AMENDMENT NO. 1 TO MARKETING SERVICES AGREEMENT
AMENDMENT NO. 1 TO MARKETING
SERVICES AGREEMENT
THIS AMENDMENT NO. 1 TO MARKETING
SERVICES AGREEMENT (this “Amendment”), dated as of October 13, 2010, by and
among Atrinsic, Inc., a Delaware corporation, with its principal place of
business located at 000 0xx Xxxxxx,
00xx
Xxxxx, Xxx Xxxx, XX, 00000 (“Atrinsic”) and Brilliant Digital Entertainment,
Inc., a Delaware corporation with its principal place of business located at
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxx Xxxx, XX 00000 (together with and on
behalf of its subsidiaries, including but not limited to Altnet, Inc., a
Delaware corporation, “BDE”). Atrinsic and BDE may be referred to
herein individually as a “Party” and collectively as the “Parties.”
WITNESSETH:
WHEREAS, Atrinsic and BDE have entered
into that certain Marketing Services Agreement, dated as of March 26, 2010, but
effective as of July 1, 2009 (as may be further amended, modified or
supplemented from time to time, the “Marketing Services Agreement”), pursuant to
which Atrinsic provides certain marketing services to BDE in connection with
BDE’s marketing, promotion and advertising of its Kazaa-branded content
subscription service, as further described therein;
WHEREAS, in connection with the Parties
entry into that certain Asset Purchase Agreement on even date herewith, the
parties desire to amend the Marketing Services Agreement as provided herein;
and
WHEREAS, Atrinsic and BDE are willing
to enter into this Amendment upon the terms and conditions set forth
below.
NOW, THEREFORE, in consideration of the
mutual promises and agreements contained herein and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged,
Atrinsic and BDE do hereby agree as follows:
SECTION
1. DEFINED TERMS.
Each defined term used herein and not
otherwise defined herein shall have the meaning ascribed to such term in the
Marketing Services Agreement.
SECTION
2. AMENDMENTS TO THE MARKETING SERVICES
AGREEMENT.
Atrinsic and BDE hereby agree that the
Marketing Services Agreement is hereby amended as follows:
1.
Section 1.5 is hereby amended and restated in its entirety to read as
follows:
1.5 Content
Services. Content Services shall be defined as all products
and services offered or provide by BDE in connection with its Kazaa-branded
content subscription service.
2.
Section 2 is hereby amended and restated in its entirety to read as
follows:
2. Exclusivity and
Services.
2.1. Exclusivity. Subject
to the terms and conditions of this Agreement, BDE hereby grants to Atrinsic any
and all licenses, rights and permissions necessary for Atrinsic to perform the
Marketing Services during the Term. Atrinsic shall be the exclusive
provider of the Marketing Services to BDE and, during the Term, BDE shall not
engage in any discussions or negotiations or enter into any agreement with any
other party for the provision of services which are the same as or similar to
the Marketing Services.
2.2. Marketing Services.
During the Term, Atrinsic shall be responsible for all Marketing Services,
strategy, development, execution and development and operation of the Ancillary
Websites and for the development and distribution of advertisements in
connection with the Marketing Services. Atrinsic shall have the exclusive right
to place advertisements for the Content Services on the Ancillary
Websites. Atrinsic shall provide the Marketing Services in compliance
with all applicable Federal Trade Commission (“FTC”) Rules and
Regulations, the CAN-SPAM Act of 2003 (the “CAN-SPAM Act”),
Mobile Marketing Association (“MMA”) Guidelines and
other applicable state and federal laws, each as amended and current at the time
of the applicable Marketing Services. Additionally, Atrinsic shall
use its commercially reasonable efforts to provide the Marketing Services in a
manner such that BDE and its Content Services offerings are not listed on the
“blacklists” of anti-spam service providers such as McAfee; in the event BDE
and/or its Content Services are included on such a list, Atrinsic shall use
commercially reasonable efforts to remove BDE from such list within thirty
days. BDE shall provide Atrinsic with any and all information,
materials, products and services needed to perform its obligations
hereunder.
