EXCLUSIVE SPONSORSHIP AGREEMENT

THIS AGREEMENT is made this [date] by and between [Sponsor’s name], a [Sponsor’s state of incorporation] corporation with offices at [Sponsor’s address] (“Sponsor”), and [Operator’s name], a [Operator’s state of incorporation] corporation with offices at [Operator’s address] (“Operator(Patent License Co.)  ”).

W I T N E S S E T H:

WHEREAS, Operator(Patent License Co.)  operates a web site on the World Wide Web, which contains specific channels (the “Network”);

WHEREAS, Sponsor(Intellectual Property Co.) maintains its own web site (the “Sponsor(Intellectual Property Co.) Web site”) and seeks to drive Network users (“Users”) to its Sponsor(Intellectual Property Co.) Web Site, to acquire repeat customers, to increase purchases focusing on [identify subject matter] and to reinforce the Sponsor’s brand;

WHEREAS, Operator(Patent License Co.)  and Sponsor(Intellectual Property Co.) now seek to enter into an agreement whereby Sponsor(Intellectual Property Co.) shall be an exclusive Sponsor(Intellectual Property Co.) and retailer throughout the Network to conduct an exclusive program for the following category [identify category] (the “Exclusive Program”) subject to the terms and conditions stated herein.

NOW, THEREFORE, in consideration of the promises and agreements set forth herein, the Parties, each intending to be legally bound hereby, do promise and agree as follows:

1. APPOINTMENT OF SPONSOR
Operator(Patent License Co.)  hereby appoints the Sponsor(Intellectual Property Co.) as its sole and exclusive Sponsor(Intellectual Property Co.) and retailer with respect to the category of the Exclusive Program with respect to entities whose primary business is that of a retailer, throughout the Network. Operator(Patent License Co.)  agrees not, during the Term of this Agreement, to accept any advertising, links, promotional information or marketing materials from any entity that engages in the category of the Exclusive Program.

2. PROMOTION
Throughout the Term of this Agreement, and any extensions or renewals thereof, Operator(Patent License Co.)  will provide links, advertisements and other promotional placements and opportunities to promote Sponsor(Intellectual Property Co.) and its sponsorship of the Network (collectively the “Promotional Placements and Opportunities”) in a manner to be agreed upon by the Parties. The Promotional Placements and Opportunities provided by Operator(Patent License Co.)  will, at a minimum, be no less prominent or frequent than those provided to any other Network Sponsor(Intellectual Property Co.) or advertiser. The Parties will cooperate in good faith to develop and implement such Promotional Placements and Opportunities and to maximize the effectiveness of all such Promotional Placements and Opportunities.

3. IMPRESSION GUARANTEES
A. In connection with the promotions, Operator(Patent License Co.)  guarantees to provide at least [number] Impressions to Sponsor(Intellectual Property Co.) during each year of any Term of this Agreement (the “Impression Guarantees”). The term “Impressions” shall mean a User’s viewing of a web page or equivalent containing one or more promotional hypertext links to the Sponsor(Intellectual Property Co.) Web Site.

B. In the event that Operator(Patent License Co.)  fails to meet the Impression Guarantees, then Operator(Patent License Co.)  shall be required to either, at Sponsor’s option: (a) continue to provide the Promotional Placements and Opportunities until the guaranteed number of Impressions have been met, in which case the applicable term of this Agreement shall be extended, at no additional cost to Sponsor, until such guarantees are met; or (b) cooperate in good faith with Sponsor(Intellectual Property Co.) to develop and implement such other advertising or promotional placements as are acceptable to Sponsor(Intellectual Property Co.) to “make good” the shortfall. In addition, if Operator(Patent License Co.)  fails to meet the Impression Guarantees, Sponsor(Intellectual Property Co.) may at any time thereafter terminate this Agreement upon [number] ([#]) days written notice.

C. Operator(Patent License Co.)  shall provide to Sponsor(Intellectual Property Co.) on a quarterly basis, within [number] ([#]) days following the end of each calendar quarter, a written report signed by an authorized representative of Operator(Patent License Co.)  showing in reasonable detail the number of Impressions delivered during such quarter. Operator(Patent License Co.)  shall keep and retain, during the term of this Agreement and for a period of [number] years thereafter, books and records sufficient to demonstrate the number of Impressions delivered, and Sponsor(Intellectual Property Co.) shall have the right to have such books and records examined by an independent third party acceptable to Operator(Patent License Co.)  as are necessary to verify the number of Impressions reported to Sponsor. Sponsor(Intellectual Property Co.) is entitled to conduct such an audit only during normal business hours and no more frequently than [number] times per calendar year. Sponsor(Intellectual Property Co.) agrees to provide Operator(Patent License Co.)  with at least [number] ([#]) week advance notice of any audit. If the audit reveals that the number of Impressions was misreported by more that [number] percent ([#]%), Operator(Patent License Co.)  will pay for all costs reasonably incurred by Sponsor(Intellectual Property Co.) in connection with the audit.

