Exhibit
10.37


 


	
  EXECUTION

  	
   

  	
  CONFIDENTIAL

  



 


THIRD
ADDENDUM TO OVERTURE SEARCH SERVICES AGREEMENT


 


This Third Addendum (the
“Third Addendum”) is effective as of April 25, 2003 (the “Third Addendum
Effective Date”) and entered into by and between Overture Services, Inc.
(“Overture”), a Delaware corporation with offices at 74 North Pasadena Avenue,
3d Floor, Pasadena, CA 91103, and Yahoo! Inc. (“Yahoo”), a Delaware corporation
with offices at 701 First Avenue, Sunnyvale, CA 94089, in connection with the
Overture Search Services Agreement effective as of May 1, 2002 and entered into
by and between Overture and Yahoo, as amended by the First Addendum to Overture
Search Services Agreement effective as of October 1, 2002 and the Second
Addendum to Overture Search Services Agreement effective as of January 10, 2003
(collectively referred to as the “Agreement”).


 


RECITALS


 


WHEREAS, the Agreement
provides for, among other things, the delivery by Overture and the display by
Yahoo of sponsored search results in response to search queries conducted
through Yahoo’s principal, U.S. targeted directory to the World Wide Web.


 


WHEREAS, the parties
anticipate expanding their strategic relationship such that Overture will
provide Yahoo with [*] sponsored search results (the “[*] Results”) in response
to [*] search queries (the “[*] Queries”) conducted on http://www.yahoo.com or
on any Yahoo Foreign Property as determined by Yahoo and Overture, and the
parties will share revenue generated from these [*] Results in accordance with
this Third Addendum, as further described herein.


 


NOW, THEREFORE, in consideration of the mutual
promises and conditions contained herein, and for good and valuable
consideration, the parties agree as follows:


 


AGREEMENT


 


1.               Capitalized terms
not defined herein have the meanings set forth in the Agreement.


 


2.               Section 4.2(a) in
the Agreement is deleted and replaced with the following:


 


(a)          [*] Overture Results.


 


(i)  Provision of [*] Results;
Implementation.  Commencing upon
delivery of five days prior written notice to Overture of Yahoo’s intention to
implement the [*] Results on Yahoo Search (the “[*] Launch Date”), upon receipt
by Overture of a Yahoo Search Query that (a) Overture determines to be an [*]
Query and (b) contains a [*] provided by Yahoo that indicates the [*]
Results, Overture will deliver [*] Results to Yahoo for implementation on Yahoo
Search in accordance with subpart (ii) below. 
The manner of implementation of [*] Results on Yahoo Search will be determined
by [*], and will not be subject to [*] or specifications regarding [*]).  Without limiting the foregoing, Yahoo will,
on the [*] Launch Date only, display Yahoo Search Results Pages containing [*]
Results in a manner substantially similar to the U.S. Implementation as of the
[*] Launch Date.  Upon the mutual
agreement of the parties, Yahoo may implement the [*] Results in other areas of
the Yahoo Network.  Overture will
deliver [*] Results solely for [*] Queries unless otherwise instructed by Yahoo
in writing.  Overture will send Yahoo an
updated list of proposed modifications to the [*] keyword list on a regular
basis during the Term as mutually determined by the parties (but no less
frequently than on a monthly basis), and Yahoo will have the opportunity to
approve such modifications prior to implementation by Overture.  Yahoo will have final editorial review over
any modifications to the [*] keyword list that is used to deliver [*]
Results.  Such editorial review shall be
exercised consistently with Yahoo’s company-wide [*] concerning [*] content.


 


(ii)  [*]. 
Yahoo will include a [*] on each Yahoo Search Query which indicates
whether the [*] Results.  If the [*]
indicates that a [*] Results, then Overture will suppress [*] Results, at a
minimum, to the same degree as the [*] that appear on the Overture Site as of
the Third Addendum Effective Date and will send to


 












*                      Certain
information on this page has been omitted and filed separately with the
Commission.  Confidential treatment has
been requested with respect to the omitted portions.


 


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Yahoo such [*] Overture
Results.  If the [*] indicates that a
[*] Results, Overture will determine whether to return [*] Results for such
Yahoo Search Query in accordance with subpart (i) above.


