<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1999
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number: 000-25577
----------------
AUTOWEB.COM, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
Delaware 77-0412737
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
</TABLE>
3270 Jay Street, Building 6
Santa Clara, California 95054
(Address of principal executive offices, including zip code)
(408) 554-9552
(Registrant's telephone number, including area code)
----------------
Indicate by check mark whether the Registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities and Exchange Act
of 1934 during the preceding 12 month (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [_]
As of July 31, 1999, there were 25,050,156 shares of the Registrant's common
stock outstanding.
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<PAGE>
AUTOWEB.COM, INC.
INDEX
<TABLE>
<CAPTION>
Page
----
PART I. FINANCIAL INFORMATION
<C> <S> <C>
ITEM 1: Condensed Financial Statements:
Condensed Balance Sheets as of June 30, 1999 and December 31,
1998.......................................................... 2
Condensed Statements of Operations for the three months and six
months ended June 30, 1999 and 1998........................... 3
Condensed Statements of Cash Flows for the six months ended
June 30, 1999 and 1998........................................ 4
Notes to Condensed Financial Statements........................ 5
ITEM 2: Management's Discussion and Analysis of Financial Condition and
Results of Operations......................................... 7
ITEM 3: Quantitative and Qualitative Disclosures About Market Risk..... 22
PART II. OTHER INFORMATION
ITEM 1: Legal Proceedings.............................................. 23
ITEM 2: Changes in Securities and Use of Proceeds...................... 23
ITEM 3: Defaults upon Senior Securities................................ 23
ITEM 4: Submission of Matters to a Vote of Security Holders............ 23
ITEM 5: Other Information.............................................. 23
ITEM 6: Exhibits and Reports on Form 8-K............................... 23
Signatures.............................................................. 24
</TABLE>
<PAGE>
PART I: FINANCIAL INFORMATION
ITEM 1: CONDENSED FINANCIAL STATEMENTS
AUTOWEB.COM, INC.
CONDENSED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
----------- ------------
(unaudited)
ASSETS
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents....................... $ 25,201 $ 2,714
Short-term investments.......................... 46,231 --
Accounts receivable, net........................ 3,166 2,147
Prepaid expenses and other current assets....... 1,837 1,162
-------- --------
Total current assets.......................... 76,435 6,023
Property and equipment, net....................... 1,380 1,162
-------- --------
Total assets.................................. $ 77,815 $ 7,185
======== ========
LIABILITIES, MANDATORILY REDEEMABLE CONVERTIBLE
<CAPTION>
PREFERRED STOCK, AND STOCKHOLDERS' EQUITY
(DEFICIT)
<S> <C> <C> <C>
Current liabilities:
Account payable and other accrued expenses...... $ 5,274 $ 2,557
Accrued payroll and related expenses............ 1,646 624
Deferred revenue................................ 1,105 1,739
Current portion of notes and capital lease
obligations payable............................ 298 303
-------- --------
Total current liabilities..................... 8,323 5,223
Notes payable and capital lease obligations, net
of current portion............................... 546 654
-------- --------
Total liabilities............................. 8,869 5,877
-------- --------
Mandatorily redeemable convertible preferred
stock............................................ -- 12,969
-------- --------
Stockholders' equity (deficit):
Common stock.................................... 18 2
Additional paid-in capital...................... 99,601 11,371
Unearned stock-based compensation............... (7,651) (5,406)
Accumulated deficit............................. (23,022) (17,628)
-------- --------
Total stockholders' equity.................... 68,946 (11,661)
-------- --------
Total liabilities, mandatorily redeemable
convertible preferred stock, and stockholders'
equity (deficit)................................. $ 77,815 $ 7,185
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
AUTOWEB.COM, INC.
CONDENSED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
-------------------- ------------------
1999 1998 1999 1998
--------- --------- -------- --------
(unaudited)
<S> <C> <C> <C> <C>
Net revenues......................... $ 7,021 $ 2,811 $ 12,765 $ 4,967
Cost of net revenues................. 652 156 1,300 267
--------- --------- -------- --------
Gross profit....................... 6,369 2,655 11,465 4,700
--------- --------- -------- --------
Operating expenses:
Sales and marketing................ 7,329 3,686 12,380 6,340
Product development................ 624 136 1,179 266
General and administrative......... 1,623 958 2,928 1,913
Stock-based compensation........... 538 11 1,202 15
--------- --------- -------- --------
Total operating expenses......... 10,114 4,791 17,689 8,534
--------- --------- -------- --------
Loss from operations................. (3,745) (2,136) (6,224) (3,834)
Interest and other income (expense),
net................................. 791 2 830 --
--------- --------- -------- --------
Net loss............................. (2,954) (2,134) (5,394) (3,834)
Accretion of mandatorily redeemable
convertible preferred stock to
redemption value.................... -- (206) -- (340)
--------- --------- -------- --------
Net loss attributable to common
stockholders........................ $ (2,954) $ (2,340) $ (5,394) $ (4,174)
========= ========= ======== ========
Net loss per share:
Basic and diluted.................. $ (0.12) $ (0.30) $ (0.31) $ (0.53)
========= ========= ======== ========
Weighted average shares--basic and
diluted........................... 24,810 7,845 17,345 7,834
========= ========= ======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
AUTOWEB.COM, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
Six Months
Ended
June 30,
----------------
1999 1998
------- -------
(unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss................................................... $(5,394) $(3,834)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization............................ 446 215
Write-down of intangible assets.......................... -- 13
Provision for doubtful accounts.......................... 144 183
Stock-based compensation expense for employee options
granted................................................. 1,210 15
Issuance of common stock options/warrants in exchange for
services................................................ 181 79
Change in assets and liabilities:
Accounts receivable.................................... (1,163) (1,274)
Prepaid expenses and other current assets.............. (675) (681)
Accounts payable and other accrued expenses............ 2,717 823
Accrued payroll and related expenses................... 1,022 205
Deferred revenue....................................... (634) 37
------- -------
Net cash used in operating activities................ (2,146) (4,219)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of short-term investments........................ (46,231) --
Redemption of Series A preferred stock..................... -- (1,000)
Acquisition of property and equipment...................... (664) (506)
------- -------
Net cash used in investing activities................ (46,895) (1,506)
------- -------
CASH FLOW FROM FINANCING ACTIVITIES:
Principal payments under notes payable and capital lease
obligations .............................................. (245) (445)
Proceeds from borrowing under debt facilities.............. 132 934
Proceeds from issuance of Series C preferred stock, net of
costs..................................................... -- 4,965
Proceeds from issuance of common stock, net of costs....... 71,641 10
------- -------
Net cash provided by financing activities............ 71,528 5,464
------- -------
Net increase (decrease) in cash and cash equivalents......... 22,487 (261)
Cash and cash equivalents, at the beginning of year.......... 2,714 1,819
------- -------
Cash and cash equivalents, at end of period.................. $25,201 $ 1,558
======= =======
Supplemental disclosure of noncash investing and financing
activities:
Unearned stock-based compensation related to employee stock
option grants............................................. $ 3,456 $ 192
Accretion of mandatorily redeemable convertible preferred
stock..................................................... $ -- $ 340
Revenue and advertising expense from barter transactions... $ 572 $ 233
Acquisition of intangibles in exchange for common stock.... $ -- $ 13
Issuance of common stock in exchange for note receivable... $ 786 $ --
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
AUTOWEB.COM, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
Note 1--The Company
Autoweb.com, Inc. (the "Company") was incorporated in California on October
3, 1995 as Downtown Web, Inc. and reincorporated in Delaware on March 16, 1999.
The Company provides a consumer automotive Internet service, whereby its Web
site enables consumers to select new or pre-owned vehicles from member dealers.
In addition, the Company offers services that enable consumers to purchase
automotive-related products and services such as insurance and financing. The
Company markets and sells its services primarily in North America and operates
in one business segment.
Note 2--Summary of Significant Accounting Policies
Basis of Preparation
The accompanying condensed financial statements as of June 30, 1999, and for
the three and six months ended June 30, 1999 and 1998, are unaudited. The
unaudited interim condensed financial statements have been prepared on the same
basis as the annual financial statements and, in the opinion of management,
reflect all adjustments, which include only normal recurring adjustments,
necessary to present fairly the Company's financial position, results of
operations and cash flows as of June 30, 1999 and for the three and six months
ended June 30, 1999 and 1998. These condensed financial statements and notes
thereto are unaudited and should be read in conjunction with the Company's
financial statements included in the Company's Prospectus, as amended, filed
with the Securities and Exchange Commission on March 22, 1999. The results for
the three and six months ended June 30, 1999 are not necessarily indicative of
the expected results for the year ending December 31, 1999.
Concentration of Credit Risk
Financial instruments that potentially subject the Company to a
concentration of credit risk consist of cash, cash equivalents, short-term
investments and accounts receivable. Cash, cash equivalents, and short-term
investments are deposited with six high credit quality financial institutions
in the United States. The Company maintains allowances for potential credit
losses, and such losses have been within management's expectation.
Fair Value of Financial Instruments
Carrying amounts of certain of the Company's financial instruments,
including cash and cash equivalents, short-term investments, accounts
receivable, accounts payable and other accrued liabilities, approximate fair
value due to their short maturities.
Marketable Securities
The Company considers all highly liquid investments purchased with original
maturities of ninety days or less to be cash equivalents. Cash equivalents
consist primarily of deposits in money market funds.
At June 30, 1999, the Company's short-term investments are made up entirely
of investments in commercial paper, are classified as "available for sale", and
are reported at fair market value, which approximates cost. Realized gains and
losses are based on the book value of the specific securities sold and were
immaterial for the three and six months ended June 30, 1999.
Stock-Based Compensation
In 1997, the Company adopted the disclosure provisions of Financial
Accounting Standards Board ("FASB") Statement of Financial Accounting Standards
("SFAS") No. 123, "Accounting for Stock-based
4
<PAGE>
AUTOWEB.COM, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS--(Continued)
Compensation." The Company has elected to continue accounting for stock-based
compensation issued to employees using Accounting Principles Board ("APB")
Opinion No. 25, "Accounting for Stock Issued to Employees." Under APB No. 25,
compensation expense is based on the difference, if any, on the date of the
grant between the fair value of the Company's stock and the exercise price.
Stock issued to non-employees has been accounted for in accordance with SFAS
No. 123 and valued using the Black-Scholes model.
Net Loss Per Share
The Company computes net loss per share in accordance with SFAS No. 128,
"Earning per Share". Under the provisions of SFAS No. 128, basic net loss per
share is computed by dividing the net loss available to common stockholders for
the period by the weighted average number of common shares outstanding during
the period. Diluted net loss per share is computed by dividing the net loss for
the period by the weighted average number of common and common equivalent
shares outstanding during the period. Common equivalent shares, composed of
unvested restricted common stock and incremental common shares issuable upon
the exercise of stock options and warrants and upon conversion of Series A,
Series B and Series C mandatorily redeemable convertible preferred stock, are
included in the diluted net loss per share computation to the extent such
shares are dilutive.
<TABLE>
<CAPTION>
Three Months Ended, Six Months
June 30, Ended June 30,
-------------------- ----------------
1999 1998 1999 1998
--------- --------- ------- -------
(In thousands, except per share
amounts)
<S> <C> <C> <C> <C>
Numerator:
Net loss.......................... $ (2,954) $ (2,134) $(5,394) $(3,834)
Accretion of mandatorily
redeemable convertible preferred
stock to redemption value........ -- (206) -- (340)
--------- --------- ------- -------
Net loss attributable to common
stockholders..................... $ (2,954) $ (2,340) $(5,394) $(4,174)
========= ========= ======= =======
Denominator:
Weighted average shares--basic and
diluted.......................... 24,810 7,845 17,345 7,834
--------- --------- ------- -------
Net loss per share--basic and
diluted.......................... $ (0.12) $ (0.30) $ (0.31) $ (0.53)
========= ========= ======= =======
</TABLE>
Recent Accounting Pronouncements
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 is effective for all fiscal
quarters of all years beginning after June 15, 1999. SFAS No. 133 requires that
all derivative instruments be recorded on the balance sheet at their fair
value. Changes in the fair value of derivatives are recorded each period in
current earnings or other comprehensive income, depending on whether a
derivative is designed as part of a hedge transaction and, if it is, the type
of hedge transaction. The Company does not expect that the adoption of SFAS No.
133 will have a material impact on its condensed financial statements. In June
1999, the FASB issued SFAS No. 137, which delayed the effective date of SFAS
No. 133 to fiscal years beginning after June 15, 2000.
Note 3--Common Stock
Initial Public Offering, Conversion of Preferred Stock
In March 1999, the Company completed its initial public offering and issued
5,550,000 shares of its Common Stock at a price of $14.00 per share. The
Company received approximately $71.1 million in cash, net of underwriting
discounts and commissions and other offering costs. Simultaneously with the
closing of the initial public offering, the shares of mandatorily redeemable
convertible preferred stock outstanding at that time were automatically
converted into approximately 10.9 million shares of common stock.
5
<PAGE>
AUTOWEB.COM, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS--(Continued)
Unearned Stock-Based Compensation
In connection with certain employee stock option grants during the three and
six months ended June 30, 1999 and 1998, the Company recognized unearned
compensation and related amortization expense as displayed in the table below.
Amortization expense is being recognized over the vesting periods of the
related options.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
1999 1998 1999 1998
--------- --------- --------- --------
<S> <C> <C> <C> <C>
Unearned compensation................. $ -- $ 118 $ 3,456 $ 192
Amortization expense.................. $ 546 $ 11 $ 1,210 $ 15
</TABLE>
Note 4--Related Party Transactions
At June 30, 1999, the Company had full recourse promissory notes receivable
totaling $982,000 from stockholders who are also related parties. The loan
receivable from the President totaling $922,000 was made in connection with the
exercise of certain stock options. The loan is interest-free, is collateralized
by approximately 595,000 shares of common stock, and is due on the earlier of
the sale of sufficient shares to repay the loan or January 22, 2002.
Note 5--Commitments
During the second quarter of 1999, the Company entered into new agreements
with global Internet media companies to maintain certain exclusive promotional
rights and linkage with the media companies and to provide for certain
advertising. As of June 30, 1999, the agreements required remaining minimum
future payments of approximately $40 million over the next two years.
Note 6--Subsequent Event
On July 9, 1999, the Company entered into an agreement to acquire certain
software products and certain other intangible and tangible assets from
SalesEnhancer.com, Inc. for approximately $3.7 million in cash.
6
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
This document contains forward-looking statements, the accuracy of which
involves risk and uncertainties. We use words such as "anticipates,"
"believes," "plans," "expects," "future" and "intends" and similar expressions
to identify forward-looking statements. You should not place undue reliance on
these forward-looking statements, which apply only as of the date of this
document. Our actual results could differ materially from those anticipated in
our forward-looking statements for many reasons, including the risks described
in "Risk Factors" included in our Registration Statement No. 333-71177, as
amended, filed with the Securities and Exchange Commission and elsewhere in
this document.
Overview
Autoweb.com is a leading consumer automotive Internet service. Our Web site
centralizes an extensive collection of automotive-related commerce, content and
community offerings to assist consumers in researching, evaluating and buying
new and pre-owned vehicles. In addition, our Web site enables consumers to
conveniently purchase automotive-related products and services such as
insurance and financing. We began selling our services to automobile dealers
and launched the Autoweb.com Web site for consumer use in October 1995. Since
that time, we have increased our network to approximately 5,000 member dealers
(where each franchise location for a particular vehicle manufacturer is defined
as a member dealer), including approximately 1,600 pre-owned vehicle locations.
We originally charged our member dealers based on a subscription model,
where each member dealer paid a flat monthly fee in exchange for our directing
consumer purchase inquiries to them. Because the number of purchase inquiries
directed to member dealers varied widely, due to factors such as their location
and franchise type, the cost per purchase inquiry under this model differed
substantially from member dealer to member dealer. In February 1998, we changed
our pricing model and began selling our services to new dealers using a "pay
for performance" model. Under this arrangement, a member dealer pays us a fee
only for a qualified purchase inquiry that it actually receives. We believe our
"pay for performance" model enables our member dealers to maximize their return
from, and enhances their satisfaction with, our services. In February 1998, we
also began converting our existing member dealer subscription contracts to
contracts utilizing the pay for performance model. As of June 30, 1999,
approximately 2% of our member dealer contracts utilized the subscription
model. We expect that there will be almost no subscription paying member deals
by the end of 1999.
We derive the majority of our revenues from fees charged to our member
dealers in exchange for qualified purchase inquiries and expect to continue to
do so for the foreseeable future. The revenue related to each fee is recognized
at the time the qualified purchase inquiry is provided to the member dealer. We
maintain a returns reserve against purchase inquiries that are later deemed not
to have been "qualified." In December 1996, we began providing online
advertising space on the Autoweb.com site and recognizing revenues from fees
paid by these advertisers. Revenues from advertising contracts, which typically
have terms of less than three months, are recognized as the contracts are
fulfilled. We expect that this component of our revenues will continue to
increase in absolute dollar terms. In February 1997, we began offering
automotive-related services on the Autoweb.com Web site through agreements with
third-party vendors. We derive revenues from certain of these agreements where
a third party pays us for the right to provide its consumer services, such as
automobile financing and insurance, on our Web site. Revenues from these
agreements are generally recognized ratably over the terms of the agreements.
We expect that this component of our revenues will continue to increase both in
absolute dollar terms and as a percentage of net revenues.
Our recent growth has placed and is expected to continue to place a
significant strain on our managerial, operational and financial resources. To
manage our potential growth, we must continue to implement and improve our
operational and financial systems, and must expand, train and manage our
employee base. Our Chief Technology Officer and our Vice President, Product
Management have been with us only since February 1999. Our Senior Vice
President, Sales and Member Services has been with us only since January 1999.
Our
7
<PAGE>
Chief Executive Officer and our Vice President, Business Development and
Advertising Sales joined us during December 1998. In addition, our Vice
President, Dealer Operations has been with us since January 1998 and our Chief
Financial Officer has been with us for less than two years. Our Vice President,
Marketing resigned July 30, 1999, and was replaced by our Chief Marketing
Officer on August 2, 1999. We cannot assure you that we will be able to manage
the expansion of our operations effectively, that our systems, procedures or
controls will be adequate to support our operations or that our management will
be able to fully exploit the market opportunity for our services. Any inability
to manage growth effectively could have a material adverse effect on our
business, results of operations and financial condition.
Results of Operations
The following table sets forth, for the periods presented, certain data
derived from our unaudited condensed statements of operations as a percentage
of net revenues. The operating results for the three and six months ended June
30, 1999 are not necessarily indicative of the results that may be expected for
any future period.
<TABLE>
<CAPTION>
Three Months Six Months
Ended Ended
June 30, June 30,
---------------- --------------
1999 1998 1999 1998
------ ------ ----- -----
<S> <C> <C> <C> <C>
Net revenues........................... 100 % 100 % 100 % 100 %
Cost of net revenues................... 9 6 10 5
------ ------ ----- -----
Gross profit........................... 91 94 90 95
------ ------ ----- -----
Operating expenses:
Sales and marketing.................. 104 131 97 128
Product development.................. 9 5 9 5
General and administrative........... 23 34 23 39
Stock-based compensation............. 8 -- 10 --
------ ------ ----- -----
Total operating expenses........... 144 170 139 172
------ ------ ----- -----
Loss from operations................... (53) (76) (49) (77)
Interest, and other income (expense),
net................................... 11 -- 7 --
------ ------ ----- -----
Net loss............................... (42)% (76)% (42)% (77)%
====== ====== ===== =====
</TABLE>
Net Revenues
Our net revenues increased to $7.0 million in the three months ended June
30, 1999 (the second quarter of 1999) from $2.8 million in the three months
ended June 30, 1998 (the second quarter of 1998), an overall increase of 150%.
Approximately 62% of the increase in net revenues was due to higher levels of
net dealer fee revenues. Revenues derived from insurance referrals and
advertisers accounted for most of the remaining increase in net revenues for
these periods. Our net revenues increased to $12.8 million in the six months
ended June 30, 1999 from $5.0 million in the six months ended June 30, 1998, an
overall increase of 157%. Approximately 64% of the increase in net revenues was
due to higher levels of net dealer fee revenues. Revenues derived from
insurance referrals and advertisers accounted for most of the remaining
increase in net revenues for these periods. Dealer fee revenues increased as a
result of increases in the size of our member dealer network and the number of
purchase inquiries that we provided to our member dealers. As described above,
we began to change our pricing model in February 1998 from a subscription-based
model to a "pay for performance" model.
Cost of Net Revenues
Cost of net revenues increased to $652,000 in the second quarter of 1999
from $156,000 in the second quarter of 1998. Approximately 51% of the increase
represented revenue-sharing expenses, related to the
8
<PAGE>
operation of our co-branded and affiliate sites. Approximately 41% of the
increase was due to increased costs of web site operations, including
personnel, equipment, depreciation, and occupancy cost. The remainder of the
increase came from the cost of providing site content. For the six months ended
June 30, 1999, cost of net revenues increased to $1.3 million compared to
$267,000 in the first six months of 1998. Approximately 47% of the increase
represented revenue-sharing expenses related to the operation of our co-branded
and affiliate sites. Approximately 38% of the increase was due to increased
cost of web site operations, including personnel, equipment, depreciation, and
occupancy cost. The remainder of the increase came from the cost of providing
site content. We believe that the cost of net revenues will increase in
absolute terms over the remainder of the year, due to anticipated increases in
revenue-sharing expenses and in the costs of web site operations.
Sales and Marketing
Our sales and marketing expenses increased to $7.3 million in the second
quarter of 1999 from $3.7 million in the second quarter of 1998. Approximately
90% of the increase in sales and marketing expenses was due to increases
primarily in online advertising and, to a lesser extent, our spending on public
relations, advertising in the traditional media, trade shows and other
promotions. Approximately 8% of the increase in sales and marketing expenses
was due to increased personnel costs caused by additions to headcount,
primarily salespersons focused on enrolling member dealers. For the six months
ended June 30, 1999, sales and marketing expenses increased to $12.4 million
from $6.3 million in the six months ended June 30, 1998. Approximately 82% of
the increase in sales and marketing expenses was due to increases primarily in
online advertising and, to a lesser extent, our spending on public relations,
advertising in the traditional media, trade shows and other promotions such as
the NADA trade show. Approximately 12% of the increase in sales and marketing
expenses was due to increased personnel costs caused by additions to headcount,
primarily salespersons focused on enrolling member dealers. We believe that
sales and marketing expenses will increase both in absolute terms and as a
percent of net revenues over the remainder of the year, due to anticipated
increases in media advertising both on the Internet and in traditional media
sources.
Product Development
Our product development expenses increased to $624,000 in the second quarter
of 1999 from $136,000 in the second quarter of 1998, and for the six months
ended June 30, 1999, product development expenses increased to $1.2 million
from $266,000 in the first six months of 1998. For both the three and six
months ended June 30, 1999, these expenses increased primarily as a result of
increased hiring of product development personnel and, to a lesser extent, as a
result of increased occupancy costs. We believe that product development
expenses will increase both in absolute terms and as a percent of net revenues
over the remainder of the year.
General and Administrative
Our general and administrative expenses increased to $1.6 million in the
second quarter of 1999 from $958,000 in the second quarter of 1998.
Approximately 44% of the increase in general and administrative expenses was
due to increases in personnel costs resulting from increased hiring of
administrative personnel. Approximately 32% of the increase was due to
increases in information technology support related to administrative functions
and occupancy costs. For the six months ended June 30, 1999, general and
administrative expenses increased to $2.9 million from $1.9 million in the
first six months of 1998. Approximately 49% of the increase in general and
administrative expenses was due to increases in personnel costs resulting from
increased hiring of administrative personnel. Approximately 33% of the increase
was due to increases in information technology support related to
administrative functions and occupancy costs. We believe that general and
administrative expense will increase in absolute terms over the remainder of
the year.
Stock-Based Compensation
Our stock-based compensation expense increased to $538,000 in the second
quarter of 1999 from $11,000 in the second quarter of 1998, primarily due to
the increased level of stock option grants and increases in the deemed fair
market value of the underlying common stock in the second quarter of 1999
compared with the
9
<PAGE>
second quarter of 1998. The increase in the six months ended June 30, 1999 from
the six months ended June 30, 1998 was also due primarily to the increased
level of stock option grants and increases in the deemed fair market value of
the underlying common stock in those respective periods. We believe that stock-
based compensation expense will decrease slightly over the remainder of the
year.
Interest and Other Income (Expense), Net
For both the three and six months ended June 30, 1999, the increase in
interest and other income (expense), net, over comparable prior year periods,
represents interest income earned on greater levels of cash, cash equivalents,
and short-term investment balances, partially offset by interest expense on
borrowings under capital leases and our credit facilities.
Recent Accounting Pronouncements
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities." SFAS No. 133 is effective for all fiscal
quarters of all years beginning after June 15, 1999. SFAS No. 133 requires that
all derivative instruments be recorded on the balance sheet at their fair
value. Changes in the fair value of derivatives are recorded each period in
current earnings or other comprehensive income, depending on whether a
derivative is designed as part of a hedge transaction and, if it is, the type
of hedge transaction. The Company does not expect that the adoption of SFAS No.
133 will have a material impact on its condensed financial statements. In June
1999, the FASB issued SFAS No. 137, which delayed the effective date of SFAS
No. 133 to fiscal years beginning after June 15, 2000.
Liquidity and Capital Resources
Prior to March 1999, we financed our operations primarily from sales of
preferred stock and, in 1998 to a significantly lesser extent, borrowings under
a long-term debt facility. In March 1999, we raised $71.1 million (net of
underwriters' discounts and commissions and other costs) in our initial public
offering.
Net cash used in operating activities was $2.1 million in the six months
ended June 30, 1999 compared to $4.2 million in the six months ended June 30,
1998. Net cash used in operating activities in the six months ended June 30,
1999 was primarily due to the net loss for the period, partially offset by
changes in other assets and liabilities, in particular the increase in accounts
payable and other accrued expenses. Net cash used in operating activities in
the six months ended June 30, 1998 was primarily due to the net loss for the
period. Our "days sales outstanding" in accounts receivable (calculated using
the net revenues for the quarter and the ending accounts receivable balance for
that quarter) decreased to 41 days for the second quarter of 1999, from 45 days
for the first quarter of 1999, and from 49 days for the second quarter of 1998.
We believe that our days' sales outstanding in accounts receivable could
increase to greater than 45 days sales outstanding in the remainder of the
year, based on our invoicing cycles and customer payment patterns. Our
allowance for doubtful accounts, which was 19% of accounts receivable at
December 31, 1998, decreased to 17% of accounts receivable at June 30, 1999.
Net cash used in investing activities was $46.9 million in the first six
months of 1999, compared to $1.5 million in the first six months of 1998. This
increase was primarily due to the purchase of short-term investments as we
continued to invest the proceeds of our initial public offering. We anticipate
that our purchases of short-term investments will increase over the balance of
the year, and that our property and equipment purchases for the remainder of
1999 will be at higher levels than the first six months of 1999.
Net cash provided by financing activities was $71.5 million in the first six
months of 1999 compared to $5.5 million in the first six months of 1998 due
almost entirely to the proceeds of the initial public offering completed in
March 1999.
At June 30, 1999, the total of our cash, cash equivalents and short-term
investments were $71.4 million. During the second quarter of 1999, we initiated
a new commitments for exclusive promotional rights, linkage and certain
advertising that will require us to pay approximately $40 million over the next
two years. We initiated no new material commitments for purchases of equipment
during the second quarter of 1999. We believe that our current cash position
together with anticipated future revenues and the availability of additional
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funds under our line of credit will be sufficient to meet our cash requirements
for at least the next 12 months. Depending on our rate of growth and cash
requirements, we may require additional equity or debt financing to meet future
working capital or capital expenditure needs. There can be no assurance that
such additional financing will be available or, if available, that such
financing can be obtained on terms satisfactory to us.
RISKS THAT COULD AFFECT OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS
We are an early stage company.
We were incorporated in October 1995. Therefore, we have a limited operating
history upon which to base an evaluation of our current business and prospects.
Moreover, our business model is evolving and depends on our ability to generate
revenues from multiple sources through our Web site. In particular, we face the
following challenges:
. maintaining and increasing our consumer base;
. maintaining and increasing our network of member dealers;
. managing the quality of services delivered by member dealers and
automotive-related vendors;
. generating continuing revenues through our Web site from consumers,
member dealers and other commercial vendors;
. competing effectively with existing and potential competitors;
. developing further our unproven business model;
. developing further Autoweb.com awareness and brand loyalty;
. anticipating and adapting to the evolving e-commerce market;
. continuing to develop our technology infrastructure to handle greater
Internet traffic efficiently
. managing expanding operations;
. broadening our service offerings and attracting and retaining
additional automotive-related vendors and content providers to enable
us to expand our service offerings; and
. attracting and retaining qualified personnel.
We may not successfully implement any of our strategies or successfully address
these risks and uncertainties.
Our quarterly financial results are subject to significant fluctuations.
Our results of operations have varied widely in the past, and we expect that
they will continue to vary significantly from quarter to quarter due to a
number of factors described below.
Our revenue growth rates may not be sustainable. Any shortfall in our
revenues would immediately increase our operating losses and would adversely
affect the market price of our common stock. We expect that over time our
revenues will come from a mix of fees from member dealers, automotive-related
vendors and advertisers. However, we expect to be substantially dependent on
member dealer fees. Therefore, our quarterly revenues and operating results are
likely to be particularly affected by the level of member dealer fees in each
quarter. We plan to increase our operating expenses significantly, based on our
expectations of future revenues. If revenues fall below our expectations, we
will not be able to reduce our spending rapidly in response to such a
shortfall. This will adversely affect our operating results.
We believe that we may experience seasonality in our business. The seasonal
patterns of Internet usage and vehicle purchasing do not completely overlap.
Internet usage typically declines during the summer and
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certain holiday periods, while vehicle purchasing in the United States is
strongest in the late spring and summer months. Because of our limited
operating history, we do not know which seasonal pattern, if any, will
predominate.
Due to the foregoing factors and factors described elsewhere in this
document, we believe that quarter-to-quarter comparisons of our results of
operations are not a good indication of our future performance. It is likely
that our results of operations in some future quarter may be below the
expectations of public market analysts and investors. In this event, the price
of our common stock is likely to decline.
We have a history of net losses and expect net losses for the foreseeable
future.
We have incurred net losses in each fiscal year since our inception,
including a net loss of $11.5 million in 1998, and we had an accumulated
deficit of $17.6 million as of December 31, 1998. During the six months ended
June 30, 1999, we incurred a net loss of $5.4 million, and, as of June 30,
1999, we had an accumulated deficit of $23.0 million. We expect to have
increasing net losses and negative cash flows for the next several quarters and
net losses and continued negative cash flows at least through the end of 2000.
