set forth in Section 8.2
below.
1.44 Search Results Characteristics means all aspects of the Yahoo
Results, Overture Results and Main Body Search Results, including
but not limited to, left and right margins, pictures or images
associated with the search results, text size, color, font, heading,
shading/background, spacing, blank areas, length, existence of URL,
and all other aspects of “look and feel.”
1.45 Term means the Initial Term and, if applicable, each Extension Term
until the expiration thereof, unless terminated as set forth herein.
1.46 Top Link Position means the first search result position in the
Featured Top Section, wherein Yahoo displays either a Yahoo Result
or an Overture Result in accordance herewith.
1.47 U.S. User means a human user (i.e., not a `bot, metaspider, macro
program, Internet agent or any other automated means) who, at the
time of conducting a Yahoo Search Query, is accessing the Internet
from an Internet Protocol address within the United States or
Canada, as measured by Yahoo.
1.48 Yahoo Affiliate means any entity worldwide, including but not
limited to corporations, partnerships, joint ventures and limited
liability companies, in which Yahoo directly or indirectly holds at
least a majority ownership, equity, or financial interest.
1.49 Yahoo Directory means the browse tree (i.e., the taxonomy of
categories through which users navigate by clicking on category
links) within Yahoo’s principal, U.S.-targeted directory to the
World Wide Web, currently located at http://www.yahoo.com, which
browse tree currently resolves to dir.yahoo.com.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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1.50 Yahoo Foreign Properties means Yahoo’s or a Yahoo Affiliate’s
foreign-targeted network of media, communications and commerce
properties, including but not limited to those properties that are
branded in whole or in part by or on behalf of Yahoo or a Yahoo
Affiliate and presented in the local languages (e.g., Yahoo!
Germany, currently located at http://www.yahoo.de) and any other
foreign-targeted products or services that are developed and branded
in whole or in part by or on behalf of Yahoo or a Yahoo Affiliate.
1.51 Yahoo Foreign Vertical means any foreign-targeted, category-specific
property within the Yahoo Foreign Properties that is owned or
operated by or on behalf of Yahoo or a Yahoo Affiliate, including
but not limited to those presented in the local language (e.g.,
Yahoo! UK Shopping, currently located at
http://shopping.yahoo.co.uk, and Yahoo! Italia Finance, currently
located at http://finance.yahoo.it).
1.52 Yahoo Marks means trademarks, service marks or graphical brand
features of Yahoo in which Yahoo has prior rights.
1.53 Yahoo Network means Yahoo’s U.S. targeted network of media,
communications and commerce properties, including but not limited to
Yahoo Search, the Yahoo Verticals and any other U.S. targeted
products or services that are developed and branded in whole or in
part by or on behalf of Yahoo or a U.S. based Yahoo Affiliate;
provided that any entity or property acquired, developed, controlled
by or branded in whole or in part by or on behalf of Yahoo or a U.S.
based Yahoo Affiliate after the Effective Date with whom Overture
has a then-existing contractual relationship will continue to
perform under the existing contract with Overture (to the extent
that such performance is within the reasonable control of Yahoo)
and, upon request by Overture, Yahoo shall not send any Yahoo Search
Queries from any such entity in the event that no contractual
relationship exists between the entity and Overture at the time of
the date of acquisition, development or branding in whole or in
party by or on behalf of Yahoo.
1.54 [*].
1.55 Yahoo Results means search results sold, bartered or bonused by
Yahoo that are displayed in the Top Link Position solely on the
first Yahoo Search Results Pages displayed in response to a Yahoo
Search Query (i.e., no “next” Search Results Pages), unless Overture
delivers the same Overture Results for any Yahoo Search Query
according to Section 3.2 (in which case Yahoo will be entitled to
display the same Yahoo Result on subsequent Yahoo Search Results
Pages).
1.56 Yahoo Search means the search functionality within Yahoo’s
principal, U.S.-targeted directory to the World Wide Web, currently
located at http://www.yahoo.com, which search functionality
currently resolves either to search.yahoo.com or to
google.yahoo.com.
1.57 Yahoo Search Box means a graphical area substantially similar in
form to the example set forth in Exhibit B that appears on web pages
across the Yahoo Network, including but not limited to the front
page of Yahoo Search and all Yahoo Search Results Pages, through
which a user can only submit a search query that is [*] a keyword or
phrase that resolves to Yahoo Search. Additionally, searches
initiated by a user clicking on the “next” button on a Yahoo Search
Results Page and searches conducted after Yahoo provides the user
with the correction to a misspelled word (in which case the user may
click on the corrected spelling to connect to a Yahoo Search Results
Page) and “Related Searches” (or similar functionality) that appear
below the Featured Bottom Section as shown in Exhibit C will be
deemed as submitted through a Yahoo Search Box. For clarity, search
boxes that resolve to searchable directories other than [*] or
successor directories thereto (e.g., searches submitted through any
Yahoo Vertical, including but not limited to the search box that
resolves to the specialty directory within Yahoo’s
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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shopping-related property) are not Yahoo Search Boxes.
1.58 Yahoo Search Query means any search query comprised of a keyword or
phrase and initiated through the Yahoo Search Box by a U.S. User.
For clarity, search queries initiated through means other than the
Yahoo Search Box (e.g., searches initiated through any Yahoo
Vertical, including but not limited to the search box that resolves
to the specialty directory within Yahoo’s shopping-related property)
will not be deemed a Yahoo Search Query.
1.59 Yahoo Search Query Reports means information and data regarding (a)
the performance of the Overture Results, to the extent provided by
Yahoo and not collected by Overture directly, including but not
limited to Impressions, the association with Yahoo of [*] and the
total number of test queries performed by Yahoo; (b) the performance
of [*], which information and data falls within the same categories
as those listed in Exhibit F for which Overture must provide
information and data about the Overture Results (e.g., [*] average
cost per click and [*]); and, if applicable, (c) any statistics
provided by Yahoo regarding the number and type of Yahoo Search
Queries and U.S. Users.
1.60 Yahoo Search Results Pages means those web pages within Yahoo
Search, excluding the Jump Page, displayed in response to Yahoo
Search Queries.
1.61 Yahoo Top Link Coverage means the total number of Yahoo Search
Queries that resulted in Yahoo’s display of a Yahoo Result, divided
by the total number of Yahoo Search Queries, as calculated by Yahoo
on a Quarterly basis.
1.62 Yahoo Vertical means any U.S. targeted, category-specific property
within the Yahoo Network that is owned or operated by or on behalf
of Yahoo or a U.S. based Yahoo Affiliate, including but not limited
to Yahoo’s travel-related property (currently located at
http://travel.yahoo.com), finance-related property (currently
located at http://finance.yahoo.com), shopping-related property
(currently located at http://shopping.yahoo.com) and its
music-related property (currently located at
http://launch.yahoo.com).
2. Licenses and Ownership.
2.1 Licenses by Overture; Overture API and Licensed Materials. Subject
to the terms and conditions of this Agreement, Overture grants to
Yahoo a limited, non-exclusive, non-assignable, non-transferable,
non-sublicensable license during the Term to use the Overture API
solely for the purpose of enabling the exchange of Yahoo Search
Queries and Overture Results between the parties in accordance with
this Agreement and to reproduce, reformat and publicly display the
other Licensed Materials provided by Overture on Yahoo Search
Results Pages in accordance with this Agreement. Yahoo shall not
cache or store any Overture Results or any other Licensed Material.
2.2 Use of Reports.
(a) Use of Overture Reports. Yahoo may use the Overture Reports
and information disclosed under Section 8.4 only to verify
performance and payment under this Agreement, and may
reproduce the Overture Reports only as necessary to do so.
[*]. Within 10 days (unless such data is needed for a
potential dispute between the parties) after expiration or
termination of this Agreement, Yahoo shall delete and destroy
(and certify such destruction to Overture) or return to
Overture any and all copies of Overture Reports in Yahoo’s
possession and all copies disclosed to Yahoo Affiliates. Other
than the obligation to delete, destroy or return information,
this Section 2.2(a) terminates when the Agreement terminates
or expires.
(b) Use of Yahoo Search Query Reports. Overture may use the Yahoo
Search Query Reports and
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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information disclosed under Section 8.4 only to verify
performance under this Agreement or, as long as the Yahoo
Search Query Reports are not associated with Yahoo or
otherwise identifiable as being derived from Yahoo, for its
internal purposes (e.g., [*]) and may reproduce Yahoo Search
Query Reports as necessary to do so. [*]. Within 10 days
(unless such data is needed for a potential dispute between
the parties) after expiration or termination of this
Agreement, Overture shall delete and destroy (and certify such
destruction to Yahoo) or return to Yahoo any and all copies of
reports provided by Yahoo pursuant to Section 8.4(c). Other
than the obligation to delete, destroy or return information,
this Section 2.2(b) terminates when the Agreement terminates
or expires.
2.3 Use of Information and Data.
(a) Information and Data Collected by Yahoo. All information and
data provided to Yahoo by users on the Yahoo Network or the
Yahoo Foreign Properties or otherwise collected from users on
the Yahoo Network or the Yahoo Foreign Properties by Yahoo
will be retained and owned exclusively by Yahoo. Overture
acknowledges that certain of that information and data may be
related to the performance of the Overture Results (the
“Overture Performance Data”). [*]. This Section survives
expiration or termination of the Agreement.
(b) Information and Data Collected by Overture. All information
and data provided to Overture by users off the Yahoo Network
and the Yahoo Foreign Properties or otherwise collected from
users off the Yahoo Network and the Yahoo Foreign Properties
by Overture will be retained and owned exclusively by
Overture. Yahoo acknowledges that certain of that information
and data may be related to Yahoo Search Queries (the “Yahoo
Performance Data”). [*]. This Section survives expiration or
termination of the Agreement.
2.4 Ownership of Marks.
(a) Overture Marks. Yahoo will not contest the validity of, or
Overture’s ownership of, any of the Overture Marks. During the
Term, Yahoo will not, in any jurisdiction, adopt, use or
register, or apply for registration of, whether as a corporate
name, trademark, service mark or other indication of origin,
or as a domain name, any Overture Marks, or any word, symbol
or device, or any combination confusingly similar to any of
the Overture Marks.
(b) Yahoo Marks. Overture will not contest the validity of, or
Yahoo’s ownership of, any of the Yahoo Marks. During the Term,
Overture will not, in any jurisdiction, adopt, use or
register, or apply for registration of, whether as a corporate
name, trademark, service mark or other indication of origin,
or as a domain name, any Yahoo Marks, or any word, symbol or
device, or any combination confusingly similar to any of the
Yahoo Marks.
2.5 Overture Licensed IP.
(a) License Grant; Yahoo Results and Exclusive Results. In
consideration of the rights and benefits provided hereunder
(including but not limited [*]),
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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and subject to the terms and conditions of this
Agreement, Overture hereby grants to Yahoo during the Term of
this Agreement a non-exclusive, non-assignable (except as set
forth in Section 2.5(i) below), non-sublicensable,
non-transferable (other than an assignment under Section
2.5(i) below), world-wide [*] license, on an as is basis,
under the Overture Licensed IP to [*] and use an Equivalent
Search Product for the exclusive purpose of generating Yahoo
Results for display in the Top Link Position and Exclusive
Results as described in Sections 4.4 and 5.1(b).
(b) License Grant; Yahoo Verticals. Subject to the terms and
conditions of this Agreement, Overture hereby grants to Yahoo
and the Yahoo Affiliates a non-exclusive, non-assignable
(except as set forth in Section 2.5(i) below),
non-sublicensable, non-transferable (other than an assignment
under Section 2.5(i) below), world-wide, [*] license
exercisable during the Term, on an as is basis, under the
Overture Licensed IP to [*] and use an Equivalent Search
Product on any Yahoo Vertical and, to the extent that
Overture-supplied search results are displayed within [*]
during the Term, any Yahoo Foreign Vertical; provided that
Yahoo and Yahoo Affiliates will not [*] or use the Equivalent
Search Product under the foregoing license until the date that
is at least [*] after Yahoo gives written notice to Overture
that Yahoo or a Yahoo Affiliate intends to exercise the
foregoing license, and Yahoo will continue to give Overture
written notice for each subsequent Yahoo Vertical or Yahoo
Foreign Vertical in which it or a Yahoo Affiliate intends to
exercise the foregoing license. The parties agree to [*] to
discuss ways in which Overture can offer and provide [*] on
Yahoo Verticals and Yahoo Foreign Verticals. [*]. The term of
each license exercised by Yahoo under this Section 2.5(b)
shall continue until, but in no event extend beyond, [*],
unless earlier terminated by Yahoo according to Section
2.5(k).
(c) License Grant; Equivalent Search Products. Subject to
the terms and conditions of this Agreement, Overture hereby
grants to Yahoo and the Yahoo Affiliates a non-exclusive,
non-assignable (except as set forth in Section 2.5(i) below),
non-sublicensable, non-transferable (other than an assignment
under Section 2.5(i) below), world-wide, [*] license, on an as
is basis, under Overture Licensed IP to [*] and use an
Equivalent Search Product solely within (1) Yahoo Search; (2)
those Yahoo Verticals and Yahoo Foreign Verticals in which
Overture-supplied search results are displayed as of the day
before the date on which this Agreement either expires or
terminates other than by reason of Yahoo’s breach; and (3)
those Yahoo Verticals and Yahoo Foreign Verticals in which
Overture-supplied search results have been displayed at any
time during the Term, but only in the case that Overture has
ceased to supply such search results to that Yahoo Vertical or
Yahoo Foreign Vertical due to either Overture’s election to
discontinue the applicable search service or Yahoo’s election
to discontinue the applicable search service by reason of
Overture’s breach; provided that Yahoo and Yahoo Affiliates
will not [*] or use an Equivalent Search Product under the
foregoing license until expiration of this Agreement or
termination of this Agreement for any reason other than
Yahoo’s breach. The term of the license set forth in this
Section 2.5(c) shall continue until, but in no event extend
beyond, [*], unless earlier terminated by Yahoo according
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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to Section 2.5(k).
(d) License Restrictions.
(1) [*]. With respect to the licenses set forth in this
Section 2.5, the rights to [*] extend only to the
following circumstances:
(A) Yahoo and the Yahoo Affiliates will be entitled to
[*] the Equivalent Search Products;
(B) Yahoo and the Yahoo Affiliates will be entitled to
enlist Overture (subject to Overture’s agreement)
either (A) [*] of the Equivalent Search Products
for Yahoo or the Yahoo Affiliate; or (B) to
provide [*] of the Equivalent Search Products to
Yahoo or the Yahoo Affiliate (e.g., in the case
that Yahoo elects to use [*] as an Equivalent
Search Product, or as a component thereof); and
(C) Yahoo and the Yahoo Affiliates will be entitled to
[*] to build all or part of the Equivalent Search
Products [*]; provided that (i) the Equivalent
Search Products either are owned by Yahoo or a
Yahoo Affiliate or are [*] Yahoo or a Yahoo
Affiliate [*]; (ii) Yahoo operates and uses the
Equivalent Search Products [*]
Overture will be entitled to update the list of
Overture Disqualified Entities from time to time
in writing, [*].
