"LICENSING AND ROYALTY AGREEMENT"
ROYALTY CONTRACT AGREEMENT This Agreement with (INDIVIDUAL’S NAME) made as of the ___ day of __________, 2011 by and between LOCKER 81 FUNDRAISING SOLUTIONS LLC. (FS”) having its principal place of business at 3102 Maple Ave Suite 400 Dallas TX 75201 (hereinafter referred to as "FS"), and (INDIVIDUAL’S NAME) an organization having its principal place of business at ______________________________, (hereinafter referred to as “IND NAME") FS for themselves, their successors and assigns. A. FS is engaged in offering stored value card programs and other fundraising programs to individuals through affinity programs with organizations of which the individual is a supporter or member; B. “IND NAME” is an individual whose mission is to "__________________________________________________________________________________.” “IND NAME” desires to build its relationship with its members in furtherance of it’s for profit / non profit purpose; C. “IND NAME” is the owner of certain trademarks, logos, service marks, trade dress and trade names as more fully described in Schedule E hereto; and D. In return for royalty payment “IND NAME” as provided herein, “IND NAME” and the Member organizations are willing to grant to FS a license to use their respective Trademarks and Member lists in connection with the Program as defined herein. 1. DEFINITIONS When used in this Agreement “IND NAME”: (a) "Agreement “IND NAME”" means this Agreement “IND NAME” and Schedules A, B, C and D, and any additional Schedules, attached hereto and any amendment thereto as may be mutually agreed to in writing by the parties from time to time. (b) "Anniversary Date" means each ______ commencing on ____________ during the term of this Agreement “IND NAME” or any extension hereof. (c) "Contract Year" means the twelve (12) months beginning ____________ and ending on ________________ and each consecutive twelve (12) month period thereafter until ____________ and any extension hereof. (d) "Customer" means any Member who is a participant in the Program. (e) "End Date" means the twelve (12) month period following any date of termination during which certain obligations hereunder are continuing. (f) "Final End Date" means that date on which FS is no longer using any Trademarks and all credit cards and other credit and bank devices bearing any Trademarks are canceled or expired and no longer in use by any Customer. (g) "Financial Services" means Reloadable, Gift & Payroll credit card programs, travel and entertainment “IND NAME” card programs, smart cards, gift cards, combination cards that may be used for credit, debit or both and similar financial services programs. (h) "Mailing List" means current lists and/or magnetic tapes containing names, postal addresses and telephone numbers of Members segment by zip codes or reasonably selected membership characteristics that are readily available in the database of “IND NAME” and the Member organizations as they currently or hereafter may exist. (i) "Member(s)" means any donor, supporter or member of “IND NAME” and the Member organizations. (j) “Member organization” means the “IND NAME” organizations listed on Schedule F and any amendments thereto as may be mutually agreed to in writing by the parties from time to time. (k) “Offered Financial Services” means the Financial Services listed in section (g) of Definitions as it may be amended from time to time by written mutual agreement of the parties hereto. (l) "Program" means the Offered Fundraising Programs listed in section (g) of Definitions that FS will offer from time to time to the Members. (m) "Trademarks" means those logos, service marks, trade address, trade names, and/or trademarks and any successor logos, service marks, trade address, trade names and/or trademarks specifically identified and described in Schedule E hereto which schedule may be amended in writing from time to time. (n) “Program Profit” is defined as net proceeds to FS after bank fees, transaction costs, and operating expenses. 2. GRANT OF LICENSE: RIGHTS AND RESPONSIBILITIES OF “IND NAME” (a) “IND NAME” and the Member organizations hereby grant to FS for the term of this Agreement a non-exclusive and limited license to use the Trademarks and the Mailing List but only in connection with the Program that is the subject of this Agreement. (b) “IND NAME” and the Member organizations agree not to grant any other third party a license to use the Trademarks or any other marks in the possession of “IND NAME” or the Member organizations, nor sell, rent or to otherwise make available the Mailing List in relation to or for promoting any stored value card programs during the term of this Agreement. (c) “IND NAME” and the Member organizations have the option to grant to FS, the license to use the Mailing List, and permission, to solicit its Members for participation in the Program. (d) To ensure quality control, “IND NAME” and the Member organizations shall have the right of prior approval of the content of all Program advertising and solicitation materials to be used by FS, which approval shall not be unreasonably withheld or delayed. (e) “IND NAME” and the Member organizations shall share in the responsibility for promoting the Program. (f) If any services provided by FS hereunder are inconsistent with the well-established reputation of “IND NAME” and the Member organizations for excellent service, “IND NAME” or the Member organization shall be entitled to notify FS of its dissatisfaction, specifying the nature of its dissatisfaction and exact services. FS hereby agrees to take immediate steps to review the circumstances giving rise to the dissatisfaction and to meet with “IND NAME” and or the Member organization to discuss the unsatisfactory services. (g) “IND NAME” and the Member organizations represent to the best of their knowledge and belief that each has valid exclusive title to the Trademarks and warrants that each has the exclusive right and power to license the Trademarks to FS for use as contemplated by this Agreement. 