The size of these net losses will depend, in part, on the rate of growth in our
revenues from member dealer fees, other commercial vendor fees, advertising
sales and other electronic-commerce ("e-commerce") activities. It is critical
to our success that we continue to expend financial and management resources to
develop Autoweb.com brand awareness and loyalty through marketing and
promotion, expansion of our member dealer network, development of our online
content and expansion of our other services. As a result, we expect that our
operating expenses will increase significantly during the next several years,
especially in sales and marketing. With increased expenses, we will need to
generate significant additional revenues to achieve profitability. As a result,
we may never achieve or sustain profitability, and, if we do achieve
profitability in any period, we may not be able to sustain or increase
profitability on a quarterly or annual basis.
We have a new and unproven business model.
The manner in which we conduct our business and charge for our services is
new and unproven. The model depends upon our ability to generate revenue
streams from multiple sources through our Web site, including:
. fees paid by member dealers for consumer referrals;
. fees paid by companies in industries related to vehicles such as
insurance and financing industries;
. advertising fees paid by manufacturers and other companies that want
access to vehicle purchasers; and
. fees paid by individuals who want to advertise their vehicles for
sale.
In order for us to be successful, we must have consumers visit our Web site
regularly to increase the likelihood that they will use our service when they
are interested in buying a vehicle or a related product or service. Therefore,
we must not only develop services that directly generate revenue, but also
provide information and community offerings that attract consumers to our Web
site frequently. We will need to develop new offerings in each of these areas
as consumer preferences change and new competitors emerge. We cannot assure you
that we will be able to provide consumers with an acceptable blend of services,
informational and community offerings. We provide information and community
offerings without charge, and we may not be able to generate sufficient
services revenue to pay for these offerings. Accordingly, we are not sure our
business model will be successful or that we can sustain revenue growth or be
profitable.
The online market for automotive services is new and rapidly developing. As
is typical for any new, rapidly evolving market, demand and market acceptance
for recently introduced products and services are subject to a high level of
uncertainty and risk. For example, in 1998 we changed our pricing model from a
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fixed-rate, subscription-based pricing model to a "pay for performance" pricing
model under which each member dealer pays a fee for each qualified purchase
inquiry that we deliver to it from a pre-selected geographic radius. In 1998,
we also changed our pricing levels. These changes may not prove to be
successful. It is also difficult to predict the market's future growth rate, if
any. Because of the low barriers to entry, the market is characterized by an
increasing number of market entrants. If the market fails to develop, develops
more slowly than expected or becomes saturated with competitors, or our
services do not achieve or sustain market acceptance, our business, results of
operations and financial condition could be materially and adversely affected.
We must reduce our allowances for doubtful accounts.
In 1998, we changed our pricing model and began selling our services to new
dealers using a "pay for performance" model instead of a subscription-based
pricing model. The increased risk of non-collection associated with a greater
scrutiny by member dealers of the validity of each purchase inquiry and
possibly the longer dealer credit cycle under the "pay for performance" model
have resulted in allowances for doubtful accounts increasing from 13% of
accounts receivable at December 31, 1997 to 19% of accounts receivable at
December 31, 1998. As of June 30, 1999, allowance for doubtful accounts had
decreased to 17% of accounts receivable. If we are unable to continue to reduce
our allowances for doubtful accounts in the future, it could have a material
adverse effect on our business, results of operations and financial condition.
We are in an intensely competitive market.
The market for the purchase of vehicles and automotive-related products and
services is intensely competitive, and we expect competition to increase
significantly, particularly on the Internet. Barriers to entry on the Internet
are relatively low, and we may face competitive pressures from numerous
companies. Currently, we believe our most significant competitors are
Microsoft's CarPoint, Autobytel.com and AutoConnect. There are also a number of
Web sites that offer vehicles, particularly vehicle manufacturers' own Web
sites and sites for electronic classifieds, and vehicle-related products and
services. In addition, there are numerous Web sites that offer vehicle
information and other content, as well as community offerings, directly to the
vehicle buying consumer generally or to targeted audiences such as car
collectors. We could face competition in the future from vehicle manufacturers,
large dealer groups or traditional media companies, such as newspaper,
television and radio companies, many of which currently operate a Web site. In
addition to direct competitors, we also compete indirectly with vehicle
brokerage firms, discount warehouse clubs and automobile clubs. Several auction
Web sites have also recently announced their intention to auction vehicles on
the Internet.
Many of our existing and potential competitors have longer operating
histories in the Internet market, greater name recognition, larger consumer
bases and significantly greater financial, technical and marketing resources
than we do. Additionally, the e-commerce market is new and rapidly evolving,
and we expect competition among e-commerce companies to increase significantly.
We cannot assure you that Web sites maintained by our existing and potential
competitors will not be perceived by consumers, vehicle dealers, other
potential automotive- related vendors or advertisers as being superior to ours.
We also cannot assure you that we will be able to maintain or increase our Web
site traffic levels, purchase inquiries and click-throughs or that competitors
will not experience greater growth in these areas than we do.
Our business is dependent on the economic strength of the automotive industry.
The economic strength of the automotive industry impacts significantly the
revenues we derive from our member dealers and other automotive-related
vendors, advertising revenues and consumer traffic to our Web site. The
automotive industry is cyclical, with sales of vehicles changing due to changes
in national and global economic forces. Since our incorporation, sales of
vehicles in the United States have been at historically high levels. We cannot
assure you that sales of vehicles will stay at their current levels, and a
decrease in the current level of vehicle sales could have a material adverse
effect on our business, results of operations and financial condition.
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We rely heavily on member dealers.
We derive the majority of our revenues from member dealer fees (payments
from member dealers for each consumer inquiry that we provide to them), and we
expect to continue to do so for the foreseeable future. Member dealer fees
represented approximately 85% of our net revenues in 1997, approximately 70% of
our net revenues in 1998, and approximately 68% of our net revenues for the six
months ended June 30, 1999. Consequently, our business is highly dependent on
consumers' use of Autoweb.com to purchase vehicles so that member dealers will
achieve a satisfactory return on their investment in the Autoweb.com program.
The success of our business strategy depends on our member dealers'
adherence to the Autoweb.com purchase process, including responding to consumer
purchase inquiries within 24 hours, providing a competitive, firm quote to
consumers during the initial communication, explaining the Autoweb.com purchase
process to the consumer and answering any consumer questions. We devote
significant efforts and resources to certifying and supporting participating
member dealers in these practices that are intended to increase consumer
satisfaction. Our inability to certify and support member dealers effectively,
or member dealers' failure to adopt such practices, respond rapidly and
professionally to vehicle purchase inquiries, or sell vehicles in accordance
with our marketing strategies, could result in low consumer satisfaction and
materially adversely affect our business, results of operations and financial
condition.
We must reduce our high member dealer turnover.
To maintain and increase our network of member dealers, we must reduce the
rate of turnover of our member dealers. Commencing in February 1998, we
introduced a new "pay for performance" pricing model and began actively to
convert our existing member dealers to this model. Prior to that time, all of
our member dealers were on a subscription model under which they paid a fixed
amount per month regardless of the number of purchase inquiries that we
provided to them. During 1998, we lost approximately 60% of the member dealers
that we had at the beginning of the year and converted approximately 30% to the
new pricing model. As of June 30, 1999, there were approximately 111 member
dealers (approximately 2% of the total) that were on the subscription model,
but we anticipate that there will be almost no subscription-based member
dealers by the end of 1999.
During 1998, we lost approximately 22% of the performance-based member
dealers that we converted or with which we first entered into a contract in
1998. We believe there were three primary reasons for this attrition:
. a number of our member dealers were not satisfied with our service as
subscription-based member dealers;
. a number of member dealers were unwilling to adequately devote the
resources required to obtain results from the performance-based
model, such as contacting consumers who submitted a purchase inquiry
within 24 hours and dedicating a person at the dealer to ensure
compliance with the Autoweb.com purchase process; and
. a number of member dealers were inadequately trained and supported by
us, due to our inability to focus our resources adequately.
Attrition remains unacceptably high. We believe that we can reduce our
attrition rate over time as our member dealer network stabilizes, due to the
efforts of our Dealer Development and Support Group and due to reduced
conversion activity. We are undertaking several initiatives to reduce our
attrition. Nevertheless, we cannot assure you that we will be able to reduce
the level of this attrition, and our failure to do so could materially and
adversely affect our business, results of operations and financial condition.
We need to build strong brand loyalty.
We believe that establishing and maintaining our brand loyalty is critical
to attract consumers, member dealers, automotive-related vendors and
advertisers. Furthermore, we believe that the importance of brand
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loyalty will increase as low barriers to entry encourage the proliferation of
Web sites. In order to attract and retain consumers, member dealers,
advertisers and partners, and in response to competitive pressures, we intend
to increase spending substantially to create and maintain brand loyalty among
these groups. We plan to accomplish this by expanding our current online
advertising campaigns and by conducting advertising campaigns in traditional
forms of media, such as newspaper, radio and television. We believe that
advertising rates, and the cost of our online advertising campaigns in
particular, could increase substantially in the future. If our branding efforts
are not successful, our business, results of operations and financial condition
will be materially and adversely affected.
Promotion and enhancement of the Autoweb.com brand will also depend, in
part, on our success in consistently providing a high-quality consumer
experience for purchasing vehicles and related products, relevant and useful
information and a quality "community experience." If consumers, other Internet
users, member dealers, automotive-related vendors and advertisers do not
perceive the Autoweb.com service offerings to be of high quality, or if we
introduce new services or enter into new business ventures that are not
favorably received by such groups, the value of our brand could be impaired or
diluted. Such brand impairment or dilution could decrease the attractiveness of
Autoweb.com to one or more of these groups, which could materially and
adversely affect our business, results of operations and financial condition.
We depend on third-party relationships.
We have entered into agreements with various commercial vendors, some of
which require us to feature them exclusively in certain sections of our Web
site. For example, we have entered into agreements with State Farm Mutual
Automobile Insurance Company ("State Farm"), pursuant to which State Farm has
the exclusive right to offer insurance services on our Web site through
September 1999 and vehicle financing on our Web site through January 2000.
Existing and future exclusive arrangements may prevent us from entering into
other content agreements, advertising or sponsorship arrangements or other
commercial relationships. Many companies that we may pursue for a commercial
relationship may also offer competing services. As a result, these competitors
may be reluctant to enter into commercial relationships with us. Our business
could be adversely affected if we do not maintain our existing commercial
relationships on terms as favorable as currently in effect, if we do not
establish additional commercial relationships on commercially reasonable terms
or if our commercial relationships do not result in the expected increased use
of our Web site.
We also depend on establishing and maintaining a number of commercial
relationships with high-traffic Web sites to increase traffic on Autoweb.com.
We currently have agreements with America Online, Yahoo!, Netscape
Communications, CNET's Search.com and Hotbot. There is intense competition for
placements on these sites, and in the future we may not be able to enter into
distribution relationships on commercially reasonable terms or at all. Even if
we enter into distribution relationships with these Web sites, they themselves
may not attract significant numbers of consumers. Therefore, our Web site may
receive less than the number of additional consumers we expect from these
relationships. Moreover, we may have to pay significant fees to establish or
renew these relationships.
We also depend on establishing and maintaining a number of commercial
relationships with other companies. Our current relationships include:
. New Car Test Drive and Automotive Service Excellence, under which we
purchase content for use by our consumers;
. America Online's Digital City, Car and Driver and USA Today, under
which we share the revenue generated from automotive and related
purchase inquiries submitted by consumers and directed to our Web
site through links between our Web site and the other company's Web
site; and
. members of the Autoweb.com Affiliates Program, each of which receives
a commission from us for each new or pre-owned vehicle purchase
inquiry or classified ad delivered to us through a link to the
affiliate's Web site.
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We cannot assure you that we will be able to establish new agreements or
maintain existing agreements or that the above agreements can be renewed on
commercially acceptable terms.
We also may not be able to maintain relationships with third parties that
supply us with the software or products that are crucial to our success, and
the vendors of these software or products may not be able to sustain any third-
party claims or rights against their use. Furthermore, we cannot assure you
that the software, services or products of those companies that provide access
or links to our services or products will achieve market acceptance or
commercial success. In addition, we cannot assure you that our existing
relationships will result in sustained business arrangements, successful
service or product offerings or the generation of significant revenues for us.
Failure of one or more of our relationships to achieve or maintain market
acceptance or commercial success or the termination of one or more relationship
could have a material adverse effect on our business, results of operations and
financial condition.
We need to continue to develop Autoweb.com content and service offerings.
To remain competitive we must continue to enhance and improve the ease of
use, responsiveness, functionality and features of the Autoweb.com site and
develop new services in addition to continuing to improve the consumer
purchasing experience. These efforts may require the development or licensing
of increasingly complex technologies. We may not be successful in developing or
introducing new features, functions and services, and these features, functions
and services may not achieve market acceptance or enhance our brand loyalty. If
we fail to develop and introduce new features, functions or services
effectively, it could have a material adverse effect on our business, results
of operations and financial condition.
We need to manage our growth.
Our recent growth has placed, and is expected to continue to place, a
significant strain on our managerial, operational and financial resources.
Several executive officers joined us recently. Any inability to manage growth
effectively could have a material adverse effect on our business, results of
operations and financial condition.
We are dependent on certain key personnel.
Our future success is substantially dependent on our senior management and
key technical personnel. If one or more of our key employees decided to leave
us, join a competitor or otherwise compete directly or indirectly with us, this
could have a material adverse effect on our business, results of operations and
financial condition.
Our future success depends on our continuing ability to retain and attract
highly qualified technical and managerial personnel. As of June 30, 1999, we
had 126 full-time employees, and we anticipate that the number of employees
will increase significantly during the next 12 months. Wages for managerial and
technical employees are increasing and are expected to continue to increase in
the foreseeable future due to the competitive nature of the current employment
market, particularly in Northern California. We may be unable to retain key
technical and managerial personnel or to attract and retain additional highly
qualified technical and managerial personnel in the future. We have experienced
difficulty from time to time attracting the personnel necessary to support the
growth of our business, and we may experience similar difficulty in the future.
Inability to attract and retain the technical and managerial personnel
necessary to support the growth of our business could have material adverse
effect upon our business, results of operations and financial condition.
We face risks associated with possible regulation under state or federal
franchise laws.
If our relationships or written agreements with our member dealers are found
to constitute "franchises" under federal or state franchise laws, we would be
subject to regulations, such as franchise disclosure, registration requirements
and limitations on our ability to effect changes in our relationships with our
member dealers. We believe that neither our relationship with our member
dealers nor our member dealer subscription
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agreements constitute "franchises" under state or federal franchise laws.
However, we have not received legal advice on this matter.
The state of Texas has challenged our pricing model under their Motor Vehicle
Code.
In May 1998, the Texas Department of Transportation notified us that, in
their opinion, our performance-based pricing model is illegal, because it makes
us a broker under Texas law. They have taken the position that the fee paid to
us by member dealers for each qualified purchase inquiry is equivalent to a
finder's or broker's fee and that we are arranging for two persons to meet and
enter into a transaction that involves the sale of a motor vehicle. We
currently intend to challenge this decision and have engaged counsel to advise
us in this matter. We presently are seeking the Texas Attorney General's
opinion that the operation of a Web site in the manner that we operate does not
constitute us as a "broker" under the Texas Motor Vehicle Code. However, if we
are not successful in challenging this decision of the Department of
Transportation, we not only may have to pay significant fines, but also will
have either to cease doing business in Texas or to change our pricing model for
member dealers in Texas from performance-based to subscription-based.
We generally face risks associated with possible regulation under vehicle
brokerage, insurance, financing or other laws.
Other states, substantially all of which have laws that broadly define
brokerage activities, could also determine that we are acting as a broker. If
this occurs, we may be required to comply with burdensome licensing
requirements or terminate our operations in those states. In either case, our
business, results of operations and financial condition could be materially and
adversely affected. We believe that our service does not qualify as a vehicle
brokerage activity and therefore that state broker licensing requirements do
not apply to us. However, we have not sought a legal opinion regarding whether
our service, in general, or our performance-based pricing, in particular, would
qualify us as a vehicle brokerage activity in any state. State regulatory
requirements may also include us within an industry-specific regulatory scheme,
such as those for the vehicle insurance or vehicle financing industries. In the
event that individual states' regulatory requirements change or additional
requirements are imposed on us, we may be required to modify aspects of our
business in those states in a manner that might undermine the attractiveness of
the Autoweb.com purchase process to consumers, member dealers, automotive-
related vendors or advertisers or require us to terminate operations in that
state, either of which could have a material adverse effect on our business,
results of operations and financial condition.
We face risks associated with government regulation and legal uncertainties
associated with the Internet.
There are numerous state laws regarding the sale of vehicles. In addition,
government authorities may take the position that state or federal insurance
licensing laws, motor vehicle dealer laws or related consumer protection or
product liability laws apply to aspects of our business. As we introduce new
services and expand our operations to other countries, we will need to comply
with additional licensing and regulatory requirements.
A number of legislative and regulatory proposals under consideration by
federal, state, local and foreign governmental organizations may lead to laws
or regulations concerning various aspects of the Internet, including, but not
limited to, online content, user privacy, taxation, access charges, liability
for third-party activities and jurisdiction. Additionally, it is uncertain as
to how existing laws will be applied to the Internet. The adoption of new laws
or the application of existing laws may decrease the growth in the use of the
Internet, which could in turn decrease the demand for our services, increase
our cost of doing business or otherwise have a material adverse effect on our
business, results of operations and financial condition.
The tax treatment of the Internet and e-commerce is currently unsettled. A
number of proposals have been made at the federal, state and local level and by
certain foreign governments that could impose taxes on the sale of goods and
services and certain other Internet activities. Recently, the Internet Tax
Information Act was
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signed into law placing a three-year moratorium on new state and local taxes on
Internet commerce. However, we cannot assure you that future laws imposing
taxes or other regulations on commerce over the Internet would not
substantially impair the growth of e-commerce and as a result have a material
adverse effect on our business, results of operations and financial condition.
Certain local telephone carriers have asserted that the increasing
popularity and use of the Internet has burdened the existing telecommunications
infrastructure, and that many areas with high Internet use have begun to
experience interruptions in telephone service. These carriers have petitioned
the Federal Communications Commission to impose access fees on Internet service
providers and online service providers. If such access fees are imposed, the
costs of communicating on the Internet could increase substantially,
potentially slowing the increasing use of the Internet, which could in turn
decrease demand for our services or increase our cost of doing business, and
thus have a material adverse effect on our business, results of operations and
financial condition.
We depend on increased use of the Internet.
Consumers and businesses will likely widely accept and adopt the Internet
for conducting business and exchanging information only if the Internet
provides these consumers and businesses with greater efficiencies and
improvements in commerce and communication. Our future success and revenue
growth depends substantially upon continued growth in the use of the Internet.
In addition, e-commerce generally, and the purchase of automotive and
automotive related products and services on the Internet in particular, must
become widespread. The Internet may prove not to be a viable commercial
marketplace generally, or, in particular, for vehicles and related products and
services. If use of the Internet does not continue to increase, our business,
results of operations and financial condition would be materially and adversely
affected.
We depend on continued improvements in our systems and the Internet
infrastructure.
Our ability to retain and attract consumers, member dealers, automotive-
related vendors and advertisers, and to achieve market acceptance of our
services and our brand, depends significantly upon the performance of our
systems and network infrastructure. Any system or network failure that causes
interruption or slower response time of our services could result in less
traffic to our Web site and, if sustained or repeated, could reduce the
attractiveness of our services to consumers, member dealers, automotive-related
vendors and advertisers. An increase in the volume of our Web site traffic
could strain the capacity of our technical infrastructure, which could lead to
slower response times or system failures. This would cause the number of
purchase inquiries, advertising impressions, other revenue producing e-commerce
offerings and our information and community offerings to decline, any of which
could hurt our revenue growth and our brand loyalty. In addition, if traffic
increases, we cannot assure you that our technical infrastructure, such as a
reliable network backbone with the necessary speed and data capacity and the
development of complementary products such as high-speed modems, will be able
to increase accordingly, and we face risks related to our ability to scale up
to expected consumer levels while maintaining performance. Further, security
and authentication concerns regarding the transmission of confidential
information over the Internet, such as credit card numbers, may continue. Any
failure of our server and networking systems to handle current or higher
volumes of traffic would have a material adverse effect on our business,
results of operations and financial condition.
The recent growth in Internet traffic has caused frequent periods of
decreased performance, requiring Internet service providers and users of the
Internet to upgrade their infrastructures. If Internet usage continues to
increase rapidly, the Internet infrastructure may not be able to support the
demands placed on it by this growth and its performance and reliability may
decline. If outages or delays on the Internet occur frequently, overall
Internet usage or usage of our Web site could increase more slowly or decline.
Our ability to increase the speed with which we provide services to consumers
and to increase the scope of such services is limited by and dependent upon the
speed and reliability of the Internet. Consequently, the emergence and growth
of the market for our services is dependent on future improvements to the
entire Internet.
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In addition, our operations depend upon our ability to maintain and protect
our computer systems, all of which are located at our corporate headquarters in
Santa Clara, California. We currently do not have a backup disaster recovery
program or fully redundant systems for our service at an alternate site. The
system therefore is vulnerable to damage from fire, floods, earthquakes, power
loss, telecommunications failures and similar events. Although we maintain
insurance against fires, floods, earthquakes and general business
interruptions, the amount of coverage may not be adequate in any particular
case. The occurrence of such an event could have a material adverse effect on
our business, results of operations and financial condition.
The Internet industry is characterized by rapid technological change.
Rapid technological developments, evolving industry standards and consumer
demands, and frequent new product introductions and enhancements characterize
the market for Internet products and services. These market characteristics are
exacerbated by the emerging nature of the market and the fact that many
companies are expected to introduce new Internet products and services in the
near future. Our future success will significantly depend on our ability to
continually improve the vehicle purchasing experience, the addition of new and
useful services and content to our Web site, and the performance, features and
reliability of our Web site. In addition, the widespread adoption of developing
multimedia-enabling technologies could require fundamental and costly changes
in our technology and could fundamentally affect the nature, viability and
measurability of Internet-based advertising, which could adversely affect our
business, results of operations and financial condition.
We could face liability for information retrieved from or transmitted over the
Internet and liability for products sold over the Internet.
We could be exposed to liability with respect to third-party information
that may be accessible through our Web site, or content and materials that may
be posted by consumers through our AutoTalk service. Such claims might assert,
among other things, that, by directly or indirectly providing links to Web
sites operated by third parties, we should be liable for copyright or trademark
infringement or other wrongful actions by such third parties through such Web
sites. It is also possible that, if any third-party content information
provided on our Web site contains errors, consumers could make claims against
us for losses incurred in reliance on such information.
We also enter into agreements with other companies under which any revenue
that results from the purchase of services through direct links to or from our
Web site is shared. Such arrangements may expose us to additional legal risks
and uncertainties, including local, state, federal and foreign government
regulation and potential liabilities to consumers of these services, even if we
do not provide the services ourselves. We cannot assure you that any
indemnification provided to us in our agreements with these parties, if
available, will be adequate.
Even to the extent such claims do not result in liability to us, we could
incur significant costs in investigating and defending against such claims. The
imposition on us of potential liability for information carried on or
disseminated through our system could require us to implement measures to
reduce our exposure to such liability, which might require the expenditure of
substantial resources or limit the attractiveness of our services to consumers,
member dealers, automotive-related vendors and others.
Our general liability insurance and our communications liability insurance
may not cover all potential claims to which we are exposed and may not be
adequate to indemnify us for all liability that may be imposed. Any imposition
of liability that is not covered by insurance or is in excess of insurance
coverage could have a material adverse effect on our business, results of
operations and financial condition.
Our intellectual property protection may be inadequate.
Legal standards relating to the validity, enforceability and scope of
protection of certain proprietary rights in Internet-related businesses are
uncertain and still evolving, and we can give no assurance regarding the future
viability or value of any of our proprietary rights. Despite the precautions we
have taken, it may be
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possible for a third party to copy or otherwise obtain and use our proprietary
information without authorization or to develop similar technology
independently.
Although we have not conducted any comprehensive searches, we are aware that
the name "Autoweb" is already in use in several regions in the United States
and in Australia. Due to our resource constraints and the perceived priority of
this issue, we have not yet researched the effect of the use of the name
"Autoweb" by other companies on our trademark or the impact of this use on our
ability to obtain the mark in other countries. As a result, we cannot guarantee
that we will be able to continue to use the name "Autoweb" in the future. If in
the future we were required to change our name and adopt a new trademark, we
would incur significant expenses related to marketing a replacement trademark,
and such a change would likely have a materially adverse effect on our
business.
We face risks associated with litigation.
Litigation may be necessary in the future to enforce our intellectual
property rights, to protect our trade secrets or trademarks or to determine the
validity and scope of the proprietary rights of others. Such litigation might
result in substantial costs and diversion of resources and management
attention. Furthermore, our business activities may infringe upon the
proprietary rights of others and other parties may assert infringement claims
against us, including claims that arise from directly or indirectly providing
hyperlink text links to Web sites operated by third parties. Moreover, from
time to time, we may be subject to claims of alleged infringement by us or our
member dealers of the trademarks, service marks and other intellectual property
rights of third parties. Such claims and any resultant litigation, should it
occur, might subject us to significant liability for damages, might result in
invalidation of our proprietary rights and, even if not meritorious, could
result in substantial costs and diversion of resources and management attention
and have a material adverse effect on our business, results of operations and
financial condition.
We depend on third party technology.
We currently license from third parties certain technologies and information
incorporated into our Web site. As we continue to introduce new services that
incorporate new technologies and information, we may be required to license
additional technology and information from others. We cannot assure you that
these third-party technology and information licenses will continue to be
available to us on commercially reasonable terms, if at all. Additionally, we
cannot assure you that the third parties from which we currently license our
technology and information will be able to defend their proprietary rights
successfully against claims of infringement. Any failure to obtain any of these
technology and information licenses could result in delays or reductions in the
introduction of new features, functions or services. It could also adversely
affect the performance of our existing services until equivalent technology or
information can be identified, obtained and integrated.
We may particularly be affected by general economic conditions.
Purchases of new vehicles are typically discretionary for consumers and may
be particularly affected by negative trends in the general economy. The success
of our operations depends to a significant extent upon a number of factors
relating to discretionary consumer spending, including economic conditions (and
perceptions of such conditions by consumers) affecting disposable consumer
income (such as employment, wages and salaries, business conditions, interest
rates, availability of credit and taxation) for the economy as a whole and in
regional and local markets where we operate. In addition, because the purchase
of a vehicle is a significant investment and is relatively discretionary, any
reduction in disposable income in general may affect us more significantly than
companies in other industries. In addition, our business strategy relies on
advertising by and agreements with other Internet companies. Any significant
deterioration in general economic conditions that adversely affects these
companies could also have a material adverse effect on our business, results of
operations and financial condition.
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We have security risks.
On occasion, some experienced programmers have attempted to penetrate our
network security ("hackers"). We expect that these attempts, some of which have
succeeded, will continue to occur from time to time. Because a hacker who
penetrates our network security could misappropriate proprietary information or
cause interruptions in our services, we might be required to expend significant
capital and resources to protect against, or to alleviate, problems caused by
hackers. Additionally, we may not have a timely remedy against a hacker who is
able to penetrate our network security. In addition to purposeful security
breaches, the inadvertent transmission of computer viruses could expose us to
litigation or to a material risk of loss. Such security breaches and
inadvertent transmissions could have a material adverse effect on our business,
results of operations and financial condition.
In offering certain online payment services, we may increasingly rely on
technology licensed from third parties to provide the security and
authentication necessary to effect secure transmission of confidential
information, such as consumer credit card numbers. Advances in computer
capabilities, new discoveries in the field of cryptography, or other events or
developments may result in a compromise or breach of the algorithms that we use
to protect our consumers' transaction data or our software vendors' products.
Any well-publicized compromise of security could deter use of the Internet in
general or use of the Internet to conduct transactions that involve
transmitting confidential information or downloading sensitive materials.
We have risks associated with international operations and expansions.
A part of our long-term strategy is to establish Autoweb.com in
international markets. However, the Internet, or our commerce, content and
community services model, may not become widely accepted in any market. In
addition, we expect that the success of any additional foreign operations we
initiate will be substantially dependent upon our member dealers, automotive-
related vendors and content services. We may experience difficulty in managing
international operations as a result of failure to locate an effective foreign
partner, competition, technical problems, local laws and regulations, distance
and language and cultural differences. Our international partners may not be
able to successfully market and operate our community model in foreign markets.
There are also certain risks inherent in doing business internationally,
including:
. cultural and business practices differences;
. fluctuations in currency exchange rates;
. political;
. legal and economic instability;
. seasonal reductions in business activity in certain other parts of
the world; and
. potentially adverse tax consequences.
One or more of such factors might have a material adverse effect on our
future international operations and, consequently, on our business, results of
operations and financial condition.
Certain existing stockholders own a large percentage of our voting stock.
Our officers, directors and 5% or greater stockholders beneficially own or
control, directly or indirectly, more than 70% of the outstanding shares of
common stock. As a result, if such persons act together, they will have the
ability to control all matters submitted to our stockholders for approval,
including (1) the election and removal of directors and (2) any merger,
consolidation or sale of all or substantially all of our assets.
We face Year 2000 risks.
The Year 2000 issue involves the potential for system and processing
failures of date-related data and is the result of the computer-controlled
systems using two digits rather than four to define the applicable year. For
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example, computer programs that have time-sensitive software may recognize a
date using "00" as the year 1900 rather than the year 2000. This could result
in system failure or miscalculations causing disruptions of operations,
including, among other things, a temporary inability to process transactions,
send invoices or engage in similar normal business activities. We may be
affected by Year 2000 issues related to non-compliant information technology
("IT") systems or non-IT systems operated by us or by third parties. We have
completed our assessment of our internal and external (third-party) IT systems
and non-IT systems. Based upon our assessment, we believe we will require
upgrades, or patches, from certain vendors, including Microsoft Corporation,
which have provided certain software that we have included in our Web site.
Although none of these vendors has informed us of any specific delivery
schedule for receipt of their upgrades, we expect to receive their upgrades
later in 1999. At this point in our assessment, we believe we will become Year
2000 compliant shortly after receiving the necessary upgrades, or patches, from
certain vendors. We do not have a contingency plan. The costs associated with
remediating our noncompliant IT systems and non-IT systems have not been
material to date and we do not anticipate that such costs will be material in
the future, although we cannot assure you that such costs will not be material.
To the extent that our assessment is finalized without identifying any material
noncompliant IT systems operated by us or by third parties, the most reasonably
likely worst case Year 2000 scenario is a systematic failure beyond our
control, such as a prolonged telecommunications or electrical failure. Such a
failure could prevent us from operating our business, prevent users from
accessing our Web site, or change the behavior of advertising consumers or
persons accessing our Web site. We believe that the primary business risks, in
the event of such failure, would include lost advertising revenues, increased
operating costs, loss of consumers or persons accessing our Web site, and
claims of mismanagement, misinterpretation or breach of contract. Any of these
eventualities could have a material adverse effect on our business, results of
operations and financial condition.
