EXHIBIT 6.5
MASTER DISTRIBUTOR AGREEMENT
BETWEEN
PRONET ENTERPRISES LTD
AND
XXXX XXXXXXX
(DBA RADIOTOWER INTERACTIVE)
This Distributor Agreement (the "Agreement") is made and entered into as of the
21st day of August, 1997 (the "Effective Date").
by and between
PRONET ENTERPRISES LTD. a properly registered corporation of British Columbia,
Canada, located at 000-000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx, XX, X0X 0X0
("DISTRIBUTOR").
and
Xxxx Xxxxxxx, dba RadioTower Interactive, a sole proprietorship with principal
offices at 0-0000 Xxxxxx Xxxxxx, Xxxxxxx, XX ("RTI").
WHEREAS, Distributor maintains and operates an internationally accessed
Internet commercial database along with certain Inernet promotion
products and services.
WHEREAS, RTI has proprietary and/or marketing rights to design, produce, host
and deliver audio sound clips for the Internet.
WHEREAS, RTI wishes to grant to Distributor and Distributor desires to obtain
certain rights to such audio services, more particularly described
below, in accordance with the terms and conditions of this Agreement.
NOW, THEREFORE, and in consideration of the mutual covenants contained herein,
the parties hereto agree to the following terms and conditions, which set forth
the rights, duties, and obligations of the parties hereto.
1. DEFINITIONS
For the purposes of this Agreement, the following terms shall have the following
meanings:
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1.1 "CUSTOMERS" means those persons and entities who purchase the Products
from the Distributor in compliance with the provisions of this Agreement.
1.2 "DOCUMENTATION" means the support materials and user guide in electronic
or printed form which supplement and support the Products.
1.3. "SERVICES" means the capability provided to Distributor by RTI to design,
create, host and produce audio sound clips for use on the Internet as an
advertising medium.
1.4. "AGENT" means that the Distributor shall be permitted to promote the RTI
opportunity to other Internet sites and enter into re-seller agreements
with them for which the Distributor shall be entitled to management and
processing fees as set forth int his agreement.
1.5. "BASE RETAIL PRICING" means the minimum price used to compute the minimum
compensation package for seller, Distributor and RTI.
1.6. "RETAIL PRICE" means the current retail price.
1.7. "MARKET AND SELL" means the right to sell and or promote the Products as
described in Attachments B and C or in subsequent Attachments as may
created and mutually approved or amended from time to time by mutual
agreement between RTI and Distributor.
1.8. "PRODUCTS" means those products listed in Attachments B and C.
1.9 "OPPORTUNITY" means the opportunity for other Companies to sell Products
through the RadioTower and Pronet Enterprises Ltd. co-branded web page.
2. APPOINTMENT AS DISTRIBUTOR AND AGENT
2.1. GRANT TO DISTRIBUTE. RTI hereby grants, and the Distributor hereby
accepts, an exclusive right, notwithstanding the right of RTI to continue
to sell its products and services and, subject to the terms and
conditions of this Agreement, to market and sell the Products and to
market and promote the Opportunity to other Internet distributors.
2.2. SERVICE XXXX LICENSE. Distributor is authorized to use the RTI name and
service xxxx only in conjunction with its marketing of the Products to
Customers. The authorization shall terminate immediately upon any
termination of this Agreement.
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3. DISTRIBUTOR AND RTI DUTIES
3.1. COMMERCIALLY REASONABLE EFFORTS. Distributor shall use commercially
reasonable efforts to market, promote and sell the Products, and
Opportunities in accordance with the terms of this Agreement.
3.2. PRESS ANNOUNCEMENTS. The Distributor and RTI may elect to issue separate
or joint press releases announcing the relationship. Such releases shall
be subject to the other party's review and approval of content prior to
distribution.
3.3. SALES PROMOTION MATERIALS. both parties shall provide sales promotion
information, either electronically or hard copy, to the other, which may
use to crease Web site pages or literature relating to the Products and
Opportunities. Both parties shall submit to the other within a reasonable
time, prior to their commercial use, promotion materials utilizing any of
the other party's service marks, trademarks and/or trade names. Both
parties agree not to use promotional materials in the event the other
party objects to said use in writing within ten (10) days after
submission to the other party.