3. RIGHTS AND RESPONSIBILITIES OF FS (a) FS shall design, develop and administer the Program for “IND NAME”. FS commits to use commercially reasonable efforts to maximize the success of the Program. (b) FS shall cause the design and production of all advertising, solicitation and promotional materials with regard to the Program. FS reserves the right of prior approval of all advertising and solicitation materials concerning or related to the Program. FS shall bear all costs of marketing, producing and distributing materials for the Program. (c) “IND NAME” and the Member organizations shall bear no financial risk related to the Program, except as provided in Subsection 5(a), shall not be deemed, in any way, as an extender of credit in the Program and shall have no liability in any form to any Customer or creditor of FS. (d) FS shall have access to the Mailing List provided to FS (or any copies of such copies) only in a manner consistent with this Agreement and shall not permit such Mailing List to be used for any other purpose. (e) FS agrees not to challenge the property rights of “IND NAME” or the Member organizations in the Trademarks. The parties to this Agreement also agree that the goodwill arising from FS's use of the Trademarks shall inure to the sole benefit of “IND NAME” and the member organizations and that no other intellectual property is being licensed to FS. (f) FS acknowledges that the Mailing List is confidential to “IND NAME” and the Member organizations and constitutes valuable assets of “IND NAME” and the Member organizations. (g) “IND NAME” and the Member organizations acknowledge that the Customer List is confidential to FS and constitutes a valuable asset of FS. 4. ROYALTIES (a) FS agrees to and shall pay to “IND NAME” the royalties set forth within Schedule C hereto and incorporated herein ("Royalties"). (b) Schedule C may be amended in writing from time to time by the parties hereto to reflect Royalties for additional programs offered as part of the Program that may be agreed upon by the parties hereto. (c) FS shall provide annual reports to “IND NAME” and the member organizations within sixty (60) days of the end of each calendar year containing sufficient information to validate Royalties accrued, due and paid or payable under this Agreement in a format mutually agreed to by the parties hereto from time to time. (d) FS shall keep and maintain books and records of all Customer account activity that relates to the accrual, obligation to pay and payment of Royalties pursuant to this Agreement and Schedule C hereto, including, without limitation, all new accounts, all account renewals, all retail purchase transactions (net of all refunds and returns), along with any other information required in calculating and verifying Royalties accrued, paid and payable, all according to generally accepted accounting principles. If requested by “IND NAME” and the Member organizations and at their expense, such reports shall be certified as accurate in a signed opinion of a mutually agreed upon independent certified public accounting firm (the “Firm”), provided that “IND NAME” shall have the right in its sole discretion to appoint the lead auditor ("Auditor") from among the certified public accountants then employed by the Firm. In the event that the Auditor determines that any compensation due “IND NAME” and the Member organizations was not computed properly, then FS or “IND NAME” (and the Member organizations), as appropriate, shall promptly pay the amounts due or return all amounts overpaid, as the case may be, plus interest thereon at the prime lending rate at that time plus one (1%) percent per annum, calculated from the date such payment(s) was (were) actually due until the date actually paid. FS shall reimburse “IND NAME” and the Member organizations for the cost of the audit if the Auditor determines that the underpayment due to “IND NAME” and the Member organizations from FS is greater than $25,000.00 for the period audited. Locker 81 will provide regular monthly reports at no charge to organization. 5. LIMIT OF LIABILITY AND INDEMNIFICATION (a) Neither party shall be liable to the other for any special, indirect or consequential damages whether arising out of this Agreement and the performance of its terms or for any reason whatsoever. “IND NAME” and the Member organizations are not liable for any assertions of FS associated with quality, financial terms or other representations in connection with the Program. Subject to the foregoing limitation, each party, on behalf of its officers, directors, employees, agents, contractors, subcontractors and other personnel (the "Indemnifying Party") agrees to indemnify, defend and hold harmless the other, its officers, directors, agents, employees, contractors, subcontractors, other personnel, successors and assigns ("Indemnified Party") from and against any and all loss, claim, damage, liability suit, proceeding, assessment, deficiency, fine, cost, judgment and expense (including reasonable attorneys' fees and costs) (for purposes of this Section 5, a “Loss”) arising out of any violation of law or regulation, breach, act, omission or misrepresentation of the Indemnifying Party. Specifically, but not by way of limitation, FS indemnifies “IND NAME” and the Member organizations with respect to any Loss by “IND NAME” and the Member organizations, any Member, Customer or any third party, including a Loss resulting from action by any governmental agency, regulatory body, administrative judge or