4. FULFILLMENT
Sponsor(Intellectual Property Co.) shall be solely responsible for: (a) fulfilling all orders for its products; and (b) calculating, collecting and paying all appropriate taxes associated with payment processing. Sponsor’s products offered through the Network will be supported by the same warranty and return policy for such products as offered through other Sponsor(Intellectual Property Co.) channels.

5. TRAFFIC DATA
On a quarterly basis, Operator(Patent License Co.)  will use its best efforts to provide Sponsor(Intellectual Property Co.) with mutually agreed data concerning search and browsing behavior on the Network, to the extent such behavior reasonably could relate to the online promotion or sale of products in the category of the Exclusive Program. Sponsor(Intellectual Property Co.) shall treat such data as Confidential Information and will not use it except in accordance with reasonable guidelines to be agreed by the Parties. Notwithstanding anything contained in this Section, Operator(Patent License Co.)  will not be required to deliver to Sponsor(Intellectual Property Co.) any user data in violation of its then-existing policies regarding the protection of user information.

6. MAINTENANCE
Each Party shall monitor and periodically test the general availability and operation of its Web site.

7. TERM
The initial term of this Agreement (the “Initial Term”) shall commence on the Effective Date and shall continue for a period of [number] ([#]) months from the date that all of the Promotional Placements and Opportunities are available on the Network (the “Implementation Date”) unless terminated earlier or extended as provided herein. Promptly after the Implementation Date has occurred, the Parties shall in good faith agree upon and document in writing such Implementation Date. Upon mutual agreement of the Parties within no less than [number] ([#]) days prior to the expiration date of the Initial Term, the Agreement may be renewed for an additional [number] ([#]) month term (the “Renewal Term”).

8. COMPENSATION
A. Upfront Fees

1. Sponsor(Intellectual Property Co.) agrees to pay Operator, upon the signing of this Agreement, an upfront, nonrefundable, non-recoupable setup fee in the amount of $[number].

2. In the event that this Agreement is renewed, Sponsor(Intellectual Property Co.) agrees to pay Operator, within [number] ([#]) days after the commencement of the Renewal Term, an upfront, nonrefundable, non-recoupable renewal fee in the amount of $[number].

B. Referral Fees

1. In addition to the above fee, Sponsor(Intellectual Property Co.) shall pay to Operator, on a quarterly basis-and payable within [number] ([#]) days after the end of each quarter, referral fees based upon a percentage of the Sale Price of Qualifying Products actually purchased from Sponsor(Intellectual Property Co.) (the “Referral Fees’). Sponsor(Intellectual Property Co.) shall receive a credit for any Referral Fees paid on Qualifying Products which are later returned. The term “Sale Price” as used herein shall mean the sale price for such product listed in the Sponsor(Intellectual Property Co.) catalog in effect at the time of order and does not include costs for shipping, handling, gift-wrapping, and taxes. The term “Qualifying Products” as used herein shall mean all products listed in Sponsor’s catalog at the time of purchase by Users as a direct result of following a hypertext link from the Network to the Sponsor(Intellectual Property Co.) Web Site.

2. Operator(Patent License Co.)  will earn referral fees according to the following fee schedule:

a. A percentage of the Sales Price on sales of each Individually Linked Product that, on the date of order, is listed in the Sponsor(Intellectual Property Co.) catalog at a percentage off the suggested list price;

b. A percentage of the Sales Price on sales of each Individually Linked Product that, on the date of order, is listed in the Sponsor(Intellectual Property Co.) catalog at the suggested list price (such as special order products);

c. A percentage of the Sales Price on sales of Individually Linked Product that, on the date of order, is listed in the Sponsor(Intellectual Property Co.) catalog at more than a percentage off the suggested list price;

d. A percentage of the Sales Price on sales of Qualifying Products other than Individually Linked Products; and

The term “Individually Linked Products” as used herein shall mean products which are specifically featured in a Promotional Placement or Opportunity on the Network and were purchased by Users as a direct result of following a link on the Network to the Web Site that specifically identifies such product.