(2) [*] Yahoo Search Boxes. Yahoo will not be entitled to
use any licenses hereunder in connection with [*]
according to Section 3.1 below.
(e) Overture Affiliate IP. With respect to the licenses granted
under this Section 2.5, Overture will undertake all reasonable
efforts to cause Overture Affiliates to grant to Yahoo
identical licenses under the Overture Affiliate IP in the
applicable regional markets. Notwithstanding the foregoing
sentence, to the extent that Overture elects to transfer any
Overture Licensed IP to any Overture Affiliate during the term
of any license granted under this Section 2.5, such that the
affected Overture Licensed IP becomes Overture Affiliate IP,
Overture will undertake all steps necessary to ensure that
Yahoo maintains the licenses hereunder to that Overture
Affiliate IP.
(f) Royalty. [*], the parties agree that the royalty payable under
the license set forth in [*] should be [*]. For purposes of
[*], a FMV royalty shall
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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mean a royalty that would be agreed upon by a willing licensee
and willing licensor in an arms length negotiation for a
license of a substantially similar scope to the license
granted under the applicable Section. Taking those factors
into account, the parties agree that the royalty payable by
Yahoo for exercise of the license under [*] (the “Applicable
Royalty”) shall be as follows:
(1) Upon Expiration. In the event of expiration of this
Agreement, the Applicable Royalty shall be as follows:
[*]
(2) Upon Termination. In the event of termination of this
Agreement under Section 15.4 (Termination for Change of
Control) or other termination of this Agreement other
than by reason of Yahoo’s breach, the Applicable Royalty
shall be as follows:
[*]
Under no circumstances shall the FMV royalty under [*] or the
Applicable Royalty under [*] be payable until Yahoo commences
to exercise the applicable license thereunder, nor shall it
extend beyond the term of the applicable license (and, in no
event, beyond [*]).
(g) Procedure for Determination of Royalty. Upon written notice by
Yahoo (1) no less than [*] days for purposes of Section
2.5[*], and (2) no sooner than [*] under Section 2.5(f)(2) for
purposes of Section 2.5[*], Yahoo and Overture will negotiate
in good faith and undertake commercially reasonable efforts to
establish a FMV royalty. Upon such notice, each party will
provide the other party with such information as the
requesting party may reasonably request for purposes of
establishing FMV, including but not limited to information
concerning royalty-rates or other consideration under any
other licenses granted by Overture under any Overture Licensed
IP. Failure to mutually agree upon a specific royalty within
[*] days after that notice will constitute an Escalation Event
under Section 16.5(a) below. If the procedures outlined under
Section 16.5(a) fail to resolve the royalty, then, unless the
parties mutually agree upon a third party appraiser to
determine FMV, the parties agree to submit the determination
of the royalty to arbitration. The arbitration will be
conducted in accordance with Section 16.5(b) below, except
that the Panel shall hold a hearing and render its decision
within 90 days after appointment of the third arbitrator of
the Panel. Either party shall be entitled from time to time to
request that FMV be re-determined in accordance with the
provisions of this Section 2.5(g), provided that such request
shall not be made within [*] months after the previous
determination of FMV; such re-determined FMV shall be used to
compute the Applicable Royalty prospectively, effective as of
the date such re-determination is requested in accordance with
the provisions of this Section 2.5(g).
(h) Other License Provisions. At the same time and under the same
procedure as for the determination of a royalty under
Subsection 2.5(g) above, the parties shall in good faith
negotiate to determine the remaining provisions of the
licenses under Sections 2.5[*], including but not
limited to provisions relating to payment procedure, reporting
procedure, record keeping requirements, audit procedure,
default and cure, termination and dispute resolution.
(i) Assignment. Notwithstanding the provisions of Section 16.2,
Yahoo may, [*] the prior
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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written consent of Overture, assign the licenses and other
rights granted under this Section 2.5 to any entity that
succeeds to all or substantially all of the assets and
liabilities of Yahoo. Upon such assignment, the license set
forth in this Section 2.5 will be binding upon and inure to
the benefit of the parties hereto and their successors and
assigns.
(j) Covenant not to Sue. Overture, on behalf of itself and the
Overture Affiliates, covenants that neither Overture nor the
Overture Affiliates will sue either (1) any advertiser for its
use of or participation in an Equivalent Search Product
operated by Yahoo or a Yahoo Affiliate in accordance with the
licenses granted hereunder; or (2) any third party other than
an [*] solely for its [*] in accordance with the licenses
granted hereunder. For clarity, nothing herein shall be deemed
to limit any claims of Overture against any third party with
respect to any act or omission other than [*] in accordance
with the licenses granted hereunder.
(k) Termination. Yahoo will be entitled to terminate the foregoing
licenses, in whole or as to any Overture Licensed IP, at any
time on written notice to Overture. Should Overture terminate
this Agreement under Section 15.2 below by reason of Yahoo’s
breach of this Agreement, all licenses under this Section 2.5
terminate. In addition, should Yahoo divest itself of all or
part of a Yahoo Affiliate, such that the affected Yahoo
Affiliate no longer is a Yahoo Affiliate as defined hereunder,
all licenses under this Section 2.5 terminate with respect to
that affected Yahoo Affiliate.
(l) Nothing in this Agreement shall be construed as imposing any
obligation upon Overture to provide any data, know-how or
other information to Yahoo or the Yahoo Affiliates under the
licenses identified in this Section 2.5.
2.6 Ownership; Reservation of Rights. This Agreement is not intended to
and shall not affect ownership by either party of any of its
intellectual property rights, content, products and services, and
nothing set forth in this Agreement shall be construed as the
assignment or transfer of any ownership rights in any of the
foregoing from one party to the other. Other than the express
licenses set forth in this Section 2, nothing in this Agreement, and
nothing in any press release or other statement made in connection
with this Agreement (including but not limited to the press release
planned under Section 12.3 below), will be deemed a license (by
implication, estoppel or otherwise) under either party’s patent
rights or other intellectual property rights. Nothing in this
Agreement, and nothing in any press release or in any other
statement made in connection with this Agreement, will be deemed an
admission by either party that any existing, planned or contemplated
products, services or technology of the other party infringes or
does not infringe its (or a third party’s) patent or other
intellectual property rights or that the other party’s (or a third
party’s) patent or other intellectual property is valid. Likewise,
neither party’s performance according to the terms and conditions of
this Agreement will in any way broaden the intellectual property
rights of the other party. Both parties reserve all rights not
expressly granted.
2.7 Non-Waiver of Claims. Nothing herein constitutes a waiver of any
pre-existing claims of one party against entities, or with respect
to businesses, services or product lines, acquired by the other
party during the Term of this Agreement or the term of a license
under Section 2.5 above.
3. Maintenance of Yahoo Search Box; Delivery of Yahoo Search Queries.
3.1 Yahoo Search Box. Yahoo will enable all U.S. Users to initiate Yahoo
Search Queries through the Yahoo Search Box. Yahoo will display the
Yahoo Search Box on the front page of Yahoo Search and all Yahoo
Search Results Pages. Yahoo will be entitled to display
commerce-related “universal” search boxes (i.e., shopping and/or
auctions) on the front page of Yahoo Search no
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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more than 5 days in a month. The Yahoo Search Box shall be the only
[*] search functionality for general searches (e.g., [*]) of the
World Wide Web displayed within the Yahoo Network during the Term
(e.g., [*]). Yahoo will be entitled to [*] and to derive search
traffic [*] (or similar search functionality) on [*] provided that
such search traffic is directed to the Yahoo Search Results Pages.
If Yahoo exercises its rights under the preceding sentence, then the
parties will negotiate in good faith for the purpose of executing an
amendment to this Agreement, which amendment will, at Overture’s
option, either (a) address the manner in which [*] and the method by
which Yahoo will be compensated for such traffic; or (b) provide for
the suppression of [*] for those Yahoo Search Results Pages
displayed in response to a Yahoo Search Query from this [*], in
which case the resulting Impression would not be counted hereunder
and the provisions of Section 7 would not apply.
3.2 Yahoo Search Queries; Delivery by Yahoo. Except as set forth in
Section 5.4, Yahoo will send the Yahoo Search Query to Overture each
and every time that a U.S. User initiates a search through a Yahoo
Search Box. When a U.S. User submits a Yahoo Search Query by
clicking on the “next” button on a Yahoo Search Results Page, Yahoo
will differentiate the Yahoo Search Query in a manner acceptable to
Overture so that Overture can deliver Overture Results that differ
from those Overture Results appearing on the prior Yahoo Search
Results Pages. Notwithstanding the foregoing, Yahoo acknowledges and
agrees that Overture will be entitled to deliver the same Overture
Results for any Yahoo Search Query initiated by a “next” button to
the extent that Overture does not have additional Overture Results
for the keyword or phrase. As of the Effective Date, the parties do
not intend this Agreement to apply to Yahoo Search or to any search
functionality within a Yahoo Vertical to the extent that the search
functionality is accessed or enabled through wireless or voice
services (however, the parties may include such wireless and voice
services during the Term by mutual consent).
4. Delivery and Maintenance of Overture Results.
4.1 Delivery by Overture. After receiving a Yahoo Search Query from
Yahoo, Overture will deliver to Yahoo, according to the Service
Level Agreement attached hereto as Exhibit A, either Overture
Results or a response that no results are being delivered for that
Yahoo Search Query. Overture will be entitled to redirect URLs
embedded within the Overture Results in the process of transferring
a user to the Advertiser site promoted within the applicable
Overture Result, so that Overture is able to record Actual Clicks.
(a) Remedies. The parties acknowledge that it is in the financial
best interest of both parties to avert Unresolved Catastrophic
Problems and Recurrent Problems, as such terms are defined in
the Service Level Agreement attached as Exhibit A hereto and
this Agreement, respectively, and that the damages
attributable to such Unresolved Catastrophic Problems and
Recurrent Problems would be difficult to ascertain. Therefore,
the parties have specified the liquidated damages below as a
reasonable estimate of such damages and as each party’s sole
and exclusive remedy other than termination (in the event of
an uncured, material breach pursuant to Section 15.2 below)
for such Unresolved Catastrophic Problems that prevent
Overture from fulfilling its delivery obligations pursuant to
Section 4.1 above and for Recurrent Problems. For purposes of
this Section 4.1, a “Recurrent Problem” means any Problem,
Severe Problem, or Catastrophic Problem (each, individually, a
“Recurrent Problem Element”), or any combination of Recurrent
Problem Elements, which renders the Overture Results
unavailable or unusable for more than [*] in any [*], and is
attributable to a single party.
(1) Yahoo Remedy for Unresolved Catastrophic Problems. For
any Unresolved Catastrophic Problem within the
reasonable control of Overture, Overture will pay to
Yahoo an amount calculated as [*] of Gross Revenue that
Yahoo would have earned pursuant to this Agreement
during the period beginning [*] after the earlier of
Overture’s
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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learning of, or Yahoo’s providing notice to Overture
that a Problem, Severe Problem or Catastrophic Problem
attributable to Overture has been detected but not
resolved. Overture’s liability for such payment will not
extend beyond the point in time when (i) Overture has
resolved the Catastrophic Problem, even if Yahoo has
elected to manually override pursuant to Section IV(F)
of the Service Level Agreement; or (ii) a Yahoo
Technical Lapse is in effect. For clarity, Overture’s
liability would continue to accrue incrementally if
Yahoo resolves such Technical Lapse but Overture has not
resolved the Catastrophic Problem.
(2) Overture Remedy for Unresolved Catastrophic Problems. In
the event of any Unresolved Catastrophic Problem within
the reasonable control of Yahoo, Yahoo will pay to
Overture an amount calculated as [*] of Gross Revenue
that Overture would have earned pursuant to this
Agreement during the period beginning [*] after the
earlier of Yahoo’s learning of, or Overture’s providing
notice to Yahoo that a Problem, Severe Problem or
Catastrophic Problem attributable to Yahoo has been
detected but not resolved. Yahoo’s liability for such
payment will not extend beyond the point in time when
(i) Yahoo has resolved the Catastrophic Problem to meet
the acceptable performance standards set forth in the
Service Level Agreement, or (ii) a technical lapse by
Overture (such as a Problem, Severe Problem or
Catastrophic Problem attributable to Overture) is in
effect. For clarity, Yahoo’s liability would continue to
accrue if Overture resolves such technical lapse but
Yahoo has not resolved the Catastrophic Problem.
(3) The Parties’ Remedies for Recurrent Problems. The party
responsible for any Recurrent Problem will pay the
non-breaching party (the “NBP”) an amount calculated as
the [*] of Gross Revenue that the NBP would have earned
during the total period in which the Recurrent Problem
Elements occurred. The beginning of this period
commences [*] after the party that is responsible for
the Recurrent Problem initially learns of, or receives
notice of, the occurrence of the first Recurrent Problem
Element in the Recurrent Problem. The liability of the
party responsible for the Recurrent Problem will not
extend beyond the point in time when the responsible
party has resolved the final Recurrent Problem Element
in the Recurrent Problem and will not include periods
when the NBP experiences a technical lapse during a
Recurrent Problem Element. For clarity, the responsible
party’s liability would continue to accrue incrementally
if the NBP resolves such technical lapse but the
responsible party has not resolved the Recurrent Problem
Element.
4.2 Suppression by Overture. Overture will suppress delivery of certain
Overture Results to Yahoo in accordance with the following:
(a) [*]-Related Overture Results. Overture will suppress
[*]-related Overture Results, at a minimum, to the same degree
as the [*] that appear on the Overture Site as of the
Effective Date. Upon receipt by Overture of [*] Yahoo Search
Query for which Overture has [*] Overture Results, Overture
will send to Yahoo such [*] Overture Results. For all other
[*] Yahoo Search Queries, Overture shall not return any
Overture Results, and if Overture does send an Overture
Result, then Yahoo shall be entitled to block such Overture
Result from being displayed pursuant to Section 4.5(a) below.
The parties acknowledge and agree that the delivery of
[*]-related Overture Results to Yahoo is not contemplated by
this Agreement and, thus, [*].
(b) Overture Results related to [*]. Overture will suppress
Overture Results that link directly to a page owned or
operated by [*].
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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(c) Overture Results in response to Excluded Terms. Overture will
not deliver Overture Results to Yahoo in response to a U.S.
User’s search of the Yahoo Search for an Excluded Term.
(d) Overture Results identified by Yahoo. Upon a reasonable
request by Yahoo according to Section 4.5 below, Overture
agrees to cease delivery of the affected Overture Result.
