MARKETING AGREEMENT
This Marketing Agreement (the "Agreement") is entered into
effective this 3rd day of May, 1999 by and between Xxxxx Xxxxxxxx
Entertainment, Inc., a Colorado corporation ("JNE") and PDQ Internet
("PDQ"). JNE and PDQ shall be collectively referred to herein as
the parties.
RECITALS
WHEREAS, JNE, through its Community Marquee Division, desires
assistance in the marketing and placement of its advertising kiosks
("Kiosks") and marquees ("Marquees").
WHEREAS, PDQ desires to assist JNE as set forth herein.
NOW, THEREFORE, for good and adequate consideration, the
receipt of which is hereby acknowledged, the parties hereby agree as
follows:
1. Exclusive Territory.
A. PDQ will have the exclusive rights to market the Kiosks
and Marquees throughout that portion of the State of Florida located
South of I-40 (the "Exclusive Territory").
B. In addition, PDQ shall have, for a period of six months
beginning on June 1, 1999, the exclusive rights to market the Kiosks
and Marquees at Convention and Visitors Bureaus throughout the
entire United States (the "C&V Exclusive Territory").
2. Guaranteed Installations.
A. PDQ guarantees, for a period of five (5) years from the
date hereof (the "Guarantee Period"), the installation of Kiosks at
a rate of a minimum of twenty (20) Kiosks per month (the "Kiosk
Guarantee"). PDQ's performance under the Kiosk Guarantee shall be
measured on a quarterly basis (i.e., at the end of each calendar
quarter, PDQ guarantees the installation of at least 60 Kiosks).
B. PDQ further guarantees, during the Guarantee Period, that
each of the Kiosks installed as a result of the Kiosk Guarantee will
have purchased a minimum of eight (8) screen savers, each at a
monthly rate of at least Fifty Dollars ($50.00) per month (the
"Screen Saver Guarantee") (The net revenue received as a result of
the Screen Saver Guarantee ($400 per month) shall be referred to as
the "Screen Saver Guarantee Revenue"). PDQ may, in its discretion,
sell more than eight (8) screen savers at a rate in excess of Fifty
Dollars ($50.00) per month (see Xxxxxxxxx 0X xxxxx).
C. PDQ further guarantees, beginning in the seventh (7th)
month of the Guarantee Period, that at least fifty percent (50%) of
the Kiosks installed as a result of the Kiosk Guarantee will have,
as an additional sale attached therewith, a Marquee that is affixed
to the Kiosk or located adjacent thereto (the "Marquee Guarantee").
Each of
the Marquee's installed under this Marquee Guarantee will
have at least ten (10) advertising panels contained therein, and
each panel will be subscribed for at a minimum rate of One Thousand
Five Hundred Dollars ($1,500) per year (the net revenue received as
a result of the Marquee Guarantee ($15,000 per year) shall be
referred to as the "Marquee Guarantee Revenue"). PDQ may, in its
discretion, place more than ten (10) advertising panels in each
Marquee at a rate in excess of One Thousand Five Hundred Dollars
($1,500) per year (see Xxxxxxxxx 0X xxxxx).
3. Failure of PDQ to satisfy Guarantees. At the end of each
calendar quarter, PDQ's performance under the Kiosk Guarantee, the
Screen Saver Guarantee, and the Marquee Guarantee (collectively the
"Guarantees") will be evaluated. In the event that PDQ is unable to
satisfy any of the Guarantees as set forth in Paragraph 2 hereof for
any given quarter, then PDQ shall be given a period of three (3)
months (the "Guarantee Satisfaction Period") to satisfy its
obligations thereunder. If, at the end of the Guarantee
Satisfaction Period, PDQ has not satisfied its obligations under the
Guarantees for the previously deficient quarter, then PDQ shall
forfeit one-half (1/2) of all consideration to which it is entitled
under Paragraph 4 hereof until such time as any and all
deficiencies, including any deficiencies which may have occurred
subsequent to the Guarantee Satisfaction Period, have been satisfied
in full.
4. Consideration to PDQ. As consideration for their obligations
hereunder, PDQ shall receive:
A. For the first One Hundred (100) Kiosks installed as a
result of PDQ's efforts, wherever located, PDQ shall receive twenty
percent (20%) of the Internet Access Revenues (defined as gross
revenues received by each Kiosk for access to the Internet, however
paid by the customer, minus commissions, maintenance, sales tax,
installation charges, and communication charges).
B. For all subsequent Kiosks installed as a result of PDQ's
efforts, wherever located, PDQ shall receive twenty five percent
(25%) of the Internet Access Revenues.
C. PDQ shall receive ten percent (10%) of the net (gross
revenue minus commissions, maintenance, sales tax, and installation
charges) Screen Saver Guarantee Revenue and the Marquee Guarantee
Revenue. PDQ shall receive ninety percent (90%) of the net (as
defined above) revenues received in excess of the Screen Saver
Guarantee Revenue and the Marquee Guarantee Revenue.