3.
Section 3.1 is hereby amended and restated in its entirety to read as
follows:
3.1 Performance
Fees. Atrinsic shall pay to BDE advances equal to the amount
of pre-approved and mutually agreed costs and expenses incurred by BDE in
connection with the provision of Marketing Services during the Term of this
Agreement (the “Advances”). The
Advances shall be recoupable, on a dollar for dollar basis, as provided
below. BDE shall pay to Atrinsic a marketing fee (collectively, the
“Fee”) as follows: (i) all amounts noted in the pre-approved
Marketing Service budget plans presented by Atrinsic in advance, which include a
detailed marketing budget and a targeted CPA; plus (ii) any pre-approved direct
costs related to the Marketing Services, including but not limited to all
Advances. For the period beginning on the Effective Date through
August 31, 2009, the “Fees” with respect to such period shall be determined
between the parties in good faith (without regard to the process noted above),
which such Fees shall be determined by August 30, 2009. Within thirty
(30) days following the last day of each calendar month, Atrinsic shall provide
to BDE a written report stating the number of Confirmed Leads provided by
Atrinsic during the preceding month and calculating the aggregate Fees (the
“Report”). Representatives
of Atrinsic and BDE shall meet on a monthly basis to review the Report and
discuss and determine the projected and budgeted Fees and targeted number of
Confirmed Leads for the following month, which such Fees may not be exceeded by
Atrinsic without the approval of BDE. In the event BDE disputes the
accuracy of the Confirmed Leads or the calculation of any Fee, BDE must notify
Atrinsic of such dispute within 30 days following the delivery of the
Report. Thereafter, the Report shall be deemed accepted by
BDE. The parties will use their commercially reasonable efforts to
resolve such dispute prior to the date such Fees are due; provided, however, in
the event that such dispute is not resolved, the reported Fees shall remain due
and payable. Fees not otherwise recouped by Atrinsic pursuant to the
Master Services Agreement (the “Master Services Agreement”) between Atrinsic and
BDE of even date herewith (the “Unrecouped Fees”)
shall be due and payable by BDE only upon the termination of this Agreement by
Atrinsic pursuant to Section 10.1(i) hereof. For avoidance of doubt,
BDE shall only be
obligated to pay Unrecouped Fees (if any) in the event of termination by
Atrinsic pursuant to Sections 10.1(i), but not upon the expiration of
the Term of this Agreement.
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4.
The first line of Section 4.1 is hereby amended to strike the word
“non-exclusive” and replace it with the word “exclusive”.
5.
The second parenthetical contained in Section 4.2 is hereby
amended and restated to read as follows: “(in all cases other than the BDE
Marks, Website, Brand and/or Content services themselves)”.
6.
Section 5.1 is hereby amended and restated in its
entirety as follows:
5.1 Ownership. Atrinsic
shall be the sole owner of any and all Subscriber information collected by or
through the Website or in connection with the Content Services or any party
thereof during the Term (collectively, the “Customer
Data”).
7.
Section 9 is hereby amended to strike the phrase “three (3) years” and
replace it with the phrase “thirty (30) years”.
SECTION
3. MISCELLANEOUS.
1.
Except as expressly set forth in this Amendment, all of
the terms of the Marketing Services Agreement shall remain in full force and
effect.
2.
This Amendment may be executed in several counterparts
(including by means of telecopied or facsimile signature pages), each of which
shall be deemed an original, and all of which shall constitute one and the same
instrument.
[Signature
Page Follows]
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IN WITNESS WHEREOF, each of the Parties
has caused this Amendment No. 1 to Marketing Services Agreement to be duly
executed and delivered by its duly authorized officer as of the date first above
written.
| PARTIES: | |||
| Brilliant Digital Entertainment, Inc. | |||
| /s/ Xxxxx Xxxxxxxxxx | |||
|
|
Name:
|
Xxxxx Xxxxxxxxxx | |
| Title: | CEO | ||