magistrate or court of competent jurisdiction against “IND NAME” and the Member organizations related to or arising in connection with FS's performance, negligent action or omission pursuant to Section 20 hereof or that of FS's officers, directors, employees, agents, contractors, subcontractors, other personnel, successors or assigns. (b) Either party shall notify the other with reasonable promptness of any claims or FS complaints that are received that may result in an indemnification request. The Indemnifying Party will be entitled to participate in the settlement or defense thereof and, if the Indemnifying Party elects, to take over and control the settlement or defense thereof with counsel satisfactory to the Indemnified party. In any case, the Indemnifying Party and the Indemnified Party shall cooperate if requested by the Indemnified Party (at no cost to the Indemnified Party) in the settlement or defense of any claim, demand, suit or proceeding, including, without limitation, making representatives available to consult and meet regarding the subject matter thereof and produce pertinent documents necessary and appropriate in responding to any such claims, complaints, demands or proceedings. 6. RATES AND BENEFITS Except as otherwise provided for in Schedules A (Disposable Card) and B (Reloadable Card) hereto, FS reserves the right to make periodic adjustments to the terms and conditions of the Program, provided, however, FS shall inform “IND NAME” and the Member organizations prior to any such adjustments. In the event the change increases the annual percentage rate to be paid by the Customer, FS shall, as required by applicable federal law, give each Customer the opportunity to reject the change and pay the existing balance under the prior terms in accordance with applicable law. Notwithstanding the foregoing, FS agrees that it will not terminate or otherwise make any adjustments adverse to Customers with respect to the benefits and features of the Program, unless FS determines that the benefit of providing such benefit or features does not justify the cost. 7. TERM OF AGREEMENT (a) The initial term of this Agreement will be for a three (3) year period beginning ______________, 2011. This Agreement will be automatically extended on the Anniversary Date or any extension thereof for successive two-year periods unless any party gives written notice at least 90 (but not more than 180) days prior to the Anniversary Date, as it may be extended, to the other party of its intention not to renew. (b) FS shall have the right to prior review of any notice in connection with, relating or referring to the termination of this Agreement communicated by “IND NAME” and the Member organizations to the Members. “IND NAME” and the Member organizations shall have the right to prior review of any notice in connection with, relating or referring to the termination of this Agreement communicated by FS to the Customers. 8. EXPIRATION OR TERMINATION (a) In the event of any material breach by FS or “IND NAME” and the Member organizations of any material obligation of this Agreement, the non-breaching party may, in its sole discretion, cancel this Agreement by giving sixty (60) days written notice to the breaching party, provided that the breaching party has been given notice of the breach and sixty (60) days to cure the default and the event of default is continuing. (b) Locker 81 will agree to not terminate agreement without cause; there must be willful and negligent behavior detrimental to the company in order to terminate. 9. NOTIFICATION TO AGENT OF RECORD All notices required or given hereunder shall be in writing and shall be deemed to have been duly given, and shall be effective when delivered in person or by posting the same certified or registered mail, postage prepaid, or by private courier (provided the courier shall verify time and place of delivery) or by facsimile transmission (confirmed by paper copy within 48 hours), to the affected party at the following address: (i) If to (INDIVIDUAL’S NAME) and the Member organizations: Place your address here. ATTENTION: Place the name of person who we need to contact directly here, if different from you. (ii) If to LOCKER 81 FUNDRAISING SOLUTIONS LLC. 3102 Maple Ave. Suite 400 Dallas TX 75201 Dallas, TX ATTENTION: Donald Kelly A party may change its address set forth above by giving the other party written notice as above described. 10. NO PARTNERSHIP OR AGENCY Nothing in this Agreement shall constitute or be deemed to constitute a partnership between the Parties hereto or constitute one Party to act as agent for the other for any purpose whatsoever and no Party shall have authority or power to bind the other or to contract in the name of or create a liability against that Party in any way or for any purpose. 11. RIGHT TO INSPECT Each party shall furnish to the other such information concerning marketing, solicitation, transactions and services provided pursuant to this Agreement as may be reasonably requested from time to time but not more than once every six (6) months. 12. PRESS RELEASES Following the date of this Agreement, FS and “IND NAME” and the Member organizations may issue press releases or other public communications concerning the Program. The content of any such communication is subject to the review and approval of the party who is not issuing the release. 13. BENEFIT OF AGREEMENT “IND NAME” Subject to Section 17, this Agreement and the rights, duties and obligations of the parties hereto under this Agreement shall be binding upon and inure solely for the benefit of the parties hereto and their respective successors and permitted assigns, and no other person, including, but not limited to, individual Members, shall acquire or have any right under or by virtue of this Agreement. If requested, any successor or assign shall execute any instrument and perform any acts that may be necessary or proper to carry out the purposes of this Agreement. 