CO-BRANDED CONTENT AGREEMENT
THIS AGREEMENT ("Agreement"), effective as of December 16, 1999
("Effective Date"), is entered into by and between ZapMe! Corporation, a
Delaware Corporation with its principal offices at 3000 Executive Parkway, San
Ramon, California 94583 ("ZapMe!"), and PCS Education Systems, Inc., an Idaho
corporation with its principal offices at 1405 W. Main Street, Boise, ID 83702
("PCS").
RECITALS
WHEREAS, ZapMe! is in the business of, among other things, installing into
schools computer systems ("ZapMe! System") which run the ZapMeTM netspace, a
networked graphical user interface software and Internet content delivery
package for use by students, parents, teachers, school administrators and others
linked together by satellite and also available through ZapMe!'s www site(s)
("Sites") and ZapMe!'s take-home CD ROM ("ZapMe! Netspace"); and,
WHEREAS, PCS offers products and services suitable for access on or through
the ZapMe! Netspace; and,
WHEREAS, PCS wishes to be a supplier of products and services available on
co-branded pages on the ZapMe! Netspace ("Co-Branded Pages");
AGREEMENT
NOW, THEREFORE, in consideration of the above circumstances and of the
mutual promises and conditions contained herein, the parties agree as follows:
Section 1. TERM AND TERMINATION
1.1 Term. The Term of this Agreement shall commence on the Effective
Date and shall continue until July 31, 2001 ("Initial Term") (the
Initial Term and any renewal term, if applicable, shall be referred
to collectively as the "Term").
1.2 Renewal. This Agreement shall be renewable by mutual written
agreement of ZapMe! and PCS, for two subsequent one (1) year terms
up to July 31, 2003. The Agreement shall automatically renew
thereafter for successive one-year periods unless either party
provides 90 days written notice prior to the expiration of the term.
1.3 Early Termination. This Agreement may be terminated at any time by
either party, effective immediately upon notice, if the other party:
(a) files a petition in bankruptcy, or (b) makes an assignment for
the benefit of its creditors. Either party may terminate the
Agreement, effective upon thirty (30) days notice, in the event that
the other party breaches any of its responsibilities or obligations
under the Agreement in any material respect (including, without
limitation, failure to pay) and the breach is not remedied within
thirty (30) days following written notice to such party.
1
<PAGE>
1.4 Effect of Termination. The provisions in Section 1, 4, 5, 6, 7, and
8 shall survive any termination or expiration of the Agreement.
1.5 Implementation. The parties shall use commercially diligent efforts
to begin performance testing and implementation of the Co-Branded
Pages, products and services as described in Section 2 below.
Section 2. CO-BRANDED PAGES
2.1 Co-Branded Pages; General Terms. Following the execution of this
Agreement, ZapMe! and PCS will cooperate to develop and market the
Co-Branded Pages in a co-branded section on the terms and conditions
set forth in this Agreement. PCS shall provide co-branded products
and services as described in this Section 2 below for integration
into the Co-Branded pages on the ZapMe! Netspace utilizing the name
PCS Education Systems at ZapMe!. To the extent that it is
technically feasible, ZapMe! and PCS shall reasonably share
editorial control over the Co-Branded Pages and both parties agree
to obtain the prior, written permission of the other party before
making any material editorial changes to the content within the
Co-Branded Section. PCS retains all editorial control over all other
PCS content outside of the ZapMe! Netspace, and ZapMe! retains all
editorial control over all other content on the ZapMe! Netspace.
2.2 ZapMe! Developments and Hosting. ZapMe! shall develop and provide
hosting services for a co-branded splash page ("Splash Page"). The
Splash Pace shall be accessible from locations on the ZapMe!
Netspace index and shall provide a point-of-entry to the Co-Branded
Pages and contain a direct link to the PCS's Home Page located at
http://www.pcsedu.com/. The Splash page shall contain language,
mutually agreed upon by the parties, describing the relationship
between PCS and ZapMe!. PCS shall provide ZapMe! with a PCS logo
("PCS Logo"), which ZapMe!
shall place on the Splash Page.