C. Referral Fee Guarantee

1. Initial Term: If during the course of the Initial Term of this Agreement Operator(Patent License Co.)  earns less in Referral Fees than $[amount] (the “Target Referral Fee Amount”), Sponsor(Intellectual Property Co.) shall include, in the final quarterly Referral Fee payment for Referral Fees earned during the Initial Term, that amount which causes Operator’s total Referral Fees for the Initial Term to equal not less than the Target Referral Fee Amount. Any amount earned by Operator(Patent License Co.)  during the Initial Term in excess of the Target Referral Fee Amount shall be due and owing to Operator(Patent License Co.)  in accordance with the above-mentioned quarterly payment schedule.

2. Renewal Term: If during the course of the Renewal Term of this Agreement, Operator(Patent License Co.)  earns less in Referral Fees than $[amount] (the “Renewal Target Referral Fee Amount”), Sponsor(Intellectual Property Co.) shall include, in the final quarterly Referral Fee payment for Referral Fees earned during the Renewal Term, that amount which causes Operator’s total Referral Fee for the Renewal Term to equal not less than the Renewal Target Referral Fee Amount. Any amount earned by Operator(Patent License Co.)  during the Renewal Term in excess of the Renewal Target Referral Fee Amount shall be due and owing to Operator(Patent License Co.)  in accordance with the above-mentioned quarterly payment schedule.

9. RECORD INSPECTION AND AUDIT
A. The Sponsor(Intellectual Property Co.) shall track sales from the Operator(Patent License Co.)  through a uniform resource locator and shall provide the Operator(Patent License Co.)  with monthly reports in a form satisfactory to the Operator.

B. Operator(Patent License Co.)  shall have the right, upon reasonable notice, to inspect Sponsor’s books and records and all other documents and material in Sponsor’s possession or control with respect to the subject matter of this Agreement. Operator(Patent License Co.)  shall have free and full access thereto for such purposes and may make copies thereof.

C. In the event that such inspection reveals an underpayment by Sponsor(Intellectual Property Co.) of the actual monies owed Operator, Sponsor(Intellectual Property Co.) shall pay the difference, plus interest calculated at the rate of [number] Percent ([#].%) per month. If such underpayment be in excess of [number] U.S. Dollars ($[#]) for any Period, Sponsor(Intellectual Property Co.) shall also reimburse Operator(Patent License Co.)  for the cost of such inspection.

D. All books and records relative to Sponsor’s obligations hereunder shall be maintained and made accessible to Operator(Patent License Co.)  for inspection at a location in the United States for at least [number] years after termination of this Agreement.

10. COMPLIANCE
Both Parties shall operate their respective Web Sites and services in compliance with all applicable laws and regulations and each will be solely responsible for obtaining all required governmental authorizations necessary for the full performance of its services as provided for under this Agreement.

11. REPRESENTATIONS AND WARRANTIES;
LIMITATION OF LIABILITY
A. Each party hereby represents and warrants that: (a) it is a corporation duly organized and validly existing and in good standing under the laws of the state of its incorporation, (b) it has full power and authority to enter into this Agreement and to perform its obligations hereunder; (c) it has obtained all permits, licenses, and other governmental authorizations and approvals required for its performance under this Agreement; and (d) the services to be rendered by each party under this Agreement neither infringe nor violate any patent, copyright, trade secret, trademark, or other proprietary right of any third party.

B. Sponsor(Intellectual Property Co.) will remain solely responsible for the operation of the Sponsor(Intellectual Property Co.) Site, and Operator(Patent License Co.)  will remain solely responsible for the operation of the Network. Each Party: (a) acknowledges that the Sponsor(Intellectual Property Co.) Web Site and the Network may be subject to temporary shutdowns due to causes beyond the operating Party’s reasonable control, and (b) subject to the specific terms of this Agreement, retains sole right and control over the programming, content and conduct of transactions over its respective site or service. EACH PARTY SPECIFICALLY DISCLAIMS ANY REPRESENTATION OR WARRANTY REGARDING (A) THE AMOUNT OF SALES THAT SPONSOR(INTELLECTUAL PROPERTY CO.) MAY GENERATE DURING THE TERM, AND (B) ANY ECONOMIC OR OTHER BENEFIT THAT THE OTHER PARTY MIGHT OBTAIN THROUGH ITS PARTICIPATION IN THIS AGREEMENT.