Future sales of our common stock may depress our stock price.
Of the 25,050,156 shares of our common stock outstanding on June 30, 1999,
approximately 5,875,000 are freely tradable. Almost all of the remaining shares
of common stock are subject to lockup agreements prohibiting their disposition
until September 20, 1999. Sales of a substantial number of these shares in the
public market after the lockup period ends could cause the market price of our
common stock to decline.
Our Certificate of Incorporation and Bylaws and Delaware law contain provisions
that could discourage a takeover.
Certain provisions of Delaware law and our Certificate of Incorporation and
Bylaws could have the effect of delaying or preventing a change in control.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We considered the provisions of Financial Reporting Release No. 48,
"Disclosure of Accounting Policies for Derivative Financial Instruments and
Derivative Commodity Instruments, and Disclosure of Quantitative and
Qualitative Information about Market Risk Inherent in Derivative Financial
Instruments, Other Financial Instruments and Derivative Commodity Instruments."
We had no holdings of derivative financial or commodity instruments at June 30,
1999. However, we are exposed to financial market risks, including changes in
foreign currency exchange rates and interest rates. Much of our revenue,
expenses and capital expenditures are transacted in U. S. dollars.
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PART II: OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
Not applicable.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS
Sales of Registered Securities and Use of Proceeds
On March 23, 1999, the Company sold 5,550,000 shares of Common Stock in its
initial public offering at a price of $14.00 per share pursuant to a Form S-1
Registration Statement, No. 333-71177, which became effective March 22, 1999.
The principal underwriters for the offering were Credit Suisse First Boston
Corporation, Hambrecht and Quist, LLC, BancBoston, Robertson Stephens Inc., and
U.S. Bancorp Piper Jaffray, Inc. The Company received gross proceeds from the
offering of $77.7 million from which the Company paid $5.4 million for
underwriting discounts and commissions and the Company paid $1.2 million for
other offering expenses, none of which was paid directly or indirectly to any
directors, officers, persons owning ten percent or more of any class of equity
securities of the Company or any affiliates of the Company. From the effective
date of the Registration Statement through June 30, 1999, the Company invested
$46.2 million of the proceeds in commercial paper and applied the balance to
working capital.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
ITEM 5. OTHER INFORMATION
Not applicable.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are filed as part of this report:
10.28 Advertising and Promotion Agreement dated June 14, 1999
between Registrant and Yahoo! Inc. *
10.29 Advertising and Promotion Agreement dated June 30, 1999
between Registrant and America Online, Inc. *
27.01 Financial Data Schedule (EDGAR version only)
(b) There were no reports on Form 8-K filed during the quarter ended
June 30, 1999.
* Confidential treatment has been requested with regard to certain
portions of this document. Such portions have been omitted from this filing and
have been filed separately with the Securities and Exchange Commission.
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934,
the Registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
AUTOWEB.COM, INC.
/s/ Dean A. DeBiase
Date: August 16, 1999 By: _________________________________
Dean A. DeBiase
President and Chief Executive
Officer
Date: August 16, 1999 /s/ Samuel M. Hedgpeth III
By: _________________________________
Samuel M. Hedgpeth III
Chief Financial Officer
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EXECUTION COPY
CONFIDENTIAL Exhibit 10.28
CONFIDENTIAL TREATMENT REQUESTED*
AUTOMOTIVE PROGRAM
ADVERTISING AND PROMOTION AGREEMENT
This Advertising and Promotion Agreement (this "Agreement") is entered into
---------
as of June 14, 1999 (the "Effective Date") between Yahoo! Inc., a Delaware
--------------
corporation with offices at 3420 Central Expressway, Santa Clara, CA 95051
("Yahoo") and Autoweb.com Inc., a California corporation with offices at 3270
-------
Jay Street, Bldg. 6, Santa Clara, CA 95054 ("Autoweb").
In consideration of the mutual promises contained in this Agreement, Yahoo
and Autoweb hereby agree as follows:
1. Definitions.
-----------
The following terms are used in this Agreement with the respective meanings
set forth below:
"Autoweb Banner" shall mean an advertising promotion substantially similar
--------------
in form as that set forth on Exhibit B that: (a) promotes the on-line sale of
---------
Auto Products, (b) has dimensions no larger than 468 pixels wide by 60 pixels
high, (c) does not have "looped" animation, (d) does not have any animation
longer than six seconds, (e) has a file size of no greater than 12K, and (f)
will permit users to navigate directly to a Page on the Autoweb Site relating to
the Autoweb Banner content. Yahoo may modify these specifications at its
discretion, provided that any such modification does not have a material adverse
impact on the Autoweb Banner.
"Autoweb Banner Pages" shall mean those Pages identified as such on Exhibit
-------------------- -------
A.
- -
"Autoweb Button" shall mean a link substantially similar in form as that
--------------
set forth on Exhibit B that: (a) contains an Autoweb logo and has dimensions no
---------
larger than 88 pixels wide by 31 pixels high, (b) does not contain animation,
(c) has a file size of no greater than 2K, (d) contains alt text of no more than
ten (10) characters (including spaces), or such greater number of alt text
characters afforded to any other U.S. based Yahoo advertiser with a similar
merchant button, (e) and will permit users to navigate directly to a Page on the
Autoweb Site relating to the Page on which such Autoweb Button appears. Yahoo
may modify these specifications at its discretion, provided that any such
modification does not have a material adverse impact on the Autoweb Button.
"Autoweb Button Keyword" shall mean those keywords identified as such on
----------------------
Exhibit A; provided that, Yahoo may substitute any such keyword for a comparable
- ---------
keyword in its reasonable discretion.
"Autoweb Button Pages" shall mean the Autoweb Category Pages, Autoweb Auto
--------------------
Pages, Autoweb Button Search Results Pages, Autoweb Classified Pages, Autoweb
Message Board Pages and Autoweb Yellow Pages.
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
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CONFIDENTIAL
"Autoweb Button Pages Area" shall mean the area on the Autoweb Button Pages
-------------------------
on which the Autoweb Button appears (together with other merchant or Yahoo
buttons). Such area may involve buttons appearing vertically or horizontally.
"Autoweb Button Search Results Pages" shall mean those Pages displayed upon
-----------------------------------
a user's searching the Yahoo Main Site for an Autoweb Button Keyword.
"Autoweb Category Pages" shall mean those Pages identified as such on
----------------------
Exhibit A.
- ---------
"Autoweb Classified Link" shall mean a text link substantially similar in
-----------------------
form as that set forth on Exhibit B that will permit users to navigate directly
---------
to a Page on the Autoweb Site relating to the Autoweb Listing to which the text
link refers.
"Autoweb Competitor" shall mean the Auto Merchants listed on Exhibit E to
------------------ ---------
this Agreement; provided that, Autoweb may add additional Auto Merchants to such
list upon giving sixty (60) days written notice to Yahoo; provided further that,
Autoweb may add to the list of Autoweb Competitors only third-party, non
manufacturer, auto buying/selling services substantially similar to those auto
buying/selling services set forth on Exhibit E. To the extent that the parties
---------
have any disagreement as to whether an entity has been properly designated an
Autoweb Competitor, the parties agree to allow an Independent, Industry-
Recognized Third Party to resolve the matter.
"Autoweb Content" shall mean auto related content owned by Autoweb, not
---------------
including content licensed by Autoweb.
"Autoweb Front Page Promotion" shall mean a promotion substantially similar
----------------------------
in form as that set forth on Exhibit B, that will appear on the home page of the
---------
Yahoo Main Site, currently located at http://www.yahoo.com/ and in all cases
comply with Yahoo's current front-page promotion guidelines attached as Exhibit
-------
D, which may be modified by Yahoo at its discretion.
- -
"Autoweb Link" shall mean any link placed by Yahoo under this Agreement,
------------
including, without limitation, the Autoweb Banner, Autoweb Button, Autoweb
Module, Autoweb Yellow Page Module, and Autoweb Classified Link.
"Autoweb Listings" shall mean those new and used car listings appearing on
----------------
the Autoweb Site.
"Auto Merchant" shall mean any company or other entity that derives revenue
-------------
through the on-line sale of Auto Products.
"Auto Merchant Program" shall mean Yahoo's program consisting of certain
---------------------
marketing, advertising and promotional activities with Auto Merchants as further
described in this Agreement.
"Autoweb Module" shall mean a promotion substantially similar in form as
--------------
that set forth on Exhibit B that: (a) has dimensions no larger than 125 pixels
---------
wide by 125 pixels high, (b)
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CONFIDENTIAL
contains two lines of text, with no more than twenty (20) characters of text
(including spaces) in each line, (c) contains no more than six (6) seconds of
animation (with no looping), (d) is in GIF format, (e) has a file size no
greater than 4K, and (f) will permit users to navigate directly to a Page on the
Autoweb Site relating to the Auto Product promoted in the module. Yahoo may
modify these specifications at its discretion, provided that any such
modification does not have a material adverse impact on the Autoweb Module.
"Autoweb Module Pages" shall mean the Autoweb Auto Pages and Autoweb
--------------------
Classified Pages.
"Auto Products" shall mean autos and related goods and services.
-------------
"Autoweb Site" shall mean the web site owned by Autoweb currently located
------------
at http://www.autoweb.com.
----------------------
"Autoweb Yellow Page Module" shall mean a promotion substantially similar
--------------------------
in form as that set forth on Exhibit B that: (a) has dimensions no larger than
---------
105 pixels wide by 60 pixels high, (b) contains two lines of text, with no more
than twenty (20) characters of text (including spaces) in each line, (c)
contains no more than six (6) seconds of animation (with no looping), (d) has a
file size no greater than 3K, and (e) will permit users to navigate directly to
a Page on the Autoweb Site relating to the Auto Product promoted in the module.
Yahoo may modify these specifications at its discretion, provided that any such
modification does not have a material adverse impact on the Autoweb Yellow Page
Module.
"Autoweb Yellow Pages" shall mean those Pages identified as such on Exhibit
-------------------- -------
A.
- -
"Click-Through" shall mean a user's pressing or "clicking" on any Autoweb
-------------
Button, Autoweb Module, or Autoweb Yellow Page Module, as each is measured by
Yahoo's advertiser reporting system.
"December 1998 Agreement" shall mean that Advertising and Promotion
-----------------------
Agreement, between Autoweb and Yahoo, dated December 17, 1998.
"EZ Wheel Lead" shall mean the collection of information from an individual
-------------
through the following EZ Wheel Program fields: (i) first name; (ii) last name;
(iii) email address; (iv) year, make, and model of the participant's current
vehicle; (v) when the participant plans to purchase their next vehicle; (vi)
gender; (vii) street address; (viii) city; (ix) state; (x) zip code; (xi) phone
number; (xii) trade-in information (if applicable); and (xiii) type of car to be
purchased. In addition, to qualify as an EZ Wheel Lead, the individual from
which the foregoing information has been collected must also "opt in" (through a
dialogue box or similar mechanism) to receive additional information from
Autoweb or an authorized Autoweb dealer (the specific language relating to such
opt-in feature to be mutually agreed upon by the parties and similar to the
following: "Yes, I would like to learn more information about this vehicle from
my local Autoweb dealer. Please provide them with the data collected on this
page so that they can contact me to provide some useful information and
facilitate the purchase of my vehicle.").
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"EZ Wheel Program" shall mean that interactive, lead-generating program,
----------------
promoted throughout the Yahoo Properties (including auto related areas), whereby
participants view sponsors' pages and answer questions in exchange for entries
towards a drawing for a cash prize to be used towards the lease of an auto
chosen by the winner.
"EZ Wheel Lead Threshold" shall mean [*] EZ Wheel Leads.
-----------------------
"January Launch Date" shall mean the date on which Yahoo activates an
-------------------
Autoweb Button; provided that, the parties anticipate the Launch Date to be on
January 15, 2000.
"Page" means any World Wide Web page (or, for online media other than Web
----
sites, the equivalent unit of the relevant protocol).
"Page View" shall mean a user's request for a Page as measured by Yahoo's
---------
advertising reporting system.
"Run of Network" shall mean banners rotating throughout the Yahoo
--------------
Properties.
"September Launch Date" shall mean the date on which Yahoo activates an
---------------------
Autoweb Banner; provided that, the parties anticipate the September Launch Date
to be on September 1, 1999.
"Term" shall mean the period beginning on the Effective Date and continuing
----
for a period of two (2) years following the September Launch Date.
"Yahoo Main Site" shall mean Yahoo's principal U.S. based directory to the
---------------
World Wide Web currently located at http://www.yahoo.com.
--------------------
"Yahoo Properties" shall mean any Yahoo branded or co-branded media
----------------
properties, including, without limitation, Internet guides, that are developed
in whole or in part by Yahoo or its affiliates.
2. Autoweb Banner.
--------------
2.1 Beginning on the September Launch Date, Yahoo shall provide the
Autoweb Banner, on a rotating basis until its Page View obligations
under Section 9 are met, on the Autoweb Banner Pages and Run of
Network.
3. Autoweb Buttons.
---------------
3.1 Beginning on the January Launch Date and continuing through the
Term, Yahoo shall provide the Autoweb Button on the Autoweb
Button Pages. The Autoweb Button's placement on the Autoweb
Button Pages shall (i) rotate equally with and appear no less
prominently (in terms of size) than any other buttons appearing
in the Autoweb Button Pages Area (consistent with the
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
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CONFIDENTIAL
limited exclusivity provision of Section 8), provided that no
more than [*] buttons (including no more than [*] such auto-
related buttons) shall appear in the Autoweb Button Pages Area,
and (ii) appear more prominently (in terms of placement (i.e.,
above)) than any Yahoo branded button in an Autoweb Button Pages
Area that displays buttons in a vertical manner. Yahoo shall
provide up to [*] text links to accompany the Autoweb
Button on the Autoweb Button Pages. In no case shall any Autoweb
Button text link exceed sixteen (16) characters. Further, each
Autoweb Button text link shall promote Auto Products and permit
users to navigate via a link directly to a Page on the Autoweb
Site relating to the Auto Products relevant to the Autoweb Button
Page on which such text link appears.
4. Autoweb Modules.
---------------
4.1 Beginning on the January Launch Date, Yahoo shall provide, on a
rotating basis until its Page View obligations under Section 9
are met: (i) the Autoweb Module on the Autoweb Module Pages; and
(ii) the Autoweb Yellow Page Module on the Autoweb Yellow Pages.
5. EZ Wheel Leads.
--------------
5.1 During the Term, Yahoo shall deliver a minimum of [*] EZ Wheel
Leads. In the event that Yahoo fails to deliver the number of EZ
Wheel Leads referred to in this Section 5.1 by the expiration of
the Term, at Yahoo's option, Yahoo will either (i) "make good"
the shortfall by extending its obligations under this Section 5.1
beyond the end of the Term until such EZ Wheel Lead obligation is
satisfied; or (ii) refund Autoweb an amount equal to [*] ($*)
for each EZ Wheel Lead below the EZ Wheel Lead Threshold.
6. Autoweb Classified Links.
------------------------
6.1 Yahoo shall provide an Autoweb Classified Link for each Autoweb
Listing. The Autoweb Listings shall be placed in the appropriate
categories of the Yahoo auto classifieds service (categorized by
location, type of listing and auto trim line). Within each
category, beginning on the January Launch Date, Yahoo agrees
that up to [*] applicable Autoweb Listings (in terms of the
user's search preferences) shall have a right of preferred
placement on each of page of the default search results for
such category (i.e., in accordance with Yahoo's sorting
procedure, up to [*] Autoweb Listings shall appear above
similarly sorted non-preferred listings). The Autoweb Listings
shall be provided by Autoweb to Yahoo pursuant to Yahoo's
specifications (e.g., Autoweb shall categorize the Autoweb
Listings for either preferred placement or general placement,
with no overlap between the categories) and shall be updated by
Autoweb on a regular basis. Notwithstanding anything to the
contrary, however, the parties agree that Yahoo shall retain:
(i) the absolute
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
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CONFIDENTIAL
right to modify the manner in which a preferred placement is
provided; and (ii) the sole editorial control and final approval
over the inclusion, content and placement of all Autoweb Listings
(provided that Yahoo agrees to exercise this right in good
faith).
7. Implementation.
---------------
7.1 Subject to the provisions of this Agreement, Yahoo will be solely
responsible for the user interface and placement of the Autoweb
Links and Autoweb shall be solely responsible for and shall
provide Yahoo with all artwork and design elements of the Autoweb
Links.
7.2 Autoweb shall promptly provide Yahoo all URLs, URL formats (as
applicable), content, and other materials necessary for Yahoo to
provide the Autoweb Links. All content and material contained in
the Autoweb Links is subject to Yahoo's approval and must comply
with all applicable federal, state and local laws, rules and
regulations, including, without limitation, consumer protection
laws and rules and regulations governing product claims, truth in
labeling, and false advertising.
7.3 During the Term, Autoweb hereby grants to Yahoo a non-exclusive
worldwide, fully paid license to use, reproduce and display the
Autoweb Listings, and the Autoweb name and logo (i) to indicate
the location of the Autoweb Links as set forth herein and (ii) in
connection with the marketing and promotion of Autoweb in the
Yahoo Properties.
7.4 In no event shall any initial Page on the Autoweb Site to which
users click-through from an Autoweb Button, Autoweb Module or
Autoweb Yellow Page Module contain graphic or textual hyperlinks,
banner advertisements or promotions of any of the following Yahoo
competitors: Amazon, eBay, Excite, Lycos, Microsoft, America
Online, Netscape, Snap.com, NBCi, CNET and Infoseek/Go Network,
and their successors; provided that, Yahoo may add additional
entities that compete directly with Yahoo in connection with its
internet services to such list upon giving sixty (60) days
written notice to Autoweb.
7.5 Autoweb shall place a Yahoo graphic link on those Pages of the
Autoweb Site to which users click-through from any Autoweb Link
other than the Autoweb Banner. Such Yahoo graphic link shall (a)
be placed in a manner approved by Yahoo (b) contain the Yahoo
name and logo as provided by Yahoo and (c) directly link the user
back to a Page on the Yahoo Properties designated by Yahoo.
7.6 During the Term, Yahoo hereby grants to Autoweb a non-exclusive,
worldwide, fully paid license to use, reproduce and display the
Yahoo name
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and logo (i) to indicate the location of the Yahoo graphic links
as set forth herein and (ii) to otherwise meet Autoweb's
obligations under this Agreement.
7.7 The Autoweb Site shall comply with the scale, speed and
performance requirements mutually agreed upon by the parties but
in no event less than that provided by the Yahoo Main Site.
7.8 For the EZ Wheel Program, Yahoo shall comply with all applicable
laws and regulations relating to contests and sweepstakes.
7.9 In the event that Yahoo makes any changes to the Yahoo Properties
that preclude placement of the Autoweb Links specified in the
agreement Yahoo shall substitute similarly prominent auto-related
locations.
8. Limited Exclusivity; Right of First Presentation; Autoweb Content.
-----------------------------------------------------------------
8.1 Beginning on the January Launch Date and continuing through the
end of the Term, Yahoo shall not include advertising (i.e.,
merchant banners, buttons or modules) of any Autoweb Competitor
on the Autoweb Button Pages. In addition, with respect to the EZ
Wheel Program, Yahoo shall not include any advertising for or
permit any participation by any Autoweb Competitor. For clarity,
the parties acknowledge that the foregoing limited exclusivity
provision of this Section 8.1 shall not preclude Yahoo from: (i)
promoting or placing banners, buttons, modules, or any other
advertising of any entity (including Autoweb Competitors) on any
Page, other than the Autoweb Button Pages or EZ Wheel Program,
within the Yahoo Properties; and (ii) promoting or placing
banners, buttons, modules or any other advertising of any entity
(including Yahoo), other than Autoweb Competitors, on the Autoweb
Button Pages or EZ Wheel Program. Further, notwithstanding
anything in this Section 8.1 to the contrary, under no
circumstances shall Yahoo be precluded from posting any content
from any entity (including an Autoweb Competitor) with
appropriate attribution, on any Yahoo Property (including the
Autoweb Button Pages), in a manner similar to those content
relationships that Yahoo has as of the Effective Date with
Edmunds and/or Kelly Blue Book.
8.2 Within thirty (30) days prior to the expiration of the Term,
Yahoo will provide written notice to Autoweb in the event that
Yahoo, at its sole discretion, elects to extend this Auto
Merchant Program. Yahoo shall describe Yahoo's reasonable
business requirements for the extension in its written notice to
Autoweb. The parties will use good-faith efforts to negotiate and
execute a written extension to this Agreement under reasonable
terms and conditions. If Autoweb declines to commence
negotiations with Yahoo within five (5) days after receiving such
written notice from Yahoo, or if the parties fail to reach
agreement within thirty (30) days following the commencement of
good faith negotiations (or such later date as is agreed by the
parties), Yahoo may offer
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the opportunity to any third party. The parties acknowledge that
the promotional opportunities and terms offered in any extension
of this Auto Merchant Program may differ substantially from those
contained in this Agreement. Further, under no circumstances
shall the foregoing right of presentation be deemed to restrict
Yahoo's ability to extend merchant positions in a subsequent Auto
Merchant Program to third parties.
8.3 During the Term, Autoweb shall apprise Yahoo of Autoweb Content
as such content is developed. Yahoo shall, in its sole
discretion, consider Autoweb Content for inclusion in appropriate
areas of Yahoo Properties; provided that, under no circumstances
shall Yahoo be under any obligation, express or implied, to
include any Autoweb Content in any Yahoo Property. In the event
that Yahoo chooses to include Autoweb Content on any Yahoo
Property, the terms of such inclusion shall be mutually agreed
upon by the parties.
9. Page Views.
----------
9.1 With respect to the Autoweb Links, Yahoo shall deliver a minimum
of [*] Page Views.
9.2 Yahoo shall use reasonable commercial efforts to deliver Autoweb
Banner Page Views in accordance with the schedule attached as
Exhibit F. The minimum numbers of aggregate Page Views to be
---------
delivered in each category are as follows: [*] Page Views of the
Autoweb Front Page Promotion; [*] Page Views of the Autoweb
Banner in the My Yahoo category of the Autoweb Banner Pages; [*]
Page Views of the Autoweb Banner on the Yahoo Auto Chat category
of the Autoweb Banner Pages; [*] Page Views of the Autoweb Banner
in the Net Events category of the Autoweb Banner Pages; [*] Page
Views of the Auto Web Banner in the Sports Auto Pages category of
the Autoweb Banner Pages; [*] Page Views of the Autoweb Banner on
Run of Network; [*] Page Views of the Autoweb Button, Autoweb
Module and Autoweb Yellow Page Module. Notwithstanding the
foregoing, Yahoo's Page View obligations are with respect to the
program as a whole as set forth in Section 9.1 above and Yahoo
shall not be in breach of this Agreement for failure to deliver
the number of Page Views in any of the areas set forth in this
Section 9.2.
9.3 In the event that Yahoo fails to deliver the number of Page Views
referred to in Section 9.1 at the expiration of the Term, Yahoo
will "make good" the shortfall by extending its obligations under
Sections 2, 3 and 4 in the areas of the Yahoo Main Site set forth
therein (or similar inventory) beyond the end of the Term until
such Page View obligation is satisfied. The provisions set forth
in this
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
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Section 9.3 set forth the entire liability of Yahoo, and
Autoweb's sole remedy, for Yahoo's breach of its Page View
obligations set forth in this Section 9.
9.4 Yahoo shall provide Autoweb access to an electronic database that
describes (in reasonable detail) Yahoo's calculation of the Page
Views delivered during the period.
9.5 In the event that Autoweb desires to alter the Autoweb Banner Run
of Network Page View delivery schedule, Yahoo shall use
commercially reasonable efforts to accommodate such request (a
"Change Request") based on inventory availability; provided that,
Autoweb agrees that (i) no Change Request shall involve altering
more than [*] percent (*%) of such scheduled inventory for
any given month; (ii) Autoweb shall provide Yahoo no less than
thirty (30) days written notice prior to the date it desires any
Change Request to take effect; and (iii) any Page Views subject
to a Change Request shall be delivered within sixty (60) days of
the month in which such Page Views were originally scheduled. For
clarity, the parties acknowledge that Change Requests shall
involve only the scheduling of when Page Views are delivered and
shall not involve any change to the Autoweb Banner Pages.
10. Compensation.
------------
10.1 Slotting Fee. In consideration of Yahoo's performance and
------------
obligations as set forth herein, Autoweb will pay Yahoo non-
refundable slotting fee equal to [*] dollars ($*). Such fee
shall be paid to Yahoo as set forth below with the first
payment designated as a set up fee for the design,
consultation, development, implementation and placement of the
Autoweb Links.
<TABLE>
<CAPTION>
Payment Date
- ----------------------------------------------------
<C> <S>
$[*] upon the Effective Date
$[*] August 30, 1999
$[*] September 30, 1999
$[*] October 31, 1999
$[*] November 30, 1999
$[*] December 31, 1999
$[*] March 31, 2000
$[*] June 30, 2000
$[*] September 30, 2000
$[*] December 31, 2000
$[*] March 31, 2001
$[*] June 30, 2001
</TABLE>
10.2 Referral Fee and EZ Wheel Lead Fee. In addition to the
---- ----------------------------------
compensation described in Section 10.1 above, Autoweb shall pay
Yahoo:
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
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(i) a quarterly referral fee ("Referral Fee") equal to $[*]
for each Click-Through. Such Referral Fee payments shall
be due to Yahoo within ten (10) days after Autoweb's
receipt of an invoice from Yahoo specifying the
appropriate amount and due date for each such payment.
(ii) a fee equal to [*] ($*) for each EZ Wheel Lead generated
beyond the EZ Wheel Lead Threshold (i.e., Autoweb shall
have no payment obligations with respect to those EZ
Wheel Leads delivered below the EZ Wheel Threshold). Such
fee shall be due within thirty (30) days of the
expiration or termination of this Agreement.
10.3 Payment Information. All payments herein are non-refundable and
-------------------
non-creditable and shall be made by Autoweb via wire transfer
into Yahoo's main account pursuant to the wire transfer
instructions set forth on Exhibit C.
---------
10.4 Late Payments. Any portion of the above payments which has not
-------------
been paid to Yahoo within ten (10) days of the dates set forth
above shall bear interest at the lesser of (i) one percent (1%)
per month or (ii) the maximum amount allowed by law.
Notwithstanding the foregoing, any failure by Autoweb to make
the payments specified in Sections 10.1 and 10.2 on the dates
set forth therein shall constitute a material breach of this
Agreement.
11. Termination.
-----------
11.1 Term. This Agreement shall commence upon the Effective Date
----
and, unless terminated as provided herein, shall remain in
effect for the Term.
11.2 Termination by Either Party with Cause. This Agreement may be
--------------------------------------
terminated at any time by either party: (i) immediately upon
written notice if the other party: (a) becomes insolvent; (b)
files a petition in bankruptcy; or (c) makes an assignment for
the benefit of its creditors; or (ii) thirty (30) days after
written notice to the other party of such other party's breach of
any of its obligations under this Agreement in any material
respect (ten (10) days in the case of a failure to pay), which
breach is not remedied within such notice period. In the event
that Yahoo provides a notice of termination under clause (ii)
above, Yahoo shall have the right to suspend its performance
under this Agreement for the notice period unless and until the
breach is fully remedied by Autoweb prior to the expiration of
the notice period.
11.3 Survival. The provisions of Sections 1, 9.3, 10, and 12 through
--------
16 and this 11.3 shall survive expiration or termination of this
Agreement; provided that, Sections 10.1 and 10.2 shall not
survive a proper termination of this Agreement by Autoweb
pursuant to Section 11.2 (i.e., upon Autoweb's proper termination
of this Agreement pursuant to Section 11.2, Autoweb shall have no
obligation
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
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to continue making those payments set forth in Sections 10.1 and
10.2 that have not become due as of the date of such
termination).
12. Confidential Information and Publicity.
--------------------------------------
12.1 Terms and Conditions. The terms and conditions of this Agreement
--------------------
shall be considered confidential and shall not be disclosed to
any third parties except to such party's accountants, attorneys,
or except as otherwise required by law. Neither party shall make
any public announcement regarding the existence of this Agreement
without the other party's prior written approval and consent.
12.2 Publicity. Any and all publicity relating to this Agreement and
---------
subsequent transactions between Yahoo and Autoweb and the method
of its release shall be approved in advance of the release by
both Yahoo and Autoweb.
12.3 Nondisclosure Agreement. Yahoo and Autoweb acknowledge and agree
-----------------------
that the terms of the Mutual Nondisclosure Agreement attached as
Exhibit D to the December 1998 Agreement, shall be incorporated
by reference and made a part of this Agreement, and shall govern
the use and disclosure of confidential information and all
discussions pertaining to or leading to this Agreement.
12.4 User Data. All information and data provided to Yahoo by users
---------
of the Yahoo Properties or otherwise collected by Yahoo relating
to user activity on the Yahoo Properties shall be retained by and
owned solely by Yahoo. All information and data provided to
Autoweb on the Autoweb Site or otherwise collected by Autoweb
relating to user activity on the Autoweb Site shall be retained
by and owned solely by Autoweb. Each party agrees to use such
information only as authorized by the user and shall not
disclose, sell, license or otherwise transfer any such user
information to any third party or use the user information for
the transmission of "junk mail," "spam," or any other unsolicited
mass distribution of information.
12.5 Privacy of User Information. Autoweb shall ensure that all
---------------------------
information provided by users of the Autoweb Site is maintained,
accessed and transmitted in a secure environment and in
compliance with security specifications to be mutually agreed
upon by the parties. Autoweb shall provide a link to its policy
(or to Yahoo's policy) regarding the protection of user data on
those pages of the Autoweb Site where the user is requested to
provide personal or financial information.
13. Indemnification.
---------------
13.1 Autoweb, at its own expense, will indemnify, defend and hold
harmless Yahoo and its employees, representatives, agents and
affiliates, against any claim, suit, action, or other proceeding
brought against Yahoo based on or arising
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from a claim any Autoweb trademark, service mark or other Autoweb
brand feature, any material, product or service produced,
distributed, offered or provided by Autoweb, or any material
presented on the Autoweb Site, infringes in any manner any
copyright, patent, trademark, trade secret or any other
intellectual property right of any third party, is or contains
any material or information that is obscene, defamatory,
libelous, slanderous, or that violates any law or regulation, or
that otherwise violates any rights of any person or entity,
including, without limitation, rights of publicity, privacy or
personality, or has otherwise resulted in any consumer fraud,
product liability, tort, breach of contract, injury, damage or
harm of any kind to any third party; provided, however, that in
any such case: (x) Yahoo provides Autoweb with prompt notice of
any such claim; (y) Yahoo permits Autoweb to assume and control
the defense of such action upon Autoweb's written notice to Yahoo
of its intention to indemnify; and (z) upon Autoweb's written
request, and at no expense to Yahoo, Yahoo will provide to
Autoweb all available information and assistance necessary for
Autoweb to defend such claim. Autoweb will not enter into any
settlement or compromise of any such claim, which settlement or
compromise would result in any liability to Yahoo, without
Yahoo's prior written consent, which shall not unreasonably be
withheld. Autoweb will pay any and all costs, damages, and
expenses, including, but not limited to, reasonable attorneys'
fees and costs awarded against or otherwise incurred by Yahoo in
connection with or arising from any such claim, suit, action or
proceeding.
