Document:

EX-10.40

 

Exhibit 10.40

Conformed Copy

INTERACTIVE SERVICES AGREEMENT

          This Interactive Services Agreement (the “Agreement”), effective as of May 9, 2001 (the
“Effective Date”), is between America Online, Inc. (“AOL”), a Delaware corporation, with offices at
22000 AOL Way, Dulles, Virginia 20166 and WebMD Corporation (“WebMD”), a Delaware corporation, with
offices at 669 River Drive, River Drive Center 11, Elmwood Park, NJ 07407. AOL and WebMD may be
referred to individually as a “Party” or collectively as the “Parties.”

INTRODUCTION

          AOL and WebMD each desire to enter into a relationship whereby (i) WebMD will be AOL’s premier
provider of content and programming for the Health Channels of the AOL Properties, (ii) WebMD will
develop, program, and distribute a co-branded interactive site referred to (and further defined) as
the Customized Site, and a co-branded area for personalized health content and services known as My
Health, (iii) AOL will promote and distribute the Health Channels, My Health, the Customized Site
and Customized Programming, (iv) WebMD will promote AOL and the availability of the Customized
Site, Customized Programming and My Health on the AOL Properties through an off-line marketing
plan, and (v) both AOL and WebMD shall share revenues earned from the Health Channels, My Health,
the Customized Site, and Customized Programming. This relationship is further described below and
is subject to the terms and conditions set forth in this Agreement. Capitalized terms used but not
defined in the body of the Agreement will be as defined on Exhibit B.

TERMS

	1.	 	PROMOTIONAL OBLIGATIONS.

	 	1.1	 	AOL Promotion of WebMD, Health Channels, My Health, and the Customized
Site.

	 	1.1.1	 	Basic Promotion. Beginning on a mutually agreed upon
date(s) after the Effective Date, AOL shall extensively promote My Health, the
Health Channels, the Customized Site and/or Customized Programming throughout
the AOL Properties as set forth in the carriage plan in Exhibit A-1 (“Carriage
Plan”). The Parties hereby acknowledge and agree that the Carriage Plan will
be modified from time to time throughout the term of this Agreement to reflect
expanded, different, and/or additional promotional opportunities that AOL may
provide to WebMD based upon programming changes. AOL and WebMD shall meet at
least once per quarter to work in good faith to identify ways in which to
ensure that the promotions being provided to WebMD and that the programming
that WebMD is providing to AOL under this Agreement are being optimized. In
their discussions, the Parties acknowledge that optimization decisions
regarding expanded, additional and/or different promotional opportunities shall
be subject to inventory availability (including without limitation,
availability limited by AOL’s then-existing exclusivity or preferential

 

	 	 	Pages where confidential treatment has been
requested are stamped, “Confidential treatment has been requested. The
redacted material has been separately filed with the
Commission.” All redacted material has been marked by an
asterisk (*).

 

 

	 	 	 	relationships) as reasonably determined by AOL and subject to AOL’s
then-Standard switching guidelines. The promotions set forth in the
Carriage Plan and any promotions provided to WebMD under this Agreement
shall be referred to as the “Promotions.” The Promotions shall link to the
Health Channels, My Health, the Customized Site, and/or Customized
Programming. Notwithstanding the foregoing, AOL shall, at a minimum,
provide WebMD with the following:

	 	(i)	 	The Promotions set forth in the Carriage Plan;
	 
	 	(ii)	 	Programming consistent with the guidelines set
forth in Exhibit A-2 (the “Programming Plan”); and
	 
	 	(iii)	 	AOL shall deliver, using the counting
methodology set forth in the Carriage Plan, * Impressions
from the promotion of WebMD Presences on the AOL Network (the
“Impressions Target”) according to the “total content and media
impressions” target set forth in the Carriage Plan, provided that only
WebMD Presences that contain a link to the Health Channels, My Health,
the Customized Site and/or Customized Programming will count against
the Impressions Target. In the event that the Impressions Target is
not met (or will not, in AOL’s reasonable judgment, be met) during the
term, then as WebMD’s sole remedy, at AOL’s option either (a) the Term
shall be extended for up to six months without WebMD providing AOL with
any additional In-kind Promotions, (b) AOL shall, from time to time,
provide WedMD with the remaining Impressions in the form of advertising
space within the AOL Represented Advertising of comparable value to the
undelivered Impressions (as reasonably determined by AOL) on the AOL
Network, or (c) some combination thereof.

	 	1.1.2	 	Off-line Promotional Programs. Immediately following
the execution of this Agreement, representatives of WebMD and AOL will meet to
discuss and identify convergent promotional opportunities resulting from the
merger of America Online, Inc. and Time Warner, Inc. Such opportunities are
anticipated to include combining television, print and online media which could
be utilized to promote WebMD, the Customized Site, Customized Programming, the
Health Channels, My Health and the development of content and programming for
distribution over various media platforms. WebMD and AOL will work together in
good faith to identify and pursue such opportunities where the Parties can
mutually agree upon all terms and conditions.

 

	 	 	Confidential treatment has been requested. The
redacted material has been separately filed with the Commission.

2

 

	 	1.2	 	Programming and Content.
	 
	 	 	 	AOL shall integrate the Customized Site, My Health, and Customized Programming into
the Health Channels in accordance with the guidelines and principals set forth in
the Programming Plan attached hereto as Exhibit A-2. The Parties agree to meet at
least once every quarter to discuss in good faith the evolving development of
programming for the Health Channels, My Health, the Customized Site and Customized
Programming and potential modifications to the Programming Plan as mutually agreed
upon. WebMD shall ensure that the Licensed Content within the Health Channels, My
Health, the Customized Site, and/or Customized Programming is equal to or better
than the Content programmed and/or distributed by WebMD through any other WebMD
Interactive Site in all material respects, including without limitation, quality,
breadth, depth, timeliness, and functionality, except that, with respect to
sponsored content, WebMD has no obligation to place such content on any WebMD
Interactive Site, including the AOL Properties, unless the sponsor has paid for
placement. With respect to products and services offered by WebMD in the Health
Channels, My Health, the Customized Site, and/or Customized Programming, WebMD shall
ensure that the features, prices, terms and conditions offered to AOL Members for
such products and services shall in all material respects be equal to or better than
similar products and services offered by WebMD through any other WebMD Interactive
Site, except that, with respect to sponsored products and services, WebMD has no
obligation to place such products and services on any WebMD Interactive Site,
including the AOL Properties, unless the sponsor has paid for placement.
Notwithstanding the foregoing, WebMD shall not be required to comply with the
immediately preceding two sentences to the extent such compliance would require
WebMD to violate another provision of this Agreement. The specific promotional
content or content within banners, text links, etc. (the “Promo Content”) to be
contained within the Promotions will be reasonably determined by WebMD subject to
AOL’s reasonable prior approval, AOL’s then-Standard advertising policies, and the
terms and conditions of this Agreement.

	 	1.2.1	 	Integration of Content of AOL Partners. In addition
to the requirements set forth above, upon AOL’s reasonable request and subject
to the terms and conditions of this Agreement, WebMD, in its reasonable
discretion, will integrate Content of existing AOL partners into My Health, the
Customized Site, and/or the Customized Programming.

	 	1.3	 	License. WebMD hereby grants, for the Term of this Agreement, a
non-exclusive license to AOL and its Affiliates and AOL Members (subject to AOL’s
Standard Members Terms of Service) for all such rights as are necessary to permit each
of them, on a worldwide basis, to use, copy, modify (subject to the terms of this
Agreement), translate, execute, display, perform, distribute, transmit, broadcast in any
fashion, through any means, to any party, as part of the AOL Network, including, but
not limited to all content, features, technologies, materials, components, branding,
and other parts thereof and including but not limited to by

3

 

	 	 	 	way of AOL hosting the
Customized Programming on servers owned or designated by AOL, and the right to
integrate Content from the Customized Site and/or Customized Programming by linking
to specific areas thereon, provided that the link to any such Content on the AOL
Network shall conform to the specifications of an WebMD Presence (the “License”).
For purposes of clarity, notwithstanding the foregoing, the License shall be limited
as follows: (i) outside of the AOL Properties, AOL’s rights under the License are
limited to promotional purposes only, which means that AOL may provide links, teaser
content (i.e., excerpts of Licensed Content), etc. to direct or drive traffic to the
Health Channels, Customized Site, Customized Programming, and/or My Health unless
the Parties add additional AOL properties into the Programming and Carriage Plan as
contemplated under Section 1.1.1 and 3.1.1 (e.g., AOL TV, AOL Plus etc.) at which
time such additional AOL properties will have the same License rights as the AOL
Properties and (ii) with respect to AOL Members, the License shall be limited to
only those rights that AOL is required to provide to AOL Members under AOL’s
Standard Members Terms of Service.

	 	1.4	 	Management

	 	1.4.1	 	Management Obligations. WebMD will use commercially
reasonable efforts to design, create, edit, manage, review, update (on a daily
basis or as otherwise specified herein), and maintain the Customized Site,
Customized Programming, My Health, and the Licensed Content in a timely and
professional manner and in accordance with the terms of this Agreement and use
commercially reasonable efforts to keep the Licensed Content current, accurate
and well-organized. Except as specifically provided for herein, AOL shall have
no obligations of any kind with respect to the Customized Site, Customized
Programming, or My Health. WebMD shall be responsible for all hosting or
communication costs or other costs associated with the Customized Site,
Customized Programming (if hosted by WebMD) and My Health, except as specified
otherwise herein.
	 
	 	1.4.2	 	WebMD Compliance. In the event that WebMD fails to
comply, in a material manner, with Sections 1.2, 3, or AOL’s then-Standard
advertising policies, AOL shall have the right (in addition to any other
remedies available to AOL hereunder) to immediately cease or decrease, in an
amount proportionate to WebMD’s non-compliance, the Promotions it provides to
WebMD pursuant to the Carriage Plan related to the noncompliance issue until
such time as WebMD corrects its non-compliance. For the purpose of clarity,
upon correction of such WebMD non-compliance, AOL shall resume performance of
its obligations to WebMD pursuant to the Carriage Plan and AOL will not be
relieved of any carriage, promotional and/or Impressions commitments made to
WebMD by AOL pursuant to the Carriage Plan. Notwithstanding the foregoing,
where commercially reasonable, AOL will notify WebMD of its failure to
comply with the terms of this section prior to AOL

4

 

	 	 	 	exercising its remedies herein. Where it is not commercially reasonable to provide notice to WebMD
prior to the exercise of its remedies herein, AOL will as soon as
practicable notify WebMD of its failure to comply with the terms of this
section and AOL’s exercise of its remedies herein after the fact. Should
WebMD materially fail to comply with its In-kind promotional obligations set
forth in Section 1.5 below, AOL and WebMD will work in good faith pursuant
to the Management Committee procedure set forth in Section 7.1 below to
resolve the In-Kind Promotion non-compliance. AOL will not decrease or
cease the Promotions it provides to WebMD pursuant to the Carriage Plan
unless the Parties are unable to resolve the In-Kind Promotion
non-compliance within thirty (30) days of AOL notifying WebMD of such
non-compliance. If the Parties have not resolved the In-Kind Promotion
non-compliance in the time set forth in the immediately preceding sentence,
then AOL shall have the right to make a reduction of the Promotions it
provides to WebMD in proportion to the In-Kind Promotion non-compliance,
until such time as WebMD corrects its non-compliance. For the purpose of
clarity, upon correction of such WebMD non-compliance, AOL shall resume
performance of its obligations to WebMD pursuant to the Carriage Plan and
AOL will not be relieved of any carriage, promotional and/or Impressions
commitments made to WebMD by AOL pursuant to the Carriage Plan.

	 	1.5	 	In-Kind Promotions. WebMD shall provide
AOL with twenty four million dollars ($24,000,000) worth
of In-Kind Promotions in accordance with the requirements and valuation methodologies
as set forth in Exhibit E.
	 
	 	1.6	 	Warrants. Pursuant to the terms of the warrant agreement attached
hereto as Exhibit G executed contemporaneously herewith, WebMD issued to AOL a warrant
to purchase shares of WebMD common stock (the number of shares to be determined at the
time of Effective Date) valued at fourteen million dollars ($14,000,000) (the “Warrant”). As set forth in the
terms of the Warrant, the Warrant has a term of seven years and is not exercisable
until the second anniversary of the date of issue. The Warrant Agreement shall be
executed contemporaneously with this Agreement.
	 
	 	1.7	 	Premier Provider and Exclusivity of WebMD. So long as WebMD is in all
material respects in compliance with Sections 1.2, 1.5, and 3 and any other material
programming requirements that the Parties mutually
agree upon, WebMD shall be the Premier Provider and have the exclusivity rights as
set forth herein. AOL will not suspend or reduce WebMD’s Premier Provider status or
exclusivity unless WebMD fails to correct the material noncompliance that triggered
such reduction or suspension within thirty (30) days after receiving notice from AOL
of such noncompliance. Notwithstanding the foregoing sentence, prior to AOL
providing notice to WebMD of the noncompliance under this Section, AOL shall work in
good faith with WebMD pursuant to the Management Committee procedure set forth in
Section 7.1 below for a period of

5

 

	 	 	 	at least ten (10) days to resolve any WebMD
non-compliance under the terms of this section.

