Exhibit 10.10
CONSULTING AGREEMENT
This
Consulting Agreement (the “ Agreement
” is entered into as of November 1, 2007 (the “
Effective
Date ”) by and between Shutterfly, Inc., a
Delaware corporation with a principal place of business at
2800 Bridge Parkway, Suite 101, Redwod City, California 94065
( “Shutterfly”)
and Mountain Capital LLC. (dba Arrow Media Solutions) a New
York limited liability company (the
“AMS”).
RECITAL
AMS
desires to perform), and Shutterfly desires to have AMS
perform, consulting services as an independent contractor to
Shutterfly.
NOW,
THEREFORE, the parties agree as follows:
1.
Services
and Compensation .
(a)
Performance
. AMS shall perform the consulting services (the “Services”
) described in detail on Exhibit A
to this Agreement (the “ Project
Description ”) in a workmanlike and professional
manner, and with a level of skill commensurate with the
requirements of this Agreement.
(b)
Compensation.
As sole compensation for the performance of the Services,
Shutterfly will pay AMS the compensation set forth on
Exhibit A
for the performance of Services, Any expenses incurred by AMS
in performing the Services will be the sole responsibility of
AMS unless otherwise agreed by Shutterfly. AMS will invoice
Shutterfly on a monthly basis. Shutterfly will pay each such
invoice no later than thirty (30) days after receipt of the
invoice.
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2.
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Relationship of Parties .
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(a)
Independent
Contractor . AMS is an independent contractor and is
not an agent or employee of, and has no authority to bind,
Shuttorfly by contract or otherwise. AMS’s will
determine, in AMS’s sole discretion, the manner, method
and means by which the Services are accomplished, subject to
the requirement that AMS shall at all times comply with
applicable law. While Shutterfly has no right or authority to
control the manner or means by which the Services arc
accomplished, it may, in its discretion, exercise broad
general power of supervision over the results of the work
performed by AMS.
(b)
Employment
Taxes and Benefits . As AMS is not an employee of
Shutterfly, Shutterfly shall not take any action or provide
AMS with any benefits or commitments. AMS will not be entitled
to receive any vacation or illness payments, or to participate
in any benefit plans, arrangements, or distributions by
Shutterfly pertaining to any bonus, stock option, profit
sharing, insurance or similar benefits for Shutterfly’s
employees, AMS shall bear sole responsibility for payment of
compensation to its personnel. AMS shall pay and report, for
all personnel assigned to Shutterfly’s work, federal and
state income tax withholding, Social Security taxes,
disability insurance contributions and unemployment insurance
applicable to such personnel as employees of AMS. AMS shall
bear sole responsibility for any health or disability
insurance, retirement benefits, or other welfare or pension
benefits (if any) to which such personnel may be
entitled.
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(c)
AMS’s
Agreements with Personnel . AMS shall obtain and
maintain in effect written agreements with each of its
personnel, if any, who participate in any of
Shutterfly’s work hereunder. Such agreements shall
contain terms sufficient for AMS to comply with all provisions
of this Agreement.
(d)
Insurance
Coverages . AMS shall procure and maintain adequate
insurance to protect AMS from the following; (a) claims under
worker’s compensation; (b) claims for damages because of
bodily injury, sickness, disease or death which arise out of
any negligent art or omission of AMS; and (c) claims for
damages because of injury to or destruction of tangible or
intangible property, including loss of use resulting
therefrom, which arise out of any negligent act or omission of
AMS.
3.
License
of Rights.
(a) Shutterfly
hereby obtains an exclusive, nontransferable and definite term
right to use one copy of the object code version of the
Software, as defined and listed on Exhibit
A . with each Kiosk for the term specified in Paragraph
6(a) of this Agreement (the “License
Term ”), Shutterfly will only have the right to
execute one copy of Software under one single operating system
image solely on the designated Kiosk, as defined in
Exhibit
A . and solely al the designated location. Any
extension of Shutterfly’s rights of use and/or any
increase to Shutterfly’s authorized computer processing
power will require payment of additional foes in accordance
with AMS’ then current terms and fees. AMS will deliver
or have delivered to Shutterfly one (1) set of the Software
unless otherwise agreed on Exhibit A, AMS is responsible for
the installation of the Software with each Kiosk unless
otherwise mutually agreed in writing
The
Software is generally composed to two components. In this
regard, parties agree as follows:
(i)
Software
Retained Components . AMS will retain all ownership
rights of the following: all intellectual property, including
trade secrete ideas and concepts, methodologies, techniques,
templates, generic tools, processes, software, routines,
algorithms, expressions and data developed or reduced to
practice by AMS prior to or
independent of its performance of the services and their
modifications and derivative works thereto or any other
retained components (collectively, “Retained
Components ”).
(ii)
Software
Shutterfly Components AMS will retain all ownership
rights of the following; all intellectual property, including
trade secrets, ideas and concepts, methodologies, techniques,
templates, generic tools, processes, software routines,
algorithms, expressions and data developed or reduced to
practice by AMS as part
of
its performance of the services, and their modifications and
derivative works thereto or any other retained components
(collectively, “Shutterfly
Components ”). Provided that Shutterfly
satisfactory fulfills of all of its payment obligations under
this Agreement, AMS agrees that it will not license,
sublicense or sale the Shutterfly Components to a third party
during the term of this Agreement and for a period of two
years following expiration or termination of this
Agreement.
(b) Shutterfly
may use the Software (i) to transmit information to and
receive information from those companies who routinely trade
or transact business with Shutterfly in the normal course of
business; (ii) for internal use in connection with its own
business requirements; and (iii) in
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connection
with any services it is providing to its parent corporation or
to wholly owned subsidiaries of Shutterfly provided that such
entities’ personnel do not have access to the Software.
Shutterfly shall not charge, or allow others to charge, any
such party for use of the Software. Shutterfly shall not sell,
license, publish, distribute, lease, rent or otherwise
transfer the Software or perform, display or otherwise use the
Software in the operation of a service bureau or for the
benefit of unrelated third parties.
(c) Shutterfly
shall not copy the Software, in whole or in part, except for
disaster recovery, program error verification, and back-up
purposes. Shutterfly may install the Software on another Kiosk
of the same operating system at the same or another Shutterfly
location only for such purposes or for use in emergency
situations. Except as authorized under Exhibit
A . Shutterfly shall not otherwise copy, modify,
translate or prepare derivative works of the Software.
Shutterfly shall maintain and furnish to AMS, upon reasonable
request, competent records of the number and location of all
copies of the Software, in whole or in part. In the event of a
major malfunction causing the Kiosk to become inoperable,
Shutterfly may, upon prompt written notice to AMS, temporarily
use the Software on a no designated kiosk or at a
nondesignated facility location, at the Designated Location,
as defined in Exhibit
A , on an interim basis. When the Kiosk becomes
operational, Shutterfly shall promptly return the Software to
the Kiosk at the Designated Location and this interim right of
use shall be revoked.
(d) Provided
Shutterfly is current on all fees payable, Shutterfly may
change the Kiosk location to another location and/or
substitute the Kiosk with another Kiosk, provided any
applicable fee is paid by Shutterfly, the prior use is
discontinued and Shutterfly continues to use the Software
under the terms of this Agreement. Shutterfly shall give AMS
written notice no less than thirty (30) days prior to such
relocation, including the new address and Kiosk. Such location
shall be the new Kiosk location.
E.
License
to Shutterfly Content . Shutterfly grants to AMS an
nonexclusive. nontransferable and definite term right license
to reproduce and modify Shutterfly Content, as defined in 3(e)
below, to develop and maintain the Kiosk Software interface
and the Kiosks.
F.
License
to Third Party Content . AMS shall be responsible for
obtaining and paying any necessary licenses to use third party
content other than, the third party content as provided by
Shutterfly to be incorporated into the Kiosks. Shutterfly
shall be responsible for obtaining and paying for any
necessary licenses to use such content provided by it to be
incorporated into the Kiosks.
G.
Licenses
to Use other Software and Tools. AMS shall be
responsible for obtaining licenses for and paying license fees
for any software and/or tools used in performance of its
services under this Agreement that are not owned by
AMS.
(e)
Ownership
. As between AMS and Shutterfly, AMS owns and retains all
right, tide and interest in and to (i) the Software, including
but not limited to the Retained Components and the Shutterfly
Components; (ii) all trademarks, service marks and trade names
of AMS associated with the Software; and (iii) all copyrights,
patents, trade secret rights and other intellectual property
associated with the Software; as well as (iv) the Kiosks and
their corresponding hardware, As between AMS and Shutterfly.
Shutterfly owns and retains all right, tide and interest in
and to all trademarks,
serve
marks and trade names of Shutterfly associated with the
Software and Kiosks (Collectively “Shutterfly
Center”)
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4.
Confidential
Information . In performing under this Agreement, each
party may disclose to the other confidential business and
technical information related to the business plans and
methods of each party, both generally and as they relate to
the Kiosk Packages and the distribution thereof (the
“Confidential
Information ”), In addition to the foregoing,
each party’s knowledge about the other party’s
business and products, and its customers and vendors,
including without limitation, the identity of and information
relating to customers, employees, financial condition,
technical information, prices, business plans, and strategies
and prospects, and that all such knowledge, information and
materials acquired, and any other information related thereto,
shall be treated as the Confidential Information. Each party
agrees it shall not use, either directly or indirectly, the
Confidential Information provided by the other party except
for the purposes contemplated by this Agreement, Each party
also agrees that it shall take all commercially reasonable
actions necessary to prevent the disclosure to any third party
of the Confidential Information provided by the other party.
“Confidential Information” shall not include any
information that is (i) known to the receiving party prior to
disclosure by the other party; (ii) lawfully obtained after
the date of this Agreement by the receiving party from a third
party who is not under any duty of nondisclosure; (iii)
generally available to the public; or (iv) lawfully developed
by the receiving party independent of information provided by
the other party.
5.
Indemnification
by AMS . AMS will indemnify Shutterfly and hold it
harmless from and against all claims, damages, losses and
expenses. Including court costs and reasonable fees and
expenses of attorneys, expert witnesses and other
professionals, arising out of or resulting from, and, at
Shutterfly’s option, AMS will defend Shutterfly
against:
(a) any
action by a third party against Shutterfly that is based on
any claim that any of the Services, Software or Kiosks
provided or delivered under this Agreement, or their results,
infringe a patent, copyright or other proprietary right or
violate a trade secret;
(b) any
action by a third party that is based on any negligent act or
Omission or willful conduct of AMS and which results m, (i)
any bodily injury, sickness, disease or death; (ii) any injury
or destruction to tangible or intangible property (including
computer programs and data) or any loss of use resulting
therefrom; or (iii) any violation of any statute, ordinance,
or regulation; and
(c) any
and all claims, relating to any obligation imposed by law on
Shutterfly lo pay any withholding taxes, social security,
unemployment or disability insurance, state and federal income
tax, workers’ compensation insurance or similar items in
connection with the Services and compensation received by AMS
pursuant to this Agreement.
6.
Term
and Termination .
(a)
Term
The term of this Agreement shall commence on the date hereof
and, unless terminated in accordance with Section
6(b) shall continue through the completion of the
services sot forth in Section 1
. and thereafter for so long as Shutterfly seeks or obtains
services from AMS.
(b)
Termination for
Convenience . The parties may terminate this Agreement
at any time upon mutual written agreement.
(c)
Termination for
Breach. Either party