13.2 Yahoo, at its own expense, will indemnify, defend and hold
harmless Autoweb and its employees, representatives, agents and
affiliates, against any claim, suit, action, or other proceeding
brought against Autoweb based on or arising from a claim that any
Yahoo trademark, service mark or other Yahoo brand feature
infringes in any manner any copyright, patent, trademark, trade
secret or any other intellectual property right of any third
party, is or contains any material or information that is
obscene, defamatory, libelous, slanderous, or that violates any
law or regulation, or that otherwise violates any rights of any
person or entity, including, without limitation, rights of
publicity, privacy or personality, or has otherwise resulted in
any consumer fraud, product liability, tort, breach of contract,
injury, damage or harm of any kind to any third party; provided,
however, that in any such case: (x) Autoweb provides Yahoo with
prompt notice of any such claim; (y) Autoweb permits Yahoo to
assume and control the defense of such action upon Yahoo's
written notice to Autoweb of its intention to indemnify; and (z)
upon Yahoo's written request, and at no expense to Autoweb,
Autoweb will provide to Yahoo all available information and
assistance necessary for Yahoo to defend such claim. Yahoo will
not enter into any settlement or compromise of any such claim,
which settlement or compromise would result in any liability to
Autoweb, without Autoweb's prior written consent, which shall not
unreasonably be withheld. Yahoo will pay any and all costs,
damages, and expenses, including, but not limited to, reasonable
attorneys' fees and costs awarded against or otherwise incurred
by
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Autoweb in connection with or arising from any such claim, suit,
action or proceeding.
14. Limitation of Liability.
-----------------------
14.1 EXCEPT AS PROVIDED IN SECTION 13, UNDER NO CIRCUMSTANCES SHALL
AUTOWEB, YAHOO, OR ANY AFFILIATE BE LIABLE TO THE OTHER PARTY FOR
INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES
ARISING FROM THIS AGREEMENT, EVEN IF THAT PARTY HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES, SUCH AS, BUT NOT LIMITED TO,
LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST BUSINESS.
15. Insurance.
---------
15.1 Autoweb agrees that it will maintain insurance with a carrier
that is reasonably acceptable by Yahoo and with coverage for
commercial general liability and errors and omissions of at least
one million dollars per occurrence. Autoweb will name Yahoo as an
additional insured on such insurance and will provide evidence of
such insurance to Yahoo within ten (10) days of the Effective
Date. Such insurance policy shall not be cancelled or modified
without Yahoo's prior written consent.
16. General Provisions.
------------------
16.1 Independent Contractors. It is the intention of Yahoo and
-----------------------
Autoweb that Yahoo and Autoweb are, and shall be deemed to be,
independent contractors with respect to the subject matter of
this Agreement, and nothing contained in this Agreement shall be
deemed or construed in any manner whatsoever as creating any
partnership, joint venture, employment, agency, fiduciary or
other similar relationship between Yahoo and Autoweb.
16.2 Entire Agreement. This Agreement, together with all Exhibits
----------------
hereto, represents the entire agreement between Yahoo and Autoweb
with respect to the subject matter hereof and thereof and shall
supersede all prior agreements and communications of the parties,
oral or written, including without limitation the Letter of
Agreement dated May 20, 1999, between Yahoo and Autoweb;
provided, however, that the parties acknowledge and agree that
the December 1998 Agreement shall remain in full force and
effect.
16.3 Amendment and Waiver. No amendment to, or waiver of, any
--------------------
provision of this Agreement shall be effective unless in writing
and signed by both parties. The waiver by any party of any
breach or default shall not constitute a waiver of any different
or subsequent breach or default.
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16.4 Governing Law. This Agreement shall be governed by and
-------------
interpreted in accordance with the laws of the State of
California without regard to the conflicts of laws principles
thereof.
16.5 Successors and Assigns. Neither party shall assign its rights
----------------------
or obligations under this Agreement without the prior written
consent of the other party, which shall not unreasonably be
withheld or delayed. Notwithstanding the foregoing, either party
may assign this Agreement to an entity who acquires
substantially all of the stock or assets of a party to this
Agreement; provided that consent will be required in the event
that the non-assigning party reasonably determines that the
assignee will not have sufficient capital or assets to perform
its obligations hereunder, or that the assignee is a direct
competitor of the non-assigning party. All terms and provisions
of this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective permitted
transferees, successors and assigns.
16.6 Force Majeure. Neither party shall be liable for failure to
-------------
perform or delay in performing any obligation (other than the
payment of money) under this Agreement if such failure or delay
is due to fire, flood, earthquake, strike, war (declared or
undeclared), embargo, blockade, legal prohibition, governmental
action, riot, insurrection, damage, destruction or any other
similar cause beyond the control of such party.
16.7 Notices. All notices, requests and other communications called
-------
for by this agreement shall be deemed to have been given
immediately if made by facsimile or Electronic mail (confirmed by
concurrent written notice sent via overnight courier for delivery
by the next business day), if to Yahoo at 3420 Central
Expressway, Santa Clara, CA 95051, Fax: (408) 731-3301 Attention:
Vice President (e-mail: [email protected]), with a copy to its
General Counsel (e-mail: [email protected]), and if to Autoweb
at the physical or Electronic mail addresses set forth on the
signature page of this Agreement, or to such other addresses as
either party shall specify to the other. Notice by any other
means shall be deemed made when actually received by the party to
which notice is provided.
16.8 Severability. If any provision of this Agreement is held to be
------------
invalid, illegal or unenforceable for any reason, such
invalidity, illegality or unenforceability shall not effect any
other provisions of this Agreement, and this Agreement shall be
construed as if such invalid, illegal or unenforceable provision
had never been contained herein.
16.9 Sole Responsibility. Autoweb will remain solely responsible for
-------------------
the operation of the Autoweb Site, and Yahoo will remain solely
responsible for the operation of the Yahoo Main Site. Each party:
(a) acknowledges that the Autoweb Site and the Yahoo Main Site
may be subject to temporary shutdowns due to causes beyond the
operating party's reasonable control; and
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(b) subject to the terms of this Agreement, retains sole right
and control over the programming, content and conduct of
transactions over its respective Internet-based service.
16.10 Counterparts. This Agreement may be executed in two
------------
counterparts, both of which taken together shall constitute a
single instrument. Execution and delivery of this Agreement may
be evidenced by facsimile transmission.
16.11 Authority. Each of Yahoo and Autoweb represents and warrants
---------
that the negotiation and entry of this Agreement will not
violate, conflict with, interfere with, result in a breach of, or
constitute a default under any other agreement to which they are
a party.
16.12 Attorneys Fees. The prevailing party in any action to enforce
--------------
this Agreement shall be entitled to reimbursement of its
expenses, including reasonable attorneys' fees.
[Signature page follows]
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This Advertising and Promotion Agreement has been executed by the duly
authorized representatives of the parties, effective as of the Effective Date.
YAHOO! INC. AUTOWEB.COM
By: /s/ ANIL SINGH By: /s/ SAMUEL M. HEDGPETH III
_____________________ __________________________
Name: Anil Singh Name: Samuel M. Hedgpeth III
___________________ ________________________
Title: SVP Title: VP
__________________ _______________________
Attn: Senior VP, Sales Attn: CFO
3420 Central Expressway 3270 Jay Street, Bldg. 6
Santa Clara, CA 95051 Santa Clara, CA 95054
Tel.: (408) 731-3344 Tel: (408) 330-4673
Fax: (408) 731-3492 Fax: (408) 588-9776
e-mail: [email protected] email: [email protected]
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EXHIBIT A
Autoweb Button Keywords:
- -------------------------------------------------------------------------------
AM General Hummer
Acura Integra
Acura NSX
Alamo
Audi A4
Audi A6
Audi A8
Austin Martin
BMW
BMW 5-Series
BMW M3
BMW Z3
Bentley Continental
Buick
Buick Century
Buick Park Avenue
Buick Regal
Buick Riviera
Cadillac
Cadillac Catera
Cadillac DeVille
Cadillac Eldorado
Cadillac Seville
Chevrolet
Chevrolet Astro
Chevrolet Blazer
Chevrolet Camaro
Chevrolet Cavalier
Chevrolet Corvette
Chevrolet Express
Chevrolet Lumina
Chevrolet Malibu
Chevrolet Metro
Chevrolet Monte Carlo
Chevrolet Prizm
Chevrolet S10
Chevrolet Suburban
Chevrolet Tahoe
Chevrolet Tracker
Chevrolet Van
Chevrolet Venture
Chrysler Sebring
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Chrysler Town & Country
Dodge
Dodge Avenger
Dodge Caravan
Dodge Dakota
Dodge Durango
Dodge Intrepid
Dodge Neon
Dodge Ram
Dodge Ram Van
Dodge Stratus
Dodge Viper
Driving
Eagle Talon
Ferrari F355
Ford
Ford Club Wagon
Ford Contour
Ford Crown Victoria
Ford Escort
Ford Escort Wagon
Ford Expedition
Ford Explorer
Ford F-150
Ford Mustang
Ford Ranger
Ford Taurus
Ford Windstar
GM
GMC
GMC Jimmy
GMC Sonoma
GMC Suburban
Harley Davidson
Honda Accord
Honda CR-V
Honda Civic
Honda Odyssey
Honda Passport
Honda Prelude
Hyundai
Infiniti I30
Infiniti Q45
Infiniti QX4
Isuzu
Isuzu Amigo
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Isuzu Rodeo
Isuzu Trooper
Jaguar
Jaguar XJ
Jaguar XK8
Jeep Cherokee
Jeep Wrangler
Kia Sephia
Kia Sportage
Land Rover
Land Rover Discovery
Lexus
Lexus ES 300
Lexus LS 400
Lexus SC 300
Lincoln Continental
Lincoln Navigator
Lincoln Town Car
Lotus Esprit
Map
Maps
Mazda
Mazda 626
Mazda Miata
Mazda protege
Mercedes
Mercedes-Benz C Class
Mercedes-Benz SLK
Mercury Cougar
Mercury Mystique
Mercury Sable
Mitsubishi 3000GT
Mitsubishi Eclipse
Mitsubishi Galant
Mitsubishi Mirage
Mitsubishi Montero
Mitsubishi Montero Sport
Nissan
Nissan 200SX
Nissan 240SX
Nissan Altima
Nissan Maxima
Nissan Pathfinder
Nissan Quest
Nissan Sentra
Oldsmobile Aurora
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Oldsmobile Cutlass
Plymouth Neon
Plymouth Voyager
Pontiac Bonneville
Pontiac Firebird
Pontiac Grand Am
Pontiac Grand Prix
Pontiac Sunfire
Pontiac Trans Sport
Porsche 911
Porsche Boxster
Range Rover
Saturn SC
Seville
Subaru Impreza
Subaru Legacy
Suzuki Sidekick
Suzuki Swift
Suzuki X-90
Toyota 4Runner
Toyota Avalon
Toyota Camry
Toyota Celica
Toyota Corolla
Toyota Land Cruiser
Toyota RAV4
Toyota Sienna
Toyota Supra
Toyota T100
Toyota Tacoma
Toyota Tercel
VW
Viper
Volkswagen
Volkswagen Beetle
Volkswagen Cabrio
Volkswagen Golf
Volkswagen Jetta
Volkswagen Passat
acura
alfa romeo
audi
auto
auto insurance
automobile
automobiles
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automotive
autos
avis
benz
blue book
budget
camaro
camry
car
car audio
car rental
cars
catera
chrysler
consumer report
corvette
deville
directions
dmv
eagle
edmunds
f1
ferrari
fiat
firebird
formula 1
general motors
hertz
honda
hummer
infiniti
jeep
kelley blue book
kelly blue book
kia
lada
lamborghini
lancia
lincoln
lotus
map quest
mapquest
mercedes-benz
mercury
mitsubishi
mustang
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nascar
oldsmobile
peugeot
plymouth
pontiac
porsche
renault
saab
saturn
seat
skoda
subaru
suzuki
toyota
truck
trucks
used car prices
used cars
volvo
911
3-series
4 runner
4 wheel drive
4runner
4-runner
4runners
4-runners
4wd
4x4
5-series
7-series
a4
a6
a8
aaa
accord
acuras
a
altima
am general
amg
aston martin
aurora
auto accessories
auto accessory
auto auction
auto auctions
auto buying
auto classified
auto classifieds
vi
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CONFIDENTIAL
auto dealer
auto finance
auto financing
auto lease
auto leases
auto loan
auto loans
auto options
auto part
auto parts
auto repair
auto repairs
auto research
auto reviews
auto warranty
auto warranties
auto web
automaker
automakers
automobile dealers
automobile dealerships
automobile financing
automobile warranty
automotives
autoweb
avalon
avant
beamer
beamers
beemer
beetle
beetles
bentley
black book
blazer
blazers
bluebook
bluebooks
bonneville
boxster
bravada
breeze
buicks
buy
cabrio
caddies
caddy
cadillacs
car accessories
car auction
car auctions
car buying
vii
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car club
car clubs
car dealer
car dealers
car finance
car financing
car insurance
car lease
car leasing
car parts
car price
car prices
car pricing
car quote
car repair
car review
car reviews
car service
car warranties
car warranty
carorder
carparts
cavalier
cavaliers
celica
century
cheap cars
cherokee
cherokees
chevrolets
chevy
chevy truck
chevy trucks
chevys
chryslers
citroen
civic
cl
classic car
classic cars
classified
classifieds
compact
consumer reports
continental
contour
convertibles
corolla
cougar
coupe
coupes
crown victoria
viii
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CONFIDENTIAL
cutlass
datsun
dealer
dealers
dealership
dealerships
drive
durango
eauto
eclipse
eighty-eight
el camino
elantra
eldorado
escalade
escort
escorts
eurovan
exotic cars
explorer
explorers
extended warranties
extended warranty
finance
financing
ford truck
ford trucks
fords
four wheel drive
galant
geo
gmbuypower
golf
goodyear
grand am
grand cherokee
grand prix
gti
hardtops
hatchback
hatchbacks
hondas
hot rod
hotrod
impreza
insurance
integra
intrepid
intrepids
intrigue
invoice
invoices
ix
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CONFIDENTIAL
iroc
jeeps
jetta
jimmy
kbb
kelley
laforza
land cruiser
lease
leasing
legacy
lesabre
lhs
low rate
low rates
lumina
m3
malibu
marquis
maxima
miata
minivan
minivans
mirage
msrp
mustang cobra
mystique
neon
new automobiles
new car
new car price
new car prices
new car pricing
new cars
nissans
nsx
olds
opel
outback
park avenue
passat
pathfinder
penske
pepboys
pickup
pickup truck
pickup trucks
pickups
prelude
preowned cars
prism
protege
x
<PAGE>
EXECUTION COPY
CONFIDENTIAL
proteges
prowler
ragtops
recalls
refinancing
regal
riviera
rl
roadster
rolls-royce
rx7
sable
savana
scirocco
sebring
second hand
secondhand
sedan
sedans
sell
sentra
sephia
service contract
service contracts
sidekick
silhouette
silhouettes
silverado
silverados
slx
sonata
sonoma
sports car
sports cars
station
station wagon
stoneage
stratus
suburban
sunfire
suv
suvs
talon
taurus
town car
toyotas
tracer
trans am
transport
transportation
trooper
troopers
xi
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CONFIDENTIAL
truck price
truck prices
used
used automobiles
used auto
used autos
used car
used trucks
used vehicles
ute
utility
v6
v8
v8 engine
van
vans
vauxhall
vehicle
vehicles
volkswagen bug
volkswagon
volkswagon bug
vw bug
vw jetta
vw van
wagon
wagons
warrantee
warranties
warranty
warrantygold
wrangler
wranglers
xj
yukon
z28
z3
Autoweb Category Pages:
- ----------------------
/yahoo/directory/Recreation/Automotive
/yahoo/directory/Recreation/Automotive/~FAQs
/yahoo/directory/Recreation/Automotive/~Usenet
/yahoo/directory/Recreation/Automotive/~Usenet/Makes and Models
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Electric
Vehicles
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Electric
Vehicles/Organizations
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Hybrid Electric
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Magazines
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Solar Vehicles
xii
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CONFIDENTIAL
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Solar
Vehicles/Bicycles
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Solar
Vehicles/Teams
/yahoo/directory/Recreation/Automotive/Alternative Fuel Vehicles/Solar
Vehicles/Winston Solar Challenge
/yahoo/directory/Recreation/Automotive/Audio
/yahoo/directory/Recreation/Automotive/Audio/Magazines
/yahoo/directory/Recreation/Automotive/British Cars
/yahoo/directory/Recreation/Automotive/Bumper Stickers
/yahoo/directory/Recreation/Automotive/Buyer's Guides
/yahoo/directory/Recreation/Automotive/Charitable Vehicle Donation
/yahoo/directory/Recreation/Automotive/Chat
/yahoo/directory/Recreation/Automotive/Classic Cars
/yahoo/directory/Recreation/Automotive/Classic Cars/Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Classic Cars/Clubs and Organizations/
Antique Automobile Club of America
/yahoo/directory/Recreation/Automotive/Classic Cars/Events and Shows
/yahoo/directory/Recreation/Automotive/Classic Cars/Magazines
/yahoo/directory/Recreation/Automotive/Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Clubs and Organizations/American
Automobile Association
/yahoo/directory/Recreation/Automotive/Clubs and Organizations/Makes and Models
/yahoo/directory/Recreation/Automotive/Clubs and Organizations/Vanning
/yahoo/directory/Recreation/Automotive/Concept Cars
/yahoo/directory/Recreation/Automotive/Dormobiles
/yahoo/directory/Recreation/Automotive/Driving
/yahoo/directory/Recreation/Automotive/Driving/Bad Drivers
/yahoo/directory/Recreation/Automotive/Driving/Insurance
/yahoo/directory/Recreation/Automotive/Driving/Road Rage
/yahoo/directory/Recreation/Automotive/Driving/Safety
/yahoo/directory/Recreation/Automotive/Driving/Safety/Organizations
/yahoo/directory/Recreation/Automotive/Driving/Safety/Traffic Signs, Signals,
and Lights
/yahoo/directory/Recreation/Automotive/Driving/Speeding
/yahoo/directory/Recreation/Automotive/Dune Buggies
/yahoo/directory/Recreation/Automotive/Emissions
/yahoo/directory/Recreation/Automotive/Emissions/Regional Information
/yahoo/directory/Recreation/Automotive/Emissions/Regional Information/
California Smog Check
/yahoo/directory/Recreation/Automotive/Employment
/yahoo/directory/Recreation/Automotive/Employment/Jobs
/yahoo/directory/Recreation/Automotive/Employment/Vocational Schools
/yahoo/directory/Recreation/Automotive/Events and Shows
/yahoo/directory/Recreation/Automotive/Events and Shows/Auto Show
/yahoo/directory/Recreation/Automotive/Events and Shows/Import Showoff
/yahoo/directory/Recreation/Automotive/Events and Shows/North American
International Auto Show
/yahoo/directory/Recreation/Automotive/Famous Cars
/yahoo/directory/Recreation/Automotive/Financing
/yahoo/directory/Recreation/Automotive/Financing/Leasing
/yahoo/directory/Recreation/Automotive/Financing/Loan Calculators
/yahoo/directory/Recreation/Automotive/Four Wheel Drive
/yahoo/directory/Recreation/Automotive/Four Wheel Drive/Clubs and Organizations
xiii
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/yahoo/directory/Recreation/Automotive/Four Wheel Drive/Magazines
/yahoo/directory/Recreation/Automotive/General Information
/yahoo/directory/Recreation/Automotive/Hearses
/yahoo/directory/Recreation/Automotive/History
/yahoo/directory/Recreation/Automotive/History/Makes and Models
/yahoo/directory/Recreation/Automotive/History/Museums
/yahoo/directory/Recreation/Automotive/Kit Cars
/yahoo/directory/Recreation/Automotive/Kit Cars/Magazines
/yahoo/directory/Recreation/Automotive/License Plates
/yahoo/directory/Recreation/Automotive/License Plates/Collecting
/yahoo/directory/Recreation/Automotive/License Plates/Vanity Plates
/yahoo/directory/Recreation/Automotive/Licensing and Registration Agencies
/yahoo/directory/Recreation/Automotive/Licensing and Registration Agencies/
United States
/yahoo/directory/Recreation/Automotive/Lowriders
/yahoo/directory/Recreation/Automotive/Lowriders/Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Lowriders/Magazines
/yahoo/directory/Recreation/Automotive/Maintenance
/yahoo/directory/Recreation/Automotive/Makes and Models
/yahoo/directory/Recreation/Automotive/Makes and Models/AC Cobra
/yahoo/directory/Recreation/Automotive/Makes and Models/Acura
/yahoo/directory/Recreation/Automotive/Makes and Models/Acura/Integra
/yahoo/directory/Recreation/Automotive/Makes and Models/Acura/Integra/GS-R
/yahoo/directory/Recreation/Automotive/Makes and Models/Acura/Legend
/yahoo/directory/Recreation/Automotive/Makes and Models/Acura/NSX
/yahoo/directory/Recreation/Automotive/Makes and Models/Alfa Romeo
/yahoo/directory/Recreation/Automotive/Makes and Models/American Motors
/yahoo/directory/Recreation/Automotive/Makes and Models/Aston Martin
/yahoo/directory/Recreation/Automotive/Makes and Models/Audi
/yahoo/directory/Recreation/Automotive/Makes and Models/Audi/A4
/yahoo/directory/Recreation/Automotive/Makes and Models/Audi/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Audi/Quattro
/yahoo/directory/Recreation/Automotive/Makes and Models/Audi/TT Coupe
/yahoo/directory/Recreation/Automotive/Makes and Models/Bentley
/yahoo/directory/Recreation/Automotive/Makes and Models/BMW
/yahoo/directory/Recreation/Automotive/Makes and Models/BMW/BMW 600
/yahoo/directory/Recreation/Automotive/Makes and Models/BMW/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/BMW/Clubs/BMW Car Club
of America
/yahoo/directory/Recreation/Automotive/Makes and Models/BMW/M3
/yahoo/directory/Recreation/Automotive/Makes and Models/BMW/Z3
/yahoo/directory/Recreation/Automotive/Makes and Models/British Leyland
/yahoo/directory/Recreation/Automotive/Makes and Models/British Leyland/Healey
/yahoo/directory/Recreation/Automotive/Makes and Models/Bugatti
/yahoo/directory/Recreation/Automotive/Makes and Models/Buick
/yahoo/directory/Recreation/Automotive/Makes and Models/Buick/Regal
/yahoo/directory/Recreation/Automotive/Makes and Models/Cadillac
/yahoo/directory/Recreation/Automotive/Makes and Models/Caterham
xiv
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/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Beretta
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Camaro
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Chevelle
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Chevette
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Corvair
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Corvette
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Corvette/
Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Corvette/
Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Impala
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Impala/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Monte Carlo
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Nova
/yahoo/directory/Recreation/Automotive/Makes and Models/Chevrolet/Suburban
/yahoo/directory/Recreation/Automotive/Makes and Models/Chrysler
/yahoo/directory/Recreation/Automotive/Makes and Models/Chrysler/Consumer
Opinion
/yahoo/directory/Recreation/Automotive/Makes and Models/Citroen
/yahoo/directory/Recreation/Automotive/Makes and Models/Daewoo
/yahoo/directory/Recreation/Automotive/Makes and Models/DeLorean
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge/Dart
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge/Durango
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge/Trucks
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge/Trucks/Dakota
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge/Viper
/yahoo/directory/Recreation/Automotive/Makes and Models/Dodge/Viper/Viper Club
of America
/yahoo/directory/Recreation/Automotive/Makes and Models/Eagle
/yahoo/directory/Recreation/Automotive/Makes and Models/Ferrari
/yahoo/directory/Recreation/Automotive/Makes and Models/Ferrari/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Ferrari/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Fiat
/yahoo/directory/Recreation/Automotive/Makes and Models/Fiat/Spider
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Bronco
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Capri
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Clubs and
Organizations/Model A
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Escort
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Expedition
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Explorer
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Falcon
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Fiesta
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Galaxie
xv
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/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Model T
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Model T/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Model T/Clubs/
Model T Ford Club of America
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Mustang
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Mustang/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Mustang/Clubs and
Organizations/Mustang Club of America
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Probe
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Taurus
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Thunderbird
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Thunderbird/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Trucks
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Trucks/Ranger
/yahoo/directory/Recreation/Automotive/Makes and Models/Ford/Windstar
/yahoo/directory/Recreation/Automotive/Makes and Models/General Motors
/yahoo/directory/Recreation/Automotive/Makes and Models/Geo
/yahoo/directory/Recreation/Automotive/Makes and Models/Geo/Storm
/yahoo/directory/Recreation/Automotive/Makes and Models/GMC
/yahoo/directory/Recreation/Automotive/Makes and Models/Holden
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/Accord
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/Civic
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/Civic/CRX
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/Civic/del Sol
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/CR-V
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/Del Sol
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/EV Plus
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/Prelude
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/S2000
/yahoo/directory/Recreation/Automotive/Makes and Models/Honda/Web Directories
/yahoo/directory/Recreation/Automotive/Makes and Models/Hummer
/yahoo/directory/Recreation/Automotive/Makes and Models/Hyundai
/yahoo/directory/Recreation/Automotive/Makes and Models/Infiniti
/yahoo/directory/Recreation/Automotive/Makes and Models/International Harvester
/yahoo/directory/Recreation/Automotive/Makes and Models/Isuzu
/yahoo/directory/Recreation/Automotive/Makes and Models/Isuzu/Amigo
/yahoo/directory/Recreation/Automotive/Makes and Models/Isuzu/Rodeo
/yahoo/directory/Recreation/Automotive/Makes and Models/Isuzu/Trooper
/yahoo/directory/Recreation/Automotive/Makes and Models/Jaguar
/yahoo/directory/Recreation/Automotive/Makes and Models/Jeep
/yahoo/directory/Recreation/Automotive/Makes and Models/Jeep/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Jeep/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Jeep/Postal Jeeps
/yahoo/directory/Recreation/Automotive/Makes and Models/Kia
/yahoo/directory/Recreation/Automotive/Makes and Models/Kia/Sportage
/yahoo/directory/Recreation/Automotive/Makes and Models/Lamborghini
xvi
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/yahoo/directory/Recreation/Automotive/Makes and Models/Lancia
/yahoo/directory/Recreation/Automotive/Makes and Models/Land Rover
/yahoo/directory/Recreation/Automotive/Makes and Models/Land Rover/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Lexus
/yahoo/directory/Recreation/Automotive/Makes and Models/Lincoln
/yahoo/directory/Recreation/Automotive/Makes and Models/Lincoln/Navigator
/yahoo/directory/Recreation/Automotive/Makes and Models/Lotus
/yahoo/directory/Recreation/Automotive/Makes and Models/Maserati
/yahoo/directory/Recreation/Automotive/Makes and Models/Mazda
/yahoo/directory/Recreation/Automotive/Makes and Models/Mazda/323
/yahoo/directory/Recreation/Automotive/Makes and Models/Mazda/Miata
/yahoo/directory/Recreation/Automotive/Makes and Models/Mazda/Miata/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Mazda/RX-7
/yahoo/directory/Recreation/Automotive/Makes and Models/McLaren
/yahoo/directory/Recreation/Automotive/Makes and Models/Mercedes-Benz
/yahoo/directory/Recreation/Automotive/Makes and Models/Mercedes-Benz/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Mercedes-Benz/Clubs and
Organizations/Mercedes-Benz Club of America
/yahoo/directory/Recreation/Automotive/Makes and Models/Mercedes-Benz/ML320
/yahoo/directory/Recreation/Automotive/Makes and Models/Mercury
/yahoo/directory/Recreation/Automotive/Makes and Models/MG
/yahoo/directory/Recreation/Automotive/Makes and Models/MG/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/MG/MGF
/yahoo/directory/Recreation/Automotive/Makes and Models/Mini
/yahoo/directory/Recreation/Automotive/Makes and Models/Mitsubishi
/yahoo/directory/Recreation/Automotive/Makes and Models/Mitsubishi/3000GT
/yahoo/directory/Recreation/Automotive/Makes and Models/Mitsubishi/Eclipse
/yahoo/directory/Recreation/Automotive/Makes and Models/Mitsubishi/Eclipse/
Club DSM
/yahoo/directory/Recreation/Automotive/Makes and Models/Mitsubishi/Lancer
/yahoo/directory/Recreation/Automotive/Makes and Models/Mopar
/yahoo/directory/Recreation/Automotive/Makes and Models/Mopar/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Morgan
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan/300ZX
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan/Maxima
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan/Pathfinder
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan/SE-R
/yahoo/directory/Recreation/Automotive/Makes and Models/Nissan/Skyline GT-R
/yahoo/directory/Recreation/Automotive/Makes and Models/Oldsmobile
/yahoo/directory/Recreation/Automotive/Makes and Models/Opel
/yahoo/directory/Recreation/Automotive/Makes and Models/Peugeot
/yahoo/directory/Recreation/Automotive/Makes and Models/Plymouth
/yahoo/directory/Recreation/Automotive/Makes and Models/Plymouth/Barracuda
/yahoo/directory/Recreation/Automotive/Makes and Models/Plymouth/Neon
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac
xvii
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CONFIDENTIAL
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/Fiero
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/Firebird
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/Firebird/Clubs
and Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/Grand Prix
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/GTO
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Pontiac/Sunfire
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/356
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/911
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/914
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/914/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/914/Clubs/
Porsche 914 Owners Association
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/928
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/944
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/Boxster
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/Clubs
/yahoo/directory/Recreation/Automotive/Makes and Models/Porsche/Clubs/Porsche
Club of America
/yahoo/directory/Recreation/Automotive/Makes and Models/Range Rover
/yahoo/directory/Recreation/Automotive/Makes and Models/Renault
/yahoo/directory/Recreation/Automotive/Makes and Models/Renault/Clio Williams
/yahoo/directory/Recreation/Automotive/Makes and Models/Renault/Models
/yahoo/directory/Recreation/Automotive/Makes and Models/Rolls Royce
/yahoo/directory/Recreation/Automotive/Makes and Models/Rover
/yahoo/directory/Recreation/Automotive/Makes and Models/Saab
/yahoo/directory/Recreation/Automotive/Makes and Models/Saturn
/yahoo/directory/Recreation/Automotive/Makes and Models/Skoda
/yahoo/directory/Recreation/Automotive/Makes and Models/Studebaker
/yahoo/directory/Recreation/Automotive/Makes and Models/Subaru
/yahoo/directory/Recreation/Automotive/Makes and Models/Sunbeam
/yahoo/directory/Recreation/Automotive/Makes and Models/Suzuki
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/4Runner
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Camry
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Celica
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Corolla
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Land Cruiser
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Land Cruiser/
Toyota Land Cruiser Association
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/MR2
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/MR2/Clubs and
Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/MR2/Clubs and
Organizations/International MR2 Owners Club
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/RAV4
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Supra
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Supra/Supra
Owners Group, Intl.