(e) Suppression of all Overture Results. Overture will be entitled
to cease delivery of all Overture Results for any Yahoo Search
Query in Overture’s keyword marketplace that triggers
Overture’s compliance obligations under this Section 4.2.
4.3 Display by Yahoo. After receiving Overture Results from Overture in
response to a Yahoo Search Query, Yahoo will display the Required
Number of Overture Results in the Featured Sections as provided for
in this Agreement, unless Overture provides less than the Required
Number of Overture Results to Yahoo in response to the particular
Yahoo Search Query, in which case Yahoo will display all Overture
Results provided by Overture in the Featured Sections.
(a) Order and Appearance. On the Effective Date and during any
population test pursuant to the Estimated Yahoo Payment and
Guaranteed Fixed Payment Adjustment Process set forth in
Exhibit K, the Yahoo Search Results Page shall be displayed as
provided for in Exhibit C. Yahoo will display the Overture
Results in the order provided by Overture. Yahoo will display
Overture Results in the Featured Sections with Overture’s full
title and a truncated description, both of which together will
consist of no less than 88 characters (as shown in the mock-up
attached as Exhibit C hereto), as well as with the full URL of
the web page associated with each Overture Result. When viewed
via Microsoft’s principal “Internet Explorer” browser product
(U.S. versions 4.0 and higher) on the Microsoft Windows
platform or any other browser that easily supports a mouse
over implementation, the title will give rise to the full
description to the extent that the user passes his or her
cursor over the title (a “Mouse Over”), which Mouse Over will
be substantially similar in form to the example set forth in
Exhibit C. Yahoo will not modify [*] of the Overture Results,
except that Yahoo will truncate the description as described
in the foregoing sentence. The only content in the Featured
Sections shall be the Overture Results and the Yahoo Results,
as provided for in this Agreement. All of the Search Result
Characteristics of the Overture Results and the Yahoo Results
in the Featured Sections, as well as the Exclusive Result,
shall be identical. To the extent that the [*] of the Overture
Results and the [*] are not identical to the Main Body Search
Results, Yahoo will provide Overture with written notice, and
any dispute regarding the difference between [*] will be
deemed an Escalation Event that is not subject to arbitration
under
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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Section 16.5(b) below (i.e., [*]). The entire first search
result in the Featured Top Section shall appear Above the
Fold. The heading of the Featured Sections shall be “Sponsor
Matches” or such other heading as is mutually agreed upon by
the parties. Yahoo agrees that it will not [*].
(b) Increases in the Required Number of Overture Results. Yahoo
will be entitled to increase the number of Overture Results
that appear within the Featured Sections as long as Yahoo (a)
provides Overture with no less than [*] prior written notice
of the increase setting forth the keywords and terms for which
the number of Overture Results shall be increased and the
duration of time that the increase will last (which in no
event shall be less than [*]); (b) enlarges the applicable
Featured Section, as determined by Yahoo, proportionally to
account for the increased number of Overture Results; and (c)
confers with Overture regarding possible revisions to the
Service Level Agreement in order to account for the additional
Overture Results and, to the extent that the parties cannot
agree on the appropriate revision or whether a revision to the
Service Level Agreement is warranted at all, the parties will
resolve the issue via the escalation provisions set forth in
Section 16.5(a). If Yahoo elects to [*] within the Featured
Sections after the date that is [*] from the Effective Date,
then Yahoo will provide Overture with [*] days prior written
notice, and Yahoo agrees to add one additional Overture Result
to the Featured Top Section with respect to [*] keywords or
phrases upon which the parties mutually agree, which agreement
will not unreasonably withheld, for the period during which
[*].
(c) No Incentives to Click. Yahoo will not provide users with any
incentives (e.g., points or special offers) to click on
Overture Results.
4.4 Preemption by Yahoo. In response to Yahoo Search Queries, Yahoo will
be entitled to display either (a) one Yahoo Result on the first
Yahoo Search Results Pages, unless Overture delivers the same
Overture Results for any Yahoo Search Query according to Section 3.2
(in which case Yahoo will be entitled to display the same Yahoo
Result on subsequent Yahoo Search Results Pages), in the Top Link
Position; or (b) one Exclusive Result (as defined below) in the
“Yahoo! Exclusives” (or similarly named) section of the Yahoo Search
Results Pages according to Section 5.1(b) below. If Yahoo elects to
display a Yahoo Result in the Top Link Section in response to a
particular Yahoo Search Query, then the Required Number of Overture
Results in the Featured Top Section for the particular Yahoo Search
Query will be reduced to two.
4.5 Removal by Yahoo; Potential Liability; Excluded Terms; Contextual
Relevance. Yahoo will be entitled to block the display of any
Overture Result for which Overture has an obligation to suppress
delivery pursuant to Section 4.2 and this Section 4.5.
(a) Overture Results that Yahoo deems Objectionable. As it
consistently administers its company-wide advertising
policies-(e.g., [*]), Yahoo will be entitled to block Overture
Results that do not comply with such policies from the Yahoo
Search Results Pages or to amend the list of Excluded Terms to
include any keywords or phrases to which those Overture
Results relate, as reasonably determined by Yahoo. Yahoo also
will be entitled to block or to request removal of any
Overture Results that [*]. Yahoo also will be entitled to
block or to request removal of any Overture Results that, in
Yahoo’s reasonable belief, might [*] or might [*]. In any
event, Yahoo agrees to notify Overture and to provide Overture
with an electronic copy of the Overture Results that give rise
to Yahoo’s request.
(b) Overture Results that Yahoo deems Contextually Irrelevant. As
it consistently administers its Yahoo Search-wide editorial
policies, Yahoo will be entitled to block or to request
removal of any Overture Results that are not contextually
relevant to the Yahoo Search Query. The
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect
to the omitted portions.
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parties will discuss relevancy issues in good faith, including
but not limited to the means for resolving relevancy issues
(e.g., revision of title and description, filter or removal).
Any disagreement between Overture and Yahoo concerning whether
an Overture Result is contextually relevant under this Section
4.5(b) shall give rise to an Escalation Event.
4.6 Yahoo Suppression. Yahoo will suppress delivery of certain Yahoo
Results in accordance with the following:
(a) Results that Overture deems Potentially Damaging. Overture
will be entitled to request that Yahoo not display any Yahoo
Results that, in Overture’s reasonable belief, might subject
Overture to criminal or civil liability.
(b) Contextual Relevance. As it consistently administers its
editorial policies, Overture will be entitled to request that
Yahoo not display any Yahoo Results that are not contextually
relevant to the Yahoo Search Query. The parties will discuss
relevancy issues in good faith, including but not limited to
the means for resolving relevancy issues (e.g., revision of
title and description, filter or removal). Any disagreement
concerning this Section 4.6(b) shall give rise to an
Escalation Event.
5. Yahoo Search Results Pages; Featured Sections.
5.1 Creation and Maintenance of Yahoo Search Results Pages. Yahoo will
create and maintain the Yahoo Search Results Pages during the Term
and, except as set forth in Section 5.4, display a Yahoo Search
Results Page in response to the submission of every Yahoo Search
Query.
(a) Editorial Control. Yahoo will be solely responsible for the
design, layout, “look and feel,” posting and maintenance of
the Yahoo Network, including but not limited to the Yahoo
Search Results Pages and any sections thereof. Notwithstanding
any provision herein to the contrary, except Section 4.3(a)
and the introductory paragraph thereto which contain the
minimum display requirements, Yahoo will be entitled to
redesign or modify [*], of the Yahoo Network, including but
not limited to the Yahoo Search Results Pages and any sections
thereof. Yahoo will undertake commercially reasonable efforts
to provide Overture with a reasonable amount of notice prior
to implementing any Redesign of the Yahoo Search Results
Pages.
(b) Pre-Approved Change to Yahoo Search Results Pages. With
respect to Yahoo Search Results Pages on which Yahoo does not
display a Yahoo Result, Overture hereby approves Yahoo’s
creation and display of a “Yahoo! Exclusives” (or similarly
named) section on the Yahoo Search Results Pages, which
section will include no more than one search result (an
“Exclusive Result”) and might appear above the Featured Top
Section.
(c) Acknowledgement of Redesign. The parties acknowledge and agree
that Yahoo might implement more than one “look and feel” for
the Yahoo Search Results Pages, which “look and feel” could
vary based on the nature of the Yahoo Search Query, as
determined by Yahoo.
(d) “Sponsor Matches” Link. Both parties acknowledge and agree
that, with respect to the page to which users navigate
directly from the “What are Sponsor Matches?” link (as shown
on the mock-up) or other similar link on the Yahoo Search
Results Page (the “Help Page”), the Help Page that has been
used prior to the Effective Date shall be the Help Page that
is used after the Effective Date, unless otherwise mutually
agreed upon by the parties.
5.2 Creation and Maintenance of Featured Sections. Yahoo will create and
maintain the Featured Sections on the Yahoo Search Results Pages
throughout the Term in accordance with the terms of
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect
to the omitted portions.
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this Agreement, including but not limited to Section 4.3(a) above.
On the Effective Date and during any population test pursuant to the
Estimated Yahoo Payment and Guaranteed Fixed Payment Adjustment
Process set forth in Exhibit K, the Featured Sections shall be
displayed as provided for in Exhibit C.
5.3 Blocked Content. Yahoo will undertake commercially reasonable
efforts not to sell advertising units (including but not limited to
pop-up windows) that block any portion of a user’s view of the
Overture Results [*].
5.4 Jump Page displayed in response to Hybrid Search Queries. With
respect to [*] Yahoo Search Queries for which “filtered” Overture
Results are available (the “Hybrid Search Queries”), Yahoo will be
entitled to present a jump page (the “Jump Page”) to each and every
U.S. User in response to that U.S. User submitting a Hybrid Search
Query, which Jump Page will (a) inform the U.S. User that the Hybrid
Search Query is likely to return [*] search results; (b) enable the
U.S. User to navigate directly to a contextually relevant Yahoo
Search Results Page and, to the extent that the U.S. User selects
this option, Yahoo will send the Hybrid Search Query to Overture in
accordance with Section 3.2 above; (c) enable the U.S. User to
submit a new Yahoo Search Query; and, in some cases, (d) enable the
U.S. User to navigate directly to a page within a third party web
site on which contextually relevant [*] search results are
displayed, thereby terminating the Hybrid Search Query. Any other
treatment of Hybrid Queries will be subject to mutual agreement of
the parties. The parties acknowledge and agree that the Jump Page
does not constitute a Yahoo Search Results Page, and that Yahoo’s
treatment of Hybrid Search Queries in this manner does not
constitute a breach of this Agreement. The parties further
acknowledge and agree that the delivery of [*] Overture Results to
Yahoo is not contemplated by this Agreement and, thus, Yahoo [*].
6. Technical Implementation; Interaction between the Parties.
6.1 Compliance with Service Level Agreement. Each party will comply with
the terms and conditions of the Service Level Agreement attached
hereto as Exhibit A.
6.2 Technical Resources; Quarterly Meetings. During the Term, each party
will contribute those technical resources reasonably necessary to
facilitate the exchange of Yahoo Search Queries and Overture Results
and the improvement of the tracking and reporting outlined in
Section 8.4 below. The search product development teams of the
parties will meet no less than once per Quarter to exchange
information regarding relevance of Overture Results and Yahoo
Results and developing trends in the search product market.
6.3 No Disparaging Comments. Yahoo will not post any disparaging
comments attributable to Yahoo about Overture or the Overture
Results on Yahoo Search and the accompanying directory property
during the Term (e.g., "The Overture Results are bad... purchase
Yahoo!'s paid listings by clicking on the Sponsor Matches links to
Advertiser Services!"), and Overture will not post any disparaging
comments attributable to Overture about Yahoo or Yahoo
Search on the Overture Site during the Term. In addition, during the
Term, Yahoo agrees (a) not to use Overture’s Confidential
Information, the Overture Results or the Overture Reports for the
purpose of selling Overture advertisers placement in any Yahoo
search sponsor matches program; (b) not to target Overture
advertisers by parsing the Overture XML feed for Overture advertiser
contact information or by obtaining such information from another
source provided by Overture. Notwithstanding the foregoing, under no
circumstances shall this Agreement be deemed to restrict Yahoo in
any manner from: (1) marketing any Yahoo product or service
(including but not limited to any Yahoo sponsor matches program) to
any existing Yahoo advertiser, content provider, or Yahoo registered
user; (2) marketing any Yahoo product or service to any potential
Yahoo
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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advertiser through “one-to-one” contacts (e.g., telephone calls,
letter, e-mails, sales calls); or (3) marketing any Yahoo product or
service through any mass media (e.g., television, radio, print,
online) that does not specifically target Overture advertisers by
name. For clarity, individual Yahoo! salespeople may distinguish
Yahoo! sponsor matches programs from Overture’s by comparing aspects
of the two programs (e.g., click-through rates, advertiser satisfaction).
6.4 Co-Marketing Opportunities. The parties agree to deliver marketing
messages on behalf of each other via email or other means, the
recipients, content and timing of which will be mutually agreed upon
by the parties, which approval shall not be unreasonably withheld.
7. Exclusivity; Additional Domestic Opportunities; International.
7.1 Exclusivity.
(a) General. Except as set forth herein, the Overture Results will
be the only Restricted Search Results displayed by Yahoo
within [*] during the Term. In addition, other than Yahoo
Results and Exclusive Results displayed by Yahoo in accordance
herewith and any search results for which Yahoo is compensated
through its [*], Yahoo will not display within Yahoo Search
any [*]. Finally, Yahoo will not display Paid Advertising that
promotes the Restricted Search Results of any [*] in the area
between the [*] and the [*] or [*] or [*] of the Featured Top
Section.
(b) [*]. During the Term, Yahoo will not enter into any agreement
with any third party under which Yahoo is supplied with (1)
[*] products for use within [*]; or (2) [*] products for use
on the Yahoo Network, which [*] products (i) are [*] to
Overture’s [*] search service as of the Effective Date; and
(ii) assemble Restricted Search Results for display in
response to general searches [*]. During the Term, if [*]
offers a service outside the scope of the [*], then Yahoo is
free to utilize that service on the Yahoo Network, subject to
Section 7.3 below.
7.2 Exclusions; Clarifications; Acknowledgements.
(a) Exclusions; Yahoo Listings and [*]. Notwithstanding anything
to the contrary in this Agreement, Yahoo will be entitled to
continue to offer and grow its listings businesses (e.g.,
[*]), as long as Yahoo does not place its directory “Sponsor
Listings” (or similarly named listings) within Yahoo Search in
a manner that [*] (for clarity, [*]). In addition,
notwithstanding anything to the contrary in this Agreement,
Yahoo will be entitled to monetize all or part of the Main
Body Search Results by
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect
to the omitted portions.
