This Affiliate Agreement is entered into by DigitalFusion Creative Technologies, Inc., a Delaware corporation (“Client”), and the Affiliate (“Partner”). In consideration of the mutual promises and covenants contained in this Agreement, the parties agree as follows:
1.1 Appointment. Subject to the terms of this Agreement, Client hereby appoints Partner as a nonexclusive representative in the geographic territory identified in EXHIBIT A (“Territory”) to solicit and refer potential customers for the Client products identified in Exhibit A (“Client Products”) through its websites and other means of correspondence and marketing. Partner will not have the authority, express or implied, to make any commitment or incur any obligations on behalf of Client other than making referrals as set forth in this Agreement.
2. REFERRAL PROCESS
2.1 Referral Submission. When Partner identifies a prospective customer or a prospective customer elects to purchase Client products through Partner’s websites or portals, Partner will submit a written or electronic referral to Client through Client’s designated portals, websites or channels in order to register Partner’s presence within the account. Any such prospective customer shall be required to provide accurate and complete information including, at a minimum, its name, address, city, state, zip, phone, and type of business.
2.2 Acceptance of Referrals. Upon registration of a referral, Client may accept or reject the referral. A referral may be rejected for any reason, including, but not limited to, because the referral is not qualified, contact with Client has already been established with the referral, or the referral is an existing customer.
3. PARTNER’S OBLIGATIONS
3.1 Reasonable Efforts. Partner will use reasonable efforts to refer to Client potential customers of the Client Products. Partner will ensure that its sales representatives and agents are knowledgeable about the Client Products.
3.2 Assistance. Partner will reasonably assist Client in completing sales to accepted referrals, if requested by Client.
3.3 Business Practices. When seeking customer referrals and otherwise performing under this Agreement, Partner will (a) not engage in any deceptive, misleading, illegal, or unethical practices; (b) not make any representations or warranties concerning the Client Products, except as set forth in printed marketing collateral or documentation furnished by Client; (c) conduct business in a manner that reflects favorably at all times on the good name, good will, and reputation of Client; and (d) comply with all applicable federal, state, and local laws and regulations. Partner will indemnify and defend Client from and against all damages, liabilities, costs, and expenses, including attorneys’ and experts’ fees and expenses, that Client may incur as the result of any action brought against Client and arising out of the acts of Partner or its agents in breach of this Section 3.3.
3.4 Internal Promotion. Partner will inform and educate its organization about the nature of the business relationship between the parties and Client’s products and services.
3.5 Expense of Doing Business. Partner will bear the entire cost, taxes, and expense of conducting its business in accordance with the terms of this Agreement.
3.6 Competing Products. Partner will not refer any prospective customers to a licensor or supplier of products that compete with or are similar to the Client Products.
4. CLIENT OBLIGATIONS
4.1 Use of Client’s Trade Name. Partner may identify Client as the supplier of the Client Products in Partner’s materials so long as Client approves such materials in writing in advance.
4.2 Marketing Materials. Client may, at its own expense and discretion, provide Partner with marketing and technical information concerning the Client Products as well as reasonable quantities of brochures, instructional material, advertising literature, and other product data. Client will retain all right, title, and interest in and to all marketing materials that it provides to Partner under this Agreement.
4.3 Sales Training. Client, at its discretion, may provide Partner’s sales organization with sales training that includes: (a) a demonstration of the Client Products, (b) a summary of market and competitive positioning, (c) a discussion of the key features, benefits, and value to end customers of the Client Products, (d) marketing materials, and (e) any other beneficial information. Client and Partner will agree on the payment of any fees and expenses associated with any sales training.
4.4 Demonstration Versions. Client, at its sole discretion, may provide Partner with demonstration versions of the Client Products for use in marketing and promoting the Client Products.
5. REFERRAL COMPENSATION
5.1 Referral Compensation. Partner’s sole compensation under this Agreement for acceptance of a referral by Client and subsequent payments by such referral to Client will be the payment of a commission calculated in accordance with Exhibit A. Client reserves the right to modify commission rates from time to time at its discretion by providing Partner with 30 days written notice. However, commission changes would only affect sales to referrals registered 30 days after the date of the notice provided by Client.
5.2 Payment. Commissions will be due and payable no later than 30 days after the last day of the month in which Client receives payment from the referred customer. Payments will be subject to all applicable taxes.