/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Tacoma
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/yahoo/directory/Recreation/Automotive/Makes and Models/Toyota/Tercel
/yahoo/directory/Recreation/Automotive/Makes and Models/Triumph
/yahoo/directory/Recreation/Automotive/Makes and Models/Triumph/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Triumph/TR6
/yahoo/directory/Recreation/Automotive/Makes and Models/TVR
/yahoo/directory/Recreation/Automotive/Makes and Models/Vauxhall
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Beetle
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Beetle/New
Beetle
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Buses, Vans,
Campers, etc.
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Clubs
and Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Clubs
and Organizations/Vintage
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/
Corrado
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Golf/
GTI
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Golf/
Jetta
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Golf/
Karmann Ghia
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Golf/
Passat
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Golf/
Passat/Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Golf/
Thing
/yahoo/directory/Recreation/Automotive/Makes and Models/Volkswagen/Cabrio/Rabbit
/yahoo/directory/Recreation/Automotive/Makes and Models/Volvo
/yahoo/directory/Recreation/Automotive/Makes and Models/Volvo/Magazines
/yahoo/directory/Recreation/Automotive/Makes and Models/Yugo
/yahoo/directory/Recreation/Automotive/Microcars
/yahoo/directory/Recreation/Automotive/Motorcycles
/yahoo/directory/Recreation/Automotive/Motorcycles/~Usenet
/yahoo/directory/Recreation/Automotive/Motorcycles/Advocacy
/yahoo/directory/Recreation/Automotive/Motorcycles/Advocacy/Organizations
/yahoo/directory/Recreation/Automotive/Motorcycles/Advocacy/Organizations/
American Motorcyclist Association
/yahoo/directory/Recreation/Automotive/Motorcycles/ATVs
/yahoo/directory/Recreation/Automotive/Motorcycles/Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Motorcycles/Clubs and Organizations/
Antique Motorcycle Club of America
/yahoo/directory/Recreation/Automotive/Motorcycles/Clubs and Organizations/
Hells Angels
/yahoo/directory/Recreation/Automotive/Motorcycles/Events
/yahoo/directory/Recreation/Automotive/Motorcycles/Feet Forwards Motorcycles
/yahoo/directory/Recreation/Automotive/Motorcycles/Knievel, Evel
/yahoo/directory/Recreation/Automotive/Motorcycles/Magazines
/yahoo/directory/Recreation/Automotive/Motorcycles/Magazines/Subscription-based
/yahoo/directory/Recreation/Automotive/Motorcycles/Mailing Lists
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/BMW
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/BMW/Clubs
and Organizations
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Buell
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Ducati
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Harley-
Davidson
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Harley-
Davidson/Clubs and Organizations
xix
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CONFIDENTIAL
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Harley-
Davidson/Clubs and Organizations/Harley Owners Group (HOG)
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Harley-
Davidson/Events
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Harley-
Davidson/Magazines
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/CB
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/Clubs
and Organizations
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/Clubs
and Organizations/Gold Wing Road Riders Association
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/Clubs
and Organizations/Honda Shadow Riders Club
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/Clubs
and Organizations/Honda Sport Touring Association
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/VFR
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/VTR100
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Honda/XR
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Indian
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Kawasaki
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Kawasaki/
Kawasaki GPz750
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Moto Guzzi
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Norton
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Suzuki
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Suzuki/
Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Triumph
/yahoo/directory/Recreation/Automotive/Motorcycles/Makes and Models/Yamaha
/yahoo/directory/Recreation/Automotive/Motorcycles/Mopeds
/yahoo/directory/Recreation/Automotive/Motorcycles/Museums
/yahoo/directory/Recreation/Automotive/Motorcycles/Off-Road Motorcycling
/yahoo/directory/Recreation/Automotive/Motorcycles/Off-Road Motorcycling/Clubs
and Organizations
/yahoo/directory/Recreation/Automotive/Motorcycles/Off-Road Motorcycling/
Magazines
/yahoo/directory/Recreation/Automotive/Motorcycles/Pictures
/yahoo/directory/Recreation/Automotive/Motorcycles/Scooters
/yahoo/directory/Recreation/Automotive/Motorcycles/Scooters/Clubs
/yahoo/directory/Recreation/Automotive/Motorcycles/Scooters/Magazines
/yahoo/directory/Recreation/Automotive/Motorcycles/Scooters/Miniscooters
/yahoo/directory/Recreation/Automotive/Motorcycles/Scooters/Vespa
/yahoo/directory/Recreation/Automotive/Motorcycles/Travelogues
/yahoo/directory/Recreation/Automotive/Motorcycles/Trikes
/yahoo/directory/Recreation/Automotive/Motorcycles/Web Directories
/yahoo/directory/Recreation/Automotive/Motorcycles/Women
/yahoo/directory/Recreation/Automotive/Motorcycles/Women/Organizations
/yahoo/directory/Recreation/Automotive/Museums
/yahoo/directory/Recreation/Automotive/News and Media
/yahoo/directory/Recreation/Automotive/News and Media/Columns and Columnists
/yahoo/directory/Recreation/Automotive/News and Media/Magazines
/yahoo/directory/Recreation/Automotive/News and Media/Magazines/Car and Driver
/yahoo/directory/Recreation/Automotive/News and Media/Radio Shows
/yahoo/directory/Recreation/Automotive/Software
/yahoo/directory/Recreation/Automotive/Sport Utility Vehicles
/yahoo/directory/Recreation/Automotive/Sport Utility Vehicles/Anti-Sport
Utility Vehicles
xx
<PAGE>
EXECUTION COPY
CONFIDENTIAL
/yahoo/directory/Recreation/Automotive/Sport Utility Vehicles/Magazines
/yahoo/directory/Recreation/Automotive/Sport Utility Vehicles/Makes and Models
/yahoo/directory/Recreation/Automotive/Station Wagons
/yahoo/directory/Recreation/Automotive/Station Wagons/Magazines
/yahoo/directory/Recreation/Automotive/Technicians
/yahoo/directory/Recreation/Automotive/Tires
/yahoo/directory/Recreation/Automotive/Trucks
/yahoo/directory/Recreation/Automotive/Trucks/~Usenet
/yahoo/directory/Recreation/Automotive/Trucks/Classic Trucks
/yahoo/directory/Recreation/Automotive/Trucks/Clubs and Organizations
/yahoo/directory/Recreation/Automotive/Trucks/Magazines
/yahoo/directory/Recreation/Automotive/Trucks/Monster Trucks
/yahoo/directory/Recreation/Automotive/Trucks/Monster Trucks/Individual Trucks
/yahoo/directory/Recreation/Automotive/Trucks/Monster Trucks/Magazines
/yahoo/directory/Recreation/Automotive/Web Directories
/yahoo/directory/Recreation/Automotive/Women
/yahoo/directory/Recreation/Automotive/Wrecks
/yahoo/directory/Recreation/Sports/Auto Racing
/yahoo/directory/Recreation/Sports/Auto Racing/ARCA
/yahoo/directory/Recreation/Sports/Auto Racing/By Region
/yahoo/directory/Recreation/Sports/Auto Racing/By Region/United States
/yahoo/directory/Recreation/Sports/Auto Racing/CART
/yahoo/directory/Recreation/Sports/Auto Racing/CART/Drivers
/yahoo/directory/Recreation/Sports/Auto Racing/CART/Races
/yahoo/directory/Recreation/Sports/Auto Racing/CART/Races/Bosch Spark Plug
Grand Prix
/yahoo/directory/Recreation/Sports/Auto Racing/CART/Teams
/yahoo/directory/Recreation/Sports/Auto Racing/CART/Teams/Honda Racing
/yahoo/directory/Recreation/Sports/Auto Racing/Demolition Derby
/yahoo/directory/Recreation/Sports/Auto Racing/DIRT
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing/~Usenet
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing/Drivers
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing/Funny Cars
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing/Funny Cars/Drivers
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing/Funny Cars/Teams
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing/Organizations
/yahoo/directory/Recreation/Sports/Auto Racing/Drag Racing/Street Racing
/yahoo/directory/Recreation/Sports/Auto Racing/Drivers
/yahoo/directory/Recreation/Sports/Auto Racing/Fantasy
/yahoo/directory/Recreation/Sports/Auto Racing/FIA GT
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Drivers
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Drivers/Schumacher,
Michael
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Drivers/Senna, Ayrton
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Drivers/Villeneueve,
Jacques
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Fantasy
xxi
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CONFIDENTIAL
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Pictures
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Races
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Races/Monaco Grand
Prix
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Teams
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Teams/Jordan Grand
Prix
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Teams/McLaren
International
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Teams/Prost-Peugeot
/yahoo/directory/Recreation/Sports/Auto Racing/Formula One/Web Directories
/yahoo/directory/Recreation/Sports/Auto Racing/Formula Society of Automotive
Engineers (FSAE)
/yahoo/directory/Recreation/Sports/Auto Racing/Indy Lights
/yahoo/directory/Recreation/Sports/Auto Racing/Indy Racing League (IRL)
/yahoo/directory/Recreation/Sports/Auto Racing/Indy Racing League (IRL)/Drivers
/yahoo/directory/Recreation/Sports/Auto Racing/Indy Racing League (IRL)/Races
/yahoo/directory/Recreation/Sports/Auto Racing/Indy Racing League (IRL)/Races/
Indianapolis 500
/yahoo/directory/Recreation/Sports/Auto Racing/International Motor Contest
Association (IMCA)
/yahoo/directory/Recreation/Sports/Auto Racing/IROC
/yahoo/directory/Recreation/Sports/Auto Racing/Karting
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Land Speed Record
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Lawn Mower Racing
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Legends
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Midget
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Chat
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers/Earnhardt,
Dale
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers/Earnhardt,
Dale, Jr.
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers/Elliot, Bill
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers/Gordon, Jeff
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers/Gordon, Jeff/
Anti-Jeff Gordon
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers/Martin, Mark
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Drivers/Wallace,
Rusty
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Fan Pages
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Fantasy
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/News and Media
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Pictures
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Races
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Races/California 500
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Races/Coca-Cola 600
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Races/Daytona 500
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Races/DieHard 500
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Races/Dura-Lube/Pepsi
400
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Scanner Frequencies
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Series
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Series/Busch Grand
National
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Series/RE/Winston
Racing
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Teams
xxii
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/yahoo/directory/Recreation/Sports/Auto Racing/Kool/NASCAR/Web Directories
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/News and Media
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/News and Media/Magazines
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Off-Road
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Organizations
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Organizations/Sports Car
Club of America (SCCA)
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Professional Sports Car
Racing
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Races
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Races/24 Hours of Le Mans
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Rallying
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/SCCA Trans-Am
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Simulation
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Soap Box Derby
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Sprint Car Racing
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Sprint Car Racing/Teams
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Sprint Car Racing/World of
Outlaws
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Teams
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Toyota Atlantic Championship
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tracks and Speedways
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tracks and Speedways/
California Speedway
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tracks and Speedways/
Daytona International Speedway
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tracks and Speedways/
Directories
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tracks and Speedways/
Indianapolis Motor Speedway
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tracks and Speedways/
Nazareth Speedway
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tracks and Speedways/
Talladega Superspeedway
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Tractor and Truck Pulling
/yahoo/directory/Recreation/Sports/Auto Racing/Kool/Vintage Racing
http://auctions.yahoo.com/26318-category.html*
(Auctions > Other Goods & Services > Transportation > Autos)
Autoweb Auto Pages:
/site/autos
/site/autos/aic
/site/autos/aic/acura
/site/autos/aic/am general
/site/autos/aic/aston martin
/site/autos/aic/audi
/site/autos/aic/bentley
/site/autos/aic/bmw
/site/autos/aic/buick
/site/autos/aic/cadillac
/site/autos/aic/chevrolet
/site/autos/aic/chevrolet truck
/site/autos/aic/chrysler
/site/autos/aic/compare
xxiii
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CONFIDENTIAL
/site/autos/aic/daewoo
/site/autos/aic/dodge
/site/autos/aic/dodge truck
/site/autos/aic/ferrari
/site/autos/aic/ford
/site/autos/aic/ford truck
/site/autos/aic/gmc
/site/autos/aic/gmc truck
/site/autos/aic/honda
/site/autos/aic/hyundai
/site/autos/aic/infiniti
/site/autos/aic/isuzu
/site/autos/aic/isuzu truck
/site/autos/aic/jaguar
/site/autos/aic/jeep
/site/autos/aic/kia
/site/autos/aic/lamborghini
/site/autos/aic/land rover
/site/autos/aic/lexus
/site/autos/aic/lincoln
/site/autos/aic/lotus
/site/autos/aic/mazda
/site/autos/aic/mazda truck
/site/autos/aic/mercedes-benz
/site/autos/aic/mercury
/site/autos/aic/mitsubishi
/site/autos/aic/nissan
/site/autos/aic/nissan truck
/site/autos/aic/oldsmobile
/site/autos/aic/plymouth
/site/autos/aic/pontiac
/site/autos/aic/porsche
/site/autos/aic/rolls-royce
/site/autos/aic/saab
/site/autos/aic/saturn
/site/autos/aic/subaru
/site/autos/aic/suzuki
/site/autos/aic/toyota
/site/autos/aic/toyota truck
/site/autos/aic/volkswagen
/site/autos/aic/volvo
/site/autos/calculators
/site/autos/calculators/lease
/site/autos/calculators/loan
/site/autos/calculators/loanlease
/site/autos/edmunds
xxiv
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CONFIDENTIAL
/site/autos/repair
/site/autos/repair/detail
Autoweb Classified Pages:
/site/classifieds/automobiles
/site/classifieds/automobiles/region
/site/classifieds/automobiles/results
/site/classifieds/automobiles/search
Autoweb Message Board Pages:
/site/messageboards/Sports and Recreation/Autos
/site/messageboards/Sports and Recreation/Autos/Boards by Make
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Acura
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Audi
/site/messageboards/Sports and Recreation/Autos/Boards by Make/BMW
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Buick
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Cadillac
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Chevrolet
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Chrysler
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Dodge
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Ferrari
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Ford
/site/messageboards/Sports and Recreation/Autos/Boards by Make/GMC
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Honda
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Hyundai
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Isuzu
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Jaguar
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Jeep
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Kia
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Lamborghini
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Land Rover
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Lexus
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Lincoln
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Mazda
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Mercedes-Benz
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Mercury
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Mitsubishi
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Nissan
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Oldsmobile
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Pontiac
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Porsche
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Saab
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Saturn
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Subaru
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Suzuki
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Toyota
xxv
<PAGE>
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CONFIDENTIAL
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Volkswagen
/site/messageboards/Sports and Recreation/Autos/Boards by Make/Volvo
/site/messageboards/Sports and Recreation/Autos/General Autos Discussion
/site/messageboards/Sports and Recreation/Autos/Motorcycles
Autoweb Yellow Pages:
/site/yellow pages/directory/Automotive
/site/yellow pages/directory/Automotive/Accessories
/site/yellow pages/directory/Automotive/Antiques and Collectibles
/site/yellow pages/directory/Automotive/Auto Wrecking
/site/yellow pages/directory/Automotive/Car Washes
/site/yellow pages/directory/Automotive/Conversions
/site/yellow pages/directory/Automotive/Dealers
/site/yellow pages/directory/Automotive/Dealers/New
/site/yellow pages/directory/Automotive/Dealers/New/Acura
/site/yellow pages/directory/Automotive/Dealers/New/BMW
/site/yellow pages/directory/Automotive/Dealers/New/Buick
/site/yellow pages/directory/Automotive/Dealers/New/Cadillac
/site/yellow pages/directory/Automotive/Dealers/New/Chevrolet
/site/yellow pages/directory/Automotive/Dealers/New/Chrysler-Plymouth
/site/yellow pages/directory/Automotive/Dealers/New/Dodge
/site/yellow pages/directory/Automotive/Dealers/New/Ford
/site/yellow pages/directory/Automotive/Dealers/New/Honda
/site/yellow pages/directory/Automotive/Dealers/New/Hyundai
/site/yellow pages/directory/Automotive/Dealers/New/Isuzu
/site/yellow pages/directory/Automotive/Dealers/New/Jeep
/site/yellow pages/directory/Automotive/Dealers/New/Lexus
/site/yellow pages/directory/Automotive/Dealers/New/Lincoln-Mercury
/site/yellow pages/directory/Automotive/Dealers/New/Mazda
/site/yellow pages/directory/Automotive/Dealers/New/Mercedes-Benz
/site/yellow pages/directory/Automotive/Dealers/New/Mitsubishi
/site/yellow pages/directory/Automotive/Dealers/New/Nissan
/site/yellow pages/directory/Automotive/Dealers/New/Oldsmobile
/site/yellow pages/directory/Automotive/Dealers/New/Pontiac
/site/yellow pages/directory/Automotive/Dealers/New/Saturn
/site/yellow pages/directory/Automotive/Dealers/New/Subaru
/site/yellow pages/directory/Automotive/Dealers/New/Toyota
/site/yellow pages/directory/Automotive/Dealers/New/Volkswagen
/site/yellow pages/directory/Automotive/Dealers/New/Volvo
/site/yellow pages/directory/Automotive/Dealers/Used
/site/yellow pages/directory/Automotive/Driving Schools
/site/yellow pages/directory/Automotive/Gas Stations
/site/yellow pages/directory/Automotive/Motorcycles
/site/yellow pages/directory/Automotive/Motorcycles/Dealers
/site/yellow pages/directory/Automotive/Motorcycles/Parts
xxvi
<PAGE>
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CONFIDENTIAL
/site/yellow pages/directory/Automotive/Motorcycles/Repair and Service
/site/yellow pages/directory/Automotive/Parts
/site/yellow pages/directory/Automotive/Parts/Automobile
/site/yellow pages/directory/Automotive/Racing
/site/yellow pages/directory/Automotive/Racing/Parts
/site/yellow pages/directory/Automotive/Racing/Tracks
/site/yellow pages/directory/Automotive/Recreational Vehicles
/site/yellow pages/directory/Automotive/Recreational Vehicles/Dealers
/site/yellow pages/directory/Automotive/Recreational Vehicles/Rental
/site/yellow pages/directory/Automotive/Recreational Vehicles/Repair and
Services
/site/yellow pages/directory/Automotive/Rental
/site/yellow pages/directory/Automotive/Rental/Cars
/site/yellow pages/directory/Automotive/Repair and Service
/site/yellow pages/directory/Automotive/Repair and Service/Auto
/site/yellow pages/directory/Automotive/Repair and Service/Body Repair and Paint
/site/yellow pages/directory/Automotive/Repair and Service/Brake Service
/site/yellow pages/directory/Automotive/Repair and Service/Exhaust and Emissions
/site/yellow pages/directory/Automotive/Repair and Service/Glass
/site/yellow pages/directory/Automotive/Repair and Service/Oil and Lubrication
/site/yellow pages/directory/Automotive/Repair and Service/Restoration
/site/yellow pages/directory/Automotive/Repair and Service/Road Service
/site/yellow pages/directory/Automotive/Repair and Service/Upholstery
/site/yellow pages/directory/Automotive/Security
/site/yellow pages/directory/Automotive/Tires
/site/yellow pages/directory/Automotive/Towing
/site/yellow pages/directory/Automotive/Trucks
/site/yellow pages/directory/Automotive/Trucks/Dealers
/site/yellow pages/directory/Automotive/Trucks/Parts
/site/yellow pages/directory/Automotive/Trucks/Rental
/site/yellow pages/directory/Automotive/Trucks/Repair and Service
AutoWeb Banner Pages:
http://events.yahoo.com/Net_Events/Recreation/Automotive/
http://sports.yahoo.com/rac/nascar
- ----------------------------------
http://chat.yahoo.com/?room=Car%20Chat
- --------------------------------------
http://my.yahoo.com/
xxvii
<PAGE>
EXECUTION COPY
AutoWeb Banner for Run of Site (Exhibit B)
[LOGO DESCRIPTION HERE]
This is an example of the placement for the AutoWeb banner for Yahoo Run of
Network.
<PAGE>
EXECUTION COPY
AutoWeb Button on Category Pages and Search Result Pages (Exhibit B)
[LOGO DESCRIPTION HERE]
This is an example of placement for the AutoWeb buttons on category pages and
search result pages.
[LOGO DESCRIPTION HERE]
This is an example of placement for the AutoWeb buttons within Yahoo Message
Boards.
<PAGE>
EXECUTION COPY
AutoWeb Button and Modules in Yahoo Classifieds (Exhibit B)
[LOGO DESCRIPTION HERE] This is an example of
placement for the AutoWeb
Button on the AutoWeb
Classified Pages
This is an example of placement for the AutoWeb Module in Yahoo Auto
Classifieds. This module shall not be fixed on such pages, but will rotate with
other promotions.
AutoWeb Button and Modules in Yahoo Autos
[LOGO DESCRIPTION HERE] This is an example of
placement for the AutoWeb
Button on the Yahoo Autos
Page
This is an example of placement for the AutoWeb Module in Yahoo Autos. This
module shall not be fixed on such pages, but will rotate with other promotions.
<PAGE>
EXECUTION COPY
AutoWeb Button in Yahoo Yellow Pages (Exhibit B)
[LOGO DESCRIPTION HERE] This is an example of
placement for the
AutoWeb Button in Yahoo
Yellow Pages.
This is an example of placement for the AutoWeb Module in Yahoo Yellow Pages.
This module shall not be fixed on such pages, but will rotate with other
promotions.
<PAGE>
EXECUTION COPY
Yahoo Front Page Promotional Placement (Exhibit B)
[LOGO DESCRIPTION HERE]
The NECX banner is an example of placement for AutoWeb front page promotional
placement as stated in this agreement.
<PAGE>
EXECUTION COPY
EXHIBIT C
Wire Transfer Instructions
Yahoo's Bank Information:
Institution Name: [*]
Institution Address: [*]
ABA: [*]
Beneficiary Name: Yahoo! Inc.
Beneficiary Account Number: [*]
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
<PAGE>
EXECUTION COPY
CONFIDENTIAL
EXHIBIT D
(Front Page Promotion Guidelines)
The Front Page Promotion shall be in the form of a banner advertisement and
subsequent promotion pages, and shall have the following specifications and
characteristics (references to the "sponsor" apply to the advertiser on whose
behalf the front page promotion is run).
Banner Specifications:
- ---------------------
Size: 230 pixels wide by 33 pixels high. File size must not exceed 3k.
The banner can animate for a period of not more than 6 seconds. No endless
looping is permitted.
For a 14 day promotion campaign, the sponsor may run up to 6 different banners
that will rotate equally.
Background Color: Backgrounds which are not transparent must have a color(s)
which are using a HSB color space, between 0% and 50% in saturation, and between
50% and 80% in brightness. The hue may be any value. Yahoo reserves the right
to define the portions of a submitted image that comprises the background.
Transparent backgrounds are permitted.
All banners are subject to aesthetic and content approval by Yahoo. All artwork
must be submitted to Yahoo at least five (5) business days prior to the
promotion's launch date. Yahoo reserves the right to review, reject or modify
any part of any creative at its sole discretion. The sponsor shall ensure that
their promotion complies in all respects with applicable laws and regulations.
The sponsor expressly understands and agrees that the approval of the official
rules for any promotion by Yahoo shall not constitute an opinion as to the legal
appropriateness or adequacy of such rules or their manner of use.
Sweepstakes Prizes: Yahoo requires that front page promotion sponsors provide a
- ------------------
prize package of a minimum retail value. Values for different types of front
page promotions are set forth below.
Type of Promotion:
Prize Package Minimum
Front Page Banner $[*]
Front Page Text $[*]
Prize values for multi-sponsored promotions vary.
Sponsor is responsible for all shipping/handling charges and any other expenses
associated with prize fulfillment.
Sponsor is responsible for sending 1099 notifications to the promotion winners
and the IRS.
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
ii
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CONFIDENTIAL
Sponsor shall deliver prizes to winning contestant within six (6) weeks of the
promotion's conclusion.
Sponsor hosted promotions.
- -------------------------
A standard promotion hosted by the sponsor shall consist of the following:
Banner(s) or text links on a Yahoo hosted page that link to the sponsor hosted
promotion jump page.
A jump page consisting of promotion graphics, client graphics, copy/content and
contest description.
A rules page consisting of official rules that govern the promotion.
An entry form page consisting of promotion graphics and the entry form. The
entry form shall include the following disclaimer located directly next to the
"submit" button.
(Sponsor's Name) is solely responsible for the use of this information.
A thank you page consisting of graphics and text.
Total size of all graphics on each promotion page must be less than 35K. This
is to optimize loading times for contestants and to reduce the amount of people
that turn away from the promotion before the page loads.
If sponsor host's the promotion, sponsor further agrees to the following:
To allow Yahoo engineers to run a stress test program to test the sponsor's
server(s) capacity. A mutually agreed upon time will be arranged with sponsor
to run this test program, which simulates the traffic level that can be expected
from a front page promotion. Sponsor shall make necessary modifications to its
server capacity so that it will pass such test prior to the start date of the
promotion.
Submit promotion URLs at least five (5) business days prior to the starting date
of the promotion for Yahoo final approval (which may include Yahoo required
modifications to the promotion).
Sponsor may not post any contest page until it receives final approval of the
entire page from Yahoo.
Yahoo reserves the right to access all aggregate information captured on entry
form submissions through the promotion. Sponsor agrees to provide such
information to Yahoo immediately upon Yahoo's request. Yahoo's use of this
information will be restricted to internal purposes.
iii
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CONFIDENTIAL
Traffic sent to sponsor home page.
- ---------------------------------
In order to send traffic from the promotional banner on Yahoo directly to a
sponsor's home page instead of a jump page, the following requirements must be
met, with no exceptions:
Sponsor agrees to create a customized prominent graphic dedicated to
prize/contest details to be displayed on sponsor's home page. Such graphic
shall always be above the fold of the sponsor's home page and link directly to
the sweepstakes page/entry form.
Total pixel area of the graphic must be at least 28,080 k or the equivalent of a
468x60 banner.
All artwork/creative must be submitted to Yahoo at least five (5) business days
prior to the promotion's start date.
Yahoo reserves the right to review, reject or modify any part of any creative at
its sole discretion.
Sponsor shall be responsible for the design, layout, posting and maintenance of
the promotion pages.
Sponsor shall operate the contest on computers and network hardware under its
ownership or control.
iv
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CONFIDENTIAL
EXHIBIT E
AUTOWEB COMPETITORS
Auto by Internet
CarsDirect
CarOrder
AutoNation
Autobytel
Dealernet
Autovantage
Carpoint
Carsmart
Autotown
Cars.com
Autoconnect
Priceline.com
Stoneage
Lithia
First American Automotive
United Automotive Group
Cobalt
Chrome.com
Cost Co.'s auto buying service
First Auction - Auto Auctions
UBid - Auto Auctions
Amazon - Auto Auctions
E-Bay-Auto Auctions
openauto.com
Respond.com's auto buying service
Classifieds 2000
Kelly Blue Book
Edmunds
Automall USA
Consumer Car Club
InvoiceDealers.com
i
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CONFIDENTIAL
EXHIBIT F
AUTOWEB BANNER PAGEVIEW DELIVERY SCHEDULE
<TABLE>
<CAPTION>
Run of Network My Yahoo Category
<S> <C> <C>
Sept99 [*] [*]
Oct 99 [*] [*]
Nov 99 [*] [*]
Dec 99 [*] [*]
Jan 00 [*] [*]
Feb 00 [*] [*]
Mar 00 [*] [*]
Apr 00 [*] [*]
May 00 [*] [*]
Jun 00 [*] [*]
July00 [*] [*]
Aug 00 [*] [*]
Sept00 [*] [*]
Oct 00 [*] [*]
Nov 00 [*] [*]
Dec 00 [*] [*]
Jan 01 [*] [*]
Feb 01 [*] [*]
Mar 01 [*] [*]
Apr 01 [*] [*]
May 01 [*] [*]
June01 [*] [*]
July01 [*] [*]
Aug 01 [*] [*]
[*] [*]
</TABLE>
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
ii
<PAGE>
Exhibit 10.29
EXECUTION VERSION
CONFIDENTIAL TREATMENT REQUESTED*
Confidential
INTERACTIVE MARKETING AGREEMENT
-------------------------------
This Interactive Marketing Agreement (the "Agreement"), dated as of June
30, 1999 (the "Effective Date"), is between America Online, Inc. ("AOL"), a
Delaware corporation, with offices at 22000 AOL Way, Dulles, Virginia 20166, and
Autoweb.com ("Marketing Partner" or "MP"), a Delaware corporation, with offices
at 3270 Jay Street, Bldg. 6, Santa Clara, CA 95054. AOL and MP may be referred
to individually as a "Party" and collectively as the "Parties."
INTRODUCTION
------------
AOL and MP each desires to enter into an interactive marketing relationship
whereby AOL shall promote and distribute certain internet landing pages referred
to (and further defined) herein as the AOL Jump Pages and an interactive site
referred to (and further defined) herein as the Affiliated MP Site. This
relationship is further described below and is subject to the terms and
conditions set forth in this Agreement. Defined terms used but not defined in
the body of the Agreement shall be as defined on Exhibit B attached hereto.
TERMS
-----
1. PROMOTION, DISTRIBUTION AND MARKETING.
-------------------------------------
1.1. AOL Promotion of Affiliated MP Site; Flexibility of Promotions. AOL
--------------------------------------------------------------
shall provide MP with the promotions for the AOL Jump Pages and the
Affiliated MP Site described on Exhibit A attached hereto
(collectively referred to herein as the "Promotions"). AOL reserves
the right (at its sole discretion) to (i) substitute for the
Promotions to be delivered in a particular Level other promotions (in
the same Level) in the same or different areas of the AOL Properties,
and (ii) (x) substitute Impressions in one Level for those in another
Level at an exchange ratio equal to the ratio of the respective CPM
rates listed in Exhibit A for each Level (e.g., one Level I Impression
can be substituted for the number of Level II Impressions that is
calculated by dividing the CPM for Level I by the CPM for Level II).