2.3 PCS Developments and Hosting. PCS shall develop and host the
Co-Branded Pages, including all necessary technical support, hosting
services, technology installation, maintenance and applicable
security and other support necessary to maintain the Co-Branded
Pages on PCS's server ("PCS Developments"). The Co-Branded Pages
shall be constructed and maintained so that their average WWW page
response times shall be substantially equivalent to commercially
similar WWW pages. PCS shall construct the Co-Branded Pages so that
their user interface, style format and color layout adapts to the
ZapMe! Netspace and ZapMe!'s style, format and color layout. ZapMe!
shall provide, and PCS shall display on the top left hand comer of
all Co-Branded Pages, a ZapMe! logo approximately one (1) inch tall
by one-half (0.5) inches wide, which links directly to a page in the
ZapMe! Netspace to be determined by ZapMe! ("ZapMe! Logo"). Any
placement of the ZapMe! Logo
2
<PAGE>
on the Co-Branded Pages shall be at least equal in placement and
size to the PCS Logo.
2.4 Co-Branded Pages; Content and Materials. ZapMe! and PCS shall
cooperate to develop a co-branded version of the PCS Edventures!
product ("Edventures!"), which shall include a co-branded version of
the PCS Edventures! Term Library product ("Term Library"). In
addition, PCS shall develop a co-branded demo version of Edventures!
for the ZapMe! Netspace ("Edventures! Demo") and shall supply ZapMe!
with co-branded, Edventures! promotional materials for ZapMe!'s
distribution to ZapMe! users ("Promotional Materials"), and a free
one-week trial of the newly developed PCS engineering education
product, to be specifically customized by PCS for distribution by
ZapMe! over the ZapMe! Netspace ("Academy of Engineering Course")
(collectively "PCS Content"). PCS retains all rights with respect to
ownership of all PCS content and materials.
2.5 Co-Branded Pages; Future Developments. During the Term of the
Agreement, PCS shall update the Co-Branded Pages with any technical
upgrades, advancements and improvement as they are developed by, or
become available to, PCS. ZapMe! and PCS agree to work together in
good faith to explore the development of additional content and
features, including but not limited to additional Academy of
Engineering Courses, to be customized for the ZapMe! Netspace and
included in the Co-Branded Pages.
2.6 Co-Branded Pages; Third Party Sponsorship. ZapMe! and PCS agree to
explore, in good faith, the solicitation of third party sponsorships
for the purpose of funding Edventures! ("Third Party Sponsorships").
ZapMe! and PCS agree to cooperate, in good faith, to establish an
appropriate revenue model under which ZapMe! and PCS would share
revenue obtained from any Third Party Sponsorships of Edventures!.
PCS retains the right to review and approve all Third Party
Sponsorships under this Section 2.6, which approval will not be
unreasonably withheld.
2.7 Co-Branded Pages; Advertising. ZapMe! shall retain sole
responsibility for the sale and serving of advertising, if any, to
run on the Co-Branded Pages ("Advertising") and shall pay PCS a
percentage of Advertising revenues as outlined in Section 4 of this
Agreement. When selling Advertising,, ZapMe! agrees to act in a
manner consistent with ZapMe!'s ordinary course of business when
selling advertising- for other co-branded sections on the ZapMe!
Netspace. ZapMe! shall have final approval rights for all
Advertising to be displayed on the Co-Branded Pages.
2.8 Co-Branded Pages; E-Commerce. ZapMe! agrees to promote selected
products and services, to be mutually agreed upon by PCS and ZapMe!,
on the ZapMe! Netspace and to offer such products for sale through
the ZapMe! Netspace via links
3
<PAGE>
and a PCS phone number displayed on the Co-Branded Paces
("Products"). Products shall consist of selected PCS products and
services, including, but not limited to the following: (i) Hands-on
Academy of Engineering Course materials from PCS's partner Pitsco
LEGO Dacta as outlined in the attached Exhibit A for sale to ZapMe!
users at a price to be determined, in good faith, by ZapMe!, PCS and
Pitsco LEGO Dacta; (ii) subscriptions to PCS Edventures! products;
and (iii) PCS Academy of Engineering lab installations. PCS shall
retain responsibility for, and maintain high industry standards for
all Product inquiries, orders and fulfillment of Product orders for
PCS Products offered for purchase through the ZapMe! Netspace. PCS
shall pay ZapMe! a percentage of revenues from the sale of Products
as outlined in Section 4 of this Agreement.