6. TERM AND TERMINATION
6.1 Term. This Agreement will commence upon the Effective Date and continue for twelve months, unless earlier terminated in accordance with the provisions of this Agreement. This Agreement will automatically renew on a month-to-month basis unless at least ten days before the end of the then-current month either party provides written notice to the other party that it does not want to renew.
6.2 Termination without Cause. Either party may terminate this Agreement without cause upon ten days prior written notice to the other party.
6.3 Termination for Cause. If either party fails to perform any of its material obligations under this Agreement, the other party may terminate this Agreement by giving ten days prior written notice, provided that the matters set forth in such notice are not cured to the other party’s reasonable satisfaction within the ten-day period. Client may terminate this Agreement immediately for a breach of Section 3.3.
6.4 No Liability for Termination. Except as expressly required by law, if either party terminates this Agreement in accordance with any of the provisions of this Agreement, neither party will be liable to the other, because of such termination, for expenditures or commitments made in connection with this Agreement or damages caused by the loss of prospective profits or anticipated sales. Termination will not, however, relieve either party of obligations incurred prior to the effective date of the termination.
6.5 Effects of Termination
(a) Upon termination, Client will only be responsible for paying a commission for referrals accepted prior to the effective date of the termination. The obligation to pay commissions will continue only for orders placed prior to termination of this Agreement.
(b) In addition, the following provisions will survive any expiration or termination of this Agreement: Sections 3.2. 3.3, 6.4, 6.5, 7.1, 8, 9, 10, and 11.
7. LIMITED WARRANTY AND DISCLAIMER
7.1 WARRANTY DISCLAIMER. CLIENT MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND WHETHER EXPRESS, IMPLIED (EITHER IN FACT OR BY OPERATION OF LAW), OR STATUTORY, AS TO ANY MATTER WHATSOEVER. CLIENT EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, QUALITY, ACCURACY, AND TITLE. CLIENT DOES NOT WARRANT AGAINST INTERFERENCE WITH THE ENJOYMENT OF THE CLIENT PRODUCTS OR AGAINST INFRINGEMENT. CLIENT DOES NOT WARRANT THAT THE CLIENT PRODUCTS ARE ERROR-FREE OR THAT OPERATION OF THE CLIENT PRODUCTS WILL BE SECURE OR UNINTERRUPTED. PARTNER WILL NOT HAVE THE RIGHT TO MAKE OR PASS ON ANY REPRESENTATION OR WARRANTY ON BEHALF OF CLIENT TO ANY OTHER THIRD PARTY.
8. PARTNER INDEMNIFICATION
8.1 Defense of Claims. Partner will defend Client and its affiliates and their employees, directors, agents, and representatives (“Client Indemnified Parties”) from any actual or threatened third party claim arising out of Partner’s breach of this Agreement or based upon Partner’s negligence or willful misconduct.
8.2 Indemnification. Partner will indemnify each of the Client Indemnified Parties against (a) all damages, costs, and attorneys’ fees finally awarded against any of them in any proceeding under Section 8.1; (b) all out-of-pocket costs (including reasonable attorneys’ fees) reasonably incurred by any of them in connection with the defense of such proceeding (other than attorneys’ fees and costs incurred without Partner’s consent after Partner has accepted defense of such claim); and, (c) if any proceeding arising under Section 8.1 is settled, Partner will pay any amounts to any third party agreed to by Partner in settlement of any such claims.
9. CONFIDENTIAL INFORMATION
9.1 “Confidential Information” means any proprietary information of a party to this Agreement including: (a) the business systems and practices, know-how, reports, plans, proposals, forecasts, personnel files and information, lists, statistics or other such information of the disclosing party, (b) any lists, statistics, information and/or data relating to the applicants, customers or consumers of disclosing party, (c) any item marked “Confidential” or “Proprietary” or marked in some other manner to indicate its confidential nature, or (d) any other information which the receiving party should or has reason to know is confidential and proprietary, a trade secret or required to be kept confidential under applicable privacy laws.
9.2 Exceptions. Confidential Information will not include any information that (a) was publicly known and made generally available prior to the time of disclosure by the disclosing party, (b) becomes publicly known and made generally available after disclosure by the disclosing party to the receiving party through no action or inaction of the receiving party, (c) is already in the possession of the receiving party at the time of disclosure, (d) is obtained by the receiving party from a third party without a breach of such third party’s obligations of confidentiality, or (e) is independently developed by the receiving party without use of or reference to the disclosing party’s Confidential Information.