In addition, AOL reserves the right to redesign or modify the
organization, structure, "look and feel," navigation and other
elements of the AOL Network at any time.
1.2 Impressions Commitment. During the Initial Term, AOL shall deliver
----------------------
[*] Impressions to MP through the Promotions (the "Impressions
Commitment"). AOL shall use commercially reasonable efforts to deliver
the Impressions Commitment in accordance with the monthly targets
specified in Exhibit A; provided, however, that in the event that AOL
-------- -------
delivers, in any quarter, less than [*] percent (*%) of the relevant
portion (i.e., the sum of the monthly targets for the respective
quarter) of the Impressions Commitment to be delivered in such
quarter pursuant to Exhibit A hereto (a "Quarter Shortfall"), then
such Quarter Shortfall shall be added to the Impressions target for
the subsequent quarter (the "Revised Impressions Target"); provided,
--------
further, that in the event that AOL fails to meet the Revised
-------
Impressions Target in the next subsequent quarter (a "Secondary
Shortfall"), then the Impressions Commitment shall be increased by
[*] times the amount of any such Secondary Shortfall. Any shortfall
in Impressions at the end of any such quarter shall not be deemed a
breach of the Agreement by AOL. With respect to the Impressions
targets specified on Exhibit A hereto, AOL shall not be obligated to
provide in excess of any Impressions target amounts in any year. In
the event AOL provides an excess of any annual Impressions target
amounts in any year, the Impressions target for the subsequent year
shall be reduced by the amount of such windfall.
CONFIDENTIAL
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
<PAGE>
EXECUTION VERSION
In the event there is (or will be in AOL's reasonable judgment) a
shortfall in Impressions as of the end of the Initial Term (a "Final
Shortfall"), AOL shall provide MP, as its sole remedy, with one of the
following (at AOL's sole discretion): (i) additional comparable
promotions equal to the amount of the Final Shortfall; (ii)
advertising placements through Run of Service Advertising on the AOL
Properties which have a total value, based on the CPM rates specified
in Exhibit A, equal to the value of the Final Shortfall (determined by
multiplying the percentage of Impressions that were not delivered by
the total, guaranteed payments provided for in Section 3.1 of this
Agreement); or (iii) a refund equal to the value of the Final
Shortfall.
1.3 Content of Promotions on AOL Network. Until the launch of the AOL
------------------------------------
Jump Pages in accordance with the terms of this Agreement, Promotions
for MP shall link to the Affiliated MP Site and shall promote only the
Services described on Exhibit D. Following the launch of such AOL
Jump Pages in accordance with the terms of this Agreement, Promotions
for MP shall link only to the AOL Jump Pages and shall promote only
the Services described on Exhibit D. The specific MP Content to be
contained within the Promotions (including, without limitation,
advertising banners and contextual promotions) (the "Promo Content")
shall be determined by MP, subject to AOL's technical limitations, the
terms of this Agreement and AOL's then-applicable policies relating to
advertising and promotions; provided, however, that the Promo Content
-------- -------
shall not contain any reference whatsoever to used cars. MP shall
submit in advance to AOL for its review a quarterly online marketing
plan with respect to the Promotions linking to the AOL Jump Pages.
The Parties shall meet in person or by telephone at least monthly to
review operations and performance hereunder, including a review of the
Promo Content to ensure that it is designed to maximize performance.
MP shall consistently update the Promo Content no less than twice per
month. Except to the extent expressly described herein, the specific
form, placement, duration and nature of the Promotions shall be as
determined by AOL in its reasonable editorial discretion (consistent
with the editorial composition of the applicable screens).
1.4 MP Promotion of Affiliated MP Site and AOL. As set forth in fuller
------------------------------------------
detail in Exhibit C, MP shall promote AOL as a preferred Interactive
Service and shall promote the availability of the Affiliated MP Site
through the AOL Network.
1.5 Keyword Search Term. During the term of this Agreement and for
-------------------
three (3) months following termination of this Agreement, AOL shall
provide MP with a Keyword Search Term on the AOL Service for use by
AOL members to link to the AOL Jump Pages (during the term of this
Agreement) or to the Affiliated MP Site (until the launch of the AOL
Jump Pages and during the three months following termination of this
Agreement). AOL grants MP the right to use such Keyword Search Term
during the term of this Agreement and for three (3) months after
termination of this Agreement, subject to the terms and conditions of
this Agreement.
2. AFFILIATED MP SITE.
------------------
2.1. Content. MP shall make available through the AOL Jump Pages the
-------
comprehensive offering of Services and Content described on Exhibit D
to this Agreement, and MP shall make available through the Affiliated
MP Site the Services and Content described on Exhibit D-1 to this
Agreement. Except as mutually agreed in writing by the Parties, the
AOL Jump Pages (i) shall contain only Content that is directly related
to the Services listed on Exhibit D; provided, however, that MP shall
-------- -------
be entitled to include on any AOL Jump Page a navigational bar that
includes a tab for used cars and/or a tab for business-to-consumer new
car and used car auctions (i.e., as an option or options in a "drop-
down box" format) (collectively, the "Navigation Bar Tab"); provided,
--------
further, that any such
-------
CONFIDENTIAL
2
<PAGE>
EXECUTION VERSION
Navigation Bar Tab shall not enable a user to link to any used car
listings, nor shall any such reference contain any creative content or
messaging related to the purchase or sale of any used car; and (ii)
shall not contain any third-party Services, services, programming or
other Content. If MP adds Content or Services to any Jump Page that
AOL reasonably determines is not related to the Services and Content
listed on Exhibit D, or if MP adds Content or Services to the
Affiliated MP Site that AOL reasonably determines is not related to
the Services and Content listed on Exhibit D-1 (collectively,
"Problematic Services or Content"), AOL shall have the immediate right
to block AOL User access to the Affiliated MP Site or to any such AOL
Jump Page. In the event that MP fails to remove such Problematic
Services or Content (or, in the alternative, to implement a mechanism
capable of blocking AOL User access to such Problematic Services or
Content) within thirty (30) days of notification by AOL of the
existence of such Problematic Services or Content on the Affiliated MP
Site or any AOL Jump Page (as the case may be), AOL shall have the
right to terminate this Agreement immediately upon the expiration of
such thirty (30) day period. All sales of Services through the
Affiliated MP Site shall be conducted through either a direct sales
format or referral Services. MP shall review, delete, edit, create,
update and otherwise manage all Content available on or through the
Affiliated MP Site in accordance with the terms of this Agreement. MP
shall ensure that the AOL Jump Pages do not in any respect promote,
advertise, market or distribute the products, services or content of
any other Interactive Service, or any entity reasonably construed to
be in competition with any third party with which AOL has an exclusive
or premier relationship. MP also shall ensure that the Affiliated MP
Site does not in any respect promote, advertise, market or distribute
the products, services or content of any other Interactive Service,
and that the Content on the Affiliated MP Site shall be competitive in
all material respects with the Content of online providers of the New
Car Services, and that such Content is updated on a regular and
frequent basis. The Affiliated MP Site shall contain the Content that
is directly related to the Services listed on Exhibit D-1.
2.2. Production Work. Except as agreed to in writing by the Parties
---------------
pursuant to Section 10 of Exhibit F hereto, MP shall be responsible
for all production work associated with the AOL Jump Pages and the
Affiliated MP Site, including all related costs and expenses.
2.3. Technology. MP shall take all reasonable steps necessary to conform
----------
its promotion and sale of Services through the Affiliated MP Site and
the AOL Jump Pages to the then-existing technologies identified by AOL
which are optimized for the AOL Service and which AOL may implement to
facilitate purchase of products or services by AOL Users through the
Affiliated MP Site. AOL shall be entitled to require reasonable
changes to the Content (including, without limitation, the features or
functionality) within any linked pages of the Affiliated MP Site to
the extent such Content will, in AOL's good faith judgment, adversely
affect any operational aspect of the AOL Network. AOL reserves the
right to review and test the Affiliated MP Site from time to time to
determine whether the site is compatible with AOL's then-available
client and host software and the AOL Network.
2.4. Product Offering. MP shall ensure that the Affiliated MP Site
----------------
includes all of the Services and other Content (including, without
limitation, any features, functionality or technology) that are then
made available by or on behalf of MP through any Additional MP
Channel; provided, however, that (i) such inclusion shall not be
-------- -------
required where it is commercially or technically impractical to either
Party (i.e., inclusion would cause either Party to incur substantial
incremental costs); and (ii) the specific changes in scope, nature
and/or offerings required by such inclusion shall be subject to AOL's
review and approval and the terms of this Agreement.
2.5. Pricing and Terms. MP shall ensure that: (i) the prices (and any
-----------------
other required consideration) for Services in the Affiliated MP Site
do not exceed the prices for the Services or substantially similar
Services offered by or on behalf of MP through any
CONFIDENTIAL
3
<PAGE>
EXECUTION VERSION
Additional MP Channel; (ii) the terms and conditions related to
Services in the Affiliated MP Site are no less favorable in any
respect to the terms and conditions for the Services or substantially
similar Services offered by or on behalf of MP through any Additional
MP Channel; and (iii) both the prices and the terms and conditions
related to Services in the Affiliated MP Site are reasonably
competitive in all material respects with the prices and terms and
conditions for the Services or substantially similar Services offered
by any online provider of the Services set forth on Exhibit D hereto
through any Interactive Site.
2.6. Exclusive Offers/Member Benefits. MP shall generally promote through
--------------------------------
the Affiliated MP Site any special or promotional offers generally
made available by or on behalf of MP through any Additional MP
Channel. In addition, MP shall promote through the AOL Jump Pages (or
the Promotions) on a regular and consistent basis special offers
exclusively available to AOL Users (the "AOL Exclusive Offers"). MP
shall, at all times, feature at least [*] AOL Exclusive Offer for
AOL Users. For example, MP shall offer [*] contest per quarter
featuring a new car to be awarded to each winner of each such
quarterly contest. Each AOL Exclusive Offer made available by MP shall
provide a substantial member benefit to AOL Users, either by virtue of
a meaningful price discount, product enhancement, unique service
benefit or other special feature. MP shall provide AOL with reasonable
prior notice of AOL Exclusive Offers so that AOL can market the
availability of such AOL Exclusive Offers in the manner AOL deems
appropriate in its editorial discretion.
2.7. Operating Standards. MP shall ensure that each of the Affiliated MP
-------------------
Site and the AOL Jump Pages complies at all times with the standards
set forth in Exhibit E. To the extent site standards are not
established in Exhibit E with respect to any aspect or portion of the
Affiliated MP Site or any AOL Jump Page (or the Services or other
Content contained therein), MP shall provide such aspect or portion at
a level of accuracy, quality, completeness, and timeliness which meets
or exceeds prevailing standards in the online industry for providers
of the services set forth on Exhibit D hereto. In the event MP fails
to comply with any material term of this Agreement or any Exhibit
attached hereto, AOL shall have the right (in addition to any other
remedies available to AOL hereunder) to decrease the promotion it
provides to MP hereunder (and to decrease or cease any other
contractual obligation hereunder) until such time as MP corrects its
non-compliance (and in such event, AOL shall be relieved of the
proportionate amount of any promotional commitment made to MP by AOL
hereunder corresponding to such decrease in promotion).
2.8. Advertising Sales. MP shall not permit or authorize (i) any
-----------------
Advertisements on the AOL Jump Pages for (a) any third party Content
or Services related to the purchase or sale of used cars, (b) any
Interactive Service other than AOL, and (c) those categories in which
AOL has exclusive or premier arrangements with its partners or (ii)
any Advertisements on the Affiliated MP Site for any Interactive
Service other than AOL. Notwithstanding anything to the contrary in
this Agreement, MP may place promotions for any auto manufacturer and
any new car dealer on both the AOL Jump Pages and the Affiliated MP
Site. In addition to the foregoing requirements, all Advertisements
permitted to be placed on the AOL Jump Pages or the Affiliated MP Site
pursuant to the terms of this Agreement shall comply with AOL's then-
applicable advertising policies. Any failure by MP to comply with the
terms of clause (i)(a) or clause (ii) of this Section 2.8 shall
constitute a material breach of this Agreement, and AOL shall have the
right to terminate this Agreement. In the event of any failure to
comply with clause (i)(c) of this Section 2.8, MP shall have three (3)
business days to cure such failure, after which period AOL shall have
the right to terminate this Agreement.
2.9. Premier Privileges. Notwithstanding the foregoing, AOL shall not
------------------
place Advertisements for any of the MP Competitors in the AOL Auto
Center, the AOL Auto Web Center, the AOL Shopping Auto and Classifieds
Department and the CompuServe Car Club. In each
CONFIDENTIAL
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
4
<PAGE>
EXECUTION VERSION
case on the AOL Properties during the Initial Term (but in any case,
subject to all preexisting agreements of AOL or its affiliates prior
to the Effective Date (e.g., AOL's agreement with Cendant)).
2.10. Traffic Flow. MP shall take reasonable efforts to ensure that AOL
------------
traffic is either kept within the Affiliated MP Site or the AOL Jump
Pages, or is channeled back into the AOL Network (with the exception
of advertising links sold and implemented pursuant to the Agreement);
provided, however, that MP shall be required to implement a channeling
-------- -------
function from the Jump Pages back to the AOL Network within two (2)
months following the Effective Date. The Parties shall work together
on implementing mutually acceptable links from the AOL Jump Pages back
to the AOL Service. The Parties hereby acknowledge and agree that MP
shall not be obligated to place any links back to the AOL Service on
the Affiliated MP Site.
2.11. Connecting the Affiliated MP Site. MP shall be responsible for all
---------------------------------
communications, hosting and connectivity costs and expenses associated
with the Affiliated MP Site and the AOL Jump Pages, and shall pay for
all of the costs and expenses incurred in connection with (i) the
development and linking to the AOL Network of the AOL Jump Pages and
(ii) the development and linking to the Affiliated MP Site of the AOL
Jump Pages. The Parties shall mutually agree upon the optimal means
for connecting the AOL Jump Pages to the AOL Network and the AOL Jump
Pages to the Affiliated MP Site. If the Parties determine that a
dedicated, high-speed connection is necessary to maintain quick and
reliable transport of information to the AOL Jump Pages (or from the
AOL Jump Pages to the Affiliated MP Site), MP shall pay for all
technology-related and production-related costs and expenses
associated with the implementation of such a high-speed connection.
For the avoidance of doubt, all costs and expenses to be borne by MP
in accordance with this Section 2.11 shall be in addition to the
payments to be made by MP pursuant to Section 3 hereof.
3. PAYMENTS.
--------
3.1. Guaranteed Payments. MP shall pay AOL a non-refundable guaranteed
-------------------
payment of [*] Dollars ($*) payable in eight equal quarterly
installments as follows:
(i) [*] Dollars (US$*) upon execution of this Agreement; and
(ii) [*] Dollars (US$*) on each of (a) July 31, 1999, (b) October
31, 1999, (c) January 31, 2000, (d) April 30, 2000, (e) July
31, 2000, (f) October 31, 2000 and (g) January 31, 2001.
In the event of any early termination of this Agreement, AOL shall
refund to MP the pro rata portion of any guaranteed payments paid by
--- ----
MP for Impressions (pursuant to Exhibit A hereto) not yet delivered as
of such date of termination, and no further guaranteed payments shall
be due thereafter.
3.2. Late Payments; Wired Payments. All amounts owed hereunder not paid
-----------------------------
when due and payable shall bear interest from the date such amounts
are due and payable at the prime rate in effect at such time. All
payments required hereunder shall be paid in immediately available,
non-refundable U.S. funds wired to the "America Online" account,
Account Number [*].
CONFIDENTIAL
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
5
<PAGE>
EXECUTION VERSION
3.3. Taxes. With respect to the transactions contemplated by this
-----
Agreement, MP shall collect and pay, and shall indemnify and hold AOL
harmless from, any sales, use, excise, import or export value added or
similar tax or duty not based on AOL's net income, including any
penalties and interest, as well as any costs associated with the
collection or withholding thereof, including attorneys' fees.
3.4. Reports.
-------
3.4.1. Usage Reports. AOL shall provide MP with standard monthly
-------------
usage information related to the Promotions (e.g. a schedule
of the Impressions delivered by AOL at such time, click-
through and other usage information) which are similar in
substance and form to the reports provided by AOL to other
interactive marketing partners similar to MP.
3.4.2 Fraudulent Transactions. To the extent permitted by
-----------------------
applicable law, MP shall provide AOL with an prompt report of
any fraudulent order, including the date, screen name or email
address and amount associated with such order, promptly
following MP obtaining knowledge that the order is, in fact,
fraudulent.
4. TERM; RENEWAL; TERMINATION.
--------------------------
4.1 Term; Mutual Early Termination Right. Unless earlier terminated as
------------------------------------
set forth herein, the initial term of this Agreement shall be two (2) years
from the Effective Date (the "Initial Term"). Notwithstanding the
foregoing, either Party shall have the right to terminate this Agreement at
any time during the Initial Term following the twelve (12) month
anniversary of the Effective Date upon thirty (30) days prior written
notice to the other Party.
4.2 Termination for Breach. Except as expressly provided elsewhere in
----------------------
this Agreement, either Party may terminate this Agreement at any time in
the event of a material breach of the Agreement by the other Party which
remains uncured after thirty (30) days written notice thereof to the other
Party (or such shorter period as may be specified elsewhere in this
Agreement); provided, however, that AOL shall not be required to provide
-------- -------
notice to MP in connection with MP's failure to make any payment to AOL
required hereunder, and the cure period with respect to any scheduled
payment shall be fifteen (15) days from the date for such payment provided
for herein. Notwithstanding the foregoing, in the event of a material
breach of a provision that expressly requires action to be completed within
an express period shorter than thirty (30) days, either Party may terminate
this Agreement if the breach remains uncured after written notice thereof
to the other Party.
4.3 Termination for Bankruptcy/Insolvency. Either Party may terminate
-------------------------------------
this Agreement immediately following written notice to the other Party if
the other Party (i) ceases to do business in the normal course, (ii)
becomes or is declared insolvent or bankrupt, (iii) is the subject of any
proceeding related to its liquidation or insolvency (whether voluntary or
involuntary) which is not dismissed within ninety (90) calendar days or
(iv) makes an assignment for the benefit of creditors.
4.4 Termination on Change of Control. In the event of (i) a Change of
--------------------------------
Control of MP resulting in control of MP by an Interactive Service or (ii)
a Change of Control of AOL, AOL may terminate this Agreement by providing
thirty (30) days prior written notice of such intent to terminate.
4.5 Press Releases. Each Party shall submit to the other Party, for its
---------------
prior written approval, which shall not be unreasonably withheld or
delayed, any press release or any other public statement ("Press Release")
regarding the transactions contemplated hereunder. Notwithstanding the
foregoing, either Party may issue Press Releases and other disclosures as
required by law without the consent of the other Party and in such event,
the disclosing Party shall provide at least
CONFIDENTIAL
6
<PAGE>
EXECUTION VERSION
five (5) business days prior written notice of such disclosure. The failure
by one Party to obtain the prior written approval of the other Party prior
to issuing a Press Release (except as required by law) shall be deemed a
material breach of this Agreement for which there is no adequate cure. In
such event, the non-breaching Party may terminate this Agreement upon
written notice to the other Party.
5. MANAGEMENT COMMITTEE/ARBITRATION.
--------------------------------
5.1 Management Committee. The Parties shall act in good faith and use
---------------------
commercially reasonable efforts to promptly resolve within ten (10)
business days any claim, dispute, claim, controversy or disagreement (each
a "Dispute") between the Parties or any of their respective subsidiaries,
affiliates, successors and assigns under or related to this Agreement or
any document executed pursuant to this Agreement or any of the transactions
contemplated hereby. If the Parties cannot resolve the Dispute within such
time frame, the Dispute shall be submitted to the Management Committee for
resolution. For ten (10) days following submission of the Dispute to the
Management Committee, the Management Committee shall have the exclusive
right to resolve such Dispute; provided, further that the Management
-------- -------
Committee shall have the final and exclusive right to resolve Disputes
arising from any provision of the Agreement which expressly or implicitly
provides for the Parties to reach mutual agreement as to certain terms. If
the Management Committee is unable to amicably resolve the Dispute during
such ten (10) day period, then the Management Committee shall consider in
good faith the possibility of retaining a third-party mediator to
facilitate resolution of the Dispute. In the event the Management
Committee elects not to retain a mediator, the dispute shall be subject to
the resolution mechanisms described below. "Management Committee" shall
mean a committee made up of a senior executive from each of the Parties for
the purpose of resolving Disputes under this Section 5.1 and generally
overseeing the relationship between the Parties contemplated by this
Agreement. Neither Party shall seek, nor shall be entitled to seek,
binding outside resolution of the Dispute unless and until the Parties have
been unable amicably to resolve the Dispute as set forth in this Section
5.1 and then, only in compliance with the procedures set forth in this
Section 5.
5.2 Arbitration. Except for Disputes relating to issues of (i)
------------
proprietary rights, including but not limited to intellectual property and
confidentiality, and (ii) any provision of the Agreement which expressly or
implicitly provides for the Parties to reach mutual agreement as to certain
terms (which shall be resolved by the Parties solely and exclusively
through amicable resolution as set forth in Section 5.1), any Dispute not
resolved by amicable resolution as set forth in Section 5.1 shall be
governed exclusively and finally by arbitration. Such arbitration shall be
conducted by the American Arbitration Association ("AAA") in Washington,
D.C. and shall be initiated and conducted in accordance with the Commercial
Arbitration Rules ("Commercial Rules") of the AAA, including the AAA
Supplementary Procedures for Large Complex Commercial Disputes ("Complex
Procedures"), as such rules shall be in effect on the date of delivery of a
demand for arbitration ("Demand"), except to the extent that such rules are
inconsistent with the provisions set forth herein. Notwithstanding the
foregoing, the Parties may agree in good faith that the Complex Procedures
shall not apply in order to promote the efficient arbitration of Disputes
where the nature of the Dispute, including without limitation the amount in
controversy, does not justify the application of such procedures.
5.3 Selection of Arbitrators. The arbitration panel shall consist of
-------------------------
three (3) arbitrators. Each Party shall name one (1) arbitrator within ten
(10) days after the delivery of the Demand. The two (2) arbitrators named
by the Parties may have prior relationships with the naming Party, which in
a judicial setting would be considered a conflict of interest. The third
arbitrator, selected by the first two, should be a neutral participant,
with no prior working relationship with either Party. If the two
arbitrators are unable to select a third arbitrator within ten (10) days, a
third neutral arbitrator shall be appointed by the AAA from the panel of
commercial arbitrators of any of the AAA Large and Complex Resolution
Programs. If a vacancy in the arbitration panel occurs after the hearings
CONFIDENTIAL
7
<PAGE>
EXECUTION VERSION
have commenced, the remaining arbitrator or arbitrators may not continue
with the hearing and determination of the controversy, unless the Parties
agree otherwise.
5.4 Governing Law. The Federal Arbitration Act, 9 U.S.C. Secs. 1-16, and
--------------
not state law, shall govern the arbitrability of all Disputes. The
arbitrators shall allow such discovery as is appropriate to the purposes of
arbitration in accomplishing a fair, speedy and cost-effective resolution
of the Disputes. The arbitrators shall reference the Federal Rules of
Civil Procedure then in effect in setting the scope and timing of
discovery. The Federal Rules of Evidence shall apply in toto. The
-- ----
arbitrators may enter a default decision against any Party who fails to
participate in the arbitration proceedings.
5.5 Arbitration Awards. The arbitrators shall have the authority to award
-------------------
compensatory damages only. Any award by the arbitrators shall be
accompanied by a written opinion setting forth the findings of fact and
conclusions of law relied upon in reaching the decision. The award
rendered by the arbitrators shall be final, binding and non-appealable, and
judgment upon such award may be entered by any court of competent
jurisdiction. The Parties agree that the existence, conduct and content of
any arbitration shall be kept confidential and no Party shall disclose to
any person any information about such arbitration, except as may be
required by law or by any governmental authority or for financial reporting
purposes in each Party's financial statements.
5.6 Fees. Each Party shall pay the fees of its own attorneys, expenses of
-----
witnesses and all other expenses and costs in connection with the
presentation of such Party's case (collectively, "Attorneys' Fees"). The
remaining costs of the arbitration, including without limitation, fees of
the arbitrators, costs of records or transcripts and administrative fees
(collectively, "Arbitration Costs") shall be borne equally by the Parties.
Notwithstanding the foregoing, the arbitrators may modify the allocation of
Arbitration Costs and award Attorneys' Fees in those cases where fairness
dictates a different allocation of Arbitration Costs between the Parties
and an award of Attorneys' Fees to the prevailing Party as determined by
the arbitrators.
5.7 Non Arbitratable Disputes. Any Dispute that is not subject to final
--------------------------
resolution by the Management Committee or to arbitration under this Section
5 or by law (collectively, "Non-Arbitration Claims") shall be brought in a
court of competent jurisdiction in the Commonwealth of Virginia. Each
Party irrevocably consents to the exclusive jurisdiction of the courts of
the Commonwealth of Virginia and the federal courts situated in the
Commonwealth of Virginia, over any and all Non-Arbitration Claims and any
and all actions to enforce such claims or to recover damages or other
relief in connection with such claims.
6. STANDARD TERMS. The Standard Online Commerce Terms & Conditions set forth
--------------
on Exhibit F attached hereto and Standard Legal Terms & Conditions set forth on
Exhibit G attached hereto are each hereby made a part of this Agreement.
7. NO REVENUE SHARING. MP shall have no obligation to share with AOL any
-------------------
Transaction Revenues or Advertising Revenues that MP derives from the AOL Jump
Pages, the Affiliated MP Site, or any other MP Interactive Site.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the
Effective Date.
AMERICA ONLINE, INC. AUTOWEB.COM
By: /s/ DAVID COLBURN By: /s/ SAMUEL HEDGPETH
------------------------------------------- --------------------------
Name: David Colburn Name: Samuel Hedgpeth
Title: Senior Vice President, Business Affairs Title: Chief Financial Officer
CONFIDENTIAL
8
<PAGE>
EXECUTION VERSION
EXHIBIT A
Placement/Promotion
-------------------
I. CARRIAGE PLAN
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
AOL Service FLIGHTS Year 1
- ---------------------------------------------------------------------------------------------------------
START END Imps/Y1 Invs/Y1
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AOL Auto Center: New Car Decision Guide 7/1/99 6/30/00
Commerce Links
- ---------------------------------------------------------------------------------------------------------
AOL Auto Center: New Car Decision Guide 7/1/99 6/30/00
Banners
- ---------------------------------------------------------------------------------------------------------
AOL Auto Center: New Cars ROS Banners 7/1/99 6/30/00
- ---------------------------------------------------------------------------------------------------------
AOL ROS Demo Targeting Banners:2 7/1/99 6/30/00
variables TBD
- ---------------------------------------------------------------------------------------------------------
AOL Promotional Car Give-Away ROS Banners 7/1/99 6/30/00
- ---------------------------------------------------------------------------------------------------------
AOL ROS Banners 7/1/99 6/30/00
=========================================================================================================
Subtotal [*]
- ---------------------------------------------------------------------------------------------------------
AOL.com
- ---------------------------------------------------------------------------------------------------------
Auto WebCenter New Car Decision Guide 7/1/99 6/30/00
Commerce Links
- ---------------------------------------------------------------------------------------------------------
Auto WebCenter: New Cars Decision Guide 7/1/99 6/30/00
Banners
- ---------------------------------------------------------------------------------------------------------
Auto WebCenter ROS Banners 7/1/99 6/30/00
- ---------------------------------------------------------------------------------------------------------
Search Term Packages: Automotive, 7/1/99 6/30/00
Dealers, Trucks, Motor Vehicle Base
=========================================================================================================
Subtotal [*]
- ---------------------------------------------------------------------------------------------------------
Netscape Netcenter
- ---------------------------------------------------------------------------------------------------------
NSCP Autos: New Car Decision Guide 7/1/99 6/30/00
Commerce Links
- ---------------------------------------------------------------------------------------------------------
NSCP Decision Guides Banners 7/1/99 6/30/00
- ---------------------------------------------------------------------------------------------------------
NSCP Autos ROS Banners 7/1/99 6/30/00
=========================================================================================================
Subtotal [*]
- ---------------------------------------------------------------------------------------------------------
Compuserve
- ---------------------------------------------------------------------------------------------------------
Car Club Co-Branded Content Permanent 7/1/99 6/30/00
Placement
- ---------------------------------------------------------------------------------------------------------
</TABLE>
CONFIDENTIAL
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
9
<PAGE>
EXECUTION VERSION
<TABLE>
<S> <C> <C>
=========================================================================================================
Subtotal [*]
- ---------------------------------------------------------------------------------------------------------
Total Year 1 [*] $[*]
- ---------------------------------------------------------------------------------------------------------
Total Year 2 [*] $[*]
- ---------------------------------------------------------------------------------------------------------
Plan Total [*] $[*]
=========================================================================================================
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
Monthly Year 1
- ----------------------------------------------------------------------------------------------------------------------
Tier 1 Impressions Target Impressions Target
- ------
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
AOL Auto Center: New Car Decision Guide Commerce Links
- ----------------------------------------------------------------------------------------------------------------------
AOL Auto Center: New Car Decision Guide Banners
- ----------------------------------------------------------------------------------------------------------------------
AOL Auto Center: New Cars ROS Banners
- ----------------------------------------------------------------------------------------------------------------------
Auto WebCenter New Car Decision Guide Commerce Links
- ----------------------------------------------------------------------------------------------------------------------
Auto WebCenter: New Cars Decision Guide Banners
- ----------------------------------------------------------------------------------------------------------------------
Auto WebCenter ROS Banners
- ----------------------------------------------------------------------------------------------------------------------
Search Term Packages: Automotive, Dealers, Trucks,
Motor Vehicle Base
- ----------------------------------------------------------------------------------------------------------------------
NSCP Autos: New Car Decision Guide Commerce Links
- ----------------------------------------------------------------------------------------------------------------------
NSCP Decision Guides Banners
- ----------------------------------------------------------------------------------------------------------------------
Car Club Co-Branded Content Permanent Placement
======================================================================================================================
Subtotal [*] [*]
- ----------------------------------------------------------------------------------------------------------------------
Tier 2
------
- ----------------------------------------------------------------------------------------------------------------------
AOL ROS Demo Targeting Banners:2 variables TBD
- ----------------------------------------------------------------------------------------------------------------------
NSCP Autos ROS Banners
======================================================================================================================
Subtotal [*] [*]
- ----------------------------------------------------------------------------------------------------------------------
Tier 3
------
- ----------------------------------------------------------------------------------------------------------------------
AOL Promotional Car Give-Away ROS Banners
- ----------------------------------------------------------------------------------------------------------------------
AOL ROS Banners
======================================================================================================================
Subtotal [*] [*]
- ----------------------------------------------------------------------------------------------------------------------
Total Impressions Target [*] [*]
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
CONFIDENTIAL
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
10
<PAGE>
EXECUTION VERSION
*Tier Exchanges. MP may elect to redistribute Promotions from Tiers 1, 2 and 3
--------------
at an exchange ratio equal to the ratio of the respective CPM rates listed in
Exhibit A for each Level (e.g., one Tier 1 Impression can be substituted for the
number of Tier 2 Impressions that is calculated by dividing the CPM for Tier 1
by the CPM for Tier 2), provided that (a) Tier 1 Impressions may be exchanged
only for those of Tier 2 or Tier 3, and (b) Level 2 Impressions may be exchanged
only for those of Tier 3. MP may not make any other type of exchange. All
redistribution of Promotions shall be subject to availability and AOL's then-
existing contractual obligations, as determined by AOL. Impressions may be
exchanged in blocks of a minimum of [*] Impressions. Requests by MP to
redistribute Impressions may be made no more frequently than once per quarter.