2.9 PCS Marketing Initiatives. ZapMe! and PCS shall work together to
explore marketing initiatives to be presented through ZapMe!, and
subject to ZapMe!'s privacy policy, applicable law and ZapMe!'s
final approval, including but not limited to email campaigns to
teachers and school administrators, promotions on the ZapMe!
take-home CD ROM and promotions on the ZapMe! user home page.
Section 3. LICENSES
3.1 Grant of License by ZapMe!. Subject to Section 3.4, ZapMe! grants to
PCS during the Tenn a nonexclusive, royalty-free, worldwide license
to use, reproduce and publicly display ZapMe! content, if any,
provided to PCS under the terms of this agreement ("ZapMe! Content")
and the ZapMe! Logo (a) on and through the PCS Web Site in the
manner described in this Agreement, and (b) in connection with the
hosting, distribution, marketing and promotion of the Co-Branded
Pages. Any display by PCS of ZapMe!'s Logo or any other Trademarks
or logos associated with the ZapMe! or the ZapMe! Netspace
(collectively "ZapMe! Brand Features") shall be subject to the
ZapMe! Brand Guidelines listed in attached Exhibit B and as amended
from time-to-time by ZapMe! ("Brand Guidelines"). All goodwill
arising out of PCS's use of the ZapMe! Content or ZapMe! Brand
Features shall inure solely to the benefit of ZapMe!
3Grant of License by PCS. Subject to Section 3.4, PCS grants to
ZapMe! during the Tenn a nonexclusive, royalty-free, worldwide
license to use, reproduce, publicly display, and publicly perform
the Academy of Engineering Course, Edventures, Edventures Demo, Tenn
Library, Promotional Materials, the PCS Logo and any other
co-branded PCS products, content or logos displayed on the
Co-Branded Pages (collectively "PCS Brand Features") (a) on and
through the ZapMe! Netspace in the manner described in this
Agreement, and (b) in connection with the hosting, distribution,
marketing and promotion, if any, of the Co-Branded Pages. All
goodwill arising out of ZapMe!'s use of any of the PCS Brand
Features shall inure solely to the benefit of PCS.
4
<PAGE>
3.3 Reserved Rights. Without limitation of the foregoing, each party
reserves all rights other than those expressly granted in this
Agreement, and no licenses are granted except as expressly set forth
herein.
3.4 Approval of Trademark Usage. ZapMe! shall not use or exploit in any
manner the PCS Brand Features, and PCS shall not use or exploit in
any manner any of the ZapMe! Brand Features, except in such manner
and media as may be specified in this Agreement, in Brand
Guidelines, or as the other party may consent to in writing, which
consent shall not be unreasonably withheld or delayed. Either party
may revoke or modify any such consent upon written notice to the
other party.
3.5 Promotion of Co-Branded Pages. Commencing upon the date of this
Agreement and thereafter throughout the Term, ZapMe! and PCS will
use their commercially reasonable efforts, subject to the terms of
this Agreement, to generally promote and market the Co-Branded Pa-es
and Products.
Section 4. COMPENSATION AND REPORTING
4.1 Payments and Accounting.
4.1.1 ZapMe! and PCS Payments. As compensation for performance of
PCS's responsibilities hereunder, ZapMe! shall pay PCS thirty
(30) percent of Advertising revenue collected for advertising
sold for, and displayed in the Co-Branded Pages. As
compensation for performance of ZapMe!'s responsibilities
hereunder, PCS shall pay ZapMe! according to the revenue
sharing scale in the attached Exhibit C.