9.3 Non-Use and Non-Disclosure. Each party will (a) treat as confidential all Confidential Information of the other party, (b) not disclose such Confidential Information to any third party, except on a “need to know” basis to third parties that have signed a non-disclosure agreement containing provisions substantially as protective as the terms of this Section provided that the disclosing party has obtained the written consent to such disclosure from the other party, and (c) will not use such Confidential Information except in connection with performing its obligations or exercising its rights under this Agreement. Each party is permitted to disclose the other party’s Confidential Information if required by law so long as the other party is given prompt written notice of such requirement prior to disclosure and assistance in obtaining an order protecting such information from public disclosure.
9.4 Confidentiality of Agreement. Neither party to this Agreement will disclose the terms of this Agreement to any third party without the consent of the other party, except as required by securities or other applicable laws. Notwithstanding the above provisions, each party may disclose the terms of this Agreement (a) in connection with the requirements of a public offering or securities filing, (b) in confidence, to accountants, banks, and financing sources and their advisors, (c) in confidence, in connection with the enforcement of this Agreement or rights under this Agreement, or (d) in confidence, in connection with a merger or acquisition or proposed merger or acquisition, or the like.
10. LIMITATION OF LIABILITY
10.1 Disclaimer of Damages. NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, CLIENT WILL NOT, UNDER ANY CIRCUMSTANCES, BE LIABLE TO PARTNER FOR CONSEQUENTIAL, INCIDENTAL, SPECIAL, PUNITIVE, OR EXEMPLARY DAMAGES ARISING OUT OF OR RELATED TO THE TRANSACTION CONTEMPLATED UNDER THIS AGREEMENT, INCLUDING BUT NOT LIMITED TO LOST PROFITS OR LOSS OF BUSINESS, EVEN IF CLIENT IS APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING.
10.2 Cap on Liability. UNDER NO CIRCUMSTANCES WILL CLIENT’S TOTAL LIABILITY OF ALL KINDS ARISING OUT OF OR RELATED TO THIS AGREEMENT (INCLUDING BUT NOT LIMITED TO WARRANTY CLAIMS), REGARDLESS OF THE FORUM AND REGARDLESS OF WHETHER ANY ACTION OR CLAIM IS BASED ON CONTRACT, TORT, OR OTHERWISE, EXCEED THE TOTAL AMOUNT PAID BY CLIENT TO PARTNER UNDER THIS AGREEMENT (DETERMINED AS OF THE DATE OF ANY FINAL JUDGMENT IN AN ACTION).
10.3 Independent Allocations of Risk. EACH PROVISION OF THIS AGREEMENT THAT PROVIDES FOR A LIMITATION OF LIABLITY, DISCLAIMER OF WARRANTIES, OR EXCLUSION OF DAMAGES IS TO ALLOCATE THE RISKS OF THIS AGREEMENT BETWEEN THE PARTIES. THIS ALLOCATION IS REFLECTED IN THE COMMISSION OFFERED BY CLIENT TO PARTNER AND IS AN ESSENTIAL ELEMENT OF THE BASIS OF THE BARGAIN BETWEEN THE PARTIES. EACH OF THESE PROVISIONS IS SEVERABLE AND INDEPENDENT OF ALL OTHER PROVISIONS OF THIS AGREEMENT, AND EACH OF THESE PROVISIONS WILL APPLY EVEN IF THE WARRANTIES IN THIS AGREEMENT HAVE FAILED OF THEIR ESSENTIAL PURPOSE.
11.1 Independent Contractors. The relationship of the parties established by this Agreement is that of independent contractors, and nothing contained in this Agreement should be construed to give either party the power to (a) act as an agent or (b) direct or control the day-to-day activities of the other. Financial and other obligations associated with each party’s business are the sole responsibility of that party.
11.2 Non-Assignability and Binding Effect. Partner may not assign its rights and obligations under this Agreement without the written consent of Client, except pursuant to a merger, acquisition, or sale of all or substantially all of its assets. Subject to the foregoing, this Agreement will be binding upon and inure to the benefit of the parties and their successors and assigns.
11.3 Notices. Any notice required or permitted to be given under this Agreement will be effective if it is in writing and sent by certified or registered mail, or insured courier, return receipt requested, to the appropriate party at the address set forth on the signature page of this Agreement and with the appropriate postage affixed; provided, however, that Client shall be permitted to provide notice to Partner using any email address or electronic communications methodology used by Partner within the then prior thirty days. Either party may change its address for receipt of notice by notice to the other party in accordance with this Section. Notices are deemed given two business days following the date of mailing or one business day following delivery to a courier.
11.4 Force Majeure. Nonperformance of either party will be excused to the extent that performance is rendered impossible by strike, fire, flood, governmental acts, orders or restrictions, or any other reason where failure to perform is beyond the control and not caused by the negligence of the non-performing party.
11.5 Foreign Corrupt Practices Act. In conformity with the United States Foreign Corrupt Practices Act and with Client’s corporate policies regarding foreign business practices, Partner and its employees and agents shall not directly or indirectly make and offer, payment, promise to pay, or authorize payment, or offer a gift, promise to give, or authorize the giving of anything of value for the purpose of influencing an act or decision of an official of any government within the Territory or the United States Government (including a decision not to act) or inducing such a person to use his influence to affect any such governmental act or decision in order to assist Client in obtaining, retaining, or directing any such business.
11.6 Governing Law and Litigation. This Agreement is governed by the laws of the State of California, without giving effect to provisions related to choice of laws or conflict of laws. The application of the United Nations Convention on the Sale of Goods is not applicable and expressly disclaimed by the parties. Venue and jurisdiction of any lawsuit involving this Agreement exists exclusively in the state and federal courts in Los Angeles County, California, unless either party seeks injunctive relief that, in that party’s reasonable and good faith judgment, would not be effective unless obtained in some other venue. The prevailing party in any lawsuit arising from or relating to this Agreement is entitled to recover its costs, including reasonable attorney fees.
11.7 Remedies Cumulative. The remedies provided to the parties under this Agreement are cumulative and will not exclude any other remedies to which a party may be lawfully entitled.
11.8 Waiver and Severability. The waiver by either party of any breach of this Agreement does not waive any other breach. The failure of any party to insist on strict performance of any covenant or obligation under this Agreement will not be a waiver of such party’s right to demand strict compliance in the future, nor will the same be construed as a novation of this Agreement. If any part of this Agreement is unenforceable, the remaining portions of this Agreement will remain in full force and effect.
11.9 Drafting and Interpretation. The parties have had an equal opportunity to participate in the drafting of this Agreement and the attached exhibits. No ambiguity will be construed against any party based upon a claim that that party drafted the ambiguous language. The headings appearing at the beginning of several sections contained in this Agreement have been inserted for identification and reference purposes only and must not be used to construe or interpret this Agreement. Whenever required by context, a singular number will include the plural, the plural number will include the singular, and the gender of any pronoun will include all genders.
11.10 Entire Agreement. This Agreement, including any exhibits, is the final and complete expression of all agreements between these parties and supersedes all previous oral and written agreements regarding these matters. It may be changed only by a written agreement signed by the party against whom enforcement is sought. The exhibits referred to in this Agreement are incorporated by this reference as if fully set forth here.
11.11 Execution in Counterparts and by Facsimile. The Agreement may be executed in counterparts, each of which will be deemed an original, but all of which taken together will constitute but one and the same instrument. The Agreement may be executed and delivered by facsimile and the parties agree that such facsimile execution and delivery will have the same force and effect as delivery of an original document with original signatures, and that each party may use such facsimile signatures as evidence of the execution and delivery of this Agreement by all parties to the same extent that an original signature could be used.
CLIENT PRODUCTS, TERRITORY, AND COMMISSION
Commission rates will be set for Partner upon approval of Partner Application by Client.
Commissions will be determined by fees actually paid by an accepted referral to Client will be paid to Partner if a purchase is made by the accepted referral within thirty days after the referral is accepted by Client; provided that such commission shall apply only to the fees paid within the month of any such purchase by such referral. When calculating the commission, fees will not include shipping, taxes, or other separately itemized charges or any fees for support or other professional services. Client may make adjustments or refunds to its customers, and Client may offset the effect of a reduction against future commission payments to Partner.