II. During the Term and for three (3) months after termination of this
Agreement, subject to the terms and conditions hereof, MP shall have the right
to use the Keyword Search Terms to be agreed upon by the Parties.
CONFIDENTIAL
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
11
<PAGE>
EXECUTION VERSION
EXHIBIT B
Definitions
-----------
The following definitions shall apply to this Agreement:
AAA. "AAA" shall have the meaning set forth in Section 5.2 of this Agreement.
- ---
Action. "Action" shall have the meaning set forth in Section 9(d) of Exhibit G
- ------
to this Agreement.
Additional MP Channel. Any other distribution channel (e.g., an Interactive
- ---------------------
Service other than AOL) through which MP makes available an offering comparable
in nature to the Affiliated MP Site.
Advertisements. Any advertisements, promotions, banners (including, without
- --------------
limitation, the creative content thereof), links, pointers or sponsorships.
Advertising Revenues. Aggregate amounts collected plus the fair market value
- --------------------
of any other compensation received (such as barter advertising) by MP, AOL or
either Party's agents, as the case may be, arising from the license or sale of
Advertisements that appear within any pages of the Affiliated MP Site which may
be exclusively available to AOL Users, less applicable Advertising Sales
Commissions.
Advertising Sales Commission. (i) Actual amounts paid as commission to third
- ----------------------------
party agencies by either buyer or seller in connection with sale of the
Advertisement or (ii) [*]%, in the event the Party has sold the Advertisement
directly and shall not be deducting any third party agency commissions.
Affiliated MP Site. The specific area or web site to be promoted and
- ------------------
distributed by AOL hereunder through which MP can market and complete
transactions regarding its Services.
AOL Exclusive Offers. "AOL Exclusive Offers" shall have the meaning set forth
- --------------------
in Section 2.6 of this Agreement.
AOL Interactive Site. Any Interactive Site that is managed, maintained, owned
- --------------------
or controlled by AOL or its agents.
AOL Jump Page. The introductory page to be designed, produced, and hosted by MP
- -------------
(within the first two (2) months following the Effective Date) to which
Promotions for MP shall link (following the launch of such AOL Jump Page) and
which shall also be linked to the Affiliated MP Site.
AOL Look and Feel. The elements of graphics, design, organization,
- ------------------
presentation, layout, user interface, navigation and stylistic convention
(including the digital implementations thereof) which are generally associated
with Interactive Sites within the AOL Service or AOL.com.
AOL Member. Any authorized user of the AOL Service, including any sub-accounts
- ----------
using the AOL Service under an authorized master account.
AOL Network. (i) The AOL Service, (ii) AOL.com, (iii) CompuServe, (iv) Digital
- -----------
City, and (v) any other product or service owned, operated, distributed or
authorized to be distributed by or through AOL or its affiliates worldwide (and
including those properties excluded from the definitions of the AOL Service or
AOL.com). It is understood and agreed that the rights of MP relate only to the
AOL Service and AOL.com and not generally to the AOL Network.
AOL Properties. The AOL Service, AOL.com and CompuServe.
- --------------
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
12
<PAGE>
EXECUTION VERSION
AOL Purchaser. (i) Any person or entity who enters the Affiliated MP Site from
- -------------
the AOL Network including, without limitation, from any third party area therein
(to the extent entry from such third party area is traceable through both
Parties' commercially reasonable efforts), and generates Transaction Revenues
(regardless of whether such person or entity provides an e-mail address during
registration or entrance to the Affiliated MP Site which includes a domain other
than an "AOL.com" domain); and (ii) any other person or entity who, when
purchasing a product, good or service through an MP Interactive Site, provides
an AOL.com domain name as part of such person or entity's e-mail address and
provided that any person or entity who has previously satisfied the definition
of AOL Purchaser shall remain an AOL Purchaser, and any subsequent purchases by
such person or entity (e.g., as a result of e-mail solicitations or any off-line
means for receiving orders requiring purchasers to reference a specific
promotional identifier or tracking code) shall also give rise to Transaction
Revenues hereunder (and shall not be conditioned on the person or entity's
satisfaction of clauses (i) or (ii) above).
AOL Service. The standard narrow-band U.S. version of the America Online brand
- -----------
service, specifically excluding (a) AOL.com or any other AOL Interactive Site,
(b) the international versions of an America Online service (e.g., AOL Japan),
(c) the CompuServe(R) brand service and any other CompuServe products or
services (d) "Driveway," "ICQ(TM)," "AOL NetFind(TM)," "AOL Instant
Messenger(TM)," "Digital City," "NetMail(TM)," "Electra", "Thrive", "Real Fans",
"Love@AOL", "Entertainment Asylum," "AOL Hometown," "My News" or any similar
independent product, service or property which may be offered by, through or
with the U.S. version of the America Online brand service, (e) Netscape
Netcenter(TM) and any additional Netscape products or services, (f) any
programming or Content area offered by or through the U.S. version of the
America Online brand service over which AOL does not exercise complete
operational control (including, without limitation, Content areas controlled by
other parties and member-created Content areas), (g) any yellow pages, white
pages, classifieds or other search, directory or review services or Content
offered by or through the U.S. version of the America Online brand service, (h)
any property, feature, product or service which AOL or its affiliates may
acquire subsequent to the Effective Date and (i) any other version of an America
Online service which is materially different from the standard narrow-band U.S.
version of the America Online brand service, by virtue of its branding,
distribution, functionality, Content or services, including, without limitation,
any co-branded version of the service and any version distributed through any
broadband distribution platform or through any platform or device other than a
desktop personal computer.
AOL User. Any user of the AOL Service, AOL.com, CompuServe, Digital City, or
- --------
the AOL Network.
AOL.com. AOL's primary Internet-based Interactive Site marketed under the
- -------
"AOL.COM(TM)" brand, specifically excluding (a) the AOL Service, (b) any
international versions of such site, (c) "ICQ(TM)," "AOL NetFind(TM)," "AOL
Instant Messenger(TM)," "NetMail(TM)," "AOL Hometown," "My News" or any similar
independent product or service offered by or through such site or any other AOL
Interactive Site, (d) any programming or Content area offered by or through such
site over which AOL does not exercise complete operational control (including,
without limitation, Content areas controlled by other parties and member-created
Content areas), (e) Netscape Netcenter(TM) and any additional Netscape products
or services, (f) any programming or Content area offered by or through the U.S.
version of the America Online brand service which was operated, maintained or
controlled by the former AOL Studios division (e.g., Electra), (g) any yellow
pages, white pages, classifieds or other search, directory or review services or
Content offered by or through such site or any other AOL Interactive Site, (h)
any property, feature, product or service which AOL or its affiliates may
acquire subsequent to the Effective Date and (i) any other version of an America
Online Interactive Site which is materially different from AOL's primary
Internet-based Interactive Site marketed under the "AOL.COM(TM)" brand, by
virtue of its branding, distribution, functionality, Content or services,
including, without limitation, any co-branded versions and any version
distributed through any broadband distribution platform or through any platform
or device other than a desktop personal computer.
Arbitration Costs. "Arbitration Costs" shall have the meaning set forth in
- -----------------
Section 5.6 of this Agreement.
Attorneys' Fees. "Attorneys' Fees" shall have the meaning set forth in Section
- ---------------
5.6 of this Agreement.
13
<PAGE>
EXECUTION VERSION
Change of Control. (a) The consummation of a reorganization, merger or
- -----------------
consolidation or sale or other disposition of substantially all of the assets of
a party or (b) the acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1933,
as amended) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under such Act) of more than 50% of either (i) the then outstanding
shares of common stock of such party; or (ii) the combined voting power of the
then outstanding voting securities of such party entitled to vote generally in
the election of directors.
Commercial Rules. "Commercial Rules" shall have the meaning set forth in
- ----------------
Section 5.2 of this Agreement.
Complex Procedures. "Complex Procedures" shall have the meaning set forth in
- ------------------
Section 5.2 of this Agreement.
CompuServe. The standard, narrow-band U.S. version of the CompuServe brand
- -----------
service, specifically excluding (a) any international versions of such service,
(b) any web-based service including "compuserve.com", "cserve.com" and "cs.com",
or any similar product or service offered by or through the U.S. version of the
CompuServe brand service, (c) Content areas owned, maintained or controlled by
CompuServe affiliates or any similar "sub-service," (d) any programming or
Content area offered by or through the U.S. version of the CompuServe brand
service over which CompuServe does not exercise complete or substantially
complete operational control (e.g., third-party Content areas), (e) Netscape
Netcenter(TM) and any additional Netscape products or services, (f) any yellow
pages, white pages, classifieds or other search, directory or review services or
Content, (g) any co-branded or private label branded version of the U.S. version
of the CompuServe brand service, (h) any version of the U.S. version of the
CompuServe brand service which offers Content, distribution, services and/or
functionality materially different from the Content, distribution, services
and/or functionality associated with the standard, narrow-band U.S. version of
the CompuServe brand service, including, without limitation, any version of such
service distributed through any platform or device other than a desktop personal
computer and (i) any property, feature, product or service which CompuServe or
its affiliates may acquire subsequent to the Effective Date.
Confidential Information. Any information relating to or disclosed in the
- ------------------------
course of the Agreement, which is or should be reasonably understood to be
confidential or proprietary to the disclosing Party, including, but not limited
to, the material terms of this Agreement, information about AOL Members, AOL
Users, AOL Purchasers and MP customers, technical processes and formulas, source
codes, product designs, sales, cost and other unpublished financial information,
product and business plans, projections, and marketing data. "Confidential
Information" shall not include information (a) already lawfully known to or
independently developed by the receiving Party, (b) disclosed in published
materials, (c) generally known to the public, or (d) lawfully obtained from any
third party.
Content. Text, images, video, audio (including, without limitation, music used
- -------
in synchronism or timed relation with visual displays) and other data, Services,
advertisements, promotions, links, pointers and software, including any
modifications, upgrades, updates, enhancements and related documentation.
Contest. "Contest" shall have the meaning set forth in Section 3 of Exhibit F
- -------
to this Agreement.
Customers. "Customers" shall have the meaning set forth in Section 9 of Exhibit
- ---------
F to this Agreement.
Digital City. The standard, narrow-band U.S. version of Digital City's local
- -------------
content offerings marketed under the Digital City brand name, specifically
excluding (a) the AOL Service, AOL.com or any other AOL Interactive Site, (b)
any international versions of such local content offerings, (c) the
CompuServe(R) brand service and any other CompuServe products or services (d)
"Driveway," "ICQ(TM)," "AOL NetFind(TM)," "AOL Instant Messenger(TM)," "Digital
City," "NetMail(TM)," "Electra", "Thrive", "Real Fans", "Love@AOL",
"Entertainment Asylum," "AOL Hometown," "My News" or any similar independent
product, service or property which may be offered by, through or with the
standard narrow band version of Digital City's local content offerings, (e)
Netscape Netcenter(TM) and any additional Netscape products or services, (f) any
14
<PAGE>
EXECUTION VERSION
programming or Content area offered by or through such local content offerings
over which AOL does not exercise complete operational control (including,
without limitation, Content areas controlled by other parties and member-created
Content areas), (g) any yellow pages, white pages, classifieds or other search,
directory or review services or Content offered by or through such local content
offerings, (h) any property, feature, product or service which AOL or its
affiliates may acquire subsequent to the Effective Date, (i) any other version
of a Digital City local content offering which is materially different from the
narrow-band U.S. version of Digital City's local content offerings marketed
under the Digital City brand name, by virtue of its branding, distribution,
functionality, Content or services, including, without limitation, any co-
branded version of the offerings and any version distributed through any
broadband distribution platform or through any platform or device other than a
desktop personal computer, and (j) Digital City- branded offerings in any local
area where such offerings are not owned or operationally controlled by AOL, Inc.
or DCI (e.g., Chicago, Orlando, South Florida, and Hampton Roads).
Disclaimed Damages. "Disclaimed Damages" shall have the meaning set forth in
- ------------------
Section 9(a) of Exhibit G to this Agreement.
Demand. "Demand" shall have the meaning set forth in Section 5.2 of this
- ------
Agreement.
Dispute. "Dispute" shall have the meaning set forth in Section 5.1 of this
- -------
Agreement.
Final Shortfall. "Final Shortfall" shall have the meaning set forth in Section
- ---------------
1.2 of this Agreement.
Impression. User exposure to the applicable Promotion, as such exposure may be
- ----------
reasonably determined and measured by AOL in accordance with its standard
methodologies and protocols.
Impressions Commitment. "Impressions Commitment" shall have the meaning set
- ----------------------
forth in Section 1.2 of this Agreement.
Indemnified Party. "Indemnified Party" shall have the meaning set forth in
- -----------------
Section 9(d) of Exhibit G to this Agreement.
Indemnifying Party. "Indemnifying Party" shall have the meaning set forth in
- ------------------
Section 9(d) of Exhibit G to this Agreement.
Initial Term. "Initial Term" shall have the meaning set forth in Section 4.1 of
- ------------
this Agreement.
Interactive Service. An entity offering one or more of the following: (i)
- -------------------
online or Internet connectivity services (e.g., an Internet service provider);
(ii) an interactive site or service featuring a broad selection of aggregated
third party interactive content (or navigation thereto) (e.g., an online service
or search and directory service)and/or marketing a broad selection of products
and/or services across numerous interactive commerce categories (e.g., an online
mall or other leading online commerce site); (iii) a persistent desktop client;
and (iv) communications software capable of serving as the principal means
through which a user creates, sends and receives electronic mail or real time
online messages (whether by telephone, computer or other means), including,
without limitation, greeting cards.
Interactive Site. Any interactive site or area, including, by way of example and
- ----------------
without limitation, (i) an MP site on the World Wide Web portion of the Internet
or (ii) a channel or area delivered through a "push" product such as the
Pointcast Network or interactive environment such as Microsoft's Active Desktop.
Keyword Search Terms. (a) The Keyword online search terms made available on the
- ---------------------
AOL Service for use by AOL Members, combining AOL's Keyword online search
modifier with a term or phrase specifically related to MP (and determined in
accordance with the terms of this Agreement) and (b) the Go Word online search
terms made available on CompuServe, combining CompuServe's Go Word online search
modifier with a term or phrase specifically related to AG and determined in
accordance with the terms of this Agreement).
15
<PAGE>
EXECUTION VERSION
Level. One of the five levels of Promotions as set forth on Exhibit A to this
- -----
Agreement.
Liabilities. "Liabilities" shall have the meaning set forth in Section 9(c) of
- -----------
Exhibit G to this Agreement.
Licensed Content. All Content offered through the Affiliated MP Site pursuant
- ----------------
to this Agreement or otherwise provided by MP or its agents in connection
herewith (e.g., offline or online promotional Content, Promotions, AOL
"slideshows", etc.), including in each case, any modifications, upgrades,
updates, enhancements, and related documentation.
Management Committee. "Management Committee" shall have the meaning set forth
- --------------------
in Section 5.1 of this Agreement.
Marks. "Marks" shall have the meaning set forth in Section 3 of Exhibit G to
- -----
this Agreement.
MP Competitors. Autobytel, Cobalt Dealer Net ("Cobalt") and Consumer Car Club
- --------------
("CCC"); provided that AOL may elect, in its sole discretion, to remove either
Cobalt or CCC, or both, from this definition (and thereby remove any and all
exclusivity / premiere privilege restrictions or obligations on AOL and its
affiliates with respect thereto), with respect to just the AOL Service, just
AOL.com, just CompuServe, or any combination thereof (including the entire AOL
Network) (at AOL's option), by reducing MP's guaranteed payment amount hereunder
by $[*] ([*] dollars) per such competitor (e.g., $[*] to remove either Cobalt
or CCC, or $[*] to remove both Cobalt and CCC), with [*]% of such amounts
attributable to CompuServe, [*]% to AOL.com and the remaining [*]% to the AOL
Service (and, if and to the extent applicable the rest of the AOL Network);
provided further that such payment reduction amounts shall be reduced pro rata
on a quarterly basis over the scheduled 2 year Initial Term hereof/1/.
MP Interactive Site. Any Interactive Site (other than the Affiliated MP Site)
- -------------------
which is managed, maintained, owned or controlled by MP or its agents.
MP Technical Problem. "MP Technical Problem" shall have the meaning set forth
- --------------------
in Section 5 of Exhibit E to this Agreement.
Navigation Bar Reference. "Navigation Bar Reference" shall have the meaning set
- ------------------------
forth in Section 2.1 of this Agreement.
New Car Services. The new car Services offered by MP on or through the Jump
- ----------------
Pages and/or the Affiliated MP Site, as further described on Exhibit D hereto.
New Functionality. "New Functionality" shall have the meaning set forth in
- -----------------
Section 9.v of Exhibit E to this Agreement.
Non-Arbitration Claims. "Non-Arbitration Claims" shall have the meaning set
- ----------------------
forth in Section 5.7 of this Agreement.
Press Release. "Press Release" shall have the meaning set forth in Section 4.5
- -------------
of this Agreement.
Prior Business Relationship. "Prior Business Relationship" shall have the
- ---------------------------
meaning set forth in Section 11 of Exhibit G to this Agreement.
Production Plan. "Production Plan" shall have the meaning set forth in Section
- ---------------
10 of Exhibit F to this Agreement.
____________________
/1/ By way of example, for illustrative purposes only, AOL may elect to remove
all exclusivity / premiere privilege obligations for the entire AOL Network (to
the extent applicable) with respect to just CCC for [$*] or only on CompuServe
with respect to CCC for only [*%] of [$*] [i.e., $*] at any time during the
first quarter after the Effective Date, or for half such amounts [$*] for the
AOL Network or [$*] for just CompuServe or AOL.com) one year after the
Effective Date (because it is halfway through the scheduled Initial Term),
etc.
* Confidential treatment has been requested with respect to certain information
contained in this document. Confidential portions have been omitted from the
public filing and have been filed separately with the Securities and Exchange
Commission.
16
<PAGE>
EXECUTION VERSION
Promo Content. "Promo Content" shall have the meaning set forth in Section 1.3
- -------------
of this Agreement.
Promotional Materials. "Promotional Materials" shall have the meaning set forth
- ---------------------
in Section 1 of Exhibit G to this Agreement.
Promotions. "Promotions" shall have the meaning set forth in Section 1.1 of
- ----------
this Agreement.
Quarter Shortfall. "Quarter Shortfall" shall have the meaning set forth in
- -----------------
Section 1.2 of this Agreement.
Revised Impressions Target. "Revised Impressions Target" shall have the meaning
- --------------------------
set forth in Section 1.2 of this Agreement.
Routine Services. "Routine Services" shall have the meaning set forth in
- ----------------
Section 10 of Exhibit F to this Agreement.
Run of Service Advertising (ROS). A collection of promotional inventory made up
- --------------------------------
of all areas of the AOL Network. To the extent applicable, AOL shall place MP's
creative in different locations throughout the AOL Network in accordance with
AOL internal policies. Run of Service Impressions shall be delivered in
accordance with the monthly targets on Exhibit A over the applicable time
period. MP may not control placement of such Run of Service Advertising and AOL
does not guarantee placement thereof on any particular screen or group of
screens. Notwithstanding anything to the contrary in this Agreement, AOL shall
(i) use commercially reasonable efforts to deliver the Run of Service
Impressions in accordance with the targets set forth on Exhibit A of this
Agreement, and (ii) not deliver any Run of Service Impressions in the following
areas: teens, love@AOL, or international. In the event that MP reasonably
believes that a disproportionate number of the Run of Service Advertising is
being delivered in any one subchannel of the AOL Network, then Parties shall
meet to discuss the manner in which AOL will attempt to rectify such imbalance.
Secondary Shortfall. "Secondary Shortfall" shall have the meaning set forth in
- -------------------
Section 1.2 of this Agreement.
Services. Any product, good or service which MP (or others acting on its behalf
- --------
or as distributors) offers, sells, provides, distributes or licenses to AOL
Users directly or indirectly through (i) the Affiliated MP Site (including
through any Interactive Site linked thereto), (ii) any other electronic means
directed at AOL Users (e.g., e-mail offers), or (iii) an "offline" means (e.g.,
toll-free number) for receiving orders related to specific offers within the
Affiliated MP Site requiring purchasers to reference a specific promotional
identifier or tracking code, including, without limitation, products or services
sold through surcharged downloads (to the extent expressly permitted hereunder).
Transaction Revenues. Aggregate amounts paid by AOL Purchasers in connection
- --------------------
with the sale, licensing, distribution or provision of any Services, including,
in each case, handling, shipping, service charges, and excluding, in each case,
(a) amounts collected for sales or use taxes or duties and (b) credits and
chargebacks for returned or canceled goods or services, but not excluding cost
of goods sold or any similar cost.
User Information. "User Information" shall have the meaning set forth in
- ----------------
Section 13 of Exhibit G to this Agreement.
17
<PAGE>
EXECUTION VERSION
EXHIBIT C
MP Cross-Promotion
- ------------------
A. MP shall promote (at least once per quarter) the AOL Service to MP
registered users through the MP newsletter sent to such users. In any MP
newsletter in which MP promotes the AOL Service, MP shall not promote any
other Interactive Service.
B. In addition, in MP's television, radio, print and "out of home" (e.g., buses
and billboards) advertisements. MP shall include specific references or
mentions (verbally where possible) of the availability of the Affiliated MP
Site through the AOL Network, which are at least as prominent as any
references that MP makes to any MP Interactive Site related to the Autoweb
brand (other than any MP Interactive Site that is co-branded with another
third party) (by way of site name, related company name, URL or otherwise).
Without limiting the generality of the foregoing, MP's listing of the "URL"
for any MP Interactive Site related to the Autoweb brand (other than MP any
Interactive Site that is co-branded with another thid-party) shall be
accompanied by an equally prominent listing of the "keyword" term on AOL for
the Affiliated MP Site.
18
<PAGE>
EXECUTION VERSION
EXHIBIT D
Description of Services and Other Content to be Promoted in the Promotions and
------------------------------------------------------------------------------
on the AOL Jump Pages
---------------------
New car listings and related new auto content (e.g., auto reviews, new car-
related chat (provided by AOL and to be used only by AOL Members), etc.) and
services (collectively, the "New Car Services"), and shall exclude email,
instant messaging, calendar services and similar functionality (unless otherwise
agreed by AOL). In accordance with Section 2.1 of this Agreement, MP also shall
be able to include the Navigation Bar Tab on the AOL Jump Page.
19
<PAGE>
EXECUTION VERSION
EXHIBIT D-1
Description of Services and Other Content to be Promoted on the Affiliated MP
-----------------------------------------------------------------------------
Site
----
The Content on the Affiliated MP Site may include the New Car Services, as well
as the new car and used car listings and related information and services
(including, without limitation, business-to-consumer new and used car auctions);
provided that the Affiliated MP Site shall not link (directly or indirectly) to
- --------
any third-party provider of used car listings.
<PAGE>
EXECUTION VERSION
EXHIBIT E
Operations
----------
1. General. The Affiliated MP Site (including the Services and other Content
-------
contained therein) shall be in the top three (3) in the online new car industry,
as determined by each of the following methods: (a) based on a cross-section
of third-party reviewers who are recognized authorities in such industry and (b)
with respect to all material quality averages or standards in such industry,
including each of the following: (i) pricing of Services, (ii) scope and
selection of Services, (iii) quality of Services, (iv) customer service and
fulfillment associated with the marketing and sale of Services and (v) ease of
use. In addition, the Affiliated MP Site shall, with respect to each of the
measures listed above, be competitive in all respects with that which is offered
by any MP Competitors.
2. Affiliated MP Site Infrastructure. MP shall be responsible for all
---------------------------------
communications, hosting and connectivity costs and expenses associated with the
Affiliated MP Site. MP shall provide all hardware, software, telecommunications
lines and other infrastructure necessary to meet traffic demands on the
Affiliated MP Site from the AOL Network. MP shall design and implement the
network between the AOL Service and Affiliated MP Site such that (i) no single
component failure shall have a materially adverse impact on AOL Members seeking
to reach the Affiliated MP Site from the AOL Network and (ii) no single line
under material control by MP shall run at more than 70% average utilization for
a 5-minute peak in a daily period. In this regard, MP shall provide AOL, upon
request, with a detailed network diagram regarding the architecture and network
infrastructure supporting the Affiliated MP Site. In the event that MP elects
to create a custom version of the Affiliated MP Site in order to comply with the
terms of this Agreement, MP shall bear responsibility for all aspects of the
implementation, management and cost of such customized site.
3. Optimization; Speed. MP shall use commercially reasonable efforts to
-------------------
ensure that: (a) the functionality and features within the Affiliated MP Site
are optimized for the client software then in use by AOL Members; and (b) the
Affiliated MP Site is designed and populated in a manner that minimizes delays
when AOL Members attempt to access such site. At a minimum, MP shall ensure
that the Affiliated MP Site's data transfers initiate within fewer than fifteen
(15) seconds on average. Prior to commercial launch of any material promotions
described herein, MP shall permit AOL to conduct performance and load testing of
the Affiliated MP Site (in person or through remote communications), with such
commercial launch not to commence until such time as AOL is reasonably satisfied
with the results of any such testing.
4. User Interface. MP shall maintain a graphical user interface within the
--------------
Affiliated MP Site that is competitive in all material respects with interfaces
of other similar sites based on similar form technology. AOL reserves the right
to review and approve the user interface and site design prior to launch of the
Promotions and to conduct focus group testing to assess compliance with respect
to such consultation and with respect to MP's compliance with the preceding
sentence.
5. Technical Problems. MP agrees to use commercially reasonable efforts to
------------------
address material technical problems (over which MP exercises control) affecting
use by AOL Members of the Affiliated MP Site (a "MP Technical Problem") promptly
following notice thereof. In the event that MP is unable to promptly resolve a
MP Technical Problem following notice thereof from AOL (including, without
limitation, infrastructure deficiencies producing user delays), AOL shall have
the right to regulate the promotions it provides to MP hereunder until such time
as MP corrects the MP Technical Problem at issue.
6. Monitoring. MP shall ensure that the performance and availability of the
----------
Affiliated MP Site is monitored on a continuous basis. MP shall provide AOL
with contact information (including e-mail, phone, pager and fax information, as
applicable, for both during and after business hours) for MP's principal
business and technical representatives, for use in cases when issues or problems
arise with respect to the Affiliated MP Site.
7. Telecommunications. Where applicable MP shall use encryption methodology to
------------------
secure data communications between the Parties' data centers. The network
between the Parties shall be configured such that no single component failure
shall significantly impact AOL Users. The network shall be sized such that no
single line runs at more than 70% average utilization for a 5-minute peak in a
daily period.
8. Security. MP shall utilize Internet standard encryption technologies (e.g.,
--------
Secure Socket Layer SSL) to provide a secure environment for conducting
transactions and/or transferring private member information (e.g. credit card
numbers, banking/financial information, and member address information) to and
from the Affiliated MP Site. MP shall facilitate periodic reviews of the
Affiliated MP Site by AOL in order to evaluate the security risks of such site.
MP shall promptly remedy any security risks or breaches of security as may be
identified by AOL's Operations Security team.
9. Technical Performance.
---------------------
i. MP shall design the Affiliated MP Site to support the AOL-client
embedded versions of the Microsoft Internet Explorer 3.0 and 4.0
browsers (Windows and Macintosh) and make commercially reasonable
efforts to support all other AOL browsers listed at:
"http://webmaster.info.aol.com/BrowTable.html."
ii. To the extent MP creates customized pages on the Affiliated MP Site
for AOL Members, MP shall configure and employ a methodology to detect
AOL Members (e.g. examine the HTTP User-Agent field in order to identify
the "AOL Member-Agents" listed at: "http://webmaster. info.aol.com/)."
iii. MP shall periodically review the technical information made available
by AOL at http://webmaster.info.aol.com.
21
<PAGE>
EXECUTION VERSION
iv. MP shall design its site to support HTTP 1.0 or later protocol as
defined in RFC 1945 and to adhere to AOL's parameters for refreshing
cached information listed at http://webmaster.info.aol.com.
v. Prior to releasing material, new functionality or features through
the Affiliated MP Site ("New Functionality"), MP shall use commercially
reasonable efforts to DELETE either (i) test the New Functionality to
confirm its compatibility with AOL Service client software and (ii)
provide AOL with written notice of the New Functionality so that AOL can
perform tests of the New Functionality to confirm its compatibility with
the AOL Service client software.
10. AOL Internet Services MP Support. AOL shall provide MP with access to the
--------------------------------
standard online resources, standards and guidelines documentation, technical
phone support, monitoring and after-hours assistance that AOL makes generally
available to similarly situated web-based partners. AOL support shall not, in
any case, be involved with content creation on behalf of MP or support for any
technologies, databases, software or other applications which are not supported
by AOL or are related to any MP area other than the Affiliated MP Site.
Support to be provided by AOL is contingent on MP providing to AOL demo account
information (where applicable), a detailed description of the Affiliated MP
Site's software, hardware and network architecture and access to the Affiliated
MP Site for purposes of such performance and load testing as AOL elects to
conduct.
22
<PAGE>
EXECUTION VERSION
EXHIBIT F
Standard Online Commerce Terms & Conditions
-------------------------------------------
1. AOL Network Distribution. MP shall not authorize or permit any third party
------------------------
to distribute or promote the Services or any MP Interactive Site through the AOL
Network absent AOL's prior written approval. The Promotions and any other
promotions or advertisements purchased from or provided by AOL shall link only
to the AOL Jump Page after the launch of such AOL Jump Page, and prior to such
launch date, shall link to the Affiliated MP Site, shall be used by MP solely
for its own benefit and shall not be resold, traded, exchanged, bartered,
brokered or otherwise offered to any third party.