3.4. AUDIO CLIP SALES SUPPORT WEB PAGE. RTI and Distributor will jointly and
equally create and maintain an audio clip sales support Web page for
distribution and use by sales reps and sales channels. The page(s) will
include frequently asked questions, service brochures and other
information agreed to by the parties to this agreement. Such pages and
information shall be accessible from all related sites.
3.5. SALES SUPPORT. Pronet Enterprises Ltd. shall take orders online using
established credit card or cash payment systems, for RTI products.
3.6. RTI/DISTRIBUTOR WEB PAGE. RTI and Distributor shall jointly and euqally
create a co-branded web page. The co-branded Web page will include each
other's logo, company and services description, and link to the other's
Web site. The web page shall include a demonstration audio clip and
relevent sales presentations and order forms. The page shall be the only
approved interface for taking orders on ine. The page(s) shall be subject
to mutual review and approval for content prior to being published.
3.7. CUSTOMER SUPPORT. RTI will provide technical support to Distributor for
the purpose of integrating the sound clips into Distributors advertising
packages and technology and into customer home pages.
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3.8. HOSTING. RTI shall host all sound clips sold by Distributor and its
re-sellers on its own commercial quality server, in such manner as to
make th esound clips available when accessed from a remote site.
3.9. TECHNOLOGY. RTI shall make the sound clips in such manner and quality as
to represent state of the art production in keeping with commercial
requirements.
3.10. CUSTOMER RELATIONS. Each party to this agreement shall treat customers in
accordance with the highest standards of respect and service, recognizing
that customer dissatisfaction reflects on all parties associated with the
audio sound clip program. This shall be a condition of any reseller
agreement.
4. CUSTOMER INFORMATION AND REPORTING
4.1. CUSTOMER INFORMATION sufficient to identify customer initial requirements
and communications options shall be passed to RTI by Distributor, but
shall not include financial information, by e-mail. RTI shall notify
Distributor when the customer needs have been met by entering the
Customer information into an Audio Enhanced Listing Page provided by
Distributor on Distributor web site. Customer shall signify acceptance of
the audio product to Distributor by return e-mail intiated by
Distributor. Distributor shall notify RTI when customer on line service
is no longer to be available.
5. TERM AND TERMINATION
5.1. TERM. This Agreement shall be for a term of one (1) year from the
Effective Date and shall automatically renew each year thereafter unless
either party shall elect by notice sixty (60) days in advance of the
renewal date not to renew.
5.2. TERMINATION. This Agreement may be terminated by either party upon a
material breach by the other party and a failure to cure such xxxxx after
thirty (30) days' written notice and an opportunity to cure. The parties
also may mutually agree to terminate this Agreement by giving sixty (60)
days notice prior to the expiration of each year if they mutually agree
that it no longer serves their mutual business interest to continue the
Agreement. Within 30 days of such termination, all Fees owed to RTI will
be paid by Distributor to RTI.
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6. WARRANTY
6.1. WARRANTY. RTI and Distributor warrants that their Services will conform
in all material respects to the Documentation as delivered by each
respectively and that the Documentation accurately describes the
features, capabilities and designs of the Services of each, except as
specifically stated otherwise. Each acknowledges that it has had
sufficient opportunity to review the Services and the Documentation of
the other prior to execution of this Agreement and that each fully
understands the capabilities of the services and the Documentation as
represented.
7. INDEMNIFICATION
7.1. INDEMNIFICATION RTI and Distributor hereby agree to mutually indemnify
defend and hold harmless the other, and each of the other's officers,
directors, employees and agents, from and against all and any actions,
proceedings, costs, expenses, losses, claims, demands and liabilities
whatsoever, including reasonable attorneys' fees, which any of them may
sustain or incur as a result of, arising out of or in connection with a
breach by either of any representation or warranty made by ech in this
Agreement. Any such indemnification shall be limited to the amount paid
by Distributor to RTI less fees paid to Distributor in the twelve (12)
months preceding notice of any such claim for indemnification.