4.1.2 Payments, Invoicing and Reports. Each party to this Agreement
shall provide the other with monthly sales reports detailing
the amount owed by the other party within five (5) days
following the month-end. PCS and ZapMe! shall remit all
payments due pursuant to this Section 4 within thirty (30)
days from the end of the month in which the payments were
earned. In addition, PCS shall provide ZapMe! a detailed
monthly report listing the requests for information and
inquiries made to PCS through the ZapMe! Netspace regarding
Academy of Engineering product and lab installation sales.
This report shall be submitted to ZapMe! not later than the
third day of the month following the month end in which the
ZapMe! Fees were earned (See example report in Exhibit D).
4.2 Records and Audit; Late Payments. During the Term and for a
period of one (1) year thereafter, PCS and ZapMe! shall
maintain accurate records regarding the sums payable under
this Agreement. Either party, at its expense, and upon ten
(10) days' advance notice to the other party, shall have
5
<PAGE>
the right, not more than once during, any twelve (12) month
period, to examine or audit such records in order to verify
the figures reported in any monthly report and the amounts
owed under this Agreement. Any such audit shall be conducted,
to the extent possible, in a manner that does not interfere
with the ordinary business operations of the Party being
audited. In the event that any audit shall reveal an
underpayment, the party in arrears shall pay to the other
party the amount of such underpayment plus interest thereon at
the rate of one and one-half percent (1.5%) per month (or, if
lower, the maximum rate permitted by law) and, if the amount
of such underpayment is more than five percent (5%) of the
amount due, will reimburse the auditing party for the cost of
such audit. With regard to the sums payable under this
Agreement, a good faith determination by the reporting party
regarding the amount of the Revenue Share payable to the
receiving party shall be final and binding.
Section 5. OWNERSHIP
5.1 PCS. As between the parties, PCS retains all night, title and
interest in and to the PCS Web Site, PCS Developments, PCS Products,
PCS Brand Features and PCS Content, along with all Intellectual
Property Rights associated with any of the foregoing.
5.2 ZapMe!. As between the parties, ZapMe! retains all n'cyht, title and
interest in and to the ZapMe! Netspace, including, without
limitation, the ZapMe! Developments, any and all ZapMe! Content and
the Co-Branded Pages (other than PCS Content, PCS Products and PCS
Brand Features), all data, URLs, domain names, technology, hardware,
software, code, techniques, algorithms, processes, user interfaces,
Intellectual Property Rights, and any other items posted thereon or
used in connection or associated therewith and the ZapMe! Brand
Features, along with all Intellectual Property Rights associated
with any of the foregoing.
5.3 User Information. PCS shall collect all information necessary to
operate the Co- Branded Pages and Products and to take and fulfill
all orders for PCS Products. PCS shall only collect such information
in a manner consistent with applicable law and its privacy policy.
ZapMe! shall have the right, at its election and consistent with its
privacy policy and applicable law, to obtain and use this
information and any other information collected by PCS in connection
with the Co-Branded Pages. PCS shall not use any personally
identifying information collected from ZapMe! users in connection
with the operation of the Co-Branded Pages and Products and sale of
Products to (1) market to ZapMe! users; (2) otherwise contact ZapMe!
users except to the extent necessary to satisfy PCS's obligations
under this Agreement; or (3) give, sell or distribute personally
identifying or other information collected in connection with the
Co-Branded Pages and Products without ZapMe!'s prior written
permission.
6
<PAGE>
5.4 Other Trademarks. ZapMe! shall not register or attempt to register
any of the PCS Logos or marks or any trademarks which PCS reasonably
deems to be confusingly similar to any of the PCS Logos or marks.
PCS shall not register or attempt to register any of the ZapMe!
Logos or marks or any Trademarks which ZapMe! reasonably deems to be
confusingly similar to any of the ZapMe! Logos or marks.
5.5 Notices. Each party agrees to display mutually agreeable trademark
and copyright notices or legends of the other party when using such
other party's logos, marks or brand features. Each party shall in
advance submit to the other party the proposed placement of such
notices or legends (including, without limitation, the place and
manner of incorporation into electronic media or transmissions), and
such other party shall have the right, acting reasonably, to
disapprove the same within fifteen (15) days notice of a trademark
or copyright notice or legend.
5.6 Further Assurances. Each party shall take, at the other party's
expense, such action (including, without limitation, execution of
affidavits or other documents) as the other party may reasonably
request to effect, perfect or confirm such other party's ownership
interests and other rights as set forth above in this Section 5.
Section 6. REPRESENTATIONS AND WARRANTIES; INDEMNITY
6.1 Representation and Warranties. Each party to this Agreement
represents and warrants to the other party that: (a) such party has
the full corporate right, power and authority to enter into this
Agreement and to perform the acts required of it hereunder;
including but not limited to the provision of content, Trademarks
and other Intellectual Property Rights; (b) the execution of this
Agreement by such party, and the performance by such party of its
obligations and duties hereunder, do not and will not violate any
agreement to which such party is a party or by which it is otherwise
bound; (c) when executed and delivered by such party, this Agreement
will constitute the legal, valid and binding obligation of such
party, enforceable against such party in accordance with its terms;
(d) such party will conduct its business, and perform its
obligations and exercise its rights hereunder, in a manner which
reflects favorably upon the name and reputation of the other party
and will not take any action or make any omission which could
reasonably harm the goodwill of the other party; and (e) 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.
6.2 Indemnity ZapMe!. ZapMe! will defend, indemnify and hold harmless
PCS from and against any and all claims, costs, losses, damages,
judgments and expenses (including reasonable attorneys' fees and
costs) arising out of or in connection with the ZapMe! Logo, ZapMe!
Brand Features, ZapMe! Content or any actual or alleged breach of
any of ZapMe!'s representations and warranties set forth in Section
7
<PAGE>
6.1 above. PCS shall promptly notify ZapMe! of any third-party claim
of which it becomes aware for which its seeks indemnification and
shall: (a) at ZapMe!'s expense, provide reasonable cooperation to
ZapMe! in connection with the defense or settlement of any such
claim; and (b) at PCS' expense, be entitled to participate in the
defense of any such claim. ZapMe! shall not acquiesce to any
judgment or enter into any settlement that adversely affects PCS'
rights or interests or agree to any obligation on behalf of PCS
without prior written consent of PCS.
PCS. PCS will defend, indemnify and hold harmless ZapMe! from and
against any and all claims, costs, losses, damaaes, judgments and
expenses (including reasonable attorneys' fees and costs) an'sing
out of or in connection with the PCS Web Site, PCS Developments, PCS
Content, PCS Brand Features or any actual or alleged breach of any
of PCS's representations and warranties set forth in Section 6.1
above. ZapMe! shall promptly notify PCS of any third-party claim of
which it becomes aware for which it seeks indemnification and shall:
(a) at PCS' expense, provide reasonable cooperation to PCS in
connection with the defense or settlement of any such claim; and (b)
at ZapMe!'s expense, be entitled to participate in the defense of
any such claim. PCS shall not acquiesce to any judgment or enter
into any settlement that adversely affects ZapMe!'s rights or
interests or agree to any obligation on behalf of ZapMe! without
prior written consent of ZapMe!
Section 7. EXCLUSIONS; NO LIABILITY
7.1 WARRANTIES EXCLUDED.
EXCEPT AS SET FORTH IN SECTION 6.1, NEITHER PARTY MAKES ANY
REPRESENTATIONS OR WARRANTIES OF ANY KIND, EXPRESS OR
IMPLIED, IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING: (A) ZAPME! MAKES NO
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE ZAPME!
NETSPACE, ZAPME! BRAND FEATURES, ZAPME! DEVELOMENTS OR
ANY OTHER ITEMS OR SERVICES PROVIDED BY ZAPME!, INCLUDING,
WITHOUT LIMITATION, ANY IMPLIED WARRANTY ARISING BY USAGE
OF TRADE, COURSE OF DEALING OR COURSE OF PERFORMANCE, ANY
IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE AND ANY IMPLIED WARRANTY OF
NON-INFRINGEMENT; AND (B) PCS ACKNOWLEDGES THAT THE ZAPME!
NETSPACE, INCLUDING ANY SERVERS OR OTHER HARDWARE,
SOFTWARE AND ANY OTHER ITEMS USED OR PROVIDED BY ZAPME! IN
CONNECTION WITH THE ZAPME! NETSPACE) AND ZAPME! BRAND
FEATURES ARE PROVIDED "AS IS" AND THAT ZAPME! MAKES NO
WARRANTY THAT THE ZAPME! NETSPACE WILL BE FREE FROM BUGS,
8
<PAGE>
FAULTS, DEFECTS OR ERRORS OR THAT ACCESS TO THE ZAPME!
NETSPACE WILL BE UNINTERRUPTED.
7.2 LIMITATION OF LIABILITY.
EXCEPT FOR THE INDEMNITY OBLIGATIONS SET FORTH IN SECTION 6 ABOVE,
NEITHER PARTY WILL BE LIABLE FOR ANY LOSS OF USE, LOST
OPPORTUNITIES, INTERRUPTION OF BUSINESS, LOST PROFITS, OR ANY
INDIRECT, SPECIAL, OR INCIDENTAL DAMAGES OF ANY KIND REGARDLESS OF
THE FORM OF ACTION WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE),
STRICT PRODUCT LIABILITY, OR OTHERWISE, EVEN IF IT HAS BEEN ADVISED
OF THE POSSIBILITY OF SUCH DAMAGES. THE PARTIES ACKNOWLEDGE AND
AGREE THAT THIS SECTION IS AN ESSENTIAL ELEMENT OF THE AGREEMENT AND
THAT THE FOREGOING DAMAGE LIMITATION SHALL APPLY EVEN IF THE PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND THAT THIS
AGREEMENT IS PREDICATED ON THIS LIMITATION OF LIABILITY.
Section 8. GENERAL PROVISIONS
8.1 Notices. Any notice required or permitted by this Agreement shall be
in writing, and shall be deemed sufficient upon receipt, when
delivered personally or by courier, overnight delivery service,
confirmed facsimile, or electronic mail (confirmed by concurrent
written notice sent first class U.S. mail, postage prepaid), or
forty-eight (48) hours after being deposited in the regular mail as
certified or registered mail (airmail if sent internationally) with
postage prepaid, if such notice is addressed to the party to be
notified at such party's address or facsimile number as set forth in
the Aereement.
Notices and payments should be addressed as follows:
For ZapMe!:
ZapMe! Corporation
Att: Accounts Receivable
3000 Executive Parkway, Suite 150
San Ramon. California 94583
Fax: (925) 543-0301
For PCS:
PCS Education Systems, Inc.
1405 W. Main Street
Boise, Idaho 83702
9
<PAGE>
8.2 Confidentiality. ZapMe! and PCS hereby acknowledge that in the
course of activities under this Agreement, each of them may have
access to confidential and proprietary information which relates to
the other party's technology, marketing and business (the
"Confidential Information"). In addition to reaffirming the Mutual
Confidentiality and Nondisclosure Agreement between the Parties
dated September 2, 1999 ("NDA"), each party agrees to preserve and
protect the confidentiality of the Confidential Information and not
to disclose any applicable Confidential Information to any third
party without the prior written consent of the other party;
provided, however, that any party hereto may disclose to any other
party any information which the receiving party demonstrates is: (1)
already publicly known through no fault of the receiving party; (ii)
discovered or created by the receiving party without reference to
the Confidential Information, as shown in records of such party; or
(iii) otherwise learned through legitimate means, other than from a
third party under confidentiality obligations. Moreover, either
party may disclose any Confidential Information to (a) such party's
agents, attorneys and other representatives only to the extent
necessary for the receiving party's business operations and only
upon securing the agreement of the agents, attorneys or other
representatives to the terms of this Section 8.2, or (2) any entity
under legal compulsion, provided that in such case the receiving
party shall give the disclosing party prompt notice and, if
requested, reasonable assistance in opposing disclosure.
8.3 Amendments and Waivers. Any term of this Agreement may be amended or
waived only with the written consent of the parties or their
respective successors and assigns. Any amendment or waiver effected
in accordance with this Section 8.3 shall be binding upon the
parties and their respective successors and assigns.