	 	1.7.1	 	Premier Provider within Health Channels. WebMD shall
be the Premier Provider of health Content within the Health Channels. “Premier
Provider” shall mean that in the aggregate WebMD will be AOL’s primary
programming partner with regard to health content within the Health Channels as
set forth in the Programming Plan and receive more prominent placement and
branding than any other health Content provider within the Health Channels and
that AOL will collaborate with WebMD on the design and operation of the Health
Channels, as set forth in the Programming Plan.
	 
	 	1.7.2	 	Exclusivity within AOL Properties. WebMD shall be the
sole provider of WebMD Products and WebMD Services and substantially similar
products and services that AOL integrates on the AOL Properties (e.g., AOL may
not integrate health benefit plan summaries that are connected to a Payer on an
AOL rainman screen); provided that this Section shall not in any way preclude
AOL from providing links or advertisements to a Payer’s or Pharmaceutical
Manufacturer’s web site or interactive site that offers products and services
substantially similar to the WebMD Products and/or WebMD Services.
	 
	 	1.7.3	 	AOL Limitation on Competitive Activities. AOL will
not integrate content of any WebMD Competitor in the Health Channels during the
Term of this Agreement unless it does so pursuant to an agreement in effect
prior to the Effective Date or in accordance with the procedures set forth in
the Programming Plan.

	 	1.8	 	Permissible AOL Activities. Notwithstanding anything to the contrary
in Sections 1.1, 1.2, or 1.7 above (and without limiting any actions that may be taken
by AOL without violation of WebMD’s rights hereunder), no provision of this Agreement
will limit AOL’s ability (on or off the AOL Network) to:

	 	(i)	 	Undertake activities or perform duties pursuant to agreements
with third parties, including without limitation any relationships with WebMD
Competitors, existing as of the Effective Date;
	 
	 	(ii)	 	Sell advertising across multiple channels (e.g., banners,
buttons, links, sponsorships), within the AOL Properties; provided that AOL
shall not a) primarily target the placement of such advertising towards the
Health Channels, the Customized Site, Customized Programming and/or My Health
(e.g., a third party purchases advertising across multiple channels including
the Health Channels but such purchase is not targeted primarily at the Health
Channels; for example, AOL may sell advertisements to a company like CVS across
multiple channels to promote either the CVS brand or a specific type of product
such as photo services or nail polish)

6

 

	 	 	 	and b) use this provision to act in bad
faith to circumvent its obligations or the rights of WebMD as set forth in this
Agreement;
	 
	 	(iii)	 	Enter into an arrangement with any third party for the primary
purpose of acquiring AOL Members whereby such third party is allowed to promote
or market its products or services to only those AOL Members that are acquired
as a result of such arrangement;
	 
	 	(iv)	 	Create non-permanent editorial or news commentary or news
programming, and contextual links within the Health Channels, relating to any
third party so long as such party does not pay AOL for such links or commentary
and such links or commentary are integrated in a manner that is otherwise
consistent with the Programming Plan;
	 
	 	(v)	 	Provide links to Payers subject to Section 3.2.3;
	 
	 	(vi)	 	Enter into agreements with any third parties for
advertisements, integration or other functionality solely in Netscape’s
business-to-business area or channel (e.g., Netbusiness); or
	 
	 	(vii)	 	Provide products and/or services similar to WebMD Products and
WebMD Services on AOL Properties if, after the launch of My Health, AOL deems
the inclusion of such products and/or services necessary to satisfy needs
and/or preferences of AOL Members and AOL Users as long as AOL has (i) first
discussed its requirement for such products and/or services with WebMD and (ii)
WebMD declined or is unable to provide such products and/or services after
having a reasonable period of time to consider AOL’s request.

	 	1.9	 	Permissible WebMD Activities. No provision of this Agreement will
limit WebMD’s ability to deploy any WebMD content, products or services, including but
not limited to, the WebMD Content, WebMD Products, WebMD communities, WebMD Services,
and Personal Health Tools on other Internet sites or broadband platforms, including,
but not limited to, portal sites such as Lycos, MSN and Excite, unless the Parties
specifically agree that the specific content, product or service is designed
exclusively for AOL.
	 
	 	1.10	 	Escalation Process. Each Party hereby acknowledges that this Agreement will require significant
interaction between the Parties on a regular basis throughout the Term of the
Agreement. Each Party further acknowledges that disagreements, disputes, and/or
unresolved matters with respect to each Parties carrying out of their respective
obligations under this Agreement will occur periodically, but may not rise to the
level of a material breach. In order to facilitate an efficient and effective
process to resolve matters that impact either Party’s operation under this
Agreement, the Parties hereby institute the Escalation Process described herein. To
the extent that day-to-day type issues arise that require a mutual resolution that
cannot be achieved by the normal interaction among the relevant employees

7

 

	 	 	 	involved in implementing and executing a specific provision of the Agreement, each Party
shall designate an “Escalation Contact” for the purpose of resolving the specific
problem or issue. Each Party will notify the other Party in a timely manner of the
name and contact information for an Escalations Contact in each relevant area of
functionality (e.g., ad sales, technical operations, programming, etc.). Each
Escalation Contact will be vested with the authority to resolve issues in his or her
designated area of functionality that have not yet arisen to the level of a material
breach. The Escalation Contact(s) from each Party must work with each other in good
faith and in a timely manner to resolve the dispute. In the event that the conflict
cannot be resolved after the Escalation Contacts have made commercially reasonable
and good faith efforts to do so and the conflict becomes a “Dispute” as described in
Section 7.1 below, the Escalation Contacts shall have the right to invoke the
Management Committee process detailed in Section 7.1.

	2.	 	JOINT MARKETING PROGRAM

	 	2.1	 	Joint Marketing. AOL and WebMD will immediately develop a program to
acquire AOL subscribers from the pool of doctors and Payers with which WebMD has
relationships. The Parties will use innovative approaches (including sponsored
accounts, among others) to acquire AOL subscribers and AOL will compensate WebMD for
such subscribers acquired in a mutually agreed upon manner.

	3.	 	DEVELOPMENT OF HEALTH CHANNELS, CUSTOMIZED SITE, CUSTOMIZED PROGRAMMING AND MY HEALTH

	 	3.1	 	Health Channels, Customized Site, and Customized Programming
	 
	 	 	 	AOL and WebMD are striving to create the most robust and engaging health content and
programming that is available to any AOL Member or AOL User while maximizing
revenues to the Parties. The Parties seek to develop rich, relevant and timely
Content that will promote “stickiness” and generate a broad and consistent following
of AOL Members and AOL Users who come to rely on the Content provided hereunder for
their health related concerns. To this end, the Parties will be guided by the
guidelines and principles set forth in the Programming Plan in the development and
deployment of the Health Channels, the Customized Site, Customized Programming, and My Health. In addition to the
foregoing, the Parties will be further guided by the distinct programming concepts
set forth below.

	 	3.1.1	 	Additional AOL Properties. As soon as practical after
the Effective Date, the Parties will work in good faith to provide WebMD with
basic integration in a mutually agreed upon manner in AOL Mobile, AOL Plus, and
AOL TV (“Additional AOL Properties”) and in any successor and/or replacement
service based on such Additional AOL Properties when health related areas are
made generally available on such Additional AOL Properties. The Parties agree
that such integration into an Additional AOL

8

 

	 	 	 	Property shall be subject to AOL’s
Standard operational and legal terms, policies, and conditions for such
property. For purpose of clarity, the Parties agree that no additional
consideration is required from either Party for any integration contemplated in
this section.
	 
	 	3.1.2	 	Content Limitation. As part of the design, the
Parties agree that the Health Channels shall contain prominently displayed
links to My Health and the Customized Site. The Health Channels, My Health,
the Customized Site and the AOL Properties shall not contain a direct link to
the WebMD Site; however, AOL acknowledges and agrees that Content and/or
Personal Health Tools may be served to the Health Channel, as well as other
Internet sites, from the WebMD Site provided that such dynamically served
Content and/or tools otherwise comply with this Agreement.
	 
	 	3.1.3	 	Operating Standards. AOL shall make available to AOL
Members and/or AOL Users the Customized Site, My Health, and Customized
Programming during the Term of this Agreement in accordance with the Carriage
Plan and Programming Plan and provide reasonable operational support to WebMD
as set forth in Section 9 of the Operating Standards in Exhibit C. WebMD will
ensure that the Customized Site and Customized Programming comply in all
material respects at all times with the operating standards set forth in
Exhibit C. WebMD will also ensure that the WebMD Content, Personal Health
Tools, WebMD Product, and WebMD Services available on or through the Health
Channels, Customized Site, Customized Programming do not promote, advertise,
market or distribute the products, services or content of any other Interactive
Service or in a Restricted Category. In the event that AOL is negotiating an
agreement that would be added to the Restricted Category, AOL shall use good
faith efforts to provide notice to WebMD and shall work in good faith with
WebMD using commercially reasonable efforts to minimize any adverse revenue
impact that such addition to the Restricted Category might have on WebMD.

	 	3.2	 	Development of My Health. Consistent with the mission statement set forth in Section 3.1 above, WebMD shall
develop, host, and provide content, products and services on My Health in accordance
with the Programming Plan. AOL shall collaborate with WebMD on the development of
the design and operation of My Health, which shall be accessible to AOL Members on
the AOL Service and the public via links on the other AOL Properties (excluding the
AOL Service).

	 	3.2.1	 	User Interface. AOL and WebMD will work together to
design the user interface through which My Health is presented to AOL Members.
WebMD will incorporate AOL functionalities (including updates) into My Health
so long as the incorporation of such AOL functionalities, in WebMD’s good faith
judgment reasonably satisfies WebMD’s technological, commercial, legal and
business requirements. If WebMD uses a tool or functionality (e.g., message
boards) on My Health that is not

9

 

	 	 	 	an AOL branded tool or functionality, such
tool or functionality shall not contain any third party branding (except WebMD
branding). Notwithstanding the foregoing, nothing in this Agreement shall
require WebMD to incorporate AOL tools or functionalities into Personal Health
Tools other than those on the My Health area that is accessible from the AOL
Properties. If the expenses related to incorporating an AOL functionality by
WebMD exceeds $* or the expenses related to incorporating all of AOL
functionalities in the aggregate exceeds $*, AOL agrees to reimburse WebMD for
the expenses incurred over and above the amount set forth herein provided that
AOL has been presented with the approximate costs and agrees to bear such costs
prior to the expense being incurred. AOL shall provide to WebMD, in a timely
manner, any and all updates on the AOL functionalities utilized by WebMD.
	 
	 	3.2.2	 	My Health Registration System. For AOL Members, WebMD
shall implement AOL’s screen name authentication functionality and display such
functionality as prominently as any other method of registration (and the use
of such functionality shall be subject to AOL’s Standard terms for use of such
functionality) (“SNS”). SNS shall be available to AOL Members (i) when AOL
Members accesses My Health through the AOL Properties, and (ii) when AOL
Members accesses the Personal Health Tools through the WebMD Site. To the
extent that other password login procedures (e.g., secondary password
requirements) apply to AOL Members attempting to access the Personal Health
Tools through the WebMD Site, WebMD will use commercially reasonable efforts to
integrate such password login procedures with SNS. AOL and WebMD shall
collaborate in the development and operation of the Health Channels and My
Health to streamline and make efficient any User registration required on
either the Health Channels or My Health. AOL shall reimburse WebMD for
pre-approved reasonable costs and expenses in connection with the design,
development and implementation of SNS. AOL hereby acknowledges that WebMD is
not required to implement the SNS functionality on its co-branded sites with other Interactive Services
(e.g., MSN, Lycos, etc.).
	 
	 	3.2.3	 	AOL Promotion of My Health. Subject to the other
provisions of this Agreement governing sales to Payers, AOL will use good faith
efforts to contact Payers with which it has an existing relationship and
discuss with Payers that contact AOL during the term of this Agreement and
encourage those Payers to participate in My Health and to contract with WebMD
to use WebMD Products and WebMD Services. If, after AOL has made such good
faith efforts, a Payer is not willing to enter into such an agreement with
WebMD, then WebMD shall, at AOL’s request, establish a link from My Health to
such Payer’s site consistent with other Payers in My Health.

 

	 	 	Confidential treatment has been requested. The
redacted material has been separately filed with the Commission.

10

 

	 	3.2.4	 	Operating Standards. WebMD will ensure that My Health
complies in all material respects at all times with the standards set forth in
Exhibit C. WebMD will also ensure that the WebMD Content, Personal Health
Tools, WebMD Product, and WebMD Services on My Health do not promote,
advertise, market or distribute the products, services or content of any other
Interactive Service or in a Restricted Category. In the event that AOL is
negotiating an agreement that would be added to the Restricted Category, AOL
shall use good faith efforts to provide notice to WebMD and shall work in good
faith with WebMD using commercially reasonable efforts to minimize any adverse
revenue impact that such addition to the Restricted Category might have on
WebMD.
	 
	 	3.2.5	 	Development Priority. WebMD will use commercially
reasonable efforts to develop and deliver My Health pursuant to the guidelines
set forth in the Programming Plan and will provide AOL with as good or better
priority as it provides any third party for the development, maintenance,
updating of connectivity and personalized services offered through My Health.
	 
	 	3.2.6	 	Privacy Policy, User Data and Portability.
	 
	 	 	 	(i) During the Term of the Agreement, WebMD agrees that the privacy policies
applicable to the Customized Site and My Health (“Customized Site Privacy
Policies”) will be consistent with any applicable laws and government
regulations. WebMD and AOL shall meet on a quarterly basis to discuss the
Customized Site Privacy Policies and applicable industry standards and WebMD
will consider all suggestions by AOL for changes to the Customized Site
Privacy Policies and shall incorporate such suggestions as deemed reasonable
by WebMD. To the extent permitted by applicable laws and government
regulations, WebMD’s actions under this Agreement will be consistent with
AOL’s relevant then-Standard Privacy policies and other relevant
then-Standard policies which policies have been identified and made
available by AOL. In the event that AOL makes a material change to any of its Standard
policies that are applicable to this Agreement and WebMD acts in a manner
inconsistent with or violates the materially changed provision of such
Standard policy, WebMD will not be deemed to be in breach of this Agreement
or the materially changed provision of the Standard policy unless (a) AOL
had provided notice to WebMD of the materially changed provision or (b)
WebMD otherwise had actual knowledge of such materially changed provision.
Promptly after WebMD receives notice from AOL or gains actual knowledge of
such materially changed provision, WebMD will ensure that its actions under
this Agreement, to the extent permitted by applicable laws and government
regulations, will be consistent with such materially changed provision.

11

 

	 	 	 	(ii) WebMD will have the right to use the Personalized Health Data collected
from AOL Members for its internal business purposes provided that WebMD
shall not sell, disclose or disseminate to third parties such individual AOL
Member Personalized Health Data without the prior authorization, consent or
direction of the AOL Member nor do anything inconsistent with applicable
laws, regulations or the terms and conditions of this Agreement.
	 
	 	 	 	(iii) WebMD agrees to seek to obtain to the extent permitted by law, at the
time a AOL Member registers for My Health, the consent, authorization,
and/or direction of such AOL Member necessary for WebMD to fulfill its
obligations to transfer Personalized Health Data to AOL, pursuant to Section
3.2.7 below, in accordance with applicable laws and regulations. Prior to
the launch of My Health, WebMD and AOL will meet to discuss the initial
form, format, and content of any such consent and/or authorization. WebMD
will act reasonably in considering all reasonable suggestions by AOL
consistent with all applicable laws and regulations to the extent such
consents and/or authorizations relate directly to WebMD’s ability to fulfill
its obligations under Section 3.2.7 below. For purposes of clarification, if
an AOL Member does not consent to the transfer of Personalized Health Data
pursuant to Section 3.2.7 below, such lack of consent shall not prevent such
AOL Member from using My Health.

	 	3.2.7	 	AOL Right to Personalized Health Data.

	 	(i)	 	Right to Request Personalized Health
Data. AOL may in its sole discretion request a copy of the
then-current Personalized Health Data at any time subject to the
following conditions: (a) AOL may only make such request once per
quarter and AOL will reimburse WebMD for any reasonable expense
incurred by WebMD related to such transfer in excess of $* per transfer
and (b) AOL’s use of such Personalized Health Data shall be consistent
with all applicable consents from AOL Members and applicable laws and
regulations and the Customized Site Privacy Policies under which such
Personalized Health Data is subject. Notwithstanding, the foregoing,
AOL reserves the right to seek additional consents from the AOL
Member and WebMD agrees to use commercially reasonable efforts to
assist AOL in obtaining such consents. Subject to applicable laws
and regulations and AOL Member consents, WebMD will use commercially
reasonable efforts to deliver a copy of the Personalized Health Data
requested, including information relating to applicable data fields
and such other information as may be useful to AOL in order to
facilitate a timely and efficient migration of such data, within ten
(10) days from receipt of such AOL request. WebMD shall not use this
provision

 

	 	 	Confidential treatment has
been requested. The redacted material has been separately filed with
the Commission.

12

 

	 	 	 	in bad faith to circumvent its obligations or the rights of
AOL as set forth in this Agreement.
	 
	 	(ii)	 	Upon Termination or Expiration of the
Agreement. Upon termination or the expiration of this Agreement
for any reason, AOL may request and WebMD shall provide to AOL or to a
third party designated by AOL, all subject to applicable law and
government regulations and AOL Member consents, a copy of all
Personalized Health Data. WebMD shall use commercially reasonable
efforts to provide such Personalized Health Data within ten (10) days
of its receipt of AOL’s request for such Personalized Health Data, or
as soon thereafter as practicable. WebMD shall not use this provision
in bad faith to circumvent its obligations or the rights of AOL as set
forth in this Agreement.

	4.	 	ADVERTISING AND MERCHANDISING.

	 	4.1	 	AOL Network Advertising Inventory. AOL owns all right, title and
interest in and to the advertising and promotional spaces within the AOL Network
including, without limitation, the AOL frames and shall have the right to all revenues
therefrom, subject to Section 5.2. The specific advertising inventory within any AOL
forms or pages, including such AOL frames, shall be as reasonably determined by AOL.
	 
	 	4.2	 	Sale of Advertisements. AOL hereby grants WebMD the right to license
or sell Advertisements on the Health Channels, the Customized Site, Customized
Programming, and My Health as follows:
	 
	 	 	 	(i) The Parties agree that Advertisements shall be licensed or sold subject to the
AOL’s and WebMD’s then-Standard advertising policies and will be sold in accordance
with the guidelines set forth on Exhibit A-3 (“Sales Process”). To the extent that
the advertising policies of AOL and WebMD conflict with respect to
advertising in My Health and/or the Customized Site, the more restrictive provision
of each of the respective policy will govern, but with respect to advertising on all
other areas within the AOL Properties (e.g., the Health Channels and Customized
Programming), AOL’s then-Standard advertising policies shall govern. The Parties
recognize that the Sales Process may change and the Parties shall meet periodically
to discuss changes in the requirements and pricing issues that are not addressed in
Sales Process. The Parties shall work in good faith to mutually agree on any
changes as necessary. Any changes agreed upon by the Parties shall be in writing.
	 
	 	 	 	(ii) Each sale of Advertisements shall be sufficiently documented on AOL’s
advertising forms consistent with the Sales Process.

13

 

	 	 	 	(iii) To the extent it is necessary for AOL to be a party to a contract for the sale
of Advertisements entered into by WebMD and a third party, AOL agrees to work in
good faith to enter into such an agreement.
	 
	 	 	 	(iv) The specific advertising inventory within the Health Channels, the Customized
Site, Customized Programming, and My Health will be as reasonably determined by the
Parties and the Parties will work together to develop an efficient inventory
management system.
	 
	 	 	 	(v) WebMD shall have the exclusive right, subject to AOL’s then-Standard Advertising
Policies, to sell Advertisements to Payers (other than Pharmaceutical Manufacturers)
in the Health Channels, Customized Site, Customized Programming and My Health;
provided, however, that AOL shall have the right to license or sell standard
Advertisements (e.g., buttons, banners, and links) to Payers through advertising
agencies, AOL’s sales force, and AOL’s local sales force for non-strategic ad sales
of less than $* per agreement; provided, further, AOL shall be primarily
responsible, with reasonable assistance from WebMD, for sales to Payers solicited by
non-AOL, Inc. divisions of AOL Time Warner (e.g., Time Inc., Turner Networks, etc.)
for Advertisements on non-AOL, Inc. brands (AOL shall not use this provision in bad
faith to circumvent its obligations or the rights of WebMD as set forth in this
Agreement).
	 
	 	 	 	(vi) Notwithstanding the above provisions, in addition to its other Advertisement
selling activities, WebMD shall be primarily responsible, with reasonable assistance
from AOL, for selling Advertisements to Pharmaceutical Manufacturers for the
Customized Site, Customized Programming, My Health and the Health Channels;
provided, however, that AOL shall have the right to license or sell standard
Advertisements (e.g., banners, buttons and links) to Pharmaceutical Manufacturers
through advertising agencies, AOL’s sales force, and AOL’s local sales force for
non-strategic ad sales of less than $* per agreement; provided, further, AOL shall
be primarily responsible, with reasonable assistance from WebMD, for sales to
Pharmaceutical Manufacturers solicited by non-AOL, Inc. divisions of AOL Time Warner
(e.g., Time Inc., Turner Networks, etc.) for Advertisements on non-AOL, Inc. brands
(AOL shall not use this provision in bad faith to circumvent its obligations or the rights of WebMD as set
forth in this Agreement).
	 
	 	 	 	(vii) Notwithstanding the above provisions, in addition to its other Advertisement
selling activities, AOL shall be primarily responsible, with reasonable assistance
from WebMD, for selling Advertisements to non-Payers for the Health Channels, the
Customized Site, and My Health. With respect to any sale of Advertisements to
Mead-Johnson during the Term for inclusion on the Health Channels or the Parenting
channel, the terms of such agreement shall be mutually agreed to by the Parties.
	 
	 	 	 	(viii) AOL shall use commercially reasonable efforts to conduct the sale of
Advertisements for at least *% of the unsold advertising inventory in the Health

 

	 	 	Confidential treatment has
been requested. The redacted material has been separately filed with
the Commission.

14

 

	 	 	 	Channels, and if any of such advertising inventory remains unsold after such
efforts, AOL shall then use commercially reasonable efforts to include third party
“Run of” Advertisements, third party makegoods, or other similar methods to generate
revenues from such unsold inventory, before its uses the unsold inventory for AOL
House Promotions.
	 
	 	 	 	(ix) WebMD shall designate one senior executive who shall work with AOL to
coordinate AOL’s advertising sales efforts with the necessary WebMD departments and
employees. AOL shall designate one senior executive who shall work with WebMD to
coordinate WebMD’s advertising sales efforts with the necessary AOL departments and
employees.

	 	4.3	 	Interactive Commerce. Any merchandising permitted hereunder through
the Health Channels, My Health, Customized Site and/or Customized Programming shall be
subject to (i) the then-standard requirements of AOL’s standard merchant certification
program as set forth at AOL keyword: merchants under the “anchor and gold tenants”
section, and (ii) AOL and WebMD shall mutually agree on the type of products, goods and
services to be offered through the Health Channels, My Health, the Customized Site or
the Customized Programming. For the purposes of clarification, the aforementioned
merchandising is subject to the revenue sharing provisions of Section 5. WebMD will
take commercially reasonable steps necessary to conform its promotion and sale of
products through My Health, the Customized Site, and Customized Programming to the
then-existing “quick checkout” technologies identified by AOL that are designed to
facilitate the purchase of products by AOL Members through the Customized Site. AOL
agrees to reimburse WebMD for all reasonable expenses associated with the incorporation
of such technologies.

	5.	 	AOL AND WEBMD REVENUE SHARING.

	 	5.1	 	Allocation of Revenue in Advertising Agreements.

	 	5.1.1	 	Health Channels and My Health Site Exclusive
Contracts. The Parties agree that, for contracts for the sale of
Advertisements appearing solely on the Health Channels, Customized Site,
Customized Programming, and/or My Health (“Site Exclusive Contracts”), all
revenue derived from such contracts shall be shared pursuant to the terms set
forth in Section 5.2 below.
	 
	 	5.1.2	 	Health Channels and My Health Non-exclusive Contracts.
The Parties agree that, for contracts for the sale of Advertisements that will
appear not only on the Health Channels, Customized Site, Customized Programming
and/or My Health but also on other sites or channels of the Parties, including,
but not limited to, the WebMD Site and other areas of the AOL Network
(“Non-Site Exclusive Contracts”), only that portion of the revenue, allocated
as described below, derived from the Advertisements that appears on the Health
Channels, My Health, the Customized Site

15

 

	 	 	 	and/or Customized Programming shall be
shared pursuant to the terms set forth in Section 5.2 (“Allocated Revenue”).
For purposes of clarification, the Parties agree that the portion of the
non-permanent advertising referenced in Section 1.8(ii) that appears on the
Health Channels, My Health, Customized Programming and/or Customized Site shall
be included in Allocated Revenue. The Allocated Revenue shall be mutually
agreed upon based on the relevant value of the Non-Site Exclusive Contract
Advertisements dedicated to the Health Channels, My Health, the Customized Site
and/or Customized Programming versus the relevant value of the Advertisements
dedicated to other channels or sites. The Parties anticipate that the relevant
value of the Advertisements will be based on a metric as mutually agreed upon
by the Parties.

	 	5.2	 	Revenue Sharing.

	 	5.2.1	 	Allocation of Revenues. During the term of this
Agreement, the Parties agree to share, under the terms described below, all the
Advertising Revenues derived from Site Exclusive Contracts, the Allocated
Revenue derived from Non-Site Exclusive Contracts and any and all other revenue
generated from the Health Channels, Customized Site, Customized Programming
and/or My Health including, but not limited to, revenues from the sale of
America Online Keywords as part of or ancillary to the sale of Advertisements,
provided that AOL has allocated revenue specifically to the sale of the America
Online Keyword (collectively, “Aggregate Revenues”).
	 
	 	 	 	(i) Aggregate Revenues shall not include revenue generated pursuant to AOL
or WebMD agreements, which existed prior to the Effective Date
(“Pre-existing Agreements”) unless WebMD requests and AOL agrees to
integrate such partners, other than on the Customized Site and My Health, in
screens on the Health Channels;
	 
	 	 	 	(ii) Aggregate Revenues shall include revenue WebMD derives from
identifiable AOL Members via SNS and/or, if technically feasible, screenname
who access the Personal Health Tools by a means other than through the AOL
Properties.
	 
	 	 	 	(iii) Aggregate Revenues shall also include revenue derived from AOL
agreements, which exist prior to the Effective Date to the extent that AOL
requests and WebMD integrates such Advertisements into the Customized Site
or My Health, pursuant to Section 1.2.1.
	 
	 	5.2.2	 	Distribution of Revenue. The Parties agree that for
the first $40,000,000.00 of Aggregate Revenues generated in an Annual Period,
WebMD shall receive eighty percent (80%) of the Aggregate Revenues and AOL
shall receive twenty percent (20%) of the Aggregate Revenues. The Parties
further agree that for any Aggregate Revenues generated over

16

 

	 	 	 	$40,000,000.00 in an Annual Period, WebMD shall receive sixty percent (60%) of the Aggregate
Revenues and AOL shall receive forty percent (40%) of the Aggregate Revenues.
Within thirty (30) days after the end of each fiscal quarter during the term of
the Agreement, WebMD and AOL shall review the Revenue Data (as defined in
Section 5.2.3) generated for the prior quarter. If a Party possesses a greater
percentage of the Aggregate Revenues for the prior quarter than is allotted
pursuant to this Section 5.2.2, the Party shall wire, within ten (10) business
days, to the other Party, pursuant to the instructions below, funds sufficient
to ensure that each Party possesses their allotted share of the Aggregate
Revenues.
	 
	 	5.2.3	 	Exchange of Revenue Data. As promptly as practical
but no later than thirty (30) days following the end of each fiscal quarter,
AOL and WebMD will exchange data sufficient to detail and describe the
Aggregate Revenues that each Party generated in the prior quarter (“Revenue
Data”). Such information will be presented in a manner mutually agreed upon by
the Parties.

	 	5.3	 	Payments: Wired Payments.
	 
	 	 	 	All amounts owed hereunder not paid when due and payable will bear interest from the
date that is thirty (30) days after such amounts are due and payable at the prime
rate as published in the Wall Street Journal at such time. All payments to AOL
required hereunder will be paid in immediately available, non-refundable U.S. funds
wired to the “America Online” account, Account Number* at JP Morgan Chase Bank, Four
New York Plaza, New York, NY 10008 (ABA: *). All payments to WebMD required
hereunder will be paid in immediately available, non-refundable U.S. funds wired to
the “Healtheon/WebMD Corporation — Concentration Account” Account Number * at First Union National Bank of Georgia
(ABA: *).
	 
	 	5.4	 	Auditing Rights.
	 
	 	 	 	Each Party will maintain complete, clear and accurate records of all expenses,
revenues and fees in connection with the performance of this Agreement. For the
sole purpose of ensuring compliance with this Agreement, AOL or WebMD (or their
representatives) will have the right to conduct a reasonable and necessary
inspection of only those portions of the books and records of the other Party that
are directly related to Advertisements sold and the collection and payment of
Advertising Revenues under this Agreement. Any such audit may be conducted after
twenty (20) business days prior written notice to such other Party. The Party
requesting any audit shall bear the expense of that audit conducted pursuant to this
Section 5.4 unless such audit shows an error in such Party’s favor amounting to a
deficiency in excess of * (*%) of the actual amounts paid and/or payable to such
Party hereunder, in which event the audited Party shall bear the reasonable expenses
of the audit. Either Party shall pay the amount of any deficiency discovered within
thirty (30) days after receipt of notice thereof.

 

	 	 	Confidential treatment has
been requested. The redacted material has been separately filed with
the Commission.

17

 

	 	5.5	 	Reports.

	 	5.5.1	 	Transaction Reports. AOL shall provide WebMD with
Standard usage information related to the Promotions (e.g., a schedule of the
Impressions delivered by AOL at such time) which is similar in substance and
form to the reports provided by AOL to other interactive marketing partners
similar to WebMD. Each Party acknowledges that such reports may contain
Confidential Information as defined herein.
	 
	 	5.5.2	 	Third Party Advertising. To the extent permitted
under the Parties’ agreements with advertisers entered into during the Term,
each Party agrees to provide the other Party with a monthly report in a
mutually agreed upon format detailing the click-through data in the Party’s
possession on users utilizing the Advertisements associated with the Health
Channels, the Customized Site and My Health. Each Party acknowledges that such
reports may contain Confidential Information as defined herein.
	 
	 	5.5.3	 	Sales Reports. Each Party will provide the other with
a monthly report in a mutually agreed-upon format detailing all sales of
Advertisements by that Party pursuant to Section 42. Such reports will also
provide Revenue Data of the reporting Party in a format mutually agreed upon by
the Parties. Each Party acknowledges that such reports may contain
Confidential Information as defined herein.
	 
	 	5.5.4	 	Financial Statements. WebMD shall furnish or cause to
be furnished to AOL all forms 10K, 10Q, and 8K filed by or on behalf of WebMD
with the Securities and Exchange Commission (“SEC”) within a commercially
reasonable time of such filing with the SEC.

	6.	 	TERM; RENEWAL; TERMINATION.

	 	6.1	 	Term.
	 
	 	 	 	Unless earlier terminated as set forth herein, the initial term of this Agreement
will be three (3) years from the Effective Date (the “Initial Term”).
	 
	 	6.2	 	Renewal.

	 	6.2.1	 	AOL’s Right to Extend the Agreement. AOL shall have
the right to extend this Agreement on the same terms and conditions for a
period of one (1) year provided that AOL uses good faith efforts to discuss
with WebMD, at least six (6) months before the expiration of the Initial Term
of the Agreement, whether it intends to extend the Agreement and notifies WebMD
of its intention to extend the Agreement at least three (3) months before the
expiration of the Initial Term of the Agreement (“Renewal Term”).

18

 

	 	6.2.2	 	WebMD’s Right to Extend the Agreement. If, at the end
of the Initial Term, WebMD has not received payments, pursuant to Section 5,
equivalent to $24,000,000 plus sixty percent (60%) of all Aggregate Revenues generated during the
Initial Term of the Agreement, WebMD, at its sole discretion, may extend the
Agreement for an additional three (3) years (“WebMD Renewal Term”) subject to
the following adjustment of terms. During the WebMD Renewal Term, the Parties
agree that (i) the definition of Aggregate Revenues shall be extended to
include revenues from all AOL online and offline healthcare related activities,
including, but not limited to, advertising sales from AOL and AOL Time Warner,
Inc. owned or controlled magazines and television programs (“Adjusted Aggregate
Revenues”) and (ii) WebMD shall receive eighty percent (80%) of the Adjusted Aggregate
Revenues and AOL shall receive twenty percent (20%) of the Adjusted Aggregate Revenues,
except that WebMD’s share of Adjusted Aggregate Revenues will be limited to the
greater of $12,000,000 or sixty percent (60%) of the Aggregate Revenue, as defined during the Initial
Period, per Annual Period.

	 	6.3	 	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 for forty five (45) days after written notice
thereof to the other Party (the “Cure Period”).
	 
	 	6.4	 	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.
	 
	 	6.5	 	Termination on Change of Control.
	 
	 	 	 	In the event of a Change of Control of WebMD resulting in WebMD being controlled by
any Named Entity, WebMD shall immediately provide notice to AOL of the Change of
Control. AOL shall have the right to terminate the Agreement within sixty (60) days
of receiving written notice from WebMD of such change of control.
	 
	 	6.6	 	Duties Upon Expiration or Termination.
	 
	 	 	 	Upon the expiration or earlier termination of this Agreement: (i) each party shall
return any Confidential Information of the other party in its possession; (ii) each
party shall cease its use of the other party’s Marks, as defined in Section 2 of
Exhibit E, in connection with this Agreement; (iii) each party shall pay to the
other any sums outstanding that are then due and payable under this Agreement;

19

 

	 	 	 	(iv) for a period of three (3) years after the date of such expiration or termination,
all applicable financial records of each Party shall be made available to the other
Party for the purpose of determining compliance with the Parties’ respective
obligations under this Agreement; (v) each party shall return to the other party
marketing literature and materials of the other party in its possession or shall
destroy such items and certify their destruction to the other party; (vi) WebMD
shall fulfill its obligations under Section 3.2.7 above; (vii) if the Agreement is
terminated by a Party as a result of a material breach of the Agreement by the other
Party, the non-breaching Party may, at its sole discretion, require the breaching
Party to continue to perform its obligations under this Agreement for a transition
period of three (3) months; and (viii) within three (3) months prior to the end of
the Initial Term, Renewal Term, or WebMD Renewal Term as appropriate or during the
transition period if the Agreement is terminated, the Parties shall use commercially
reasonable efforts to develop and implement a plan to notify users of the Health
Channels and My Health of (a) the termination of the Agreement between the Parties
and (b) post-termination options available to such users to enable them to continue
to access the content and service provided on the Health Channels and My Health.
Such plan shall include neutral messaging (e.g., in terms of content of message and
mechanism, timing and manner of delivery) that does not advantage either Party over
the other Party in being able to establish and/or maintain an ongoing customer
relationship with users of My Health to provide personalized interactive health
management services. For a period of eighteen (18) months following the expiration
of the Term or Renewal Term, as the case may be, WebMD will continue to support the
Personal Health Records and all features and functionality related thereto as a
product for AOL that is branded as determined by AOL in its sole discretion and in accordance with the same
quality level and operating standards required during the Term of this Agreement.
AOL and WebMD will share equally all revenue generated from the OEM Personal Health
Records. The post termination options shall include, but not be limited to,
notification to AOL Members of links to relevant WebMD Products and Services and the
WebMD site.

	 	6.6.1	 	Post Termination License Rights. WebMD understands
that, following the termination of the Agreement, AOL may develop, make, use,
sell or otherwise exploit, by itself or in cooperation with others,
applications or sites with Design Features that are similar to or the same as
the Design Features of the Customized Site and My Health. WebMD agrees, on
behalf of itself and its WebMD Affiliates, subsidiaries, or successors in
interest not to assert any patent infringement or other intellectual property
claims against AOL or its Affiliates for such development, use, sale or
exploitation. “Design Features” shall mean “look and feel”, layout, design,
navigation, feature set, functionality and overall structure, sequence and
organization, except that Design Features shall not include WebMD Marks.

20

 

	 	6.7	 	Press Releases.
	 
	 	 	 	Each Party will submit to the other Party, for its prior written approval, which
will 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, rule, regulation or court order or as reasonably
advised by legal counsel without the consent of the other Party and in such event,
the disclosing Party will provide at least five (5) business days prior written
notice of such disclosure. The failure to obtain the prior written approval of the
other Party shall be deemed a material breach of this Agreement.

	7.	 	MANAGEMENT COMMITTEE/ARBITRATION.

	 	7.1	 	Management Committee.
	 
	 	 	 	The Parties will act in good faith and use commercially reasonable efforts to
promptly resolve any claim, dispute, 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, either Party may request, in writing, that the Dispute
be submitted to the Management Committee for resolution. For ten (10) business days following request for submission of the
Dispute to the Management Committee, the Management Committee will have the
exclusive right to resolve such Dispute; provided further that the Management
Committee will 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 the ten-day period, then the
Management Committee will 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 will be subject to
the resolution mechanisms described below. “Management Committee” will mean a
committee made up of a senior executive from each of the Parties for the purpose of
resolving Disputes under this Section 7.1 and generally overseeing the relationship
between the Parties contemplated by this Agreement. Neither Party will seek, nor
will 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 7.1 and then, only in compliance with the procedures set forth in this
Section 7.1.
	 
	 	7.2	 	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

21

 

	 	 	 	agreement as to certain terms (which will be resolved by the Parties solely and
exclusively through amicable resolution as set forth in Section 7.1), any Dispute
not resolved by amicable resolution as set forth in Section 7.1 will be governed
exclusively and finally by arbitration. Such arbitration will be conducted by the
American Arbitration Association (“AAA”) in Washington, D.C. and will 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 will 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 will
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.
	 
	 	7.3	 	Selection of Arbitrators.
	 
	 	 	 	The arbitration panel will consist of three arbitrators. Each, Party will name an
arbitrator within ten (10) days after the delivery of the Demand. The two
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 will 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 have commenced, the remaining arbitrator or arbitrators may not
continue with the hearing and determination of the controversy, unless the Parties
agree otherwise.
	 
	 	7.4	 	Governing Law.
	 
	 	 	 	The Agreement will be governed under the laws of the Commonwealth of Virginia. The
Federal Arbitration Act, 9 U.S.C. Secs. 1-16 will govern the arbitrability of all
Disputes. The arbitrators will 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 will reference the Federal Rules of
Civil Procedure then in effect in setting the scope and timing of discovery. The
Federal Rules of Evidence will apply in toto. The arbitrators may enter a default
decision against any Party who fails to participate in the arbitration proceedings.
	 
	 	7.5	 	Arbitration Awards.
	 
	 	 	 	The arbitrators will have the authority to award compensatory damages only. Any
award by the arbitrators will be accompanied by a written opinion setting

22

 

	 	 	 	forth the findings of fact and conclusions of law relied upon in reaching the decision. The
award rendered by the arbitrators will 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 will be
kept confidential and no Party will 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.
	 
	 	7.6	 	Fees.
	 
	 	 	 	Each Party will 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”) will 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.
	 
	 	7.7	 	Non-Arbitratable Disputes.
	 
	 	 	 	Any Dispute that is not subject to final resolution by the Management Committee or
to arbitration under this Section 7.7 or by law (collectively, “Non-Arbitration
Claims”) will 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.
	 
	 	7.8	 	APPLICATION OF LAWS AND REGULATIONS.
	 
	 	 	 	THE PARTIES SHALL ABIDE BY ALL APPLICABLE LAWS AND REGULATIONS IN THE PERFORMANCE OF
THEIR RESPECTIVE OBLIGATIONS UNDER THIS AGREEMENT.
	 
	 	7.9	 	OBLIGATIONS UNDER HIPAA.
	 
	 	 	 	THE PARTIES ACKNOWLEDGE AND AGREE THAT NOTHING IN THE AGREEMENT IS INTENDED TO
CONVERT AOL INTO AN ENTITY COVERED BY HIPAA. OTHER THAN IN CONNECTION WITH AOL’S
USE OF PERSONALIZED HEALTH DATA ACQUIRED THROUGH THE EXERCISE OF ITS RIGHT TO
RECEIVE A COPY OF PERSONALIZED HEALTH DATA, AOL WILL NEITHER HAVE ACCESS TO OR USE
INFORMATION RELATING TO THE PAST, PRESENT, OR FUTURE

23

 

	 	 	 	PHYSICAL OR MENTAL CONDITION OF
AN INDIVIDUAL USING THE CUSTOMIZED SITE, THE CUSTOMIZED PROGRAMMING OR MY HEALTH.
WEBMD AGREES AT THE REQUEST OF AOL TO MODIFY THIS AGREEMENT OR THE MANNER IN WHICH
THE AGREEMENT IS PERFORMED BY WEBMD TO THE EXTENT REASONABLY NECESSARY TO ENSURE
THAT AOL IS NOT TREATED AS AN ENTITY SUBJECT TO HIPAA OR THAT AOL’S ACTIVITIES
HEREUNDER (OTHER THAN IN CONNECTION WITH AOL’S USE OF PERSONALIZED HEALTH DATA
ACQUIRED THROUGH THE EXERCISE OF ITS RIGHT TO RECEIVE A COPY OF PERSONALIZED HEALTH
DATA) DO NOT INVOLVE USE OR DISCLOSURE OF INFORMATION RELATING TO THE PAST, PRESENT,
OR FUTURE PHYSICAL OR MENTAL CONDITION OF AN INDIVIDUAL USING THE CUSTOMIZED SITE,
THE CUSTOMIZED PROGRAMMING OR MY HEALTH.
	 
	 	7.10	 	WebMD Indemnification.
	 
	 	 	 	WebMD will defend, indemnify, save and hold harmless AOL and its officers,
directors, agents, affiliates, distributors, franchisees and employees from any and
all third party claims, demands, liabilities, costs or expenses, including
reasonable attorney’s fees (Liabilities), related to any medical malpractice and/or
the unauthorized practice of medicine resulting from WebMD’s delivery of products,
information and/or services to consumers of My Health; provided, however that AOL
shall pursue any claims arising under this Section 7.10 in accordance with the
provisions of Section 8.4 of the Standard Legal Terms & Conditions attached hereto
as Exhibit E.
	 
	 	7.11	 	STANDARD TERMS.
	 
	 	 	 	The Standard Legal Terms & Conditions set forth on Exhibit E attached hereto are
each hereby made a part of this Agreement.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the Effective Date.

	 	 	 	 	 	 	 
	AMERICA ONLINE, INC.	 	WEBMD CORPORATION
	 
	 	 	 	 	 	 
	By:

	 	/s/ Jonathan R. Edson	 	By:	 	/s/ David Schlanger
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Name:

	 	Jonathan R. Edson	 	Name:	 	David Schlanger
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Title:

	 	Vice President Business Affairs	 	Title:	 	Senior Vice President
	 

	 	 
	 	 	 	 

24

 

Schedule of Exhibits

	 	 	 
	Exhibit A-1

	 	Carriage Plan [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit A-2

	 	Programming Plan [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit A-3

	 	Sales Process [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit B

	 	Definitions
	 
	 	 
	Exhibit C

	 	Operating Standards
	 
	 	 
	Exhibit D

	 	Standard Online Commerce Terms and Conditions
	 
	 	 
	Exhibit E

	 	Standard Legal Terms and Conditions
	 
	 	 
	Exhibit F

	 	In-Kind Requirement [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit F-1

	 	Keyword and Logo Guidelines [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit G

	 	Warrant Agreement [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit H

	 	WebMD Products [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit I

	 	WebMD Services [INTENTIONALLY OMITTED]
	 
	 	 
	Exhibit J

	 	Screen Shots [INTENTIONALLY OMITTED]

25

 

EXHIBIT B

Definitions

The following definitions will apply to this Agreement:

Advertisements. All advertising, sponsorship, carriage, links, commerce and other
promotional programs appearing on any page of the Health Channels, the Customized Site, Customized
Programming or My Health or otherwise included within the WebMD Content, WebMD Products, WebMD
Services or Personal Health Tools as such appear on the AOL Network.

Advertising Revenues. The aggregate amount of all cash paid or payable to AOL or WebMD (in
each case the “Receiving Party”) for Advertising that has been sold for placement as described in
Section 4.2 (other than local advertising sold by Digital City) and all carriage, performance and
other related fees or revenues, at such time as such cash is recognized as revenue by such
Receiving Party in accordance with applicable generally accepted accounting principles, less (i)
actual third party commissions and (ii) any amounts not collected by Receiving Party and more than
ninety (90) days past due.

Advertising Sales Commission. Actual reasonable amounts paid as commission to third party
agencies by the selling party in connection with sale of the Advertisement.

Affiliates. Any agent, distributor or franchisee of AOL, or an entity that, directly or
indirectly, controls, is controlled by, or is under common control with AOL, including any entity
in which AOL holds, directly or indirectly, at least a nineteen percent (19%) equity interest.

Annual Period. During the Initial Term and any Renewal Term, the twelve month period from
May 9, 2001 through May 8, 2002 and each successive twelve month period thereafter.

AOL Look and Feel. The elements of graphics, design, organization, presentation, layout,
user interface, navigation, trade dress and stylistic convention (including the digital
implementations thereof) within the AOL Network and the total appearance and impression
substantially formed by the combination, coordination and interaction of these elements.

AOL Represented Advertising. Advertising inventory within any AOL Property(ies) or third
party Internet site(s) on which AOL sells advertising.

AOL Network. (i) The AOL Service, AOL.com, the CompuServe Service, Digital City and
Netscape Netcenter and (ii) any other product, service or property owned, operated, distributed or
authorized to be distributed by or through AOL or its Affiliates worldwide- (and including those
products, services and properties that are excluded from the definitions of the AOL Service,
AOL.com or any other AOL Property). It is understood and agreed that the rights of WebMD relate
solely to particular AOL Properties and AOL Additional Properties as expressly set forth in this
Agreement and not generally to the AOL Network.

AOL Member(s). Any authorized user of the AOL Service, CompuServe Service or any other
subscription based service offered by AOL.

 

 

AOL Mobile. Any product or service owned, operated, distributed or authorized to be
distributed by AOL through any domestic wireless telephone product or service.

AOL Plus. The specific AOL PIusSM branded service which is available through the U.S.
version of the America Online brand service and which is accessible solely through a high speed
(generally over 100 kbps) broadband distribution platform, specifically excluding (a) the
components of the AOL Service accessible through narowband distribution platforms,
(b) AOL.com, any AOL Interactive Site and the international versions of an America Online service
(e.g., AOL Japan) and any broadband component available through such AOL Properties and versions
(c) the CompuServe® brand service and any other CompuServe products or services whether broadband
or narrowband, (d) Netscape NetcenterTM and any other Netscape products or services
whether broadband or narrowband, (e) “ICQTM,” “AOL NetFindTM,” “AOL Instant
MessengerTM,” “Digital CityTM,” “NetMailTM,” “Real Fans”,
“Love@AOL”, “Entertainment Asylum,” “AOL Hometown” 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 or the broadband component thereof, (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), whether broadband or narrowband, (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 whether broadband or narrowband, (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 and (and broadband Content
associated therewith) which is materially different from the 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 platform or device other than a desktop personal
computer.

AOL TV Service. AOL’s primary U.S. interactive service primarily for use through a
standard analog television set and marketed under the “AOL TVTM” brand name specifically
excluding (a) the AOL Service, AOL.com, Netscape Netcenter, the CompuServe Service, CompuServe.com
and any other AOL Property, whether or not accessible through the AOL TV branded service, (b) any
international versions of an AOL TV or similar service, (c) “ICQTM,” “AOL NetFindTM,” “AOL Instant
MessengerTM,” “Digital CityTM,” or any similar independent product, service or property which may be
offered by, through or with the U.S. version of the AOL TV brand service, (f) any programming or
content area offered by or through the U.S. version of the AOL TV 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 AOL TV 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 AOL TV brand service
which is materially different from the U.S. version of the AOL TV brand service, by virtue of its
branding, distribution, functionality, Content or services, including, without limitation, any
co-branded

2

 

version of the service and any version distributed through any platform or device other
than a standard analog television set.

AOL Properties. The AOL Service, AOL.com, Netscape Netcenter and CompuServe and any
successor consumer sites and/or replacement sites of the foregoing.

AOL Service. The standard narrow-band U.S. version of the America Online brand service,
specifically excluding (a) AOL.comSM and any other AOL Interactive Site, (b) the international
versions of an America Online service (e.g., AOL Japan) and/or any non-English language based
feature or area of the America Online brand service, (c) the CompuServe® brand service and any
other CompuServe products or services, (d) Netscape NetcenterTM and any other Netscapeâ
products or services, (e) “ICQSM,” “AOL Search,” “You’ve Got Pictures,” “Shop @,” “My News,” “AOL
PlusSM ,” “AOL Instant MessengerSM,” “Digital CitySM,” “AOL
NetMailSM,” “Real FansSM”, “Love@AOLSM”, “Entertainment
AsylumSM,” “AOL HometownSM” 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, (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 narrowband 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.com. AOL’s primary Internet-based interactive site marketed under the
“AOL.COMSM” brand, specifically excluding (a) the AOL Service, (b) any international
versions of such site and/or any non-English language based feature or area of such site, (c)
CompuServe.com, Netscape Netcenter, any other CompuServe or Netscape products or services or
interactive sites, (d) “ICQSM,” “AOL Search,” “You’ve Got Pictures,” “Shop @,” “My
News,” “AOL PlusSM,” “AOL Instant MessengerSM,” “AOL NetMailSM” or
any similar independent product or service offered by or through such site or any other AOL
interactive site, (e) any programming or Content area offered by or through such site over which
AOL does not exercise complete operational control (including, without limitation, Content areas
controlled by other parties and member-created Content areas), (f) any programming or Content area
offered by or through the U.S. version of the America Online brand service which was operated,
maintained or controlled by the former AOL Studios division, (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” brand, by virtue of its branding, distribution, functionality,
Content or services, including, without limitation, any co-branded versions and any version

3

 

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 Network, including all users of the non-subscription based
AOL properties (e.g., users of Netscape, AOL.com, etc.).

Change of Control. With respect to any party means the consummation of one transaction or
series of related transactions resulting in (i) the sale or other disposition of all or
substantially all of the assets of a party, or (ii) the acquisition (by merger, consolidation,
reorganization or otherwise) 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 (A) the
then outstanding shares of common stock of such party or (B) the combined voting power of the then
outstanding voting securities of such party entitled to vote generally in the election of
directors.

Confidential Information. Any information relating to or disclosed in the course of this
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, 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 time
relation with text, images, or video), and other data, products, services, advertisements,
promotions, URLs, keywords and other navigational elements, links, pointers, technology and
software.

CompuServe. CompuServe’s primary Internet-based interactive site marketed under the
“CompuServe.comTM” brand, specifically excluding (a) the CompuServe Service and AOL Service, (b) any
international versions of such site and/or any non-English language based feature or area of such
site, (c) AOL.com, Netscape Netcenter, any other AOL or Netscape products or services or
interactive sites, (d) “ICQTM,” “AOL Search,” “You’ve Got Pictures,” “Shop @,” “My News,” “AOL
PIusSM,” “AOL Instant MessengerTM,” “NetMailTM” or any similar independent product or
service offered by or through such site or any other AOL or CompuServe interactive site, (e) any
programming or Content area offered by or through such site over which AOL does not exercise
complete operational control (including, without limitation, Content areas controlled by other
parties and member-created Content areas), (f) any programming or Content area offered by or
through the U.S. versions of the America Online® brand service or CompuServe brand service which
was operated, maintained or controlled by the former AOL Studios division, (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 or CompuServe interactive site, (h) any property, feature,
product or service which AOL or its affiliates may acquire subsequent to the Effective Date and (i)
any other version of an AOL or CompuServe interactive site which is materially different from
CompuServe’s primary Internet-based interactive site marketed under the “CompuServe.comTM” brand, by
virtue of its branding,

4

 

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.

Customized Programming. Any (a) area within the AOL Network or outside the AOL Network but
exclusively available to AOL Members, which area is developed, programmed, and/or managed by WebMD,
in whole or in part, pursuant to this Agreement and all Content thereon (including, without
limitation, message boards, chat and other AOL Member-supplied content areas contained therein and
including any sites or areas linked thereto) including, without limitation, any co-branded site or
page, but excluding the Customized Site and My Health and
(b) Content provided to AOL by WebMD pursuant to this Agreement for distribution on or through the
AOL Network other than on the Customized Site and My Health, including any Content appearing in the
Placements.

Customized Site. Collectively, each version of the WebMD Site that is customized for
distribution through the AOL Properties in accordance with this Agreement. For purposes of
clarity, the Parties agree that the Customized Site shall be hosted and served by WebMD from
outside the AOL Network.

Digital City. The standard, narrow-band U.S. version of Digital City® brand service’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 and/or any non-English language based feature or area of such local content
offering, (c) the CompuServe® brand service and any other CompuServe products or services (d)
“Driveway,” “ICQTM,” “AOL Search,” “You’ve Got Pictures,” “Shop @,” “My News,” “AOL
PlusSM,” “AOL Instant MessengerTM,” “AOL NetMailTM,” “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® brand service’s local content offerings, (e) any programming or Content area offered
by or through such local content offerings over which Digital City, Inc. (“DCI”) does not exercise
complete operational control (including, without limitation, Content areas controlled by other
parties and member-created Content areas), (f) any yellow pages, white pages, classifieds or other
search, directory or review services or Content offered by or through such local content offerings,
(g) any property, feature, product or service which AOL or its affiliates may acquire subsequent to
the Effective Date, (h) any other version of a Digital City® brand service local content offering
which is materially different from the narrow-band U.S. version of Digital City® brand service’s
local content offerings marketed under the Digital City® brand name, by virtue of its branding,
distribution, functionality, Content or services, including, without limitation, DCI’s Your Town
branded cities or any other similar “light” product offering, 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 (i) Digital City® branded offerings
in any local area where such offerings are not owned or operationally controlled by AOL, Inc. or
DCI.

Health Channels. The specific channel on each of the AOL Properties that is primarily
dedicated to consumer health content and any such consumer health channels developed, created,

5

 

purchased or otherwise incorporated into the AOL Properties during the Term of this Agreement which
specifically excludes Netscape’s business-to-business channels or areas (e.g., Netbusiness). This
definition does not include sub-areas of non-Health Channels on the AOL Network.

House Promotions. Promotions by AOL of AOL or an AOL Affiliate.

Impression. User exposure to a page, screen, panel or deck containing an WebMD Presence,
as such exposure may be reasonably determined and measured by AOL in accordance with its standard
methodologies and protocols. Each WebMD Presence on any such page or screen will count as a
separate Impression.

Interactive Service. An entity offering one or more of the following: (i) online or
Internet connectivity services (e.g., an online service or Internet service provider); (ii) an
interactive site or service featuring a broad selection of aggregated third party interactive
content (or navigation thereto) covering a broad range of subjects and targeted at a broad audience
(e.g., a search and directory service or portal) and/or marketing a broad selection of products
and/or services across numerous “vertical” interactive commerce categories (e.g., an online mall or
multiple-category e-commerce site); or (iii) communications software capable of serving as the
principal means through which a user creates, sends or receives electronic mail or real time online
messages.

Keyword Search Terms. (a) The KeywordTM online- search terms made available on the AOL
Service, combining AOL’s KeywordTM online search modifier with a term or phrase specifically related
to WebMD (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 WebMD and determined in accordance with the
terms of this Agreement).

Licensed Content. All Content offered through the Customized Site and My Health pursuant
to this Agreement or otherwise provided by or on behalf of WebMD or its agents in connection
herewith (e.g., offline promotional content or online Content for distribution through the AOL
Network), including without limitation all Customized Programming the WebMD Products, WebMD
Services, and Personal Health Tools.

My Health. WebMD shall develop a personal health management service through which
individual user information, including but not limited to Personalized Health Data, may be
collected and stored on a user specific database hosted by WebMD from the WebMD Site. “My Health”
is the interactive site created and hosted by WebMD outside the AOL Network via cul-de-sac
co-branding and customization and served onto the AOL Health Channel through which AOL Members will
be able to access personalized health care content and services as more fully described in the
Programming Plan.

Named Entities. Microsoft/MSN, Yahoo, Earthlink/Mindsrping, Juno, Terra-Lycos, Excite,
NetZero, Ebay, Amazon, Viacom, Disney, Prodigy, Altavista, any long distance telecommunications
provider, any Regional Bell Operating Company, any competitive local exchange telecommunications
company or any of the foregoing entities’ divisions or affiliate,

6

 

parent, successor entities or
subsidiary relationships. The list of Named Entities may be updated from time-to-time as
reasonably agreed upon by the Parties.

Netscape Netcenter. Netscape Communications Corporation’s primary Internet-based
interactive site marketed under the “Netscape NetcenterSM” brand, specifically excluding
(a) the AOL Service and the CompuServe Service, (b) AOL.com and CompuServe.com, (c) any
international versions of such site and/or any non-English language based feature or area of such
site, (d) “ICQ,” “AOLSearch,” “You’ve Got Pictures,” “Shop @,” “My News,” “AOL PlusSM,”
“AOL Instant Messenger,” “AOL NetMail,” “AOL Hometown,” “My News,” “Digital City,” or any similar
independent product or service offered by or through such site or any other AOL interactive site,
(e) any programming or Content area offered by or through such site over which AOL does not
exercise complete operational control (including, without limitation, Content areas controlled by
other parties and member-created Content areas), (f) any programming or Content area offered by or
through the U.S. version of the America Online brand service which was operated, maintained or
controlled by the former AOL Studios division (e.g., Electra), (g) any yellow pages, white pages,
classifieds or other search, directory or review services or Content offered by or through such
site or any other AOL interactive site, (h) any property, feature, product or service which AOL or
its affiliates may acquire subsequent to the Effective Date
(i) Netscape’s Netbusiness, and (j) any other version of an AOL or Netscape Communications
Corporation interactive site which is materially different from Netscape Communications
Corporation’s primary Internet-based interactive site marketed under the “Netscape NetcenterTM”
brand, by virtue of its branding, distribution, functionality, Content or services, including,
without limitation, any co-branded versions and any version distributed through any broadband
distribution platform or through any platform or device other than a desktop personal computer
(e.g. Custom NetCenters built specifically for third parties).

Payer. Health care providers (including doctors, hospitals, practice management
companies), health plans (including insurance companies, HMO’s, TPA’s, PBM’s, PPO’s, self-insured
employers, carve out benefit plans, and plan sponsors), and pharmaceutical services companies
(including clinical research organizations, wholesalers, pharmacies and PBM’s) and clinical
laboratories.

Personalized Health Data. Personally identifiable health information, including all
information contained in the files and/or records for AOL Members, obtained by WebMD in connection
with such AOL Member’s use of My Health, the Customized Site and/or the Health Channels.

Personal Health Tools. The personalized interactive health management tools provided by
WebMD for use on the Customized Site, My Health and the Health Channels, including, but not limited
to, WebMD Products and WebMD Services, the MyHealthRecord functionality that is otherwise available
on the WebMD site and additional functionalities as WebMD and AOL mutually agree upon.

Pharmaceutical Manufacturer. Any division, product group, unit and/or affiliates who is
primarily engaged in the manufacture of prescription pharmaceuticals, excluding divisions, groups,
units and/or affiliates selling consumer packaged goods, over-the-counter drugs or supplies, beauty
products and other non-prescription products.

7

 

Promotions. The promotions described in Section 1.1 and the Carriage Plan and any
additional promotions of the Customized Site, Customized Programming, My Health, Health Channels,
Personal Health Tools, WebMD Products, and WebMD Services provided by WebMD or AOL (including,
without limitation, additional Keyword Search Terms and other navigational tools).

Restricted Category. A category in which AOL or the applicable AOL Property has an
exclusive or other preferential relationship.

ROS. Run of Service advertising sales include non-permanent advertising promotions and
placements that appear throughout the AOL Network.

Semi-Annual Period. During the Initial Term and any Renewal Term, the six month period
from May 9, 2001 through November 8, 2001 and each successive six month period thereafter.

Standard. AOL policies and/or guidelines that are generally applicable to all AOL
programming partners.

WebMD Affiliate. Any agent, distributor or franchisee of WebMD, or an entity that,
directly or indirectly, controls, is controlled by, or is under common control with WebMD,
including any entity in which WebMD holds, directly or indirectly, at least a nineteen percent
(19%) equity interest.

WebMD Interactive Site. Any interactive site or area (other than Customized Programming or
WebMD content on CNN.com), including any mirrored site or area, which is managed, maintained or
owned by WebMD or its agents or to which WebMD provides and/or licenses substantially all of the
information, content or other materials on such interactive site, including, but not limited to
WebMD co-branded sites with MSN, Lycos, and Excite so long as WebMD continues to manage, maintain,
or provide and/or license substantially all of the information, content or other materials on such
interactive site.

WebMD Products. The My Health Products described on Exhibit H and the unique products
created by WebMD for AOL. With the exception of such products, if any, identified by WebMD as
being created for AOL’s sole use, the Parties agree that WebMD has the right to deploy WebMD
Products on other sites, including, but not limited to, portal site such as Excite, Lycos or MSN.

WebMD Presences. Any (a) WebMD trademark or logo, (b) headline or picture from WebMD
Content, (c) teaser, icon, or link to the Customized Site or Customized Programming and/or (d)
other Content which originates from, describes or promotes WebMD or WebMD’s Content.

WebMD Competitor. The following entities are WebMD Competitors: Medscape.com/CBS
Healthwatch.com, HealthCentral.com, DrKoop.com, Intelihealth.com, Healthgate, Healthscout.com,
Thriveonline, allHealth.com and Wellmed.com. The list of WebMD Competitors may be updated from
time-to-time as reasonably agreed upon by the Parties.

8

 

WebMD Content. Text, images, video, audio (including, without limitation, music used in
synchronism or timed relation with visual displays) and other data, including materials, articles,
features, applications and tools similar to the programming currently offered on the WebMD Site,
that is provided by WebMD for use on My Health, the Customized Site, Customized Programming, and/or
Health Channels. WebMD Content shall not include WebMD Services and WebMD Products. With the
exception of such WebMD Content, if any, identified by WebMD as being created for AOL’s sole use,
the Parties agree that nothing in this Agreement will prevent WebMD from deploying the WebMD
Content on other Internet sites, including, but not limited to, other portal sites such as Lycos,
MSN or Excite.

WebMD Services. The My Health Services described on Exhibit I and the unique services
created by WebMD for AOL. With the exception of such services, if any, identified by WebMD as
being created for AOL’s sole use, the Parties agree that WebMD has the right to deploy WebMD
Services on other sites, including, but not limited to, portal site such as Excite, Lycos or MSN.

WebMD Site. The collection of consumer oriented Internet pages (other than My Health)
residing on servers owned or controlled by WebMD and accessible by the public via the Internet and
located at the URL http://www.webmd.com, and all successor sites, excluding (i) any programming or
content area offered by or through such site over which WebMD does not exercise complete
operational control (including, without limitation, Content areas controlled by other parties and
member-created Content areas) and (ii) any portions of the site dedicated or providing services to
physicians, health care professionals and their staff.

9

 

EXHIBIT C

Operations

	1.	 	My Health and Customized Site Infrastructure. Except as otherwise provided in
the Agreement, WebMD will be responsible for all communications, hosting and connectivity
costs and expenses associated with the Customized Site and My Health Site. WebMD will
provide all hardware, software, telecommunications lines and other infrastructure necessary
to meet traffic demands to the Customized Site and My Health from the AOL Network. WebMD
will design and implement the network between the AOL Service and Customized Site and My
Health such that (i) no single component failure will have a materially adverse impact on
AOL Members seeking to reach the Customized Site and My Health from the AOL Network and
(ii) no single line under material control by WebMD will run at
more than *% average utilization for a 5 minute peak in a daily period. In this regard, WebMD will
provide AOL, upon request, with a detailed network diagram regarding the architecture and
network infrastructure supporting the Customized Site and My Health.
	 
	2.	 	WebMD Optimization: Speed. WebMD will ensure that: (a) the functionality and
features within the Customized Site and My Health are fully functional with the client
software then in use by AOL Members; and (b) the Customized Site and My Health is designed and
populated in a manner that minimizes delays when AOL Members attempt to access such site. At
a minimum, WebMD will ensure that the WebMD’s Site’s data transfers initiate within fewer than
fifteen (15) seconds on average. Prior to commercial launch of any material promotions
described herein, WebMD will permit AOL to conduct performance and load testing of the
Customized Site and My Health (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.
	 
	3.	 	User Interface. WebMD will maintain a graphical user interface within the Customized
Site that is competitive in all material respects with interfaces of other similar sites based
on similar form technology. AOL reserves this right to review and approve, such approval not
to be unreasonably refused, the user interface and site design prior to launch of the
Promotions and to conduct focus group testing to assess compliance with respect to the
preceding sentence.
	 
	4.	 	Technical Problems. WebMD agrees to use commercially reasonable efforts to address
material technical problems (over which WebMD exercises control), affecting use by AOL Members
of the Customized Site (a “WebMD Technical Problem”) promptly following notice thereof.
	 
	5.	 	Monitoring. WebMD will ensure that the performance and availability of the
Customized Site, Customized Programming, and My Health is monitored on a continuous
basis. WebMD will provide AOL with contact information (including e-mail, phone,

 

	 	Confidential treatment has been requested. The
redacted material has been separately filed with the commission.

 

 

	 	 	pager and fax information, as applicable, for both during and after business hours) for WebMD’s
principal technical representative, for use in cases when issues or problems arise with
respect to the Customized Site, Customized Programming or My Health.
	 
	6.	 	Telecommunications. Where applicable WebMD will utilize encryption methodology to
secure data communications between the Parties’ data centers. The network between the Parties
will be configured such that no single component failure will significantly impact AOL
Members. The network will be sized such that no single line over which the WebMD has material
control runs at more than *% average utilization for a 5-minute peak in a daily period.
	 
	7.	 	Security. WebMD will utilize Internet standard encryption technologies (e.g., Secure
Socket Layer - SSL) or other technologies mutually agreed by the Parties or generally
acknowledged by experts to provide equal or greater security 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
Customized Site and My Health. WebMD will facilitate periodic reviews of the Customized Site
and My Health by AOL in order to evaluate the security risks of such site. WebMD will promptly
remedy any security risks or breaches of security as may be identified by AOL’s Operations
Security Team
	 
	8.	 	Technical Performance.

	 	1.	 	WebMD will design the Customized Site and My Health to support those AOL-Client
embedded versions of the Microsoft Internet Explorer browsers (Windows and Macintosh)
and the Netscape Browsers supported by AOL and WebMD will make commercially reasonable
efforts to support all other AOL browsers supported by AOL.
	 
	 	2.	 	To the extent WebMD creates customized pages on the Customized Site or My
Health for AOL Members, WebMD will develop 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.”).
	 
	 	3.	 	WebMD will periodically review the technical information made available by AOL
at “http://webmaster.info.aol.com.”
	 
	 	4.	 	WebMD will design the Customized Site and My Health to support HTTP 1.0 or
latter protocol as defined in RFC 1945 and to adhere to AOL’s parameters for refreshing
or preventing caching of information in AOL’s proxy system as outlined in the document
provided at the following URL: “http://webmaster.info.aol.com.” WebMD and AOL are
responsible, on the respective sites, for the manipulation these parameters in
web-based objects so as to allow them to be cached or not cached as outlined in RFC
1945.
	 
	 	5.	 	Prior to releasing material, new functionality or features (“New
Functionality”) through the Customized Site and/or My Health, WebMD will use
commercially

2

Confidential treatment has been requested. The redacted material has been separately filed with the Commission.

 

	 	 	 	reasonable efforts to test the New Functionality to confirm its compatibility with
AOL Service client software.

	9.	 	AOL Internet Services WebMD Support. AOL will provide WebMD 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 will not in any case be involved with content creation on
behalf of WebMD or support for any technologies, databases, software or other applications
which are not supported by AOL or are related to any WebMD area other than the Customized Site
or My Health. Support to be provided by AOL is contingent on WebMD providing to AOL demo
account information (where applicable), a description of My Health and the Customized Site’s
software, hardware and network architecture sufficient to permit AOL to provide assistance
and, if necessary to provide assistance, access to the Customized Site and My Health for
purposes of such performance and load testing as AOL elects to conduct.

3

 

EXHIBIT D

Standard Online Commerce Terms & Conditions

	1.	 	Provision of Content. In the event that AOL notifies WebMD that, as reasonably
determined by AOL, any Content within the Customized Site, Customized Programming or My
Health violates AOL’s Standard Terms of Service (as set forth on the America Online® brand
service at Keyword term “TOS”) for the AOL Service or any other AOL property through which
the Customized Site, Customized Programming or My Health is promoted, the terms of this
Agreement or any other Standard, written AOL policy, then WebMD will take commercially
reasonable steps to block access by AOL Members to such Content using WebMD’s
then-available technology. In the event that WebMD cannot, through its commercially
reasonable efforts, block access by AOL Users to the Content in question, then WebMD will
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.
WebMD will cooperate with AOL’s reasonable requests to the extent AOL elects to implement
any such access restrictions.
	 
	2.	 	Contests. WebMD will take all steps necessary to ensure that any contest
sweepstakes or similar promotion conducted or promoted through the Customized Site and/or
My Health (a “Contest”) complies with all applicable federal, state and local laws and
regulations.
	 
	3.	 	Disclaimers. Upon AOL’s request, WebMD agrees to include within the Customized
Site, Customized Programming, WebMD Products offered on My Health, WebMD Services offered
on My Health Personal Health Tools and My Health a product disclaimer (the specific form
and substance to be mutually agreed upon by the Parties) indicating that transactions are
solely between WebMD and AOL Members. Upon WebMD’s request, AOL agrees to include within
the Health Channels a product disclaimer (the specific form and substance to be mutually
agreed upon by the Parties) indicating that transactions are solely between AOL Members and
other AOL interactive content partners and not WebMD.
	 
	4.	 	AOL Look and Feel. WebMD acknowledges and agrees that AOL will 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 (“AOL Look and Feel”), subject to WebMD’s ownership rights in any WebMD
trademarks or copyrighted materials within the Customized Site, Customized Programming and
My Health and to WebMD’s rights to any elements of graphics, design, organization,
presentation, layout, user interface, navigation or stylistic convention (including digital
implementations thereof) which are generally associated with the online areas of the
Customized Site, Customized Programming and My Health which are neither copies of nor
derived from such elements generally associated with the online areas contained within the
AOL Network. The Parties agree that nothing this Agreement grants AOL any right in the
proprietary WebMD elements of graphics, design, organization, presentation, layout, user
interface, navigation and stylistic convention (including digital implementations thereof)
which are used on the WebMD Site, even if such elements are used on the Health Channels, My Health or the Customized
Site.

 

 

	5.	 	Management of the Customized Site, Customized Programming and My Health. WebMD
warrants that the WebMD Products, WebMD Services, Customized Programming, Customized Site,
My Health and other Licensed Content: (i) will 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; and (ii) will not violate any applicable
law or regulation, including those relating to the advertising and sale of prescription
drugs, the advertising and sale of over-the-counter drugs, the practice of medicine, the
practice of pharmacy, contests, sweepstakes or similar promotions. AOL will have no
obligations with respect to the WebMD Products, WebMD Services or other Licensed Content
including, but not limited to, any duty to review or monitor any such WebMD Products, WebMD
Services or Licensed Content. AOL represents and warrants that any content that it creates
and/or provides for the rainman pages of the Health Channels: (i) will 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; and (ii) will not
violate any applicable law or regulation, including those relating to the advertising and
sale of prescription drugs, the advertising and sale of over-the-counter drugs, the
practice of medicine, the practice of pharmacy, contests, sweepstakes or similar
promotions. WebMD will have no obligations with respect to the content AOL creates and/or
provides for the rainman pages including, but not limited to, any duty to review or monitor
any such AOL content.
	 
	6.	 	Section Reserved.
	 
	7.	 	Customer Service. It is the responsibility of WebMD to provide customer
service to persons or entities accessing WebMD Products and WebMD Services through the AOL
Properties (“Customers”) and AOL will have no obligations whatsoever with respect thereto.
WebMD will receive all emails from Customers via a computer available to WebMD’s customer
service staff and generally respond to such emails within a reasonable period following the
receipt of the email. WebMD will comply with the requirements of any federal, state or
local consumer protection or disclosure law. Payment for Products will be collected by
WebMD directly from Customers.
	 
	8.	 	Production Work. In the event that WebMD requests AOL’s production assistance
in connection with (i) ongoing programming and maintenance related to the Customized Site
or My Health, (ii) a redesign of or addition to the Customized Site or My Health (e.g., a
change to an existing screen format or construction of a now custom form), (iii) production
to modify work performed by a third party provider, or (iv) any other type of production
work, WebMD will 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 will notify WebMD 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 will be reflected in a separate work order signed by the Parties. All work performed under a Production Plan shall be demanded work for hire
and owned solely by WebMD, except for portions of the work that include elements of
graphics, design, organization, presentation, layout, user interface, navigation and
stylistic convention

2

 

	 	 	(including the digital implementations thereof) which are generally
associated with online areas contained within the AOL Network.
	 
	9.	 	Overhead Accounts. To the extent AOL has granted WebMD any overhead accounts
on the AOL Service or CompuServe, WebMD will 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 WebMD, but WebMD will 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 will bear. Upon the termination of this Agreement, all overhead accounts,
related screen names and any associated usage credits or similar rights, will automatically
terminate. AOL will have no liability for loss of any data or content related to the
proper termination of any overhead account.
	 
	10.	 	Navigation Tools. Any Keyword Search Terms to be directed to the Customized
Site or My Health shall be (i) subject to availability for use by WebMD and (ii) limited to
the combination of the Keywordtm search modifier combined with a trademark of
WebMD as well as (e.g. “AOL keyword: XYZ Company Name”). AOL reserves the right to revoke
at any time WebMD’s use of any, Keyword Search Terms which do not incorporate registered
trademarks of WebMD. WebMD acknowledges that its utilization of a Keyword Search Term will
not create in it nor will it represent it has, any right title or interest in or to such
Keyword Search Term, other than the right title and Interest WebMD holds in WebMD’s
trademark independent of the Keyword Search Term. Without limiting the generality of the
foregoing. WebMD will 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 Members to “bookmark” the URL or other locator for the Customized Site or My
Health, such bookmarks will be subject to AOL’s control at all times. Upon the termination
of this Agreement, WebMD’s rights to any Keyword Search Term; and bookmarking will
terminate.
	 
	11.	 	Search Terms. To the extent this Agreement sets forth any mechanism by which
the Customized Site or My Health will be promoted in connection with specified search terms
within any AOL product or service, WebMD hereby represents and warrants that WebMD has all
consents, authorizations, approvals, licenses, permits or other rights necessary for WebMD
to use such specified search terms. Notwithstanding the foregoing, AOL shall have the
right to suspend the use of any search term if AOL has reason to believe continued use may
subject AOL to liability or other adverse consequences.

3

 

EXHIBIT E

Standard Legal Terms & Conditions

	1.	 	Promotional Materials/Press Releases. Each Party will submit to the other Party, for
its prior written approval which will not be unreasonably withheld or delayed, any marketing,
advertising, or other promotional materials, excluding Press Releases, related to the
Customized Site, My Health and Health Channels and/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 Customized Site, Customized Programming, or My
Health for promotional purposes will not require the approval of the other Party so long as
America Online® and/or WebMD®, as appropriate is clearly identified as the source of such
screen shots, 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, will not require the
approval of the other Party. Each Party will 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 Customized Site, Customized Programming, Health Channels and My Health 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.	 	Trademark License. In designing, promoting and implementing the Health Channels, My
Health and the Customized Site, Customized Programming and Promotional Materials and subject
to the other provisions contained herein, WebMD will be entitled to use the following trade
names, trademarks, and service marks of AOL: the “America Online®” brand service,
“AOLtm” service/software and AOL’s triangle logo and the trademarks and logos of
AOL.com, CompuServe, and Netcenter, for which AOL holds all rights necessary for use in
connection with this Agreement. In promoting the Health Channels, Customized Site, My Health
and Promotional Materials and subject to the other provisions contained herein, AOL and its
affiliates will be entitled to use the trade names, trademarks, and service marks of WebMD,
for which WebMD 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.

	3.	 	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 will
inure to the benefit and be on behalf, of the other Party. Each Party acknowledges that its
utilization of the other Party’s Marks will not create in it, nor will 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.
	 
	4.	 	Quality Standards. Each Party agrees that the nature and quality of its products and
services supplied in connection with the other Party’s Marks will 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 will comply with all applicable laws,
regulations, and customs and obtain any required government approvals pertaining to use of the
other Party’s marks.
	 
	5.	 	Infringement Proceeding. 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 will
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.
	 
	6.	 	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 on 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 will 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 will
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.
	 
	7.	 	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
will take reasonable steps, at least substantially equivalent to the steps it takes to protect
its own proprietary information, during the term of this Agreement and for a period of three
(3) 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 will 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
will provide as much notice as is reasonably possible of such proposed disclosure to the other
Party, but in no event less than two (2) 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 will (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

2

 

	 	 	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. Each Party
acknowledges that the unauthorized disclosing a Party’s Confidential Information would cause
the Party irreparable harm and significant injury, the degree of which may be difficult to
ascertain. Accordingly, each Party agrees that the Party whose Confidential Information
will be disclosed will have the right to obtain an immediate injunction enjoining any breach
of this Section 7, as well as, the right to pursue any and all other rights and remedies
available at law or in equity in the event of such breach.
	 
	8.	 	Limitation of Liability, Disclaimer Indemnification.

	 	8.1 	Liability. UNDER NO CIRCUMSTANCES WILL 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 USE OR INABILITY TO USE THE AOL NETWORK, THE AOL SERVICE,
AOL.COM, THE HEALTH CHANNELS, MY HEALTH, THE WEBMD SITE OR THE CUSTOMIZED 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 WILL 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 8.3. EXCEPT AS PROVIDED IN SECTION 8.3, LIABILITY ARISING UNDER
THIS AGREEMENT WILL BE LIMITED TO DIRECT, OBJECTIVELY MEASURABLE DAMAGES AND THE
MAXIMUM LIABILITY OF ONE PARTY TO THE OTHER PARTY FOR ANY CLAIM ARISING IN CONNECTION
WITH THIS AGREEMENT WILL NOT EXCEED
$15,000,000.00; PROVIDED THAT EACH PARTY WILL
REMAIN LIABLE FOR THE AGGREGATE AMOUNT OF ANY PAYMENT OBLIGATIONS OWED TO THE OTHER
PARTY PURSUANT TO THE AGREEMENT AND THAT, TO THE EXTENT AVAILABLE, THE FOREGOING
LIMITATIONS ON DAMAGES SHALL NOT AFFECT EITHER PARTY’S RIGHT TO SEEK EQUITABLE RELIEF.
	 
	 	8.2 	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

 

3

 

	 	 	 	NETWORK, THE AOL SERVICE, AOL.COM, WEBMD, THE WEBMD
SITE, THE PERSONALIZED HEALTH TOOLS, THE CUSTOMIZED PROGRAMMING, THE HEALTH
CHANNELS, MY HEALTH, OR THE CUSTOMIZED SITE, 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 AND WEBMD SPECIFICALLY DISCLAIM ANY WARRANTY REGARDING THE
PROFITABILITY OF THE CUSTOMIZED SITE, MY HEALTH AND HEALTH CHANNELS.
	 
	 	8.3 	Indemnity. Each Party will 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. In addition, WebMD will defend,
indemnify, save and hold harmless AOL and AOL’s officers, directors, agents,
affiliates, distributors, franchisees and employees from any and all Liabilities
arising out of or in any way related to the Licensed Content.
	 
	 	8.4 	Claims. If a Party entitled to indemnification hereunder (the
“Indemnified Party”) becomes aware of any matter it believes is indemnifable 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 will give the other Party (the “Indemnifying Party”) prompt written notice of
such Action. Such notice will (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 will 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 will be obligated to
defend the Action, at its own expense, and by counsel reasonably satisfactory to the
Indemnified Party. The Indemnified Party will cooperate, at the expense of the
Indemnifying Party, with the Indemnifying Party and its counsel in the defense and the
Indemnified Party will 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 will 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 will cooperate, at
its own expense, with the Indemnified Party and its counsel in the defense against
such Action and the Indemnifying Party will have the right to participate fully, at
its own expense, in the defense of such Action. Any compromise or settlement of an
Action will require the prior written consent of both Parties hereunder, such
consent not to be unreasonably withheld or delayed.

4

 

	9.	 	Acknowledgement. AOL and WebMD 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 8 will be enforceable independent of and severable from any other enforceable or
unenforceable provision of this Agreement.

	10.	 	Solicitation of AOL Members. During the term of the Agreement and for a two year
period thereafter, WebMD will not use the AOL Network (including, without limitation, the
e-mail network contained therein) to solicit AOL Members on behalf of another Interactive
Service. More generally, WebMD will not intentionally 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” will mean that the AOL Member to whom commercial e-mail or other online
communication is being sent has voluntarily either (i) engaged in a transaction with WebMD or
(ii) provided information to WebMD through a contest, registration, or other communication,
which included clear notice to the AOL Member that the information provided could result in
commercial e-mail or other online communication being sent to that AOL Members by WebMD or its
agents. Any commercial e-mail or other online communications to AOL Members which are
otherwise permitted hereunder, will (a) include a prominent and easy means to “opt-out” of
receiving any future commercial communications from WebMD, 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). WebMD will not disclose Member Information collected hereunder to any third party
in a manner that identifies AOL Members as end users of an AOL product or service or use
Member Information collected under this Agreement to market another Interactive Service.
	 
	 	 	AOL Member Communications. To the extent WebMD is otherwise permitted to send
communications to AOL Members (in accordance with the other requirements contained herein):
in any such communications to AOL Members on or off the Customized Site (including, without
limitation, e-mail solicitations), WebMD will limit the subject matter of such
communications to those categories of products, services and/or content that are
specifically contemplated by this Agreement and will not encourage AOL Members 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 Customized
Site for the purchase of Products, (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 Member communications, in the event
that WebMD encourages an AOL Member to purchase products through such communications, WebMD
shall ensure that (a) the AOL Network is expressly promoted as the primary means through
which the AOL Member can access the Customized Site (including without limitation by stating
the applicable Keyword Search Term and including direct links to specific offers within the

5

 

	 	 	Customized Site) and (b) any link to the Customized Site will link to a page which indicates
to the AOL Member that such user is in a site which is affiliated with the AOL Network.
	 
	11.	 	Section Reserved
	 
	12.	 	Excuse. Neither Party will 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.
	 
	13.	 	Independent Contractors. The Parties to this Agreement are independent contractors.
Neither Party is an agent, representative or employee of the other Party. Neither Party will
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 will
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.
	 
	14.	 	Notice. Any notice, approval, request, authorization, direction or other
communication under this Agreement will be given in writing and will be deemed to have been
delivered and given for all purposes (i) on the delivery date, if delivered by electronic mail
“AOLNotice@AOL.com” 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 will 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 WebMD, except as otherwise specified
herein, the notice address will be the address for WebMD set forth in the first paragraph of
this Agreement to the attention of WebMD’s General Counsel with a copy to Kevin Boyle at
Latham & Watkins, 11400 Commerce Park Drive, Suite 200, Reston, Virginia 20191-1549.
	 
	15.	 	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 will 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 will be and remain in full force and effect.
	 
	16.	 	Return of Information. Upon the expiration or termination of this Agreement, each
Party will, upon the written request of the other Party, return or destroy (at the option of
the Patty receiving the request) all confidential information, documents, manuals and other
materials specified the other Party.

6

 

	17.	 	Survival. Sections 5.1 through 5.4 and 6.6 of the body of the Agreement. Sections 7
through 28 of this Exhibit and any payment obligations accrued prior to termination or
expiration will survive the completion, expiration, termination or cancellation of this
Agreement.
	 
	18.	 	Entire Agreement. Except where specified otherwise in the 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 will 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.
	 
	19.	 	Amendment. No change, amendment or modification of any provision of this Agreement
will 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.
	 
	20.	 	Further Assurances. Each Party will 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.
	 
	21.	 	Assignment. Neither AOL nor WebMD may assign this Agreement or any right interest or
benefit under this Agreement to a third party without the prior written consent of the other
Party; except that AOL may assign this Agreement to an Affiliate without WedMD’s consent as
long as AOL is not released from liability for this Agreement and WebMD may assign this
Agreement to a WebMD Affiliate, which is not a Named Entity, without AOL’s consent, as long as
WebMD is not released from liability for this Agreement. Either Party may effect an
assumption of the Agreement by any successor by way of merger, acquisition, consolidation or
sale of substantially all of the assets provided that (a) the entity assuming this Agreement
has adequate capacity (including financial and technical) to fully perform hereunder and (b)
with respect to an assumption of the Agreement by a successor to WebMD that is a Named Entity,
such assumption shall be subject to Section 6.5.
	 
	22.	 	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 will 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 will remain in full force and
effect provided the resulting agreement is not fundamentally different than the original
Agreement.

7

 

	23.	 	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.
	 
	24.	 	Applicable Law. Except as otherwise expressly provided herein, this Agreement will
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.
	 
	25.	 	Export Controls. Both Parties will adhere to all applicable laws, regulations and
rules relating to the export of technical data and will not export or re-export any technical
data, any products 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.
	 
	26.	 	Headings. The captions and headings used in this Agreement are inserted for
convenience only and will not affect the meaning or interpretation of this Agreement.
	 
	27.	 	Counterparts. This Agreement may be executed in counterparts, each of which will be
deemed an original and any of which together will constitute one and the same document.
	 
	28.	 	Third Party Beneficiaries. This Agreement does not create any benefits, rights,
claims, obligations, or causes of action in, to, or on behalf of, any person or entity other
than to AOL and WebMD under this Agreement.

8EX-10.41

 

Exhibit 10.41

Conformed Copy

FIRST AMENDMENT TO
INTERACTIVE SERVICES AGREEMENT

          This Amendment to Interactive Services Agreement (this “First Amendment”), effective as of May
15, 2001 (“Amendment Effective Date”), is made and entered into by and between America Online, Inc.
(“America Online” or “AOL”), a Delaware corporation with its principal offices at 22000 AOL Way,
Dulles, Virginia 20166 and WebMD Corporation (“WebMD”), a Delaware corporation, with offices at 669
River Drive, River Drive Center 11, Elmwood Park, NJ 07407. Defined terms that are used but not
defined herein shall be as defined in the Interactive Services Agreement between AOL and WebMD
effective as of May 9, 2001 (“Agreement”).

          The Parties wish to amend the Agreement as described below.

          It is therefore agreed as follows:

	1.	 	Impressions-Section 1.1.1(iii). The Impressions Target set forth in section
1.1.1(iii) of the Agreement shall be increased by* (*) Impressions to * (*)
Impressions.
	 
	2.	 	Carriage Plan-Exhibit A-1. [Intentionally Omitted]

 

	 	 	Confidential treatment has been requested. The
redacted material has been separately filed with the Commission. All
redacted material has been marked by an asterisk (*).

 

 

Conformed Copy

	3.	 	Order of Precedence. This Amendment is supplementary to and modifies the
Agreement. The terms of this Amendment supersede provisions in the Agreement only to the
extent that the terms of this Amendment and the Agreement expressly conflict. However,
nothing in this Amendment should be interpreted as invalidating the Agreement, and provisions
of the Agreement will continue to govern relations between the parties insofar as they do not
expressly conflict with this Amendment.

	4.	 	Counterparts. This Amendment may be executed in counterparts, each of which shall be
deemed an original and all of which together shall constitute one and the same document.

          IN WITNESS WHEREOF, the Parties hereto have executed this Amendment as of the date first
written above.

	 	 	 	 	 	 	 
	AMERICA ONLINE, INC.	 	WEBMD CORPORATION
	 
	 	 	 	 	 	 
	By:

	 	/s/ Jonathan R. Edson	 	By:	 	/s/ David Schlanger
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Name:

	 	Jonathan R. Edson	 	Name:	 	David Schlanger
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Title:

	 	Vice President Business Affairs	 	Title:	 	Senior Vice President
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Date:
	 	6/18/01	 	Date:	 	6/15/01
	 

	 	 
	 	 	 	 

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00090-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00090-of-00352.parquet"}]]