C. NEITHER SPONSOR(INTELLECTUAL PROPERTY CO.) NOR OPERATOR(PATENT LICENSE CO.)  WILL BE LIABLE TO THE OTHER FOR ANY INDIRECT, SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST PROFITS OR LOST DATA) ARISING OUT OF THIS AGREEMENT. EACH PARTY’S ENTIRE LIABILITY ARISING FROM THIS AGREEMENT WHETHER IN CONTRACT OR TORT, WILL NOT EXCEED THE AMOUNTS TO BE PAID.

12. INTELLECTUAL PROPERTY RIGHTS AND LICENSES
A. Subject to the license granted to Operator, Sponsor(Intellectual Property Co.) reserves all of its right, title and interest in its intellectual property rights (e.g., patents, copyrights, trade secrets, trademarks and other intellectual property rights). Subject to the license granted to Sponsor, Operator(Patent License Co.)  reserves all of its right, title and interest in its intellectual property rights.

B. Sponsor(Intellectual Property Co.) hereby grants to Operator, during the term of this Agreement and any extensions or renewals thereof, a non-exclusive, non-transferable, royalty-free license to establish hyperlinks between the Party’s Web Sites and to use Sponsor’s trade names, logos, trademarks and service marks (the “Sponsor(Intellectual Property Co.) Marks”) on the Network as is reasonably necessary to establish and promote such hyperlinks and to otherwise perform its obligations under this Agreement; provided, however, that any promotional materials or usages containing any of the Sponsor(Intellectual Property Co.) Marks will be subject to Sponsor’s prior written approval.

C. Operator(Patent License Co.)  hereby grants to Sponsor, during the term of this Agreement and any extensions or renewals thereof, a non-exclusive, nontransferable, royalty-free license to establish hyperlinks between the Party’s Web Sites and to use Operator’s trade names, logos, trademarks and service marks (the “Operator(Patent License Co.)  Marks”) as is reasonably necessary to establish and promote such hyperlinks and to otherwise perform its obligations under this Agreement; provided, however, that any promotional materials or usages containing any of the Operator(Patent License Co.)  Marks will be subject to Operator’s prior written approval.

D. Neither Party will modify, alter or obfuscate the other Party’s Marks or use the other Party’s Marks in a manner that disparages the other Party or its products or services, or portrays the other Party or its products or services in a false, competitively adverse or poor light. Each Party will comply with the other Party’s requests as to the form of use of the other Party’s Marks and will avoid any action that diminishes the value of such Marks. Either Party’s unauthorized use of the other’s Marks is strictly prohibited. Upon termination of this Agreement and upon written request, the Party in receipt of the requesting Party’s intellectual or proprietary property and/or information pursuant to this Agreement shall return such information to the requesting Party.

13. CONFIDENTIALITY
A. “Confidential Information” shall mean any confidential technical data, trade secret, know-how or other confidential information disclosed by any party hereunder in writing, orally, or by drawing or other form and which shall be marked by the disclosing party as “Confidential” or ”Proprietary”. If such information is disclosed orally, or through demonstration, in order to be deemed Confidential Information, it must be specifically designated as being of a confidential nature at the time of disclosure and reduced in writing and delivered to the receiving party within [number] ([#]) days of such disclosure.

B. Notwithstanding the foregoing, Confidential Information shall not include information which: (i) is known to the receiving party at the time of disclosure or becomes known to the receiving party without breach of this Agreement; (ii) is or become publicly known through no wrongful act of the receiving party or any subsidiary of the receiving party; (iii) is rightfully received from a third party without restriction on disclosure; (iv) is independently developed by the receiving party or any of its subsidiary; (v) is furnished to any third party by the disclosing party without restriction on its disclosure; (vi) is approved for release upon a prior written consent of the disclosing party; (vii) is disclosed pursuant to judicial order, requirement of a governmental agency or by operation of law.

C. The receiving party agrees that it will not disclose any Confidential Information to any third party and will not use Confidential Information of the disclosing party for any purpose other than for the performance of the rights and obligations hereunder during the term of this Agreement and for a period of [number] ([#]) years thereafter, without the prior written consent of the disclosing party. The receiving party further agrees that Confidential Information shall remain the sole property of the disclosing party and that it will take all reasonable precautions to prevent any unauthorized disclosure of Confidential Information by its employees. No license shall be granted by the disclosing party to the receiving party with respect to Confidential Information disclosed hereunder unless otherwise expressly provided herein.

D. Upon the request of the disclosing party, the receiving party will promptly return all Confidential information furnished hereunder and all copies thereof.