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EXECUTION CONFIDENTIAL
implementing [*], provided that Yahoo will notify Overture,
and discussions arising therefrom will be deemed an Escalation
Event (with the criteria being whether [*]), before Yahoo
itself [*] (or instructs the [*]) to the fact that a Main Body
Search Result is paid. Any [*] results will be displayed with
the same Search Result Characteristics as the other Main Body
Search Results, and the [*] results may not be displayed in a
separate section, but rather must be displayed among the other
Main Body Search Results. Overture acknowledges and agrees
that (1) Yahoo may not have control over [*]; and (2) Yahoo
uses and will continue to use the fact that a web site within
its directory is [*] for display in the Main Body Search
Results.
(b) Clarifications; U.S. Users. For clarity, the exclusivity set
forth in this Section 7 extends to U.S. Users on Yahoo Search
only, unless the parties mutually agree in an executed
amendment to this Agreement to broaden the exclusivity to
include New Domestic Opportunities or International
Opportunities as set forth in Section 7.3 and 7.4 below.
(c) Acknowledgements; European Users on Yahoo Search. Overture
acknowledges and agrees that Yahoo has entered into agreements
with (a) LookSmart International Pty Limited (“LookSmart
Australia”) under which, among other things, LookSmart
Australia provides and Yahoo displays Restricted Search
Results in response to search queries submitted to Yahoo
Search from Internet Protocol addresses within Australia or
New Zealand, as measured by Yahoo; and (b) eSpotting Media
(UK) Limited (“eSpotting UK”) under which, among other things,
eSpotting UK might provide and Yahoo might display Restricted
Search Results in response to search queries submitted to
Yahoo Search from Internet Protocol addresses within Europe,
as measured by Yahoo. Overture agrees that nothing in this
Agreement will be construed to prohibit, restrict, or
otherwise prevent Yahoo from continuing to participate in and
pursue the foregoing relationships, as long as these pursuits
do not violate this Agreement. Nothing in this provision or
Agreement shall be construed to constitute an admission by
Overture that any third party system does not infringe any
Overture intellectual property right. Further, nothing in this
provision or Agreement shall preclude Overture from asserting
a claim for infringement against any third party for
infringement of Overture’s intellectual property or seeking an
injunction against providing infringing search results to
others, including Yahoo.
7.3 Additional Domestic Opportunities. If, during the Term, Yahoo elects
to create a new opportunity for a [*] for display on the Yahoo
Network but outside Yahoo Search and Yahoo Directory (the “New
Domestic Opportunity”), then Yahoo will provide Overture with
written notice that sets forth Yahoo’s business requirements for the
New Domestic Opportunity. The parties will negotiate in good faith
for the purpose of executing an amendment to this Agreement under
which Overture will provide the New Domestic Opportunity under
reasonable terms and conditions. [*].
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXECUTION CONFIDENTIAL
7.4 International Opportunities. The parties will negotiate in good
faith for the purpose of executing an amendment to this Agreement
under which Overture or an Overture Affiliate will provide
Restricted Search Results within certain mutually agreed upon areas
of those Yahoo Foreign Properties located within the [*], which
provision by Overture cannot occur until Yahoo’s or the Yahoo
Affiliate’s pre-existing contractual obligations with respect to the
display of Restricted Search Results on the [*] expire or terminate.
If, during the Term, Yahoo or a Yahoo Affiliate elects to create a
new opportunity for a third party to provide Yahoo with Restricted
Search Results for display on any Yahoo Foreign Property (the
“International Opportunity”), then Yahoo will provide Overture with
written notice that sets forth Yahoo’s business requirements for the
International Opportunity. The parties will negotiate in good faith
for the purpose of executing an amendment to this Agreement under
which Overture will provide the International Opportunity under
reasonable terms and conditions. [*]. Upon Overture providing
services in a new market under this Agreement, whenever a user of
such market conducts a search on Yahoo Search, Yahoo shall display
Overture’s search results for that market and not the Overture
Results.
8. Overture’s Payment Obligations. Overture will make payments to Yahoo in
accordance with the following:
8.1 Guaranteed Fixed Payments. Overture will make the applicable
Guaranteed Fixed Payment to Yahoo within [*] days after the start of
the applicable Quarter according to the schedule set forth below,
unless the applicable Guaranteed Fixed Payment is reduced according
to Section 8.7 below. If the parties reasonably believe that a
Revenue Share Payment will be less than the Guaranteed Fixed Payment
in a particular Quarter, then Overture shall pay to Yahoo a [*]
reasonable estimate of the next Guaranteed Fixed Payment due (which
reasonable estimate shall not bind either party to such number) and,
once the parties determine the correct Guaranteed Fixed Payment for
that Quarter according to Section 8.7 below, the party that owes
money to the other shall pay the same. If Yahoo owes money to
Overture, then Overture shall be entitled to reduce its next
payment(s) by the amount that is owed until the entire amount has
been repaid.
—-----------------------------------------------------------
Quarter Guaranteed Fixed Payment
—-----------------------------------------------------------
Q1 $[*]
—-----------------------------------------------------------
Q2 $[*]
—-----------------------------------------------------------
Q3 $[*]
—-----------------------------------------------------------
Q4 $[*]
—-----------------------------------------------------------
Q5 $[*]
—-----------------------------------------------------------
Q6 $[*]
—-----------------------------------------------------------
Q7 $[*]
—-----------------------------------------------------------
Q8 $[*]
—-----------------------------------------------------------
Q9 $[*]
—-----------------------------------------------------------
Q10 $[*]
—-----------------------------------------------------------
Q11 $[*]
—-----------------------------------------------------------
Q12 $[*]
—-----------------------------------------------------------
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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—-----------------------------------------------------------
Each Quarter of any Extension Term $[*]
—-----------------------------------------------------------
8.2 Revenue Share Payments. Overture will make Quarterly revenue share
payments (the “Revenue Share Payments”) to Yahoo based on Gross
Revenue in the applicable Quarter according to the schedule set
forth below, but only to the extent that the applicable Revenue
Share Payment exceeds the applicable Guaranteed Fixed Payment made
by Overture (e.g., if the Revenue Share Payment for the applicable
Quarter were to exceed the Guaranteed Fixed Payment made by Overture
for the applicable Quarter, then Overture would make a payment to
Yahoo in the amount of the difference between the applicable Revenue
Share Payment and the applicable Guaranteed Fixed Payment). [*].
Percentages of Gross Revenue apply solely to Gross Revenue within
each of the ranges listed below (i.e., [*]). Revenue Share Payments
are due and payable to Yahoo within [*] days after the end of the
applicable Quarter.
[*]
Overture will retain all revenue that it derives from the Overture
Results, except as specifically set forth in this Agreement.
8.3 Advance Payment; Renewal Fee; Prior Agreement True-Up.
(a) Advance Payment. On or before the date that is [*] days after
the Effective Date, Overture shall pay to Yahoo, as an advance
payment, [*] of the Guaranteed Fixed Payment due for [*] as
specified in Section 8.1 above (the “Advance Payment”). If
this Agreement is terminated prior to the end of the [*], then
Yahoo will apply the Advance Payment to any amount owed by
Overture to Yahoo hereunder. If the Advance Payment is greater
than the amount owed by Overture to Yahoo hereunder, then the
difference between the amount of the Advance Payment and the
amount owed by Overture to Yahoo hereunder shall be refunded
to Overture within [*] days after the effective date of
termination.
(b) Renewal Fee. If Yahoo irrevocably exercises its First Option
(as defined below) according to Section 10 below and so
notifies Overture in writing no later than April 30, 2004,
then Overture shall pay to Yahoo a renewal fee in the amount
of $2,000,000 within 60 days after Yahoo’s notice.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXECUTION CONFIDENTIAL
(c) Prior Agreement True-Up. The parties acknowledge and agree
that, under the Prior Agreement and in consideration of
Yahoo’s performance under the Prior Agreement, Overture owes
additional fees in the amount of $[*] (the “True-Up Payment”).
Overture shall pay the True-Up Payment to Yahoo within [*]
days after the Effective Date.
8.4 Tracking; Reporting.
(a) Tracking. Yahoo will include [*] search URLs or other source
feed indicators provided by Overture (the “Tags”) for (i) [*];
(ii) Yahoo Search Results Pages within the Yahoo Network
within which Overture Results are displayed and (iii) any
search service testing performed by Yahoo related to the
Overture Results. Overture will use the Tags solely for [*].
(b) Overture Reporting. Overture will be responsible for tracking
and calculating Gross Revenue and Revenue Share Payments.
Overture will provide Yahoo a monthly report that sets forth
in reasonable detail the information listed in Exhibit F (the
“Overture Reports”) in a format to be mutually agreed upon by
the parties. All reports provided hereunder will be
accompanied by a certificate of accuracy, signed by Overture’s
Chief Financial Officer or similar officer with responsibility
for the reporting function.
(c) Yahoo Reporting. Yahoo will provide Overture with access to
either offline reports or an online database (and each of
which will be deemed Yahoo Search Query Reports to the extent
reduced to tangible form by or for Overture) that sets forth
Yahoo’s calculation of the Yahoo Search Queries, Impressions
and “next” button Yahoo Search Queries delivered hereunder in
the aggregate, as well as the number and percentage of
Timeouts (as that term is defined in the Service Level
Agreement attached hereto as Exhibit A) and the number of
times that Yahoo displayed an impression that was not in
compliance with the terms of this Agreement. The Impression
information shall be reflected in the on-line reporting
database within 48 hours. In addition, with respect to the
Yahoo Results and Exclusive Results, Yahoo will provide
Overture with a Yahoo Search Query Report that sets forth in
reasonable detail monthly Impressions for the Yahoo Results
and Exclusive Results in the aggregate and the aggregate
information and data that falls within the same categories as
those listed in Exhibit F for which Overture must provide
information and data about the Overture Results (e.g., total
clicks, average cost per click and average click-through
rate). All reports provided hereunder will be accompanied by a
certificate of accuracy, signed by Yahoo’s Chief Technology
Officer or similar officer with responsibility for the
reporting function.
(d) `Bot Traffic. Yahoo will implement a tracking solution that
tracks the number of Impressions (i.e., a tracking solution
that determines which Yahoo Search Queries were performed by
U.S. Users, thereby qualifying as Yahoo Search Queries, and
which search queries were performed by `bots, metaspiders,
macro programs, Internet agents, any other automated means, or
by Yahoo as part of any testing in accordance with the
subsection (e) below and the Service Level Agreement).
(e) Mutual Exchange of Information. The parties hereby agree to
negotiate in good faith for [*] days following the Effective
Date to provide an exchange of information during the Term
that (i) enables either Overture to develop its own reasonable
estimates of `bot traffic in addition to the numbers reported
in the Yahoo Search Query Reports or Yahoo to develop its own
marketplace for the Yahoo Results and Exclusive Results, (ii)
does not violate any law or regulation affecting user privacy,
(iii) provides contractual assurances to each party that such
information will not be used for any purpose other than those
set forth in subsection (i) above, and (iv) provides standards
for storing and destroying such information. The parties
acknowledge and agree that the goal of this Section 8.4(e) is
to exchange that information
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXECUTION CONFIDENTIAL
reasonably necessary for each party to administer this
Agreement on a timely basis and to mutually determine relative
fault for adjustments to the Estimated Yahoo Payment and the
Guaranteed Fixed Payments under Section 8.7 below. Any failure
to complete such negotiations will trigger an Escalation Event
pursuant to Section 16.5(a) below.
(f) Testing. Yahoo agrees to (i) identify search queries submitted
by Yahoo in connection with any test conducted by Yahoo in
accordance with the Service Level Agreement as “test” queries
by marking them as such in a data field at the time of
submission; and (ii) include a total of these “test” queries
in the Yahoo Search Query Reports.
8.5 Mutual Audit Rights. Each party (the “Auditing Party”), at its own
expense, will be entitled to retain a reputable, independent
certified public accounting firm reasonably acceptable to the other
party (the “Audited Party”) solely for the purpose of auditing, at a
mutually agreed upon time during normal business hours, those
records of the Audited Party that relate to the calculation of `bot
traffic, Click-Through Rate, Price Per Click, Impressions, Yahoo
Results, U.S. Users, Gross Revenue or the Revenue Share Payments.
Prior to an audit, the Auditing Party will require the certified
public accounting firm (the “Auditor”) to sign a confidentiality
agreement reasonably acceptable to the Audited Party, and the
results of the audit will be deemed “Confidential Information”. Such
audit shall be conducted in accordance with generally accepted
auditing standards and the Auditor will be entitled to disclose to
the Auditing Party only whether or not the Audited Party is in
compliance and the amount of any non-compliance, if any, and will be
precluded from disclosing any other Confidential Information to the
Auditing Party without written consent of the Audited Party. If an
audit reveals an underpayment, then the Audited Party will
immediately make payment to the Auditing Party in the amount of the
underpayment [*]. If an audit reveals an underpayment or
miscalculation of more than 10%, then the Audited Party will pay the
reasonable cost of that audit. Either party shall only be entitled
to [*] during the Term, which will apply to the prior [*] under the
Agreement. Upon request by the Auditor, Yahoo shall provide the
Auditor access to its query logs to confirm compliance with the
Guaranteed Impressions of this Agreement.
8.6 Payment Mechanics. Overture will make payments to Yahoo in U.S.
dollars via wire transfer into Yahoo’s main account according to the
instructions set forth below:
[*]
8.7 Estimated Yahoo Payment and Guaranteed Fixed Payment Reductions.
(a) Principles. The principles below convey the shared
understanding of the parties of how economic value is
generated and how actions by the parties can change the rate
of economic value creation:
(1) [*] is responsible for Impressions as modeled in this
Agreement.
(2) [*] is responsible for Coverage as modeled in this
Agreement.
(3) [*] is responsible for PPC as modeled in this
Agreement.
[*] based its PPC model on [*]. [*] may impact PPC in a
number of different ways (but the parties recognize that
such ways may or may not adversely affect PPC) which
will be considered by the parties in
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXECUTION CONFIDENTIAL
determining relative fault in their discussions and in
third party arbitration. These ways include (but are not
limited to) by [*].
The PPC on [*] is one indicator of the degree to which
[*] is achieving the PPC for which it is responsible.
[*].
(4) [*] is responsible for CTR as modeled in this Agreement.
[*] based its CTR model on the [*]. [*] may impact CTR
in a number of different ways (but the parties recognize
that such ways may or may not adversely affect CTR)
which will be considered by the parties in determining
relative fault in their discussions and in third party
arbitration. These ways include (but are not limited to)
[*] and [*] may impact CTR through [*].
(b) Estimated Yahoo Payment. Once a Measurement Period is
triggered, the Estimated Yahoo Payment and Guaranteed Fixed
Payment Adjustment Process set forth in Exhibit K will be
followed. If an adjustment in the Estimated Yahoo Payment is
required, then the following formula will be used to determine
that adjustment:
[*]
(c) Credit for Guaranteed Fixed Payment. If the Revenue Share
Payment is less than the Guaranteed Fixed Payment in Quarter
X, then Overture will be credited toward the Guaranteed Fixed
Payment in Quarter Y an amount (the “Credit”) = [*]:
(1) [*], or
(2) [*].
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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If the above calculation occurs during the final Quarter of
the Agreement (inclusive of any Extension Terms), then the
Term of the Agreement will be extended until the actual
Revenue Share Payment is equal to the Credit. For clarity,
[*]. If the parties mutually agree not to extend the Term as
set forth herein, then Yahoo will pay the amount of the Credit
to Overture within [*] days after the expiration of the
Agreement.
(d) Measurement Period. A Measurement Period is triggered when the
[*]. At the time a Measure Period is triggered, the Parties
shall determine a fair reserve from the Guaranteed Fixed
Payment as described in Section 8.1 above.
By way of example, [*].
(e) Adjustment. If, in a Quarter subsequent to a Measurement
Period, the Yahoo Revenue Share exceeds the Estimated Yahoo
payment for that Quarter (as adjusted, if applicable), then
Overture will reset the Estimated Yahoo Payment and the
Guaranteed Fixed Payment for the subsequent Quarter to the
level calculated using the formula in Section 8.7(b) above,
subject to the following exceptions:
(1) To the extent that the Guaranteed Fixed Payment is
adjusted upwards [*].
(2) The Guaranteed Fixed Payment will not be adjusted
upwards unless the actual revenue share to Yahoo is
greater than or equal to [*]% of Estimated Yahoo Payment
for a given Quarter.
8.8 Late Payments. Any Guaranteed Fixed Payment or undisputed Revenue
Share Payment that is paid more than [*] days late will bear
interest at the rate of [*]% per month.
8.9 [*]
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXECUTION CONFIDENTIAL
9. Impressions.
9.1 Deliveries. Yahoo will deliver the Guaranteed Impressions for each
Quarter, except that Yahoo will be deemed to have delivered the
Guaranteed Impressions for any Quarter in which [*] for that
Quarter. Additionally, if [*], then Yahoo will be deemed to have
delivered the Guaranteed Impressions for that Quarter, regardless of
the number of Impressions actually delivered. For clarity, Yahoo
will continue to deliver Impressions hereunder, by virtue of
delivering each and every Yahoo Search Query to Overture according
to Section 3.2 above, even if Yahoo has delivered the Guaranteed
Impressions for a particular Quarter. For additional clarity, the
fact that the Guaranteed Impressions are deemed delivered hereunder
will not preclude the parties from considering Impressions in
connection with an adjustment under Section 8.7 above.
9.2 Remedy, Make-Good. If Yahoo does not deliver the Guaranteed
Impressions within the applicable Quarter, then it will “make good”
the shortfall by extending its obligations hereunder at the end of
the Initial Term or the end of the applicable Extension Term, if
any, until it delivers the Guaranteed Impressions.
10. Yahoo’s Option to Extend. Yahoo shall have two options to extend the Term,
each of which shall extend the Term by an additional two or three years,
as determined by Yahoo. The first option to extend (“First Option”), if
exercised by Yahoo, shall extend the Term for a period commencing on May
1, 2005 and continuing until either April 30, 2007 or April 30, 2008 (an
“Extension Term”), depending on whether Yahoo chooses the two year option
or three year option. In order for Yahoo to exercise the First Option,
Yahoo must notify Overture in writing prior to [*] of its desire to
exercise such option. The second option to extend (“Second Option”), if
exercised by Yahoo, shall extend the Term for a period commencing on the
date on which the first Extension Term expires (i.e., either April 30,
2007 or April 30, 2008) and continuing for a period of either two or three
years from
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXECUTION CONFIDENTIAL
the date on which the first Extension Term expires, depending on whether
Yahoo chooses the two year option or three year option. In order for Yahoo
to exercise the Second Option, Yahoo must have exercised the First Option
and Yahoo must notify Overture in writing prior to the date that is [*]
prior to the end of the First Option of its desire to exercise the Second
Option. All notices of exercise hereunder must disclose whether Yahoo is
extending the Term for two years or three years.
11. Representations and Warranties.
11.1 Overture Warranties. Overture represents and warrants that it has
full power and authority to enter into this Agreement. Overture
further represents and warrants to Yahoo that Overture’s total costs
for credit card charges and bad debt for the first 9 months of 2001
was [*]% of amounts earned by Overture for Bidded Clicks. Bad debt
for the purpose of this Agreement consists of matters which Overture
categorizes in its normal course of business as uncollectable
revenues and invoiced revenues that are not collected. Overture
uncollectable revenues consists of the following: credit card fraud;
adjustments for system and other errors in billing on a client
account; adjustments made to advertiser’s accounts for disputed
billings; and adjustments [*] after processing through our normal
click-through protection filters. Overture finally represents and
warrants that, as of the Effective Date and at all times throughout
the Term, it has all consents, approvals, licenses and permissions,
necessary for Overture to perform all of its obligations hereunder
and for Yahoo to exercise all of its rights hereunder.
11.2 Yahoo Warranties. Yahoo represents and warrants that it has full
power and authority to enter into this Agreement.
11.3 Disclaimer. EXCEPT AS SET FORTH IN SECTION 13, NEITHER PARTY WILL BE
RESPONSIBLE FOR ANY CONTENT PROVIDED BY THIRD PARTIES, INCLUDING BUT
NOT LIMITED TO ADVERTISERS, OR FOR ANY THIRD PARTY WEB SITES THAT
CAN BE LINKED TO OR FROM THAT PARTY’S WEB SITE. NEITHER PARTY
NOR SUCH PARTY’S LICENSORS MAKE ANY OTHER WARRANTY OF ANY KIND,
WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, INCLUDING BUT NOT
LIMITED TO WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
USE AND NONINFRINGEMENT.
12. Confidentiality.
12.1 Definition. “Confidential Information” means any information
disclosed by either party to the other party during the Term (and
any renewals terms), either directly or indirectly, in writing,
orally or by inspection of tangible objects, which is designated as
“Confidential,” “Proprietary” or some similar designation. All of
the terms of this Agreement, including but not limited to all
Overture Reports and all Yahoo Search Query Reports, will be deemed
“Confidential.” Information communicated orally will be considered
Confidential Information if such information is designated as being
Confidential Information at the time of disclosure and confirmed in
writing as being Confidential Information within 20 days after the
initial disclosure. Confidential Information will not, however,
include any information that (a) was publicly known and made
generally available in the public domain prior to the time of
disclosure by the disclosing party; (b) becomes publicly known and
made generally available after disclosure by the disclosing party to
the receiving party through no action or inaction of the receiving
party; (c) is already in the possession of the receiving party at
the time of disclosure by the disclosing party; (d) is obtained by
the receiving party from a third party without a breach of such
third party’s obligations of confidentiality; or (e) is
independently developed by the receiving party without use of or
reference to the disclosing party’s Confidential Information.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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12.2 Restrictions. Other than the rights expressly granted under Section
2, the receiving party agrees (a) not to disclose any Confidential
Information to any third parties; (b) not to use any Confidential
Information for any purposes other than to exercise its rights or
perform its obligations under this Agreement; and (c) to keep the
Confidential Information confidential using the same degree of care
the receiving party uses to protect its own confidential
information, as long as it uses at least reasonable care. If either
party receives a subpoena or other validly issued judicial process
requesting, or is required by a government agency (e.g., the
Securities and Exchange Commission) to disclose, Confidential
Information of the other party, then the receiving party will notify
the disclosing party of such request and will reasonably cooperate
to seek confidential treatment or to obtain an appropriate
protective order to preserve the confidentiality of the Confidential
Information. Notwithstanding the foregoing, either party may
disclose following notice to the other party, pursuant to a
confidentiality agreement no less restrictive than the
confidentiality terms hereof, the terms of this Agreement and
performance hereunder to third parties for the purpose of due
diligence examinations in the context of financings or a potential
Change of Control (as defined in Section 15.4). All obligations
under this Section 12.2 will survive for a period of [*] after
termination or expiration of the Agreement.
12.3 Press Release. Immediately upon execution of the Agreement, the
parties will jointly issue the press release attached hereto as
Exhibit D, the content of which has been mutually agreed upon by
both parties. Further, the parties agree that Overture and Yahoo or
the applicable Yahoo Affiliate and Overture Affiliate will jointly
issue a press release, the timing of which will be mutually agreed
upon, relating to any amendment of this Agreement to incorporate an
International Opportunity in accordance with Section 7.4 above.
Neither party shall issue any additional press releases in
connection with this Agreement without the other party’s prior
written consent, which will not be unreasonably withheld. Excluding
disclosures that are required by law, neither party will disclose
any other terms of this Agreement to any third party via any medium
without the prior approval of the other party. When determining
whether a disclosure is “required by law,” each party may rely on
its legal counsels’ advice on such matters. Notwithstanding the
foregoing, (a) Overture shall have the right to notify its
advertisers and potential advertisers of the general nature of this
transaction (including Overture’s estimate of the increase in
traffic) pursuant to the general provisions of Exhibit I in order to
encourage Overture’s advertisers to increase their spending with
Overture and to encourage potential advertisers to advertise with
Overture; and (b) both parties shall be entitled to (i) provide
additional disclosures containing any and all information contained
in any previously agreed upon press release; and (ii) list the other
party’s name in advertising and other materials (provided that such
language shall not disparage the other party) according to the other
party’s then-current brand usage guidelines, which the other party
will make available upon request.
13. Indemnification.
13.1 Overture Indemnification. Overture, at its own expense, will
indemnify, defend and hold harmless Yahoo and Yahoo Affiliates,
employees, representatives and agents from and against any claim,
demand, action, investigation or other proceeding, including but not
limited to all damages, losses, liabilities, judgments, costs and
expenses arising therefrom, brought by any third party against Yahoo
(collectively, a “Yahoo Claim”) to the extent that the Yahoo Claim
is based on, or arises out of an allegation that Overture’s
performance hereunder (including but not limited to Overture’s
practice of any method under the Overture Licensed IP by which
Overture assembles and orders Overture Results for delivery to Yahoo
hereunder) or the Licensed Materials violates any applicable law,
rule or regulation or infringe the rights of any third party,
including but not limited to intellectual property rights, privacy
and publicity rights, claims of defamation, false or deceptive
advertising claims and consumer fraud.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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13.2 Yahoo Indemnification. Yahoo, at its own expense, will indemnify,
defend and hold harmless Overture and Overture Affiliates,
employees, representatives and agents from and against any claim,
demand, action, investigation or other proceeding, including but not
limited to all damages, losses, liabilities, judgments, costs and
expenses arising therefrom, brought by any third party against
Overture (collectively, an “Overture Claim”) to the extent that the
Overture Claim is based on, or arises out of an allegation that
Yahoo’s performance hereunder or the Yahoo Marks violate any
applicable law, rule or regulation or infringe the rights of any
third party, including but not limited to intellectual property
rights, privacy and publicity rights, claims of defamation, false or
deceptive advertising claims and consumer fraud.
13.3 Indemnification Procedure. All indemnity obligations arising under
this Section 13 will be subject to the following requirements: (a)
the indemnified party will provide the indemnifying party with
prompt written notice of any Yahoo Claim, in the case that Yahoo is
the indemnified party, or any Overture Claim, in the case that
Overture is the indemnified party, (as applicable, a “Claim”),
except that failure to give prompt notice will not waive any rights
of the indemnified party to the extent that the rights of
indemnifying party are not materially prejudiced thereby; (b) the
indemnified party will permit the indemnifying party to assume and
control the defense of the Claim upon the indemnifying party’s
written acknowledgment of its obligation to indemnify; (c) upon the
indemnifying party’s written request, and at no expense to the
indemnified party, the indemnified party will provide the
indemnifying party with all available information and assistance
reasonably necessary for the indemnifying party to defend the Claim.
The indemnifying party will not enter into any settlement or
compromise of the Claim (except a settlement or compromise that (i)
is full and final with respect to the Claim; (ii) does not obligate
the indemnified party to act or to refrain from acting in any way;
(iii) does not contain an admission of liability on the part of the
indemnified party; (iv) dismisses the Claim with prejudice; and (v)
is subject to confidentiality, such that no party may disclose the
terms of the settlement or compromise without the indemnified
party’s prior written consent) without the indemnified party’s prior
written approval, which shall not be unreasonably withheld.
14. Limitation of Liability. EXCEPT FOR INDEMNITY OBLIGATIONS ARISING UNDER
SECTION 13 ABOVE, ANY BREACH OF SECTION 12.2 (CONFIDENTIALITY —
RESTRICTIONS) OR ANY WILLFUL, UNCURED AND MATERIAL BREACH OF THIS
AGREEMENT, UNDER NO CIRCUMSTANCES WILL EITHER PARTY OR ITS AFFILIATES BE
LIABLE TO THE OTHER PARTY OR ITS AFFILIATES FOR ANY INDIRECT, INCIDENTAL,
CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES ARISING FROM THE SUBJECT
MATTER OF THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOSS OF DATA,
BUSINESS, PROFITS OR GOODWILL AND COSTS OF PROCUREMENT OF SUBSTITUTE GOODS
OR SERVICES, REGARDLESS OF THE LEGAL THEORIES AND EVEN IF THAT PARTY HAS
BEEN AWARE OR ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. IN NO EVENT WILL
YAHOO’S AGGREGATE, CUMMULATIVE LIABILITY TO OVERTURE UNDER THIS AGREEMENT
EXCEED THE SUM OF $[*] AND ANY AMOUNTS CREDITABLE OR REFUNDABLE TO
OVERTURE UNDER THIS AGREEMENT PURSUANT TO SECTION 8, EXCEPT THAT YAHOO’S
AGGREGATE, CUMMULATIVE LIABILITY TO OVERTURE UNDER THIS AGREEMENT WILL NOT
EXCEED THE SUM OF $[*] AND ANY AMOUNTS CREDITABLE OR REFUNDABLE TO
OVERTURE UNDER THIS AGREEMENT PURSUANT TO SECTION 8 IN THE EVENT OF
YAHOO’S WILLFUL, EFFICIENT BREACH OF THIS AGREEMENT. IN NO EVENT WILL
OVERTURE’S AGGREGATE, CUMMULATIVE LIABILITY TO YAHOO UNDER THIS AGREEMENT
EXCEED THE SUM OF $[*] AND ANY AMOUNTS PAST DUE UNDER THIS AGREEMENT
PURSUANT TO SECTION 8, EXCEPT THAT OVERTURE’S AGGREGATE, CUMMULATIVE
LIABILITY TO YAHOO UNDER THIS AGREEMENT WILL NOT EXCEED THE SUM OF $[*]
AND ANY AMOUNTS PAST DUE UNDER THIS AGREEMENT PURSUANT TO SECTION 8 IN THE
EVENT OF OVERTURE’S WILLFUL, EFFICIENT BREACH OF THIS AGREEMENT.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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15. Term.
15.1 Term. This Agreement will become effective as of the Effective Date
and, unless terminated or renewed as set forth herein, will remain
effective for the Term.
15.2 Termination. If either party breaches this Agreement in any material
respect, and that party does not cure its breach within 30 days
after written notice by the non-breaching party of its breach, then
the non-breaching party will be entitled to terminate this Agreement
immediately upon written notice to the breaching party after failure
to cure within those 30 days.
15.3 Termination for Cause. Following the first year of this Agreement,
Yahoo will be entitled to terminate this Agreement upon [*] prior
written notice (the “Termination Notice”) to Overture if the [*] is
less than [*] for [*] consecutive Quarters; provided that the reason
the [*] is less than [*] must be determined to be Overture’s
responsibility by applying the principles and provisions described
in Section 8.7 above. Upon receipt of the Termination Notice,
Overture shall have the right to increase the Guaranteed Fixed
Payment from its current level of approximately [*] to [*] in which
case the Agreement shall continue as if no Termination Notice had
been delivered.
15.4 Termination for Change of Control. For purposes of this provision,
“Change of Control” means (a) the direct or indirect acquisition
(except for transactions described in clause (b) of this paragraph
below), whether in one or a series of transactions by any person (as
such term is used in Section 13(d) and Section 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”)),
or related persons (such person or persons, an “Acquirer”)
constituting a group (as such term is used in Rule 13d-5 under the
Exchange Act), other than in all cases Yahoo and/or controlled
affiliates of, or an entity that controls 50% or more of, Yahoo, of
(i) beneficial ownership (as defined in the Exchange Act) of issued
and outstanding shares of stock of Overture, the result of which
acquisition is that such person or such group possesses in excess of
50% of the combined voting power of all then-issued and outstanding
stock of Overture, or (ii) the power to elect, appoint, or cause the
election or appointment of at least a majority of the members of the
board of directors of Overture (or such other governing body in the
event Overture or any successor entity is not a corporation); (b) a
merger or consolidation of Overture with a person or a direct or
indirect subsidiary of such person, other than in all cases Yahoo
and/or controlled affiliates of, or an entity that controls 50% or
more of, Yahoo, provided that the result of such merger or
consolidation, whether in one or a series of related transactions,
is that the holders of the outstanding voting stock of Overture
immediately prior to such consummation do not possess, whether
directly or indirectly, immediately after the consummation of such
merger or consolidation, in excess of 50% of the combined voting
power of all then-issued and outstanding stock of the merged or
consolidated person, its direct or indirect parent, or the surviving
person of such merger or consolidation; (c) the stockholders of
Overture approve a plan of complete liquidation of Overture; or (d)
a sale or disposition, whether in one or a series of transactions,
of all or substantially all of Overture’s assets. Overture will
provide Yahoo with prompt written notice following (or at Overture’s
election, up to [*] days prior to) (i) the approval by the
Overture board of directors of a transaction that is or is intended
to be a Change in Control or (ii) the public announcement (including
without limitation by means of a filing pursuant to Section 13D of
the Exchange Act) by any third party of its intention to effect a
Change in Control of Overture, including without limitation the
initiation of a tender offer, proxy fight, consent solicitation or
other means designed or intended to effect a Change in Control of
Overture. Upon receipt of such notice from Overture, Yahoo will be
entitled to the right (the “Change of Control Right”) to elect in
writing (the “Change of Control Election”) to Overture, within [*]
days of receipt of such notice, either the “Continue on Revised
Financial Terms” option set forth in subpart (a) immediately below
or the “Termination; Termination Fee” option set forth in subpart
(b)
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
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immediately below. Notwithstanding anything to the contrary herein,
once a Change of Control has been consummated, Yahoo shall have no
further rights under this Section 15.4 in respect of a subsequent
Change of Control , if any, that may be consummated. The following
subparts (a) and (b) are the two choices, one of which Yahoo may
elect pursuant to a Change of Control Election (it being understood
that if Yahoo does not make an election prior to the end of such
[*] day period, then it shall be deemed to have elected the option
set forth in subpart (a) below):
(a) Continue on Revised Financial Terms. Yahoo elects to maintain
the Agreement under its terms and conditions, subject to the
following adjustment, to become effective immediately prior to
the consummation of the Change of Control: Overture will
increase the percentage at which it makes Revenue Share
Payments hereunder by (1) [*]% (e.g., in year 3 of the Initial
Term, the revenue share percentage would increase from [*]% to
[*]%) to the extent that the Acquirer is [*] or controlled by
one of such entities or any successor to substantially all of
the current business of any of such entities (each, a
“Designated Company”); or (2) [*]% to the extent that the
Acquirer is any entity other than a Designated Company. The
term of the increased Revenue Share Payment percentages
pursuant to this subpart (a) shall continue from immediately
prior to the consummation of the Change of Control until the
later of (x) one year following consummation of the Change of
Control, and (y) the expiration of the Initial Term (if the
Change of Control is consummated during the Initial Term) or
the applicable Extension Term (if the Change of Control is
consummated during an Extension Term). Notwithstanding the
foregoing sentence, to the extent that either (i) the Change
of Control occurs after January 1, 2005 and Yahoo has not
provided Overture with written notice of Yahoo’s intent to
exercise the First Option according to Section 10 above; or
(ii) the Change of Control occurs after the date that is six
months prior to the end of the First Option and Yahoo has not
provided Overture with written notice of Yahoo’s intent to
exercise the Second Option according to Section 10 above, the
term of the increased Revenue Share Payment percentages
pursuant to this subpart (a) shall continue from immediately
prior to the consummation of the Change of Control until the
expiration of the then-current Term (i.e., the Initial Term in
the case of clause (i) above and the first Extension Term in
the case of clause (ii) above).
(b) Termination; Termination Fee. Yahoo elects to terminate the
Agreement, in which case the following will become effective
immediately prior to the consummation of the Change of
Control: the Agreement will terminate and Overture will pay to
Yahoo a termination fee of (i) if Acquirer is a Designated
Company, then (A) $10,000,000 in cash, payable promptly upon
consummation of a Change of Control; and (B) 3% of the
outstanding shares of Overture Common Stock, on a fully
diluted basis immediately prior to consummation of the Change
of Control (calculated on the treasury stock method (utilizing
the average closing trading price of shares of Overture for
the 10 trading days ending on the day that is two trading days
prior to but not including the date of consummation of the
Change of Control (the “Ten-Day Average Price”))) which,
subject to applicable governmental regulatory approvals and
the expiration of applicable waiting periods, shall be issued
immediately prior to consummation of a Change of Control; or
(ii) if Acquirer is not a Designated Company, then (A)
$5,000,000 in cash, payable promptly upon consummation of a
Change of Control; and (B) 2% of the outstanding shares of
Overture Common Stock, on a fully diluted basis, immediately
prior to consummation of the Change of Control (calculated on
the treasury stock method as aforesaid) which, subject to
applicable governmental regulatory approvals and the
expiration of applicable waiting periods, shall be issued
immediately prior to consummation of a Change of Control (the
shares referred to in clauses (i)(B) and (ii)(B), the
“Overture Shares”). Notwithstanding the foregoing, if the
Change of Control is the type described in clause (a) of the
first paragraph of this Section 15.4, then the obligation of
Overture to issue Overture Shares and make payments to Yahoo
pursuant to this paragraph shall take effect as promptly as
practicable following the Change of Control, rather than
immediately prior to or upon the Change of Control. In
connection with the issuance of the Overture Shares, the
parties will cooperate in the filing of any
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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EXECUTION CONFIDENTIAL
applicable regulatory filing pursuant to the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended (the “HSR
Act”). Overture and Yahoo will share equally any applicable
filing fee required in connection with any such HSR Filing.
The parties will retain and pay their own legal counsel and
other expenses, if any, in connection with such filing. The
parties also will use all reasonable efforts to file any
applicable regulatory filing promptly, so as to permit the
timely issuance of the Overture Shares. In addition, if the
Change of Control is the type described in clause (a), (c) or
(d) of the first paragraph of this Section 15.4 (a “Non-Merger
Change of Control”), unless Yahoo can trade the Overture
Shares in the public market without an effective registration
statement, Overture will use all reasonable efforts to file
and have the SEC promptly declare effective a registration
statement pursuant to which the Overture Shares will be fully
registered for resale by Yahoo under the Securities Act of
1933, as amended, and any applicable state securities law;
following effectiveness of the registration statement, subject
to applicable law. Overture will take all reasonable actions
to ensure Yahoo’s ability to dispose of the Overture Shares as
promptly as desired by Yahoo. If the terms of the issuance of
Overture Shares are publicly disclosed by Overture, upon
Yahoo’s request, Overture shall take reasonable steps to apply
for and obtain a permit for the issuance of the Overture
Shares to Yahoo from the California Department of Corporations
in the event of a Non-Merger Change of Control.
Notwithstanding anything to the contrary herein, in lieu of
issuing Overture Shares to Yahoo pursuant to this subpart (b),
Overture may elect, in its sole discretion, instead to pay
Yahoo cash equal to the market value of such Overture Shares
based on the Ten-Day Average Price.
15.5 Effect of Termination or Expiration. Upon termination or expiration
of this Agreement for any reason, (a) except as set forth in Section
2.5 above, all licensed rights granted herein will terminate
immediately; (b) Yahoo will immediately cease use of the Licensed
Materials; (c) Overture will immediately cease use of the Yahoo
Search Query Reports other than as contemplated herein; (d) Yahoo
will cease all use of all Overture Reports other than as
contemplated herein; and (e) Sections 1, 2.2 (with respect to the
covenants to destroy/certify destruction of information only), 2.3
2.5, 8.1 and 8.2 (with respect to payments accrued during the Term),
8.3, 8.7 (with respect to credits accrued during the Term), 8.8,
9.2, 12-14, 15.5 and 16 of this Agreement will survive. The parties
further agree that, in the event of an early termination under this
Agreement, each party will be entitled to any fees due or owed to it
by the other party (e.g., Overture will be entitled to a pro rata
refund of the applicable Guaranteed Fixed Payment in the event of a
proper termination of the Agreement by Overture). The remedies
stated herein are cumulative and in addition to any remedies
available at law or equity, and nothing contained herein shall be
deemed to limit either party’s right to pursue any and all such
remedies.
16. Miscellaneous.
16.1 Notice. Any notice required for or permitted by this Agreement must
be in writing and delivered by (a) personal delivery; (b)
nationally-recognized overnight courier; (c) certified or registered
mail, return receipt requested; or (d) email, telecopy or facsimile
transmission, confirmed by concurrent notice delivered by one of the
means set forth in subsections (a) — (c) above. All notices will be
deemed delivered upon receipt by the receiving party. All notices
must be sent (1) to Yahoo at 701 First Avenue, Sunnyvale, California
94089, Attn: Vice President, North American Operations, with a copy
to its General Counsel; or (2) to Overture at 74 North Pasadena
Avenue, third floor, Pasadena, California 91103, Attn: Vice
President Business Affairs. Each party will be entitled to change
its address for purposes of this Section 16.1 by providing written
notice to the other party in accordance herewith.
16.2 Assignment; Binding Effect. This Agreement will be binding upon and
inure to the benefit of the parties hereto and their permitted
successors and assigns, as set forth herein and Section 15.4
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EXECUTION CONFIDENTIAL
above. Neither Overture nor Yahoo may assign this Agreement, or any
of its rights hereunder, or delegate any of its duties hereunder
without the prior written consent of the other party.
Notwithstanding the foregoing, either party may, without the prior
written consent of the other party, assign this Agreement to any
entity that succeeds to all or substantially all of the assets and
liabilities of that assigning party. If an assignment or delegation
is made by Overture according to Section 15.4 above, then the terms
and conditions set forth in that Section 15.4, including but not
limited to all applicable notice periods and remedies, will apply to
that assignment or delegation. If an assignment or delegation is
made by Yahoo in connection with the sale of all or substantially
all of its assets and liabilities, and either (a) the assignee is an
Overture Restricted Company; or (b) Overture reasonably determines
that the assignee does not have sufficient capital or assets to
perform its obligations under this Agreement, then Overture will be
entitled to approve the assignment or to terminate this Agreement
within 30 days after the date on which the assignee succeeds to all
or substantially all of Yahoo’s assets and liabilities. If Overture
approves the assignment, then this Agreement will be binding upon
and inure to the benefit of Yahoo’s successor or assign.
16.3 No Third Party Beneficiaries. All rights and obligations of each
party hereunder are personal to that party. This Agreement is not
intended to benefit, nor shall it be deemed to give rise to, any
rights in any third party.
16.4 Governing Law; Attorneys’ Fees. This Agreement will be governed and
construed, to the extent applicable, in accordance with United
States law, and otherwise, in accordance with California law,
without regard to conflict of law principles. In the event of any
material breach by either party of any provision of this Agreement,
the non-breaching party will be entitled to suspend its performance
hereunder until the breach is cured. The prevailing party in any
action arising hereunder will be entitled to recover reasonable
expenses, including but not limited to attorneys’ fees.
16.5 Dispute Resolution.
(a) Escalation Events. If the parties cannot agree on disputes
arising from the determination of a reasonable royalty, the
calculation of Impressions, revisions to the Service Level
Agreement according to Section 4.3(b), or any other subsequent
dialogue provided for under this Agreement, then the dispute
will be subject to escalation (an “Escalation Event”). An
Escalation Event first will be discussed in good faith by the
parties at a mutually convenient location in an attempt to
resolve the Escalation Event amicably, in whole or in part. A
senior director or vice president of business development with
decision-making authority (“Senior Business People”) will
participate in these discussions. If the Senior Business
People cannot resolve the Escalation Event within [*] days,
then each party will designate a senior executive with
decision-making authority (“Senior Executive”) to meet and
confer in an effort to resolve the Escalation Event. If the
Senior Executives cannot resolve the Escalation Event within
[*] days, then the chief executive officers of the respective
parties (“CEO”) will meet and confer in an effort to resolve
the Escalation Event. Any decisions and resolutions of the
Senior Business People, Senior Executives or CEOs will be
final and binding on the parties once reduced to writing and
signed by the parties. If the procedures outlined under this
Section 16.5(a) fail to resolve an Escalation Event, then the
parties hereby agree to submit the issue to binding
arbitration pursuant to Section 16.5(b), except as set forth
in Section 2.5(g) [?].
(b) Arbitration, Equitable Relief. All controversies, disputes,
differences or claims between the parties arising out of or
relating to this Agreement (each, a “Dispute”), including but
not limited to any unresolved Escalation Events and any
question concerning the existence, validity, termination,
interpretation, performance or enforcement of this Agreement,
will be finally and exclusively settled by binding arbitration
in accordance with the following:
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(1) Submission; Rules. Either party will be entitled to
submit a Dispute to JAMS for binding arbitration in San
Francisco, California or Los Angeles, California by
providing written notice to the other party and to JAMS.
Discovery will be conducted in accordance with Rules 26
through 36 and Rule 45 of the Federal Rules of Civil
Procedure.
(2) Appointment of Panel. The parties will assemble a panel
of 3 arbitrators (the “Panel”) as follows: Each party
will nominate one arbitrator, and those 2 arbitrators
will select a chairperson of the Panel. Each arbitrator
on the Panel must have at least 5 years senior
management or consulting experience in the on-line
services industry and must not have been employed by or
a supplier to either party during the preceding 2 years.
(3) Timing. The parties will undertake commercially
reasonable efforts to conclude any arbitral proceedings
within 180 calendar days from the date on which the last
arbitrator accepts his or her appointment; provided,
however, that if the arbitral award is not issued within
such 180 calendar days, then the arbitration proceedings
will continue until an award is made.
(4) Legal and Equitable Remedies. Neither party will be
entitled to file a legal action against the other party
until the arbitration is concluded, but nothing herein
prohibits a party from requesting temporary injunctive
relief from any court of competent jurisdiction. Either
party may at any time apply to a court of competent
jurisdiction for equitable relief.
(5) Decision. Any decision or award of the Panel will be
based solely on the terms of this Agreement and the
facts and legal arguments presented at the hearing and
any documents presented in accordance with the discovery
rules. The Panel will issue a written decision that sets
forth its rationale in reasonable detail. Any award
rendered by the Panel may be enforced by any court of
competent jurisdiction. The Panel will have the
authority to award specific performance or an injunction
to the prevailing party, or to make an award of direct
damages, but will have no right to grant special,
punitive or exemplary damages, or indirect or
consequential damages unless such amounts are allowed
under this Agreement.
16.6 Independent Contractors. The parties are independent contractors
with respect to the subject matter of this Agreement. This Agreement
will not be construed to create a joint venture or partnership
between the parties. Neither party will be deemed to be an employee,
agent, partner or legal representative of the other party for any
purpose, and neither party will have any right, power or authority
to create any obligation or responsibility on behalf of the other
party.
16.7 Force Majeure. Neither party will be liable hereunder (and their
performance shall be excused under this Agreement) by reason of any
failure or delay in the performance of its obligations (except for
the payment of money) on account of strikes, shortages, riots,
insurrection, terrorism, fires, flood, storm, explosions,
earthquakes, Internet outages beyond the reasonable control of such
party, acts of God, war, governmental action, or any other cause
that is beyond the reasonable control of such party.
16.8 Compliance with Law. Each party will be responsible for compliance
with all applicable laws, rules and regulations, if any, related to
the performance of its obligations under this Agreement.
16.9 Entire Agreement. This Agreement, including all exhibits attached
hereto, constitutes the entire agreement between the parties with
respect to the subject matter hereof and supersedes any prior or
contemporaneous proposals, whether written or oral, with respect to
the subject matter hereof. Any amendments to this Agreement must be
in writing and executed by an officer of each party.
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16.10 Counterparts. This Agreement may be entered into by each party in
separate counterparts, which will constitute one fully executed
Agreement upon execution by both Yahoo and Overture.
16.11 Severability. If any provision of this Agreement is held or made
invalid or unenforceable for any reason, this Agreement will be
construed as if that provision had never been contained herein, but
considering the original intentions of the parties.
16.12 Waiver. The terms or covenants of this Agreement may be waived only
by a written instrument executed by a duly authorized representative
of the party waiving compliance. The failure of either party at any
time or times to require performance of any provision hereof will in
no manner affect the right at a later time to enforce the same. No
waiver by either party of the breach of any term or covenant
contained in this Agreement, whether by conduct or otherwise, in any
one or more instances, will be deemed to be, or construed as, a
further or continuing waiver of any such breach or a waiver of the
breach of any other term or covenant contained in this Agreement.
16.13 Section Headings. The section headings contained herein are for
reference purposes only and do not in any way affect the meaning or
interpretation of this Agreement.
* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.
| “Yahoo” | “OVERTURE” | |||
| YAHOO! INC., A DELAWARE CORPORATION | OVERTURE SERVICES, INC., A | |||
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| By: | /s/ GREG COLEMAN |
| By: | /s/ TODD TAPPIN |
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| Name: |
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| Name: | Todd Tappin |
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| Title: | CFO |
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EXECUTION
EXHIBIT A
SERVICE LEVEL AGREEMENT
The purpose of this Service Level Agreement (the “SLA”) is to describe the service level commitments that the parties are obligated to deliver under this Agreement. The sections are as follows:
I. Definitions
II. Contacts
III. Support Procedures
IV. Operational Metrics
I. DEFINITIONS
A. Definitions.
(i) Aggregate Response Time. This value is the sum of the Internal
Overture Response Time and the Network Response Time.
(ii) Availability. The percentage of the total properly formatted
Yahoo Search Queries (as defined in the Agreement) for which
Overture responds (either with a “no results delivered” response
or a response in the form of properly formatted Overture
Results, regardless of whether delivered within the Critical
Threshold or not (i.e., Timeouts are irrelevant to the
calculation of Availability to the extent that a response in the
form set forth herein is ultimately delivered by Overture)).
Load balancing must be in effect for the Availability terms to
be applicable. Catastrophic Problem. A Problem that persists for
a period of [*] or more during Peak Hours and [*] or more during
Non-Peak Hours.
(iii) Implementation Change. A request by Yahoo to incorporate a new
feature or enhance an existing feature of the Overture Services
provided to Yahoo under the Agreement to which this SLA is
attached as an Exhibit.
(iv) ICMP. An Internet Control Message Protocol used for, among other
things, determining whether a particular computer is attached to
the Internet and working properly.
(v) Internal Overture Response Time. The period of time beginning at
the time of Overture’s receipt of a Yahoo Search Query from
Yahoo to completion of send by Overture, as measured by
Overture’s NOC.
(vi) Minor Problem. A cosmetic display issue which allows the major
elements of Overture results to display, but causes textual
irregularities (e.g., an umlaut not displaying properly). For
clarity, [*].
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(vii) Network Response Time. The period of time required for an ICMP
ping packet to complete a round trip cycle between Yahoo and
Overture. Network Response Time will be measured from each
party’s data center to the other party’s data center.
(viii) NOC. Network Operations Center.
(ix) Non-Peak Hours. Non-Peak Hours shall mean all hours outside of
Peak Hours.
(x) Normal Maintenance. Ongoing scheduled maintenance.
(xi) Peak Hours. Peak Hours shall mean [*].
(xii) Problem. An error, bug, incompatibility or malfunction, which
renders the Overture Results unavailable to or unuseable by
Yahoo for [*] consecutive [*] or more. A “Problem” can include,
but is not limited to, instances of [*], but does not include
circumstances where Yahoo or Overture is not available to the
Internet at large due to a force majeure event (as described in
Section 16.7 of the Agreement to which this document is
attached).
(xiii) Problem Resolution. A correction, patch, fix, alteration or
Temporary Workaround that minimizes the effect of a Problem,
Severe Problem, or Catastrophic Problem restoring the system to
the levels set forth in this SLA within the response times set
forth in this SLA.
(xiv) Results Set. A Results Set will consist of the number of
Overture Results required to be displayed pursuant to the
Agreement, or a “No Results Delivered” notification, if
applicable, which Results Set is properly formatted in a
mutually agreed XML format.
(xv) Severe Problem. A Problem that persists for a period of [*] or
more during Peak Hours and [*] or more during Non-Peak Hours.
(xvi) Temporary Workaround. A temporary technical solution that
restores the system to the levels set forth in this SLA,
although there may be ongoing or additional measures until a
permanent solution can be implemented.
(xvii) Timeouts. A timeout refers to an action taken by Yahoo
production servers when Overture Results are not received within
the maximum Aggregate Response Time referred to as the “Critical
Threshold” in Article IV, Section E below. This action will
result in Overture Results not being displayed, but may or may
not constitute an “Impression” under the Agreement.
(xviii) TTL. Time-to-live settings that determine the time that the
Overture entries remain in the Yahoo DNS cache.
(xix) Unresolved Catastrophic Problem. A Catastrophic Problem that
does not have a Problem Resolution within a total period of [*]
or more during Peak Hours ([*]) and [*] or more during Non-Peak
Hours.
(xx) Yahoo Technical Lapse. A Yahoo Technical Lapse means a set of
technical circumstances within Yahoo’s reasonable control
whereby (i) a properly formatted set of Overture Results are
delivered to Yahoo in response to a properly formatted Yahoo
Search Query within the Critical Threshold established in
Article IV, Section E below, but are not displayed as a Yahoo
Search Results Page or (ii) Yahoo is unable to receive a
properly formatted set of Overture Results and does not transmit
properly formatted Yahoo Search Queries to Overture.
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II. CONTACT INFORMATION
A. Contact Information.
(i) Overture Support Personnel.
[*]
(ii) Yahoo Support Personnel.
[*]
B. Updates. Either party may change its designated support personnel at its discretion with reasonable written notice to the other party. Each party’s preliminary contact personnel are as shown in Article II, Section A.
III. SUPPORT PROCEDURES
A. Support Procedures.
(i) All Problems, Severe Problems, and Catastrophic Problems
reported by either party must be submitted to the other party,
as appropriate, via the technical support telephone number, via
email or pager to the contact information set forth in the
Support Table, and each such Problem, Severe Problem, and
Catastrophic Problem will be given a unique reference number by
the receiving party.
(ii) The responsible party shall inform the other party’s technical
support personnel of ongoing efforts to provide a Problem
Resolution concerning Problems, Severe Problems, and
Catastrophic Problems at least once per day, or more frequently
if such is provided for in the Support Table until such Problem
Resolution is complete.
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(iii) In the event that there is a Minor Problem, Problem, Severe
Problem or Catastrophic Problem during Non-Peak Hours, the
reporting party shall contact the other party’s NOC via customer
support pager at the email pager address provided herein for
such purpose.
B. Overture Response. Upon receiving notification from Yahoo, Overture
shall promptly determine whether the request is a Minor Problem, a
Problem, a Severe Problem, or a Catastrophic Problem or none of the
above according to the definitions set forth above. If it is determined
by the parties that the issue is Overture’s responsibility, then
Overture will respond to the request within the response times set forth
in this SLA and shall use all commercially reasonable efforts to resolve
the Minor Problem, Problem, Severe Problem or Catastrophic Problem in
accordance with this SLA. If the parties agree that a Minor Problem,
Problem, Severe Problem, or Catastrophic Problem is not Overture’s
responsibility, then Overture shall reasonably cooperate with Yahoo to
provide a Problem Resolution.
C. Yahoo Response. Upon receiving notification from Overture, Yahoo shall
promptly determine whether the request is a Minor Problem, Problem, a
Severe Problem, or a Catastrophic Problem or none of the above,
according to the definitions set forth above. If it is determined by the
parties that the issue is Yahoo’s responsibility, then Yahoo will
respond to the request within the response times set forth in this SLA
and shall use all commercially reasonable efforts to resolve the Minor
Problem, Problem, Severe Problem, or Catastrophic Problem in accordance
with this SLA. If the parties agree that a Minor Problem, Problem,
Severe Problem, or a Catastrophic Problem is not Yahoo’s responsibility,
then Yahoo shall reasonably cooperate with Overture to provide a Problem
Resolution.
D. Indeterminate Responsibility. If the parties disagree which party bears
responsibility for a Problem, Severe Problem, or Catastrophic Problem
then both parties will form a resolution team comprised of at least a
technical contact representing each party. Any continuing disagreement
regarding responsibility, or any failure by either party to effect a
Problem Resolution within the times indicated will result in escalation
to the Primary business contact as identified in Article II above and as
set forth in Section E below.
SUPPORT TABLE
| RECEIPT OF NOTICE |
| TYPE OF PROBLEM REPORTED |
| RESPONSE TIME |
| TIME FOR IMPLEMENTATION CHANGE AND REPORTING OBLIGATIONS |
|
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|
|
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|
|
| During business hours or other times. |
| Minor Problem |
| Initial response to request within [*] during business hours and [*] after business hours begins if reported outside of business hours. |
| Responsible party will provide notifications [*] per business day until Problem Resolution. All such notifications will be to the other party’s NOC. |
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|
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|
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|
|
|
| Problem Resolution or plan for Problem Resolution by next business day. |
|
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|
|
|
|
|
|
|
|
| During normal business hours (8:00 a.m. — 6:00 p.m. |
| Problem |
| Initial response to request within [*] |
| Responsible party will provide a proposed Problem Resolution. If the Problem |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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| PST Monday-Friday) |
|
|
| [*]. |
| Resolution is not immediate, the responsible party will provide [*] on the first day of occurrence and then daily updates. All such notifications and updates will be sent to the other party’s NOC. |
|
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|
|
|
|
|
|
| During normal business hours (8:00 a.m. — 6:00 p.m. PST Monday-Friday) |
| Severe Problem |
| Initial response to request within [*]. |
| Responsible party will provide a proposed Problem Resolution to address the Severe Problem. If the Problem Resolution is not immediate, the responsible party will provide notifications every [*] hours on the first day of occurrence and then daily updates thereafter. All such notifications and updates will be to the other party’s NOC. |
|
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|
|
|
|
|
|
| During normal business hours (8:00 a.m. — 6:00 p.m. PST Monday-Friday) |
| Catastrophic Problem |
| Initial response to request within [*]. |
| Responsible party will provide a proposed Problem Resolution to address the Catastrophic Problem. A Catastrophic Problem will result in escalation to the Primary business contact as identified in Article II above and as set forth in Section E below. If the Problem Resolution is not immediate, the responsible party will provide notifications every [*] until resolved. All such notifications and updates will be to the other party’s NOC. |
|
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|
|
| During all other times. |
| Problem |
| Initial response to request within [*]. |
| Responsible party will provide a proposed Problem Resolution in response to the Problem or Severe Problem. |
|
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|
|
|
|
|
|
| During all other times |
| Severe Problem |
| Initial response to request within [*]. |
| Responsible party will provide a proposed Problem Resolution in response to the Problem or Severe Problem. |
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| During normal business hours (8:00 a.m. — 6:00 p.m. PST Monday-Friday) |
| Catastrophic Problem |
| Initial response to request within [*]. |
| Responsible party will provide a proposed Problem Resolution to address the Catastrophic Problem. A Catastrophic Problem will result in escalation to the Primary business contact as identified in Article II above and as set forth in Section E below. updates will be to the other party’s NOC. |
|
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|
|
|
| During business hours or other times. |
| Implementation Changes |
| Within [*]. |
| Notification of or request for Implementation Changes should be sent to the Business Contacts outlined in Article II, section (i) and (ii) |
E. Escalation Process.
(i) Each party hereby agrees to notify the other party’s NOC within
[*] of detecting any Problem, Severe Problem, or Catastrophic
Problem and to notify the other party of a Minor Problem.
(ii) In the event that either party does not respond to the other
party within the response time from receipt of communication or
detection of a Minor Problem, Problem, Severe Problem, or
Catastrophic Problem, then each party may contact any of the
personnel outlined in the Contacts section, Article II.
IV. OPERATIONAL METRICS.
A. Availability. Overture will maintain [*]% Availability as measured by
[*] production query logs, verified by [*] with at least [*] intervals,
reported [*]. In the event of discrepancies between these two sources,
Yahoo and Overture will work together to determine root cause of such
discrepancy. If Availability falls below [*]%, Problem Resolution would
occur, and the Cure Period (i.e., the process under Article IV, Section
G) would be in effect. Overture will provide to Yahoo reasonable
technical specifications for redirecting traffic in case of temporary
unavailability of an Overture search data center.
B. Capacity. Overture will provide capacity based on Yahoo’s current
forecast of [*] Yahoo Search Queries per [*], supporting a peak rate of
[*] (the “Peak Rate”), which is [*] that of the average per day Yahoo
Search Query rate. The parties acknowledge that Yahoo’s volume forecast
and “Peak Rate” will increase during the Term. Overture will use
commercially reasonable efforts provide increasing capacity to
accommodate such growth in a timely fashion. [*]. Additionally, Overture
will provide up to [*]% capacity beyond these levels if so requested by
Yahoo, provided that Yahoo gives a minimum of [*] days prior written
notice. Yahoo will notify Overture if Yahoo anticipates an increase of
Yahoo Search Queries by more than [*]% in any calendar quarter. During
the period of time that Overture is working to accommodate the
additional capacity, the Availability, Response Times, and Timeouts will
be
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renegotiated for the additional traffic. [*]. Finally, [*].
Notwithstanding the previous sentence, if Yahoo delivers Yahoo Search
Queries [*].
C. Site monitoring. Overture will monitor the performance of its
obligations under this Agreement using automated tools/utilities
developed and/or configured by Overture, or contracted with external
third parties, to validate the Availability of [*]% and response
times. Additionally, Yahoo will perform a [*] test for compliance with
operational metrics and will share such results with Overture on a [*]
basis. If either party detects fault, the discovering party will respond
as defined in Article III, “Support Procedures.”
D. Response Times. Overture will comply with the following operational
metrics:
[ ] INTERNAL OVERTURE RESPONSE TIME shall [*].
[ ] AGGREGATE RESPONSE TIME shall [*]. In the event of discrepancies
between these two sources, Yahoo and Overture will work together to
determine root cause of such discrepancy.
[ ] RESPONSE TIME ENHANCEMENT. The parties mutually agree that they
will employ reasonable efforts to provide an Average Aggregate
Response Time that is lower than the stated number in this SLA.
Specifically, the parties will engage in good faith efforts to develop
co-location infrastructure to support enhanced operational metrics.
Upon the mutually acceptable completion of such co-location efforts,
the parties agree to amend this SLA to improve the operation metrics
set forth in this Section IV.
E. Critical Thresholds. Aggregate Response Time that is greater than [*]
will result in Timeouts (the “Critical Threshold”).
F. Problems and Critical Threshold. If there is a Severe Problem or
Catastrophic Problem, Yahoo may, at its discretion, lower the Critical
Threshold until a Problem Resolution is completed. Additionally, if
Severe Problem or Catastrophic Problem results in no results being
returned to Yahoo within any threshold, Yahoo may, at its discretion,
disable the Overture results until a Problem Resolution is completed.
G. Cure Period. Once the responsible party is identified for a Minor
Problem, Problem or Severe Problem, according to Article III, Section B
or C, the responsible party shall identify and communicate a Problem
Resolution or plan and shall comply with the support table set forth in
Article IV. The responsible party shall use commercially reasonable
efforts to implement a Problem Resolution as soon as possible and in any
event, within 8 business days, and to implement Problem Resolution for
Minor Problems as soon as possible and, in any event, within 21 days. If
the responsible party cannot implement a Problem Resolution for the
Problem or Severe Problem within 8 business days, the other party may
deem such failure an Escalation Event pursuant to Section 16.5(a) of the
Agreement. Overture’s failure to comply with the operational metrics set
forth in Article IV, Sections A or D will be deemed a Problem and will
be subject to this Section G of Article IV.
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H. DNS. Overture uses DNS-based global load balancing to direct search
traffic to one of the several facilities that serve Overture’s search
traffic. Yahoo servers shall adhere to the TTL in the Overture name
server resolution response (no more than [*]), periodically
querying the Overture DNS servers to determine the IP address of the
Overture site where the Yahoo servers must direct their query traffic.
Overture will not be responsible for satisfying requirements for
Availability Response Times if TTLs exceed [*].
I. Maintenance Requirements. Normal Maintenance occurs on [*], and will not
exceed [*], and will not be counted in the determination of Availability
(Section A) and Response Times (Section D) of this Section IV.
J. Monitoring Servers. In addition to the Yahoo’s servers monitoring
Aggregate Response Times, Overture may at its option place a monitoring
server (or servers, one for each site) proximal to the Yahoo production
network to aid in the resolution of connectivity and Network Response
problems. Yahoo may place a monitoring server (or servers, one for each
site) proximal to the Overture production network, also to aid in the
resolution of connectivity and Network Response problems.
K. Reporting. Both parties will make available upon request, in a format
mutually agreed by both parties, a report showing Availability, Internal
Response Time and Aggregate Response Time as measured under this SLA.
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EXECUTION CONFIDENTIAL
EXHIBIT B
YAHOO SEARCH BOXES
[Graphic of Yahoo Search Box]
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EXECUTION CONFIDENTIAL
EXHIBIT C
YAHOO SEARCH RESULTS PAGES
[Graphic depicts example of “mouse over” Overture search result and
corresponding text box with result description]
[Graphic depicts search results page on Yahoo network, including implementation
and presentation of Overture search results]
* Certain information on this page has been omitted and filed separately with
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EXECUTION CONFIDENTIAL
EXHIBIT D
YAHOO! AND OVERTURE EXTEND PAY-FOR-PERFORMANCE SEARCH AGREEMENT
OVERTURE CONTINUES TO POWER SUCCESSFUL YAHOO! SPONSOR MATCHES PROGRAM
SUNNYVALE & PASADENA, Calif. — (BUSINESS WIRE) — April 25, 2002 — Yahoo! Inc. (Nasdaq:YHOO - news), a leading global Internet company, and Overture Services, Inc. (Nasdaq:OVER - news), the world’s leading provider of Pay-For-Performance search to Web sites across the Internet, today announced that they have extended their relationship to a three-year agreement to distribute Overture’s search listings through Yahoo! Sponsor Matches.
Under the agreement, Overture will continue to provide Yahoo! with its editorially reviewed Pay-For Performance search results from its growing base of 60,000 advertisers. This agreement is a renewal of a relationship that began in November 2001. The terms of the agreement were not disclosed.
“We will continue to leverage our strength as the leading search platform and are extremely pleased to be working with an industry leader like Overture,” said Terry Semel, chairman and chief executive officer, Yahoo! Inc. “Search and paid listings are key growth areas for Yahoo! and with the strong success of Sponsor Matches since its launch in November, we are looking forward to providing even more comprehensive and enhanced search opportunities for advertisers and consumers.”
Yahoo! Sponsor Matches is an enhanced placement program that gives Web sites increased visibility in Yahoo!’s search results, distinguished in clearly demarcated sections. Since its inception, the Yahoo! Sponsor Matches program has shown strong performance and experienced click-through rates considerably higher than the industry average. Businesses are able to reach their targeted consumers more effectively through enhanced placement in search results on keywords that are relevant to their business and consumers are able to find services that are relevant to their needs.
“We are excited to announce this long-term partnership with one of the most popular destination sites on the Internet,” said Ted Meisel, president and chief executive officer, Overture Services, Inc. “It is clear that Yahoo! views search as a strategic priority and we look forward to developing new search products with them in the future.”
Overture’s search results are generated by Overture’s 60,000 advertisers who bid for placement on keywords that are relevant to their businesses. These listings are carefully screened by Overture’s 100-person editorial team before being distributed to the company’s affiliate partner network, which includes many of the Internet’s most popular destination sites.
About Yahoo!
Yahoo! Inc. is a leading provider of comprehensive online products and services to consumers and businesses worldwide. Yahoo! reaches more than 237 million individuals worldwide each month, and is the No. 1 Internet brand globally. Headquartered in Sunnyvale, Calif., Yahoo!’s global network includes 25 World properties and is available in 13 languages.
About Overture (formerly GoTo)
Overture, (Nasdaq: OVER - news), formerly known as GoTo, is the leader in Pay-For-Performance search on the Internet. The company created the market for Pay-For-Performance search by redefining how businesses market online. In the first quarter of 2002, Overture facilitated more than 587 million paid introductions on a worldwide basis between consumers and its approximately 60,000 advertisers, who bid for placement on relevant search results and pay Overture only when a consumer clicks on their listing. Following a rigorous screening for user relevance by Overture’s 100-person editorial team, the company distributes its search results to tens of thousands of sites across the Internet, including America Online, Microsoft and Yahoo! - making it the largest Pay-For-Performance search and advertising network on the Internet. Overture is based in Pasadena, California, with offices in New York, San Francisco and the UK, Germany and Ireland. For more information, visit www.overture.com.
* Certain information on this page has been omitted and filed separately with
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Yahoo! and the Yahoo! logo are registered trademarks of Yahoo! Inc. Overture and Pay-For-Performance are service marks of Overture Services Inc. All other names are trademarks, registered trademarks or service marks of their respective owners.
This press release contains forward-looking statements within the meaning of the federal securities laws. These forward-looking statements include without limitation statements regarding Yahoo!’s users will continue to use Overture search results, that advertisers and businesses will want to participate in Sponsored Matches by seeking enhanced placement in the search results, that businesses will be able to reach customers more effectively through enhanced placement in search results, that the companies will develop new search products. These forward-looking statements are subject to risks and uncertainties that could cause actual results and events to differ materially. These risks and uncertainties include, among others that the implementation may not be successful or generate revenue for Overture or yield economic benefits to Overture, that the development of new search products may not happen and if it does happen that it will be successful or generate revenue for Overture or yield economic benefits to Overture, the risk that Overture’s advertisers and businesses may not want traffic from Yahoo! and the risk that Yahoo!’s users may not want to use the Sponsor Matches product. For a discussion of other risks that could cause actual results or events to differ materially from such forward-looking statements, see the discussion of “Risks That Could Affect Our Financial Condition and Results of Operations” in Overture’s 10-K filing with the SEC for the period ended December 31, 2001. Overture undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.
--------------------------------------
Contact:
Overture Services, Inc.
Al Duncan, 626 ###-###-#### (Media)
***@***
Jim Olson, 626 ###-###-####
***@***
Laurie Berman, 626 ###-###-#### (Investors)
***@***
or
Yahoo!
Diana Lee, 408 ###-###-####
***@***
or
Fleishman Hillard PR
Nicole Waddell, 503 ###-###-####
***@***
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EXECUTION CONFIDENTIAL
EXHIBIT E
[*]
[*]
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EXECUTION CONFIDENTIAL
EXHIBIT F
OVERTURE REPORTS
MAIN MONTHLY REPORTS:
— Yahoo average CPC
— Published site wide CPC (delivered in the report following
Overture’s quarterly announcement of this number)
— Yahoo Search Queries asked of Overture (number)
— Total Actual Clicks delivered from Yahoo (number)
[*]
SOURCE OF QUERY REPORTS:
For each unique source of Yahoo Search Queries (e.g., “next” Yahoo Search Results Pages) that Yahoo “tags” pursuant to Section 8.4(a), Overture will provide the following reports:
— Average CPC for that source
— Yahoo Search Queries asked of Overture from each source (number)
— Total Actual Clicks delivered from Yahoo from each source (number)
[*]
— Total Gross revenue earned by Yahoo from each source
— All of the above in a cumulative manner annually and over the Term
(totals/averages across the term, as distinct from the applicable
Quarter)
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EXECUTION CONFIDENTIAL
EXHIBIT G
EXCLUDED TERMS
[*]
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EXECUTION CONFIDENTIAL
EXHIBIT H
OVERTURE RESTRICTED COMPANIES
[*]
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EXECUTION CONFIDENTIAL
EXHIBIT I
Subject: Overture Signs Long-Term Yahoo! Agreement
Dear Overture Advertiser:
Overture is excited to announce the renewal of our Pay-for-Performance(TM) search agreement with Yahoo! for the next three years. We are pleased to have secured long-term agreements with two of the most popular destinations on the Internet — Yahoo! and MSN. These agreements give Overture advertisers an opportunity to reach a majority of all active Internet users.
Overture search results will continue to appear on Yahoo at www.yahoo.com. As the leading provider of comprehensive online products and services, Yahoo! reaches millions of users and is the number one Internet brand globally.
Earlier today we announced that our U.S. search distribution relationship with America Online has ended, including AOL, AOL.com, Compuserve and Netscape (scheduled to end in August). Overture will continue to provide its search results to AOL Europe’s Internet properties in the UK, Germany and France.
The strength of our affiliate network, which includes, Yahoo!, MSN, AltaVista, Lycos, Infospace, AskJeeves, and CNET, allows Overture to deliver the quality and quantity of leads you’ve come to expect from us.
We are committed to your success and look forward to continuing to deliver the highest return on your advertising investment.
Sincerely,
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EXECUTION CONFIDENTIAL
EXHIBIT J
OVERTURE DISQUALIFIED ENTITIES
[*]
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EXECUTION CONFIDENTIAL
EXHIBIT K
ESTIMATED YAHOO PAYMENT AND GUARANTEED FIXED PAYMENT ADJUSTMENT PROCESS
[*]
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EXECUTION CONFIDENTIAL
EXHIBIT 8.4
YAHOO REPORTING:
Yahoo will provide monthly Yahoo Search Query reports that include the following categories of information:
[*]
YAHOO SEARCH QUERY, IMPRESSION AND `BOT TRAFFIC VERIFICATION INFORMATION:
Yahoo will provide Overture with the following information in a data field at the time-of-search to enable Overture to develop its own reasonable estimates of searches performed by `bots as a percentage of Yahoo Search Queries and Impressions:
[*]
Yahoo will be entitled to encrypt such information so long as the encryption algorithm is consistent (allowing Overture to verify valid searches performed by human users in a consistent manner that is time-independent). Accordingly, Yahoo will provide Overture with six weeks notice prior to a change in the encryption data, which preserves the utility of the data for the purpose of verifying valid Impressions and Search Queries.
* Certain information on this page has been omitted and filed separately with
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1