D. Options.
(1) Immediately upon the installation of one hundred
Kiosks, wherever located, PDQ shall be granted an option,
exercisable for a period of two (2) years from the grant thereof, to
acquire 100,000 shares of JNE common stock at a price of $0.45 per
share.
(2) Immediately upon the installation of five hundred (500)
Kiosks, wherever located, PDQ shall be granted an option,
exercisable for a period of two (2)
years from the grant thereof, to acquire 250,000 shares of JNE
common stock at a price which is the lower of (i) $0.75 per share,
or (ii) sixty percent (60%) of the average bid price for the ten (10)
days immediately following the grant thereof.
(3) Immediately upon the installation of one thousand
(1000) Kiosks, wherever located, PDQ shall be granted an option,
exercisable for a period of two (2) years from the grant thereof, to
acquire 250,000 shares of JNE common stock at a price which is the
lower of (i) $1.25 per share, or (ii) sixty percent (60%) of the
average bid price for the ten (10) days immediately following the
grant thereof.
5. Additional Terms.
A. JNE will manufacture, deliver, and install the Kiosks and
Marquees at no cost to PDQ, except the offsets as set forth in
Paragraph 4 hereof. Both JNE and PDQ agree that JNE shall have a
reasonable time to deliver the Kiosks and Marquees following the
receipt of orders to do so.
B. JNE will provide PDQ with audio/visual training aids. In
addition, all leads generated in the Exclusive Territory shall be
given to PDQ for follow-up at PDQ's discretion and expense.
C. This Agreement shall be in full force and effect for the
term of the Guarantee Period. At the end of the Guarantee Period,
this Agreement, and all the obligations of the parties hereunder,
shall automatically terminate.
6. Nondisclosure. Each party hereto agrees to keep the terms of this
Agreement and the transactions contemplated hereby as confidential
and shall not disclose such information to any third party, other
than professional advisors utilized to negotiate and consummate the
transactions contemplated hereby. The parties hereto agree that in
the event there is a breach of the foregoing confidentiality
provision, the damage to the parties hereto would be difficult to
estimate and as a result, in the event of such a breach, the
non-breaching party, in addition to any and all other remedies
allowed by law, would be entitled to injunctive relief enjoining the
actions of the breaching party.
7. Representations and Warranties.
Each party hereby represents, warrants and covenants as
follows:
A. When executed and delivered, the terms hereof shall
constitute a valid and legally binding agreement enforceable
in accordance with its terms, except as may be limited by
bankruptcy, insolvency or other laws affecting generally the
enforceability of creditors rights and by limitations on the
availability of equitable remedies.
B. Neither the execution and delivery of this Agreement nor
the consummation or performance of the transactions contemplated
herein will violate any law, rule, regulation, writ, judgment,
injunction, decree, determination, or other order of any court,
government or governmental agency or instrumentality, domestic or
foreign, or conflict with or result in any breach of any of the
terms of or the creation or imposition of any mortgage, deed of
trust, pledge, lien, security interest or other charge or
encumbrance of any nature pursuant to the terms of any contract or
agreement.
8. Severability. If any portion of this Agreement is found by a
court of competent jurisdiction to be void or unenforceable, that
portion shall be deemed to be reformed to the extent necessary to
cause such portion to be enforceable and the same shall not affect
the remainder of this Agreement, which shall be given full force and
effect without regard to the invalid or unenforceable portions.
9. Entire Agreement. This Agreement, which may be signed in
duplicate or counterparts, replaces and supersedes all previous
Agreements between the parties hereto, and contains the entire
understanding between the parties, and may not be changed, altered,
amended, or modified, except in writing, duly executed by each of
the parties.
10. Assignment. This Agreement may not be assigned or transferred by
either party hereto without the prior written consent of all other
parties hereto.
11. Notices. All notices, requests, instruments or documents
hereunder shall be in writing and delivered personally or sent by
registered or certified mail, postage prepaid, or by facsimile
transmission, telegraphic or similar conveyance:
If to JNE:
Xxxxx Xxxxxxxx Entertainment, Inc.
0000 Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxxxx
Facsimile (000) 000-0000
If to PDQ:
PDQ Internet
Attn: Xxxxxxx Xxxxx
Facsimile ( )
If delivered personally, the date on which a notice, request,
instruction or document is delivered shall be the date on which
delivery is made, and, if delivered by mail, the date on which such
notice, request, instruction or document is deposited in the mail
shall be the date of delivery. Each notice, request, instruction or
document shall bear the date on which it is delivered.
12. Governing Law. This Agreement shall be governed by the laws of
the State of California, United States of America.
13. Attorney's Fees. Should any action be commenced between the
parties to this Agreement concerning the matters set forth in this
Agreement or the rights and duties of either in relation thereto,
the prevailing party in such action shall be entitled, in addition
to such other relief as may be granted, to a reasonable sum as and
for its Attorney's Fees and Costs.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the date first
written above.
XXXXX XXXXXXXX ENTERTAINMENT, INC.
/s/Xxxxxx Xxxxxxxx
By: Xxxxxx Xxxxxxxx
Its: President
PDQ Internet
/s/Xxxxxxx Xxxxx
By: Xxxxxxx Xxxxx