 


(iii)  Separate Feed; Reporting; Guaranteed
Impressions.  As of the Third
Addendum Effective Date, Overture will account for the [*] Results as a
separate line item in any reports required hereunder.  Any reports for [*] Results will include CTR in the aggregate by
search result position.  Yahoo will
provide Overture with the same information at the time-of-search for each [*]
Query as it does for the U.S. Implementation, and Overture will be entitled to
use and disclose that information subject to the use and disclosure
restrictions set forth in this Agreement. 
Overture will include a [*] identifying each [*] Result as provided by
either an [*] Advertiser or a [*] Advertiser. 
Finally, Yahoo will have no obligation to deliver Guaranteed Impressions
pursuant to Section 9 of this Agreement with respect to the [*] Results.  Impressions delivered pursuant to the Third
Addendum shall not count towards the number of Guaranteed Impressions delivered
by Yahoo under Section 9 of this Agreement.


 


(iv)  Cancellation; Suspension of [*]
Service.  Yahoo has the right to
cancel the delivery or suspend the display of [*] Results at any time upon
written notice provided to Overture (which notice can be via email to
legal@overture.com) within one business day of such cancellation or suspension.  In the event that Yahoo either has cancelled
delivery or suspended its display of [*] Results, then Overture will suppress
[*] Results, at a minimum, to the same degree as the [*] that appear on the
Overture Site as of the Third Addendum Effective Date.  Upon receipt by Overture of an [*] Query for
which Overture has [*] Overture Results, Overture will send to Yahoo such [*]
Overture Results.  For all other [*]
Queries, Overture shall not return any [*] Results, and if Overture does send
an [*] Result, then Yahoo shall be entitled to [*] such [*] Result from being
displayed pursuant to Section 4.5(a) of this Agreement.


 


(v)  Other [*] Service Providers.  The parties acknowledge and agree that,
subject to Section 7.1(b), which Section shall apply to [*] Queries, [*].


 


3.               The following
subsection is added to the end of Section 4.5 (“Removal by Yahoo; Potential
Liability; Excluded Terms; Contextual Relevance”) of the Agreement:


 


(c)          [*] Results.  As it consistently administers its
company-wide [*] concerning [*] content, Yahoo will have the right to prevent
the display of [*] Results in response to [*] Queries at any time during the
Term.


 


4.               Payment.  Overture will make payments to
Yahoo for Gross Revenue earned pursuant to this Third Addendum in accordance
with the following:


 


4.1         Revenue Share Payments.  Overture will make Quarterly revenue share
payments to Yahoo based on Gross Revenue earned from [*] Results (the “[*]
Gross Revenue”) in the applicable Quarter according to the schedule set forth
below.  For purposes of calculating [*]
Gross Revenue, in determining the amount for subpart (i) in the definition of
Gross Revenue, the parties shall use Overture’s actual amounts for bad debt and
credit card processing fees, which amounts will not exceed [*]%.  In calculating the [*] Gross Revenue, the
remainder of the definition of Gross Revenue remains unchanged.  For clarity, for all Gross Revenue other
than [*] Gross Revenue, the definition of Gross Revenue remains unchanged.  Payments are due and payable to Yahoo within
[*] days after the end of the applicable Quarter.


 


[*]


 


Overture will retain all
revenue that it derives from the [*] Results, except as specifically set forth
in this Third Addendum.


 


4.2         Payment Mechanics.  Overture will make payments to Yahoo in U.S.
dollars via wire transfer into Yahoo’s main account according to the
instructions set forth below:


 












*                      Certain
information on this page has been omitted and filed separately with the
Commission.  Confidential treatment has
been requested with respect to the omitted portions.


 


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[*]


 


4.3         Late Payments.  Any undisputed payment that is paid more
than [*] days late will bear interest at the rate of [*]% per month.


 


4.4         Audit Rights and Data
Rights.  Except as expressly set
forth herein or as otherwise agreed by the parties in writing, the audit rights
and data rights and obligations for the [*] Results will mirror the rights and
obligations set forth in Sections 8.4 (including Exhibit F) and 8.5 of
the Agreement.


 


4.5         No Payment Adjustments.  The parties acknowledge and agree that the
delivery of [*] Results will be tracked separately from the delivery of all
other Overture Results in Yahoo Search, and that the [*] Results will not be
included in the calculation of Impressions, Coverage, PPC, CTR or of
adjustments to the Estimated Yahoo Payment or the Guaranteed Fixed Payment
under the Agreement.


 


5.               Term and
Termination.


 


5.1         Term.  This Third Addendum will become effective as
of the Third Addendum Effective Date and, unless terminated as set forth
herein, will remain effective for the same period as the Agreement remains
effective.


 


5.2         Termination
in connection with Agreement. 
This Third Addendum will terminate to the extent that the Agreement is
terminated in accordance with its terms, effective as of the effective date of
termination of the Agreement.


 


5.3         Termination
with Cause.  If either
party breaches this Third Addendum in any material respect, and that party does
not cure its breach within [*] after written notice by the non-breaching party
of its breach, then the non-breaching party will be entitled to terminate this
Third Addendum immediately upon written notice to the breaching party after
failure to cure within those [*].  The
parties acknowledge and agree that a breach under this Third Addendum will not
affect the Agreement, regardless of whether the breach gives rise to
termination of this Third Addendum.


 


5.4         Termination
by Overture.  Overture may
terminate this Third Addendum for [*] upon providing Yahoo with [*] prior
written notice.


 


5.5         Effect of
Termination.  Sections 1,
4 (with respect to payments accrued during the Term), and 6 through 8 of this
Third Addendum will survive termination or expiration of this Third Addendum.


 


6.               Notice of [*]
Content.  Yahoo will use
commercially reasonable efforts to provide prompt written notice (as set forth
in Section 16.1 of the Agreement) to Overture whenever a third party has
notified Yahoo that any content appearing on the Yahoo Search Results Pages
that include [*] Results or the content of [*] Advertiser web sites linked to
from [*] Results contains content that violates any applicable law, rule or
regulation or infringes the rights of any third party, including but not
limited to intellectual property rights, privacy and publicity rights, claims
of defamation, false or deceptive advertising claims, consumer fraud or would
otherwise violate Yahoo’s company-wide [*] concerning [*] content.


 


7.               Overture
Warranties.  As of this Third
Addendum Effective Date, Overture represents and warrants that it has
implemented a screening policy whereby it screens the Advertiser web page that
is directly linked to from the [*] Result as part of the initial registration
process in an effort to exclude from [*] Results web sites that contain the
following [*].


 


8.               Overture
Screening Policy Covenant. 
Overture’s screening policies are subject to change during the Term;
however, (1) Overture will provide Yahoo with prompt written notice of any
change to its [*] content screening policy, and (2) during the Term, Overture
will use commercially reasonable efforts to exclude [*] Results (at the point
in time such [*] Results go through the initial registration process described
in Section 7) that directly link


 












*                      Certain
information on this page has been omitted and filed separately with the
Commission.  Confidential treatment has
been requested with respect to the omitted portions.


 


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to a web page that
contains the [*] content listed in Section 7. 
To the extent that Yahoo does not approve of a change to Overture’s [*]
screening policy, then Yahoo may exercise its right of cancellation as set
forth in Section 4.2(a)(iv) of this Agreement. 
If Yahoo has not exercised this cancellation right after receiving
notice from Overture as described in this Section, then Overture shall be
deemed to have complied with its continuing obligations to use commercially
reasonable efforts to exclude [*] Results that would otherwise violate this
Section.


 


9.               Press Release
and Public Statements.  Each party
is expressly prohibited from making any press release or public statement
related to either party’s performance under this Third Addendum without the
other party’s prior written approval.


 


10.         Replacement of
“Fraudulent Clicks” with “Invalid Clicks”. 
All instances of “Fraudulent Clicks” in this Agreement is hereby
replaced with the term “Invalid Clicks”.


 


11.         Exclusion of Certain
Provisions of the Agreement.   For
purposes of clarity, Sections 2.5, 3.2, 4.3(a) and (b), 5.1, 5.2, 7.1(a), 8.1
through 8.3, 8.6 through 8.9 and 9 of the Agreement will not apply to this
Third Addendum solely to the extent that such provisions apply to [*] Queries
and the display of [*] Results within the Yahoo Network.


 


[signature page
follows]


 












*                      Certain
information on this page has been omitted and filed separately with the
Commission.  Confidential treatment has
been requested with respect to the omitted portions.


 


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IN WITNESS WHEREOF, the
parties have caused this Third Addendum to be executed by their duly authorized
representatives as of the Third Addendum Effective Date.


 


 


	
  YAHOO! INC.

  	
  OVERTURE SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Jeff Weiner

  	
   

  	
  By:

  	
  /s/ Bill Demas

  	
   

  
	
  Name:

  	
  Jeff Weiner

  	
  Name:

  	
  Bill Demas

  
	
  Title:

  	
  Senior Vice President,
  Search and Marketplace

  	
  Title:

  	
  Senior Vice President
  & General Manager, Affiliate Business Group

  
						



 


 


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