8. PAYMENT
8.1 PAYMENT. Distributor shall make payments due to RTI within 5 working days
of the month end for orders placed in the previous month. Distributor
shall make payments due to re-sellers within 5 working days of the end of
each calendar quarter commencing September 1 for the previous quarter.
All payments shall be made by cheque in Canadian or US funds as
applicable.
9. GENERAL
9.1. ASSIGNMENT. Neither this Agreement nor any rights granted hereby may be
assigned by the Distributor voluntarily or by operation of law without
RTI's prior written consent, which shall not be unreasonably withheld.
This Agreement shall inure to the benefit of and be binding upon any
successor or assignee of RTI and Distributor alike.
9.2. GOVERNING LAW. This Agreement is entered into in the Province of British
Columbia, Canada, and this Agreement shall be governed by and construed
in accordance with the laws of the Province of British Columbia
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without reference to its conflicts of law provisions. Any dispute
regarding this Agreement shall be subject to mediation as provided for in
the Province of British Columbia and thereafter, if no agreement can be
reached, in the Provincial courts, and the parties agree to submit to the
personal and exclusive jurisdiction and venue of these courts.
9.3. RELATIONSHIP OF THE PARTIES. Neither Distributor nor its agents have any
authority of any kind to bind RTI in any respect whatsoever.
9.4. ENTIRE AGREEMENT. This Agreement constitutes the entire Agreement between
RTI and the Distributor, with respect to the subject matter hereof, and
supersedes all prior oral and written agreements. This Agreement shall
not be amended, altered or changed except by a written agreement dated
subsequent to the date of this Agreement and signed by the parties
hereto.
9.5. CONFIDENTIALITY. Distributor and RTI agree that the terms of this
Agreement are confidential, and shall not be disclosed to any third party
without the prior written consent of the other party.
IN WITNESS WHEREOF, this Agreement has been executed as of the Effective Date.
PRONET ENTERPRISES LTD. Xxxx Xxxxxxx dba
RadioTower Interactive
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxx Xxxxxxx
----------------------------- -------------------------------
Name Name
Xxxx X. Xxxxxxx Xxxx Xxxxxxx
----------------------------- -------------------------------
Title: Title:
President Owner
PRONET ENTERPRISES LTD. 08/21/97
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ATTACHMENT A
RETAIL, COMMISSION AND RESIDUAL PRICING, RADIOTOWER
PRODUCTS
A1. BASE RETAIL PRICING. PRODUCT 1. Defined as the minimum retail price set by
RadioTower shall be as follows
INITIAL SETUP - $279.95 (CDN)
MONTHLY FEE $34.95 (CDN) if paid on a month to month basis
ANNUAL FEE (if paid in advance) $335 (CDN)
A2. RETAIL PRICE. Retail price as set from time to time by RadioTower.
A3. SELLER COMPENSATION. Compensation to the seller of RTI sound clips shall be
computed at 15% of the Retail Price Initial setup and 10.0% of the Retail
Price Monthly fee or Annual fee.
A4 SALES PROCESSING FEE. Pronet Enterprises shall be entitled to a sales
processing fee for each sale processed through its system equal to 5.0%
of any Retail Price.
A5. MANAGEMENT FEE. Pronet Enterprises shall be entitled to a management fee
equal to 10% of any Retail Price. To process purchase orders, pay
re-sellers on at least a quarterly basis, pay RadioTower no more
frequently than monthly.
A6. RESIDUAL PAYMENT (SETUP) RadioTower shall be entitled to a residual payment
equal to ($195.97 CDN) adjusted for foreign exchange for customer sales
outside Canada.
A7 RESIDUAL PAYMENT (MONTHLY) RadioTower shall be entitled to a residual payment
equal to ($26.20 CDN) adjusted for foreign exchange for customer sales
outside Canada.
A8 RESIDUAL PAYMENT (ANNUAL) RadioTower shall be entitled to a residual payment
equal to ($243.75 CDN) adjusted for foreign exchange for customer sales
outside Canada
A9 BONUS PAYMENT RadioTower and Pronet Enterprises Ltd. shall share equally
(50/50 each) of the difference between
(RETAIL PRICE) MINUS (SELLER COMPENSATION plus SALES PROCESSING FEE plus
MANAGEMENT FEE) MINUS (RESIDUAL PAYMENT FROM APPLICABLE CATEGORY)
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ATTACHMENT B
RADIOTOWER PRODUCT LIST
The following products shall be sold at all outlets under this agreement.