8.4 Successors and Assigns. Neither party may assign this Agreement, in
whole or in part, without the other party's written consent;
provided, however, that either Party may assign this Agreement
without such consent in connection with: (a) any reincorporation,
merger, consolidation, any sale of all or substantially all of such
Party's assets; or (b) any other transaction in which more than
fifty percent (50%) of such Party's voting securities are
transferred; or (c) to an Affiliate of such Party provided in each
case the assignee assumes all of the obligations and liabilities of
the assignor subject to all of the terms of this Agreement. Any
attempt to assign this Agreement other than in accordance with this
provision shall be null and void.
8.5 Governing Law. This Agreement and all acts and transactions pursuant
hereto and the rights and obligations of the parties hereto shall be
cyovemed, construed and interpreted in accordance with the laws of
the State of California, without giving effect to principles of
conflicts of law.
10
<PAGE>
8.6 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of
which together shall constitute one instrument.
8.7 Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered
in construing or interpreting this Agreement.
8.8 Severability. If one or more provisions of this Agreement are held
to be unenforceable under applicable law, the parties agree to
renegotiate such provision in good faith, in order to maintain the
economic position enjoyed by each party as close as possible to that
under the provision rendered unenforceable. In the event that the
parties cannot reach a mutually agreeable and enforceable
replacement for such provision, then (i) such provision shall be
excluded from this Agreement, (11) the balance of the Agreement
shall be interpreted as if such provision were so excluded and (111)
the balance of the Agreement shall be enforceable in accordance with
its terms.
8.9 Entire Agreement. This Agreement is the product of both of the
parties hereto, and constitutes the entire agreement between such
parties pertaining to the subject matter hereof, and merges all
prior negotiations, drafts of, and the Memo of Understanding between
the parties with regard to the transactions contemplated by this
Agreement. Any and all other written or oral agreements existing
between the parties gr hereto regarding such transactions are
expressly canceled.
8.10 Arbitration. Any dispute or claim arising out of or in connection
with this Agreement will be fully and finally settled by binding
arbitration in San Francisco, California in accordance with the
then-current Commercial Arbitration Rules of the American
Arbitration Association by three arbitrators appointed in accordance
with said rules. Each party shall select one such arbitrator, and
the two arbitrators so chosen shall select the third arbitrator. The
arbitrators shall apply California law, without reference to rules
of conflicts of law or rules of statutory arbitration, to the
resolution of any dispute. Judgment on the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof.
Notwithstanding the foregoing, the parties may apply to any court of
competent jurisdiction for preliminary or interim equitable relief,
or to compel arbitration in accordance with this paragraph, without
breach of this arbitration provision.
8.11 Advice of Legal Counsel. Each party acknowledges and represents
that, in executing this Agreement, it has had the opportunity to
seek advice as to its legal riahts from legal counsel and that the
person signing on its behalf has read and understood all of the
terms and provisions of this Agreement. This Agreement shall not be
construed against any party by reason of the drafting or preparation
thereof.
11
<PAGE>
8.12 No Partnership Implied; Future Business Activity. Neither this
Agreement nor any terms and conditions contained herein may be
construed as creating, or constituting a partnership, joint venture
or agency relationship between the parties. This Agreement shall not
limit either party's present or future business activities of any
nature, including business activities which could be competitive
with the other party, except to the extent such activities would
involve a breach of (a) the confidentiality provisions of Section
9.2 above or (b) any other express provision of this Agreement.
The parties have caused this Acreement to be executed by their duly
authorized representatives as of the date first written above.
ZAPME! CORPORATION PCS EDUCATION SYSTEMS, INC.
By: /s/ Bruce D. Bower By: /s/ Anthony Maher
--------------------------------- -----------------------------------
Title: Vice President and General Title: Chairman, President and CEO
Counsel
Address: Address:
------------------------ ---------------------------
3000 Executive Parkway 1405 W. Main Street
San Ramon, CA 94583 Boise, ID 83702
12