2. Provision of Other Content. In the event that AOL notifies MP that (i) as
--------------------------
reasonably determined by AOL, any Content within the Affiliated MP Site violates
AOL's then-standard Terms of Service (as set forth on the America Online brand
service at Keyword term "TOS"), the terms of this Agreement or any other
standard, written AOL policy (which is either available online or of which AOL
has otherwise notified MP) or (ii) AOL reasonably objects to the inclusion of
any Content within the Affiliated MP Site (other than any specific items of
Content which may be expressly identified in this Agreement), then MP shall take
commercially reasonable steps to block access by AOL Users to such Content using
MP's then-available technology. In the event that MP cannot, through its
commercially reasonable efforts, block access by AOL Users to the Content in
question, then MP shall provide AOL prompt written notice of such fact. AOL may
then, at its option, restrict access from the AOL Network to the Content in
question using technology available to AOL. MP shall cooperate with AOL's
reasonable requests to the extent AOL elects to implement any such access
restrictions.
3. Contests. MP shall take all steps necessary to ensure that any contest,
--------
sweepstakes or similar promotion conducted or promoted through the Affiliated MP
Site (a "Contest") complies with all applicable federal, state and local laws
and regulations.
4. Navigation. Subject to the prior consent of MP, which consent shall not be
----------
unreasonably withheld, AOL shall be entitled to establish navigational icons,
links and pointers connecting the AOL Jump Pages (or portions thereof) with
other content areas on or outside of the AOL Network. Additionally, in cases
where an AOL User performs a search for MP through any search or navigational
tool or mechanism that is accessible or available through the AOL Network (e.g.,
Promotions, Keyword Search Terms, or any other promotions or navigational
tools), AOL shall have the right to direct such AOL User to the Affiliated MP
Site, the AOL Jump Pages, or any other MP Interactive Site determined by AOL in
its reasonable discretion, provided that during the three months following
termination of this Agreement, MP's Keyword Search Term shall direct AOL Users
to the Affiliated MP Site.
5. Disclaimers. Upon AOL's request, MP agrees to include within the
------------
Affiliated MP Site a product disclaimer (the specific form and substance to be
mutually agreed upon by the Parties) indicating that transactions are solely
between MP and AOL Users purchasing Services from MP.
6. AOL Look and Feel. MP acknowledges and agrees that AOL shall own all right,
-----------------
title and interest in and to the elements of graphics, design, organization,
presentation, layout, user interface, navigation and stylistic convention
(including the digital implementations thereof) which are generally associated
with online areas contained within the AOL Network, subject to MP's ownership
rights in any MP trademarks or copyrighted material within the Affiliated MP
Site.
7. Management of the Affiliated MP Site. MP shall manage, review, delete,
------------------------------------
edit, create, update and otherwise manage all Content available on or through
the Affiliated MP Site, in a timely and professional manner and in accordance
with the terms of this Agreement. MP shall ensure that the Affiliated MP Site
is current, accurate and well-organized at all times. MP warrants that the
Services and other Licensed Content : (i) shall not infringe on or violate any
copyright, trademark, U.S. patent or any other third party right, including
without limitation, any music performance or other music-related rights; (ii)
shall not violate AOL's then-applicable Terms of Service or any other standard,
written AOL policy (which is either available online or of which AOL has
otherwise notified MP); and (iii) shall not violate any applicable law or
regulation, including those relating to contests, sweepstakes or similar
promotions. Additionally, MP represents and warrants that it owns or has a
valid license to all rights to any Licensed Content used in AOL "slideshow" or
other formats embodying elements such as graphics, animation and sound, free and
clear of all encumbrances and without violating the rights of any other person
or entity. MP also warrants that a reasonable basis exists for all Product
performance or comparison claims appearing through the Affiliated MP Site. MP
shall not in any manner, including, without limitation in any Promotion, the
Licensed Content or the Materials state or imply that AOL recommends or endorses
MP or MP's Services (e.g., no statements that MP is an "official" or
"preferred" provider of Services or services for AOL). AOL shall have no
obligations with respect to the Services available on or through the Affiliated
MP Site, including, but not limited to, any duty to review or monitor any such
Services.
8. Duty to Inform. MP shall promptly inform AOL of any information related to
--------------
the Affiliated MP Site which could reasonably lead to a claim, demand, or
liability of or against AOL and/or its affiliates by any third party.
9. Customer Service. It is the sole responsibility of MP to provide customer
----------------
service to persons or entities purchasing Services through the AOL Network
("Customers"). MP shall bear full responsibility for all customer service,
including without limitation, order processing, billing, fulfillment, shipment,
collection and other customer service associated with any Services offered, sold
or licensed through the Affiliated MP Site, and AOL shall have no obligations
whatsoever with respect
23
<PAGE>
EXECUTION VERSION
thereto. MP shall receive all emails from Customers via a computer available to
MP's customer service staff and generally respond to such emails within one
business day of receipt. MP shall receive all orders electronically and
generally process all orders within one business day of receipt, provided
Services ordered are not advance order items. MP shall ensure that all orders of
Services are received, processed, fulfilled and delivered on a timely and
professional basis. MP shall bear all responsibility for compliance with
federal, state and local laws in the event that the Services are no longer
available at the time an order is received. MP shall also comply with the
requirements of any federal, state or local consumer protection or disclosure
law. Payment for Services shall be collected by MP directly from customers. MP's
order fulfillment operation shall be subject to AOL's reasonable review.
10. Production Work. In the event that MP requests AOL's production assistance
---------------
in connection with (i) ongoing programming and maintenance related to the
Affiliated MP Site, (ii) a redesign of or addition to the Affiliated MP Site
(e.g., a change to an existing screen format or construction of a new custom
form), (iii) production to modify work performed by a third party provider or
(iv) any other type of production work, MP shall work with AOL to develop a
detailed production plan for the requested production assistance (the
"Production Plan"). Following receipt of the final Production Plan, AOL shall
notify MP of (i) AOL's availability to perform the requested production work,
(ii) the proposed fee or fee structure for the requested production and
maintenance work and (iii) the estimated development schedule for such work. To
the extent the Parties reach agreement regarding implementation of the agreed-
upon Production Plan, such agreement shall be reflected in a separate work order
signed by the Parties. To the extent MP elects to retain a third party provider
to perform any such production work, work produced by such third party provider
must generally conform to AOL's standards & practices (as provided on the
America Online brand service at Keyword term "styleguide"). The specific
production resources which AOL allocates to any production work to be performed
on behalf of MP shall be as determined by AOL in its sole discretion. With
respect to any routine production, maintenance or related services which AOL and
MP mutually agree are necessary for AOL to perform in order to support the
proper functioning and integration of the Affiliated MP Site ("Routine
Services"), MP shall pay the then-standard fees charged by AOL for such Routine
Service.
11. Overhead Accounts. To the extent AOL has granted MP any overhead accounts
-----------------
on the AOL Service, MP shall be responsible for the actions taken under or
through its overhead accounts, which actions are subject to AOL's applicable
Terms of Service and for any surcharges, including, without limitation, all
premium charges, transaction charges, and any applicable communication
surcharges incurred by any overhead Account issued to MP, but MP shall not be
liable for charges incurred by any overhead account relating to AOL's standard
monthly usage fees and standard hourly charges, which charges AOL shall bear.
Upon the termination of this Agreement, all overhead accounts, related screen
names and any associated usage credits or similar rights, shall automatically
terminate. AOL shall have no liability for loss of any data or content related
to the proper termination of any overhead account.
12. Navigation Tools. Any Keyword Search Terms to be directed to the
----------------
Affiliated MP Site or the AOL Jump Pages shall be (i) subject to availability
for use by MP and (ii) limited to the combination of the Keyword search modifier
combined with a trademark of MP. AOL reserves the right to revoke at any time
MP's use of any Keyword Search Terms which do not incorporate trademarks of MP.
MP acknowledges that its utilization of a Keyword Search Term shall not create
in it, nor shall it represent it has, any right, title or interest in or to such
Keyword Search Term, other than the right, title and interest MP holds in MP's
trademark independent of the Keyword Search Term. Without limiting the
generality of the foregoing, MP shall not: (a) attempt to register or otherwise
obtain trademark or copyright protection in the Keyword Search Term; or (b) use
the Keyword Search Term, except for the purposes expressly required or permitted
under this Agreement. To the extent AOL allows AOL Users to "bookmark" the URL
or other locator for the Affiliated MP Site, such bookmarks shall be subject to
AOL's control at all times. At the end of three months following the termination
of this Agreement, MP's rights to any Keyword Search Terms and bookmarking shall
terminate.
13. Merchant Certification Program. MP shall participate in any generally
------------------------------
applicable "Certified Merchant" program operated by AOL or its authorized agents
or contractors. Such program may require merchant participants on an ongoing
basis to meet certain reasonable, generally applicable standards relating to
provision of electronic commerce through the AOL Network (including, as a
minimum, use of 40-bit SSL encryption and if requested by AOL, 128-bit
encryption) and may also require the payment of certain reasonable certification
fees (applicable to all AOL Certified Merchants) to the relevant entity
operating the program. Each Certified Merchant in good standing shall be
entitled to place on its affiliated Interactive Site an AOL designed and
approved button promoting the merchant's status as an AOL Certified Merchant.
14. Prohibited Promotional Payments. On the AOL Jump Pages, MP shall not
-------------------------------
offer, provide, implement or otherwise make available any promotional programs
or plans that are intended to provide customers with rewards or benefits in
exchange for, or on account of, their past or continued loyalty to, or patronage
or purchase of, the products or services of MP or any third party (e.g., a
promotional program similar to a "frequent flier" program), unless such
promotional program or plan is provided exclusively through AOL's "AOL Rewards"
program, accessible on the AOL Service at Keyword: "AOL Rewards."
24
<PAGE>
EXECUTION VERSION
EXHIBIT G
Standard Legal Terms & Conditions
---------------------------------
1. Promotional Materials/Press Releases. Each Party shall submit to the other
------------------------------------
Party, for its prior written approval, which shall not be unreasonably withheld
or delayed, any marketing, advertising, or other promotional materials,
excluding Press Releases, related to the AOL Jump Pages and the Affiliated MP
Site (other than any such materials which solely relate to the Affiliated MP
Site and which do not mention or otherwise reference AOL, this Agreement or the
terms hereof), and/or referencing the other Party and/or its trade names,
trademarks, and service marks (the "Promotional Materials"); provided, however,
-------- -------
that either Party's use of screen shots of the Affiliated MP Site for
promotional purposes shall not require the approval of the other Party; and
provided, further, however, that, following the initial public announcement of
- -------- ------- -------
the business relationship between the Parties in accordance with the approval
and other requirements contained herein, either Party's subsequent factual
reference to the existence of a business relationship between the Parties in
Promotional Materials, shall not require the approval of the other Party. Each
Party shall solicit and reasonably consider the views of the other Party in
designing and implementing such Promotional Materials. Once approved, the
Promotional Materials may be used by a Party and its affiliates for the purpose
of promoting the Affiliated MP Site and the content contained therein and reused
for such purpose until such approval is withdrawn with reasonable prior notice.
In the event such approval is withdrawn, existing inventories of Promotional
Materials may be depleted.
2. License. During the term of this Agreement, MP hereby grants AOL a non-
-------
exclusive worldwide license to market, , reproduce, display, perform, transmit
and promote the Licensed Content (or any portion thereof) through such areas or
features of the AOL Network as AOL deems appropriate for the purpose of
promoting the Affiliated MP Site. MP acknowledges and agrees that the foregoing
license permits AOL to distribute portions of the Licensed Content in
synchronism or timed relation with visual displays prepared by MP or AOL (e.g.,
as part of an AOL "slideshow"). In addition, AOL Users shall have the right to
access and use the Affiliated MP Site.
3. Trademark License. In designing and implementing the Materials and subject
-----------------
to the other provisions contained herein, MP shall be entitled to use the
following trade names, trademarks, and service marks of AOL: the "America
Online" brand service, "AOL" service/software and AOL's triangle logo; and AOL
and its affiliates shall be entitled to use the trade names, trademarks, and
service marks of MP for which MP holds all rights necessary for use in
connection with this Agreement (collectively, together with the AOL marks listed
above, the "Marks"); provided that each Party: (i) does not create a unitary
--------
composite mark involving a Mark of the other Party without the prior written
approval of such other Party; and (ii) displays symbols and notices clearly and
sufficiently indicating the trademark status and ownership of the other Party's
Marks in accordance with applicable trademark law and practice.
4. Ownership of Trademarks. Each Party acknowledges the ownership right of the
-----------------------
other Party in the Marks of the other Party and agrees that all use of the other
Party's Marks shall inure to the benefit, and be on behalf, of the other Party.
Each Party acknowledges that its utilization of the other Party's Marks shall
not create in it, nor shall it represent it has, any right, title, or interest
in or to such Marks other than the licenses expressly granted herein. Each
Party agrees not to do anything contesting or impairing the trademark rights of
the other Party.
5. Quality Standards. Each Party agrees that the nature and quality of its
-----------------
products and services supplied in connection with the other Party's Marks shall
conform to quality standards set by the other Party. Each Party agrees to
supply the other Party, upon request, with a reasonable number of samples of any
Materials publicly disseminated by such Party which utilize the other Party's
Marks. Each Party shall comply with all applicable laws, regulations, and
customs and obtain any required government approvals pertaining to use of the
other Party's marks.
6. Infringement Proceedings. Each Party agrees to promptly notify the other
------------------------
Party of any unauthorized use of the other Party's Marks of which it has actual
knowledge. Each Party shall have the sole right and discretion to bring
proceedings alleging infringement of its Marks or unfair competition related
thereto; provided, however, that each Party agrees to provide the other Party
with its reasonable cooperation and assistance with respect to any such
infringement proceedings.
7. Representations and Warranties. Each Party represents and warrants to the
------------------------------
other Party that: (i) such Party has the full corporate right, power and
authority to enter into this Agreement and to perform the acts required of it
hereunder; (ii) the execution of this Agreement by such Party, and the
performance by such Party of its obligations and duties hereunder, do not and
shall not violate any agreement to which such Party is a party or by which it is
otherwise bound; (iii) when executed and delivered by such Party, this Agreement
shall constitute the legal, valid and binding obligation of such Party,
enforceable against such Party in accordance with its terms; and (iv) such Party
acknowledges that the other Party makes no representations, warranties or
agreements related to the subject matter hereof that are not expressly provided
for in this Agreement. MP hereby represents and warrants that it possesses all
authorizations, approvals, consents, licenses, permits, certificates or other
rights and permissions necessary to sell the Services.
8. Confidentiality. Each Party acknowledges that Confidential Information may
---------------
be disclosed to the other Party during the course of this Agreement. Each Party
agrees that it shall take reasonable steps, at least substantially equivalent to
the steps it takes to protect
25
<PAGE>
EXECUTION VERSION
its own proprietary information, during the term of this Agreement, and for a
period of three years following expiration or termination of this Agreement, to
prevent the duplication or disclosure of Confidential Information of the other
Party, other than by or to its employees or agents who must have access to such
Confidential Information to perform such Party's obligations hereunder, who
shall each agree to comply with this section. Notwithstanding the foregoing,
either Party may issue a press release or other disclosure containing
Confidential Information without the consent of the other Party, to the extent
such disclosure is required by law, rule, regulation or government or court
order. In such event, the disclosing Party shall provide at least five (5)
business days prior written notice of such proposed disclosure to the other
Party. Further, in the event such disclosure is required of either Party under
the laws, rules or regulations of the Securities and Exchange Commission or any
other applicable governing body, such Party shall (i) redact mutually agreed-
upon portions of this Agreement to the fullest extent permitted under applicable
laws, rules and regulations and (ii) submit a request to such governing body
that such portions and other provisions of this Agreement receive confidential
treatment under the laws, rules and regulations of the Securities and Exchange
Commission or otherwise be held in the strictest confidence to the fullest
extent permitted under the laws, , rules or regulations of any other applicable
governing body.
9. Limitation of Liability; Disclaimer; Indemnification.
----------------------------------------------------
(a) Liability. UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE
---------
OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY
DAMAGES (EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES), ARISING FROM BREACH OF THE AGREEMENT, THE SALE OF SERVICES, THE USE OR
INABILITY TO USE THE AOL NETWORK, THE AOL SERVICE, AOL.COM, THE AOL JUMP PAGES,
OR THE AFFILIATED MP SITE, OR ARISING FROM ANY OTHER PROVISION OF THIS
AGREEMENT, SUCH AS, BUT NOT LIMITED TO, LOSS OF REVENUE OR ANTICIPATED PROFITS
OR LOST BUSINESS (COLLECTIVELY, "DISCLAIMED DAMAGES"); PROVIDED THAT EACH PARTY
SHALL REMAIN LIABLE TO THE OTHER PARTY TO THE EXTENT ANY DISCLAIMED DAMAGES ARE
CLAIMED BY A THIRD PARTY AND ARE SUBJECT TO INDEMNIFICATION PURSUANT TO SECTION
9.3(c). EXCEPT AS PROVIDED IN SECTION 9.3(c), (I) LIABILITY ARISING UNDER THIS
AGREEMENT SHALL BE LIMITED TO DIRECT, OBJECTIVELY MEASURABLE DAMAGES, AND (II)
THE MAXIMUM LIABILITY OF ONE PARTY TO THE OTHER PARTY FOR ANY CLAIMS ARISING IN
CONNECTION WITH THIS AGREEMENT SHALL NOT EXCEED THE AGGREGATE AMOUNT OF PAYMENT
OBLIGATIONS OWED BY EITHER PARTY TO THE OTHER PARTY HEREUNDER IN THE YEAR IN
WHICH THE EVENT GIVING RISE TO LIABILITY OCCURS; PROVIDED THAT EACH PARTY SHALL
REMAIN LIABLE FOR THE AGGREGATE AMOUNT OF ANY PAYMENT OBLIGATIONS OWED TO THE
OTHER PARTY PURSUANT TO THE AGREEMENT.
(b) No Additional Warranties. EXCEPT AS EXPRESSLY SET FORTH IN THIS
-------------------------
AGREEMENT, NEITHER PARTY MAKES ANY, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS
ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, REGARDING THE AOL
NETWORK, THE AOL SERVICE, AOL.COM, THE AFFILIATED MP SITE, OR THE AOL JUMP
PAGES, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR
COURSE OF PERFORMANCE. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AOL
SPECIFICALLY DISCLAIMS ANY WARRANTY REGARDING THE PROFITABILITY OF THE
AFFILIATED MP SITE.
(c) Indemnity. Either Party shall defend, indemnify, save and hold harmless
---------
the other Party and the officers, directors, agents, affiliates, distributors,
franchisees and employees of the other Party from any and all third party
claims, demands, liabilities, costs or expenses, including reasonable attorneys'
fees ("Liabilities"), resulting from the indemnifying Party's material breach of
any duty, representation, or warranty of this Agreement.
(d) Claims. If a Party entitled to indemnification hereunder (the "Indemnified
-------
Party") becomes aware of any matter it believes is indemnifiable hereunder
involving any claim, action, suit, investigation, arbitration or other
proceeding against the Indemnified Party by any third party (each an "Action"),
the Indemnified Party shall give the other Party (the "Indemnifying Party")
prompt written notice of such Action. Such notice shall (i) provide the basis on
which indemnification is being asserted and (ii) be accompanied by copies of all
relevant pleadings, demands, and other papers related to the Action and in the
possession of the Indemnified Party. The Indemnifying Party shall have a period
of ten (10) days after delivery of such notice to respond. If the Indemnifying
Party elects to defend the Action or does not respond within the requisite ten
(10) day period, the Indemnifying Party shall be obligated to defend the Action,
at its own expense, and by counsel reasonably satisfactory to the Indemnified
Party. The Indemnified Party shall cooperate, at the expense of the Indemnifying
Party, with the Indemnifying Party and its counsel in the defense and the
Indemnified Party shall have the right to participate fully, at its own expense,
in the defense of such Action. If the Indemnifying Party responds within the
required ten (10) day period and elects not to defend such Action, the
Indemnified Party shall be free, without prejudice to any of the Indemnified
Party's rights hereunder, to compromise or defend (and control the defense of)
such Action. In such case, the Indemnifying Party shall cooperate, at its own
expense, with the Indemnified Party and its counsel in the defense against such
Action and the Indemnifying Party shall have the right to participate fully, at
its own expense, in the defense of such Action. Any compromise or settlement of
an Action shall require the prior written consent of both Parties hereunder,
such consent not to be unreasonably withheld or delayed.
26
<PAGE>
EXECUTION VERSION
10. Acknowledgment. AOL and MP each acknowledges that the provisions of this
--------------
Agreement were negotiated to reflect an informed, voluntary allocation between
them of all risks (both known and unknown) associated with the transactions
contemplated hereunder. The limitations and disclaimers related to warranties
and liability contained in this Agreement are intended to limit the
circumstances and extent of liability. The provisions of this Section 9 shall
be enforceable independent of and severable from any other enforceable or
unenforceable provision of this Agreement.
11. Solicitation of AOL Users. During the term of the Agreement and for a two
-------------------------
year period thereafter, MP shall not use the AOL Network (including, without
limitation, the e-mail network contained therein) to solicit AOL Users on behalf
of another Interactive Service. More generally, MP shall not send unsolicited,
commercial e-mail (i.e., "spam") or other online communications through or into
AOL's products or Services, absent a Prior Business Relationship. For purposes
of this Agreement, a "Prior Business Relationship" shall mean that the AOL User
to whom commercial e-mail or other online communication is being sent has
voluntarily either (i) engaged in a transaction with MP or (ii) provided
information to MP through a contest, registration, or other communication, which
included clear notice to the AOL User that the information provided could result
in commercial e-mail or other online communication being sent to that AOL User
by MP or its agents. Any commercial e-mail or other online communications to
AOL Users which are otherwise permitted hereunder, shall (a) include a prominent
and easy means to "opt-out" of receiving any future commercial communications
from MP, and (b) shall also be subject to AOL's then-standard restrictions on
distribution of bulk e-mail (e.g., related to the time and manner in which such
e-mail can be distributed through or into the AOL product or service in
question).
12. AOL User Communications. To the extent that MP is permitted to communicate
--------------------------
with AOL Users under Section 15 of this Exhibit G, in any such communications to
AOL Users on or off the Affiliated MP Site (including, without limitation, e-
mail solicitations), MP shall not encourage AOL Users to take any action
inconsistent with the scope and purpose of this Agreement, including without
limitation, the following actions: (i) using an Interactive Site other than the
Affiliated MP Site for the purchase of Services, (ii) using Content other than
the Licensed Content; (iii) bookmarking of Interactive Sites; or (iv) changing
the default home page on the AOL browser. Additionally, with respect to such
AOL User communications, in the event that MP encourages an AOL User to purchase
products through such communications, MP shall ensure that (a) the AOL Network
is promoted as the primary means through which the AOL User can access the
Affiliated MP Site and (b) any link to the Affiliated MP Site shall link to a
page which indicates to the AOL User that such user is in a site which is
affiliated with the AOL Network.
13. Collection and Use of User Information. MP shall ensure that its
--------------------------------------
collection, use and disclosure of information obtained from AOL Users under this
Agreement ("User Information") complies with (i) all applicable laws and
regulations and (ii) AOL's standard privacy policies, available on the AOL
Service at the keyword term "Privacy" (or, in the case of the Affiliated MP
Site, MP's standard privacy policies so long as such policies are prominently
published on the site and provide adequate notice, disclosure and choice to
users regarding MP's collection, use and disclosure of user information). MP
shall not disclose User Information collected hereunder to any third party in a
manner that identifies AOL Users as end users of an AOL product or service or
use Member Information collected under this Agreement to market another
Interactive Service, and MP shall not sell or share such information with any
third party without the prior written consent of AOL.
14. Excuse. Neither Party shall be liable for, or be considered in breach of
------
or default under this Agreement on account of, any delay or failure to perform
as required by this Agreement as a result of any causes or conditions which are
beyond such Party's reasonable control and which such Party is unable to
overcome by the exercise of reasonable diligence.
15. Independent Contractors. The Parties to this Agreement are independent
-----------------------
contractors. Neither Party is an agent, representative or employee of the other
Party. Neither Party shall have any right, power or authority to enter into any
agreement for or on behalf of, or incur any obligation or liability of, or to
otherwise bind, the other Party. This Agreement shall not be interpreted or
construed to create an association, agency, joint venture or partnership between
the Parties or to impose any liability attributable to such a relationship upon
either Party.
16. Notice. Any notice, approval, request, authorization, direction or other
------
communication under this Agreement shall be given in writing and shall be deemed
to have been delivered and given for all purposes (i) on the delivery date if
delivered by electronic mail on the AOL Network (to screenname
"[email protected]" in the case of AOL) or by confirmed facsimile; (ii) on the
delivery date if delivered personally to the Party to whom the same is directed;
(iii) one business day after deposit with a commercial overnight carrier, with
written verification of receipt; or (iv) five business days after the mailing
date, whether or not actually received, if sent by U.S. mail, return receipt
requested, postage and charges prepaid, or any other means of rapid mail
delivery for which a receipt is available. In the case of AOL, such notice
shall be provided to both the Senior Vice President for Business Affairs (fax
no. 703-265-1206) and the Deputy General Counsel (fax no. 703-265-1105), each at
the address of AOL set forth in the first paragraph of this Agreement. In the
case of MP, except as otherwise specified herein, the notice address shall be
the address for MP set forth in the first paragraph of this Agreement, with the
other relevant notice information, including the recipient for notice and, as
applicable, such recipient's fax number or AOL e-mail address, to be as
reasonably identified by AOL.
17. Launch Dates. In the event that any terms contained herein relate to or
------------
depend on the commercial launch date of the Affiliated MP Site contemplated by
this Agreement (the "Launch Date"), then it is the intention of the Parties to
record such Launch Date in a written
27
<PAGE>
EXECUTION VERSION
instrument signed by both Parties promptly following such Launch Date; provided
that, in the absence of such a written instrument, the Launch Date shall be as
reasonably determined by AOL based on the information available to AOL.
18. No Waiver. The failure of either Party to insist upon or enforce strict
---------
performance by the other Party of any provision of this Agreement or to exercise
any right under this Agreement shall not be construed as a waiver or
relinquishment to any extent of such Party's right to assert or rely upon any
such provision or right in that or any other instance; rather, the same shall be
and remain in full force and effect.
19. Return of Information. Upon the expiration or termination of this
---------------------
Agreement, each Party shall, upon the written request of the other Party, return
or destroy (at the option of the Party receiving the request) all confidential
information, documents, manuals and other materials specified the other Party.
20. Survival. Sections 1.5, 3.1, 3.2, 3.3 and 5.6 of the body of the
--------
Agreement, and Sections 8, 9, 11, 12, 13, 16, 18, 19, 20, 21, 25, 26 and 27 of
this Exhibit, shall survive the completion, expiration, termination or
cancellation of this Agreement (and to the extent set forth therein, only for
the period provided in each such Section).
21. Entire Agreement. This Agreement sets forth the entire agreement and
----------------
supersedes any and all prior agreements of the Parties with respect to the
transactions set forth herein. Neither Party shall be bound by, and each Party
specifically objects to, any term, condition or other provision which is
different from or in addition to the provisions of this Agreement (whether or
not it would materially alter this Agreement) and which is proffered by the
other Party in any correspondence or other document, unless the Party to be
bound thereby specifically agrees to such provision in writing.
22. Amendment. No change, amendment or modification of any provision of this
---------
Agreement shall be valid unless set forth in a written instrument signed by the
Party subject to enforcement of such amendment, and in the case of AOL, by an
executive of at least the same standing to the executive who signed the
Agreement.
23. Further Assurances. Each Party shall take such action (including, but not
------------------
limited to, the execution, acknowledgment and delivery of documents) as may
reasonably be requested by any other Party for the implementation or continuing
performance of this Agreement.
24. Assignment. MP shall not assign this Agreement or any right, interest or
----------
benefit under this Agreement without the prior written consent of AOL.
Assumption of the Agreement by any successor to MP (including, without
limitation, by way of merger or consolidation) shall be subject to AOL's prior
written approval. Subject to the foregoing, this Agreement shall be fully
binding upon, inure to the benefit of and be enforceable by the Parties hereto
and their respective successors and assigns.
25. Construction; Severability. In the event that any provision of this
--------------------------
Agreement conflicts with the law under which this Agreement is to be construed
or if any such provision is held invalid by a court with jurisdiction over the
Parties to this Agreement, (i) such provision shall be deemed to be restated to
reflect as nearly as possible the original intentions of the Parties in
accordance with applicable law, and (ii) the remaining terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect.
26. Remedies. Except where otherwise specified, the rights and remedies
--------
granted to a Party under this Agreement are cumulative and in addition to, and
not in lieu of, any other rights or remedies which the Party may possess at law
or in equity; provided that, in connection with any dispute hereunder, MP shall
be not entitled to offset any amounts that it claims to be due and payable from
AOL against amounts otherwise payable by MP to AOL.
27. Applicable Law. Except as otherwise expressly provided herein, this
--------------
Agreement shall be interpreted, construed and enforced in all respects in
accordance with the laws of the Commonwealth of Virginia except for its
conflicts of laws principles.
28. Export Controls. Both Parties shall adhere to all applicable laws,
---------------
regulations and rules relating to the export of technical data and shall not
export or re-export any technical data, any products or services received from
the other Party or the direct product of such technical data to any proscribed
country listed in such applicable laws, regulations and rules unless properly
authorized.
29. Headings. The captions and headings used in this Agreement are inserted
--------
for convenience only and shall not affect the meaning or interpretation of this
Agreement.
30. Counterparts. This Agreement may be executed in counterparts, each of
------------
which shall be deemed an original and all of which together shall constitute
one and the same document.
28
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 6-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1999 DEC-31-1998
<PERIOD-START> JAN-01-1999 JAN-01-1998
<PERIOD-END> JUN-30-1999 JUN-30-1998
<CASH> 25,201 1,558
<SECURITIES> 46,231 0
<RECEIVABLES> 3,808 1,789
<ALLOWANCES> (642) (249)
<INVENTORY> 0 0
<CURRENT-ASSETS> 76,435 4,316
<PP&E> 2,576 1,165
<DEPRECIATION> (1,196) (399)
<TOTAL-ASSETS> 77,815 5,082
<CURRENT-LIABILITIES> 8,323 3,288
<BONDS> 546 327
0 10,489
0 0
<COMMON> 18 2
<OTHER-SE> 68,928 (9,025)
<TOTAL-LIABILITY-AND-EQUITY> 77,815 5,082
<SALES> 12,765 4,967
<TOTAL-REVENUES> 12,765 4,967
<CGS> 1,300 267
<TOTAL-COSTS> 1,300 267
<OTHER-EXPENSES> 17,689 8,534
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> (830) 0
<INCOME-PRETAX> (5,394) (3,834)
<INCOME-TAX> 0 0
<INCOME-CONTINUING> 0 0
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (5,394) (3,834)
<EPS-BASIC> (0.31) (0.53)
<EPS-DILUTED> 0 0
</TABLE>