Product 1 a. A sound clip of up to 30 second duration, the script shall be the
copyright property of the customer, the sound clip shall be the
copyright property of the customer, the sound clip shall be the
copyright property of RadioTower, and includes
i. A basic enhanced audio listing in the Pronet Database
ii. An automatic activation link between the enhanced
listing when depressed and the sound clip.
iii. software for the customer to install on his own home
page that allows the sound clip to be either
automatically or manually activated at the customer home
page
iv. a guaranteed maximum of 2500 plays per 28 days
Option 1 a. As per option 1
b. Plus tied to an advertising banner purchased at Pronet, or at any
other site, with an automatic link to the sound clip whenever the
banner is displayed.
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ATTACHEMENT C
RETAIL, COMMISSION AND RESIDUAL PRICING OF PRONET
PRODUCTS
A1. BASE RETAIL PRICING. ADVERTISING BANNERS.
BANNER CREATION (IF BANNER DOES NOT EXIST) - $85 (CDN)
BASIC MONTHLY FEE FOR ONE COUNTRY ONE CATEGORY $19.95 (CDN) if paid on a
month to month basis
QUARTERLY FEE FOR ONE COUNTRY ONE CATEGORY (if paid in advance) $50
(CDN))
Each additional country / category adds $7.50 per month to a
maximum of $50 CDN per month for global coverage.
A2. RETAIL PRICE. Retail price as set from time to time by Pronet.
A3. SELLER COMPENSATION. Compensation to the seller of Pronet Banners shall be
computed at 15% of the Retail Price Initial setup and 15.0% of the Retail
Price Monthly fee or Annual fee.
A9 BONUS PAYMENT RadioTower and Pronet Enterprises Ltd. shall share equally
(50/50 each) of
(0.85 X RETAIL PRICE) MINUS (0.85 X BASE RETAIL PRICE)
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ATTACHMENT D
RADIOTOWER PRODUCT 2
D1. PRODUCT 2 DESCRIPTION
a. A sound clip of up to 25 words, the script shall be the copyright
property of the customer, the sound clip shall be the copyright property
of RadioTower, and includes
i. A basic enhanced listing in the Pronet Database.
ii. An automatic activation link between the enhanced listing
when depressed and the sound clip
iii. Software for the customer to install on his own home page
that allows the sould clip to be either automatically or
manually activated at the customer home page.
iv. Customer will be responsible for hosting of all sound
clips.
D2. BASE RETAIL PRICE. One-time fee of $149.95 USD.
D3. SELLER COMPENSATION. Compensation to the seller of RTI sound clips shall be
computed at 15% of the Base Retail Price. A reseller program will be
developed by Pronet after 1000 units are sold.
D4. SALES PROCESSING/MANAGEMENT FEE. Pronet Enterprises shall be entitled to 15%
of the Base Retail Price for each unit sold.
D5. NAME & ADDRESS CHANGE. RTI has changed their legal name to the following:
XxxxxXxxxx.xxx Inc. and now has their working offices at: #000-000
Xxxxxxx xx. Xxxxxxxxx X.X. Xxxxxx X0X 0X0.
D6. TRADEMARK. Pronet acknowledges the Word Marks "AudioAds" and "AudioAd" are
Trademarks of RTI
and that both are RTI products.
D7. DOMAIN. RTI acknowledges that the Internet domains "xxxxxxxx.xxx" and
"xxxxxxx.xxx" are the sole property of Pronet.
D8. ENTIRE AGREEMENT. Both parties acknowledge that this attachment supersedes
previous [FK][PV] attachments A & B. [FK][PV]
By: PRONET By: XxxxxXxxxx.xxx Inc.
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Name: /s/ Xxxx X. Xxxxxxx Name: /s/ Xxxx Xxxxxxx
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Title: President Title: Founder, Director
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Date: 1 Sept 99 Date: Sept 1/99
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