E. The Parties agree that all publicity and public announcements concerning the formation and existence of this Agreement shall be jointly planned and coordinated by and among the Parties. Neither party shall disclose any of the specific terms of this Agreement to any third party without the prior written consent of the other party, which consent shall not be withheld unreasonably. Notwithstanding the foregoing, any party may disclose information concerning this Agreement as required by the rules, orders, regulations, subpoenas or directives of a court, government or governmental agency, after giving prior notice to the other party.

F. If a party breaches any of its obligations with respect to confidentiality and unauthorized use of Confidential information hereunder, the non- breaching party shall be entitled to equitable relief to protect its interest therein, including but not limited to injunctive relief, as well as money damages notwithstanding anything to the contrary contained herein.

14. INDEMNITY
Each Party agrees to defend, indemnify, and hold the other party, and its officers, directors, agents, and employees, harmless against all costs, expenses, and losses (including reasonable attorney fees and costs) incurred through claims of third Parties against such party based on any breach of any representation and warranty made in this Agreement.

15. TERMINATION
Either party may terminate this Agreement on [number] days’ written notice to the other party in the event of a breach of any provision of this Agreement by the other party, provided that, during the [number]-day period, the breaching party fails to cure such breach.

16. EFFECT OF TERMINATION
Upon termination or expiration of this Agreement, all rights granted to Sponsor(Intellectual Property Co.) hereunder shall forthwith terminate and Operator(Patent License Co.)  shall be free to contract with others to perform the same or similar function on an exclusive or non-exclusive basis without any further obligation to Sponsor.

17. RELATIONSHIP OF PARTIES
The Parties are entering this Agreement as independent contractors, and this Agreement will not be construed to create a partnership, joint venture or employment relationship between them. Neither Party will represent itself to be an employee or agent of the other or enter into any agreement on the other’s behalf of or in the other’s name.

18. COMPLIANCE WITH LAWS
In its performance of this Agreement, each Party will comply with all applicable laws, regulations, orders and other requirements, now or hereafter in effect, of governmental authorities having jurisdiction. Without limiting the generality of the foregoing, each Party will pay, collect and remit such taxes as may be imposed with respect to any compensation, royalties or transactions under this Agreement. Except as expressly provided herein, each Party will be responsible for all costs and expenses incurred by it in connection with the negotiation, execution and performance of this Agreement.

19. FORCE MAJEURE
Neither party will be liable for, or will be considered to be in breach of or default under this Agreement on account of, any delay or failure to perform as required by this Agreement as a result of any causes or conditions that are beyond such Party’s reasonable control and that such Party is unable to overcome through the exercise of commercially reasonable diligence. If any force majeure event occurs, the affected Party will give prompt written notice to the other Party and will use commercially reasonable efforts to minimize the impact of the event.

20. NOTICE AND PAYMENT
A. Any notice required to be given under this Agreement shall be in writing and delivered personally to the other designated party at the above stated address or mailed by certified, registered or Express mail, return receipt requested or by Federal Express.

B. Either party may change the address to which notice or payment is to be sent by written notice to the other under any provision of this paragraph.

21. JURISDICTION/DISPUTES
This Agreement shall be governed in accordance with the laws of the State of [State]. All disputes under this Agreement shall be resolved by litigation in the courts of the State of [State] including the federal courts therein and the Parties all consent to the jurisdiction of such courts, agree to accept service of process by mail, and hereby waive any jurisdictional or venue defenses otherwise available to it.

22. AGREEMENT BINDING ON SUCCESSORS
The provisions of the Agreement shall be binding upon and shall inure to the benefit of the Parties hereto, their heirs, administrators, successors and assigns.

23. ASSIGNABILITY
Neither party may assign this Agreement or the rights and obligations thereunder to any third party without the prior express written approval of the other party which shall not be unreasonably withheld.

24. WAIVER
No waiver by either party of any default shall be deemed as a waiver of prior or subsequent default of the same of other provisions of this Agreement.

25. SEVERABILITY
If any term, clause or provision hereof is held invalid or unenforceable by a court of competent jurisdiction, such invalidity shall not affect the validity or operation of any other term, clause or provision and such invalid term, clause or provision shall be deemed to be severed from the Agreement.

26. INTEGRATION
This Agreement constitutes the entire understanding of the Parties, and revokes and supersedes all prior agreements between the Parties and is intended as a final expression of their Agreement. It shall not be modified or amended except in writing signed by the Parties hereto and specifically referring to this Agreement. This Agreement shall take precedence over any other documents which may conflict with this Agreement.

IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound hereby, have each caused to be affixed hereto its or his/her hand and seal the day indicated.

[Operator]     [Sponsor]

By:        By:
Title:      Title:
Date:      Date: