Development And Distribution Agreement

Exhibit 10.48


Confidential treatment has been requested for portions of this
exhibit. The copy filed herewith omits the information
subject to the confidentiality request. Omissions are
designated as [*]. A complete version of this exhibit has been
filed separately with the Securities and Exchange Commission.


DEVELOPMENT AND DISTRIBUTION AGREEMENT
--------------------------------------


This Development and Distribution Agreement (the "Agreement") is made and entered into as of this 30th day of April, 2002 by and between America Online, Inc., a Delaware corporation ("AOL"), and TiVo Inc., a Delaware corporation ("TiVo") (each a "Party" and, collectively, the "Parties").


R E C I T A L S


WHEREAS, AOL and TiVo entered into a Product Integration and Marketing Agreement dated June 9, 2000 (the "Original Agreement") pursuant to which AOL and TiVo undertook to develop an integrated product that would enable AOL's "AOL TV(R)" service to be bundled with and installed on a TiVo personal digital video recorder and to market and distribute such integrated product solely in the United States; and


WHEREAS, AOL and TiVo intend that this Agreement terminate, replace and supersede the Original Agreement in its entirety.


A G R E E M E N T


NOW, THEREFORE, in consideration of the foregoing and mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, AOL and TiVo, intending to be legally bound, agree as follows:


1. Certain Definitions.


Capitalized terms used but not defined in the Agreement will be as defined in Schedule 1 attached hereto.


2. Amended and Restated Agreement.


This Agreement terminates, replaces and supersedes the Original Agreement in its entirety. The Original Agreement is hereby terminated and has no further force or effect. Each Party hereby releases and discharges each other from any and all claims, liens, charges and other rights with respect to the Original Agreement.


3. Obligations related to the Development and Delivery.


3.1 Joint Responsibilities. Joint responsibilities of the Parties
----------------------
hereunder shall include, without limitation, the following:


(a) AOL and TiVo will jointly coordinate the development of the
Specifications to ensure compatibility and integration between
the AOL TV Service (existing as of the Effective Date) and the
TiVo Platform. TiVo will be responsible for the development and
integration of the AOL TV Application and the development of the
Mercury Application, as set forth in Schedule 2.


(b) AOL and TiVo will meet via teleconference or in person on a
regularly scheduled basis to discuss progress on the development
or marketing obligations set forth herein. AOL and TiVo each
shall designate a program manager ("Program Manager") who shall
be the principal point of contact between them for all matters
relating to this Agreement. The initial Program Manager for AOL
shall be Peter Nush and the initial Program Manager for TiVo
shall be Vic Alessi. AOL and TiVo may designate new Program
Managers and other personnel responsible for particular tasks
related to this Agreement by written notice to the other Party.


(c) TiVo will develop[*] as set forth in Schedule 11 in
accordance with the Milestone Schedule set forth in Schedule 2.
AOL shall use commercially reasonable efforts to (i) provide to
TiVo [*] required from [*]and[*] necessary to develop and
demonstrate the prototype for[*]. AOL believes in good faith it
has through its existing agreements or can obtain through
commercially reasonable efforts [*]from [*] or[*]for the work
described at Schedule 11. TiVo agrees and acknowledges that it
must execute the standard [*]required by each of [*]and[*] (which
are substantially similar to the [*]obligations undertaken by AOL
with such party) prior to the provision by AOL of any necessary
sublicense of such third party rights (a "Third Party
Passthrough") and prior to receiving any information or materials
or documentation belonging to each such party. In the event that
TiVo is unable or unwilling to enter into such [*]with each
party, TiVo shall promptly refund to AOL the initial payment
allocated to[*], and the Parties shall have no further obligation
to each other with respect to[*]. In the event, notwithstanding
AOL's commercially reasonable efforts, that either [*]or[*]
refuses to or is otherwise unable or unwilling to perform the
work identified for such party in Schedule 11, the Parties shall
use commercially reasonable efforts to identify a substitute
project whereby the Parties would jointly develop a [*]similarly
suitable for deployment [*], and if the Parties are unable to
identify a substitute project, the Parties will use commercially
reasonable efforts to agree in good faith upon the reallocation
of the funds paid by AOL to TiVo for[*], provided, however, that
if the Parties, notwithstanding their good faith commercially
reasonable efforts, fail to agree upon the reallocation, then the
Parties shall agree in writing to cancel[*], and neither Party
shall have any further obligation to the other with respect to
[*] (including without limitation, any obligation of TiVo to
refund the initial payment paid by AOL for[*].)


(d) Acceptance Criteria. The Parties shall use commercially
-------------------
reasonable efforts and work in good faith to mutually agree upon
Acceptance Criteria within sixty (60) days of the Effective Date.
AOL has provided a draft of such Acceptance Criteria to TiVo, and
TiVo agrees that the final Acceptance Criteria shall be based
upon the draft Acceptance Criteria provided by AOL. AOL is
willing to agree to the draft Acceptance Criteria provided by AOL
as of the Effective Date; in the event the Parties are unable,
notwithstanding their commercially reasonable and good faith
efforts, to agree upon Acceptance Criteria within sixty (60)
days, either Party shall have the right to terminate this
Agreement solely with respect to the Development Activities
covered by the Acceptance Criteria, and TiVo shall promptly
refund to AOL all amounts paid by AOL to TiVo hereunder for such
Development Activities minus TiVo's reasonably documented
expenses incurred during such sixty (60) day period.


3.2 Development Obligations of TiVo.
-------------------------------


(a) Development. As of the Effective Date, TiVo has completed
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development of the TiVo Platform. Based on such TiVo Platform,
TiVo shall develop the AOL TV Application and the Mercury
Application in accordance with the Specifications and the
milestone schedule set forth in Schedule 2 (the "Milestone
Schedule").


(i) TiVo will develop Documentation necessary for the testing,
operation, and use of the AOL TV Application and the Mercury
Application running on or in conjunction with the TiVo
Platform and will deliver such Documentation, in both print
and machine-readable format, to AOL. Documentation shall
include release dates and version numbers to facilitate its
use with the Deliverables.


(ii) TiVo will provide AOL with [*]oral and written reports of
its progress in the development of the Deliverables in a
format to be mutually agreed upon by the Parties.


During the Term of this Agreement, TiVo shall not make or
implement any changes to the TiVo


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


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Platform that materially degrade the performance or
accessibility of the AOLTV Application, Mercury Application,
[*].


(b) Change Requests. Within sixty (60) days of the Effective Date
---------------
with respect to the AOL TV Application or the Mercury
Application, and during the Term with respect to[*], AOL may,
from time to time, request changes (consisting of additions,
modifications, reallocation of development funds, deletions or
other revisions) to the Specifications or to the Development
Activities provided such changes relate to development work for a
[*]product or service for AOL or its Affiliates, subject to
TiVo's consent, [*]. Following the date occurring sixty (60) days
after the Effective Date, the Parties may from time to time agree
to changes (consisting of additions, modifications, reallocation
of development funds, deletions or other revisions) to the
Specifications or to the Development Activities identified for
the AOL TV Application or the Mercury Application. Each change
request must be reflected in a written document signed by both
Parties that includes a detailed description of the specific
change, along with any modified specifications and desired
completion date(s) ("Change Request"). Each Change Request duly
authorized in writing by the Parties shall constitute a formal
amendment to this Agreement, and shall be deemed incorporated
into and shall become part of this Agreement. A Change Request
shall have no effect on the rights and obligations of TiVo or AOL
with respect to products delivered or services provided before
the effective date of the Change Request. The Parties shall
negotiate in good faith the terms, conditions (including any
changes to the Milestone Schedule), and allocation of costs
related to the implementation of any Change Request.


(c) Delivery and Approval.
---------------------


(i) Delivery. TiVo shall deliver all Deliverables and
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[*]hereunder to AOL in accordance with the Milestone
Schedule. Without limitation of the foregoing, all such
Deliverables and all jointly-owned or AOL-owned elements of
[*]shall be provided to AOL in both Source Code and object
code and via electronic means mutually agreed to by the
Parties.


(ii) Acceptance Testing. Prior to delivery of the Deliverables to
------------------
AOL, TiVo will perform its standard qualification testing.
Specifically, TiVo's standard qualification testing shall
include without limitation (A) efforts to diagnose any
failure of the Deliverable to comply with the Specifications
and the Acceptance Criteria prior to and during any testing;
and (B) correction of any such failure diagnosed by TiVo or
reported to TiVo in writing. Within [*]days of receipt, AOL
will test the Deliverables (including, without limitation,
all Documentation therefor), in accordance with standard
diagnostic practices, to determine whether or not it
substantially complies with the Acceptance Criteria. AOL
shall, within such [*]day period, provide TiVo with written
Acceptance of the Deliverable or a statement identifying any
failure of the Deliverable to comply with the Acceptance
Criteria in sufficient detail for TiVo to recreate such
non-compliance. In the event AOL identifies such a failure
and rejects the Deliverable, TiVo shall have [*]days from
TiVo's receipt of notice of such rejection to repair the
failure and resubmit the units of the repaired Deliverable
for testing. AOL shall then have [*]days after receipt of
the resubmitted Deliverable to determine whether such
version passes Acceptance testing. The Parties may repeat
the aforementioned process, provided, however, that [*]to
deliver a Deliverable that has been accepted by AOL in
accordance with this Section by the date specified for
"AOLTV Application Manufacturing Release as a Third Party
Application", in the case of the AOLTV Application, the date
specified for "Mercury Application Manufacturing Release as
a Third Party Application", in the case of the Mercury
Application, or by the date specified for "Full prototype
demo; [*]", in the case of[*]in the Milestone Schedule, as
mutually adjusted pursuant to Section 3.4 (or Sections
3.1(c) or 3.2(b), as applicable) shall [*]of this Agreement.
Each such date shall be [*]


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


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(iii) Test Units. TiVo shall provide (directly or indirectly
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through a Manufacturer) and AOL shall have the right, but
not the obligation, to purchase up to [*]total units of the
TiVo Platform. At AOL's request, TiVo shall assist AOL in
obtaining such units directly from the Manufacturer at
production cost, which the Parties anticipate will be no
more than [*]per unit. AOL and TiVo acknowledge and agree
that AOL has purchased [*]total units as of the Effective
Date. For each production run of development units provided
to AOL directly by TiVo, TiVo shall provide documentation
containing lists and descriptions of known errors and
limitations for such production run.


(iv) TiVo Cooperation. During the thirty (30) day Acceptance
----------------
period and any subsequent periods referenced in Section
3.2(c)(ii) above, TiVo will provide AOL personnel with
telephone and e-mail access to TiVo development and quality
assurance personnel, during standard TiVo business hours to
answer questions about the development and architecture of
the AOLTV Application and Mercury Application, and the
infrastructure required to support them. A single point of
contact at each Party will be identified for emergencies
that require AOL communication with TiVo during[*]the
designated TiVo contact will be provided to AOL for use in
such emergencies.


(v) No Effect on TiVo's Other Obligations. AOL's inspection or
-------------------------------------
failure to inspect, and AOL's Acceptance of the Deliverables
shall in no way relieve TiVo of its obligations under this
Agreement, including without limitation Section 5.1 of
Schedule 4.


(d) Support of AOL. TiVo will provide for the sole and exclusive
--------------
benefit of AOL, support of the AOL TV Application and the Mercury
Application during the Warranty Period, in accordance with
Section 5.1 of Schedule 4. Such support does not extend to any
AOL TV Service End Users and specifically excludes any obligation
to provide corrections for errors in the operation of the AOL TV
Service if such errors are attributable to the AOL TV Service and
not the AOL TV Application or Mercury Application. In addition,
TiVo shall provide support of the AOL TV Application and the
Mercury Application as set forth in Schedule 10 (Maintenance) for
the lesser of (i) [*]from the first date of deployment for each
of the AOL TV Application and the Mercury Application, or (ii)
[*]from the date of final Acceptance of the "Manufacturing
Release as a Third Party Application" for each such AOL TV
Application and Mercury Application, [*].


(e) Launch and Hosting Services. Following the commercial launch of
---------------------------
the Mercury Application, if any, subject to AOL's option to host
the Mercury Application in its entirety, during the Term and
specifically for the Mercury Application, TiVo will receive
specified information from AOL's servers and will provide backend
connectivity, through the TiVo Service, to provide such
information to the AOL TV-Enabled Products. Notwithstanding
anything contained herein, launch of the Mercury Application on
the AOL Service shall at all times be within AOL's sole
discretion. AOL will be solely responsible for providing
front-end services of the Mercury Application for the personal
computer presentation to AOL TV Service End Users. The hosting of
the Mercury Application, and the responsibilities of AOL and TiVo
for the initial hosting and interconnectivity, are more
specifically set forth in Schedule 6. Notwithstanding the
foregoing, AOL shall have the option at any point during the
Term, in AOL's sole discretion, to perform all or a part of the
hosting responsibilities initially allocated to TiVo or to
discontinue the provision of the Mercury service in its entirety;
provided that if AOL elects to transition the TiVo hosted
portions (excluding components related to the TiVo Service) to
AOL, then AOL shall pay any costs reasonably incurred by TiVo in
such transition.


(f) Provisioning Support. The TiVo Platform shall include service
--------------------
provisioning and download support required to remotely update,
manage and maintain the AOL TV Application and Mercury
Application, in a multiple service, closed loop bit and
information management system (the


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


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"Provisioning Support") [*], unless otherwise agreed by the
Parties. Such Provisioning Support also shall include without
limitation, download of [*]in TiVo's regularly scheduled update
downloads, download of [*]subject to [*]and service testing and
certification. The AOL TV Application shall operate substantially
in accordance with the specifications for maximum downtime,
service interruption and degradation as set forth in the
Specifications; provided that in no event shall TiVo be
responsible for any downtime, service interruption or degradation
attributable to the AOL communications network or the AOL TV
Service. Notwithstanding the foregoing, if AOL does not [*]from
the AOL TV Service as enabled on the TiVo Platform (excluding out
any [*]offered to End Users), then TiVo will[*]such Provisioning
Support provided [*]for such Provisioning Support (i.e., actual
[*]plus [*]).


(i) [*]In the event an [*]arises with regard to the AOL TV
Application, TiVo shall work in good faith with AOL to
develop a plan to test and certify (as required) within
[*]or as soon thereafter as possible of notification from
AOL of the need for such [*]and to [*]the [*]For purposes of
this provision, such [*]shall [*]TiVo's routine business
operations, [*] shall [*]related to the TiVo Platform or
TiVo Service (i.e., comparable to the [*].


(ii) Dispute Process. In the event that the Parties dispute
---------------
whether [*]constitutes an[*], or regarding the [*]plan for
the[*], the dispute shall be immediately escalated to the
Management Committee for resolution in accordance with
Section 16.1 of Schedule 4; provided that the Management
Committee shall, within[*]business days of notice of the
dispute, use its best efforts to meet (in person or by
telephone) to resolve such dispute.


AOL shall [*]TiVo for [*]in [*]any such [*].


(g) [*]. Within thirty (30) days of the Effective Date, TiVo shall
cooperate with AOL to ensure that [*]are [*]in an[*], and upon
the Effective Date the Parties shall execute [*]attached hereto
as Schedule 9. Such [*]entered into by the Parties shall remain
in effect for the Term. TiVo shall update the [*]for each [*]of
the TiVo [*]that is[*] TiVo, but in no event shall TiVo be
obligated hereunder to [*]more than[*]. If for any reason,
the[*]expires or is terminated during the Term of this Agreement
(except in the event of termination by TiVo for a Material Breach
by AOL of this Agreement), other than upon the occurrence of a
[*]as defined in the[*], then [*]may require [*] to place the
[*]in [*]for AOL pursuant to[*]on substantially [*]as the[*]. If
for any reason, any such [*]are not in the [*]of an[*]pursuant to
such [*]upon the occurrence of a[*]shall provide such [*]to[*]
immediately upon [*]written request and [*]shall have the rights
and obligations with respect thereto set forth in the[*].
[*]shall[*]associated with such[*].


(h) Technology License Option. For a period of [*]from the Effective
-------------------------
Date or if the Parties do not agree in writing to cancel
[*]development pursuant to Section 3.1(c) until completion
of[*]development, whichever occurs last, AOL shall have the
option to receive a license to the TiVo technology incorporated
within the TiVo Platform and the related server software on terms
and condition consistent with those terms and conditions set
forth in Schedule 7.


(i) AOL Time Warner. Nothing in this Agreement (including the fact of
---------------
this Agreement) shall be construed to acknowledge, waive or
otherwise prejudice any rights or defenses of AOL Time Warner
Inc. and/or its Affiliates or TiVo with respect to the
reproduction, use, display, distribution, or performance by TiVo
of content owned or licensed by AOL Time Warner Inc. and/or its
Affiliates. Further, nothing in this Agreement (including the
fact of this Agreement) shall be construed to make
representations or any commitments on behalf of, or in any way
bind, AOL Time Warner Inc. and/or any other Affiliates of AOL,
Inc.


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


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3.3 Delivery and Development Obligations of AOL.
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(a) AOL's Assistance. AOL shall, at AOL's expense, furnish TiVo with
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materials specified in the Milestone Schedule and Specifications,
including without limitation the AOL Toolkit in object form
(collectively, "AOL Materials").


(b) Network Access. AOL will provide connectivity for the AOL TV
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Service only. AOL will agree to continue discussions with TiVo
concerning AOL assuming responsibility for certain connectivity,
network hosting, and customer support services for the TiVo
Platform and for certain services enabled on the TiVo Platform.


(c) Subscriber Documentation. AOL will develop documentation for the
------------------------
AOL TV Application instructing End Users how to subscribe to and
use the AOL TV Service ("Subscriber Documentation"). TiVo will
include this documentation in the TiVo packaging for all TiVo
products containing the TiVo Platform ...