14. CONSULTATION Notwithstanding the giving of any notice required herein, FS or its designated agent and “IND NAME” and the Member organizations will use their best efforts to be available at reasonable times at their respective offices for consultation with the other on matters related to this Agreement. 15. FORCE MAJEURE In the event that any party fails to perform its obligations under this Agreement in whole or in part as a consequence of acts of God, fire, explosion, public utility failure, accident, strike, flood, embargoes, war, nuclear disaster or riot, such failure to perform shall not be considered a breach of this Agreement during the period of such disability. The disabled party shall promptly and in writing advise the other party if it is unable to perform due to a force majeure event, the expected duration of such inability to perform and of any developments (or changes therein) that appear likely to affect the ability of that party to perform any of its obligations hereunder, in whole or in part. If a force majeure event shall continue for longer than ninety (90) days, the other party shall have the right to terminate this Agreement as a not for cause termination event. 16. ASSIGNMENTS No party may assign or transfer its rights under this Agreement without the written consent of the other; including the license to use the Trademarks and Mailing List. 17. AGREEMENT MODIFICATION This Agreement may not be modified or changed except by written agreement signed by the authorized representatives of the parties. 18. SEVERABILITY If any term, provision or condition of this Agreement shall be found or held invalid or unenforceable for any reason by any court or governmental entity of competent jurisdiction, such invalidity or unenforceability shall not affect the remainder of such term, provision or condition nor any other provision or condition, and this Agreement shall survive and be construed as if such invalid or unenforceable term, provision or condition had not been contained therein. The parties shall negotiate a substitute term in good faith and shall substitute for the invalid or unenforceable provision(s) a valid and enforceable provision that most closely approximates the intent and economic effect of the invalid or unenforceable provision(s). 19. WAIVER The waiver or failure of any party to exercise in any respect any right, remedy or power provided for in this Agreement shall not be deemed a waiver of any further exercise thereof or future rights hereunder. The waiver by any party of the time for performance of any act or condition hereunder does not constitute a waiver of the act or condition itself. 20. REPRESENTATIONS AND WARRANTIES Each of the parties has all requisite corporate power and authority to enter into this Agreement and to perform under the Agreement. This Agreement has been duly and validly authorized, executed and delivered by each of the parties and constitutes the valid and legally binding obligation of FS and “IND NAME” and the Member organizations, enforceable against each party in accordance with its terms. FS and “IND NAME” and the Member organizations each warrant and represent that each has not entered into any contract, agreement or understanding with any third party, nor is it the subject of any litigation or regulatory enforcement action or investigation that would in any respect prohibit or restrict either party in the performance of any of its duties or obligations under this Agreement. 21. COUNTERPARTS This Agreement may be executed in one or more counterparts, each of which when executed and delivered shall be deemed an original, and all of which together shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties hereto by their authorized representatives have set their hands on the dates indicated below and warranted that they are authorized representatives. Dated this __ day of ___________, 2011, (INDIVIDUAL’S NAME) By: __________________________ Title: _________________________ Dated this __ day of ___________, 2011 By: __________________________ Title: _________________________ Dated this __ day of ___________, 2011 LOCKER 81 FUNDRAISING SOLUTIONS LLC. By: __________________________ Title: _________________________ Dated this __ day of ___________, 2011 Mark Gonzales By: __________________________ Program Administrator Title: _________________________ Dated this __ day of ___________, 2011 By: __________________________ Title: _________________________ SCHEDULE A Gift Card Fees & Limits Item Fee Initial Card Fee $3.95 -$5.95 per card Card Activation/Issuance Fee Included in Initial Card Fee Monthly Fee Waived Pin Selection Fee Waived Transaction Fees Signature Based POS Transaction Fees Waived per transaction PIN Based POS Transaction Fees waived per transaction ATM Transaction Fees Withdrawal (in U.S.) $1.50 per withdrawal Withdrawal (outside U.S.) $4.50 per withdrawal Other Waived per transaction Cash Advance Fees $5.00 per advance Customer Service Fees VRU Fee Waived Representative-assisted $1.50 per call (discretionary) Online Access Waived per access Lost or Stolen Card Fees $4.95 per card Express Delivery of Replacement Card $15.00 per card Administrative Fee to Close Account for Fraudulent $15.00 per account Activity Overdraft Fee* N/A Return Item Fee N/A Account on File Fee (for Expired Cards Only) Waived Maximum Card Load Limit $100.00 per day Maximum Card Balance Limit $100.00 Maximum ATM Withdrawal Limit 3 transactions or $500.00 per day Maximum POS Transaction Limit 3 transactions or $500.00 per day SCHEDULE B Reloadable Card Fees & Limits Item Fee Initial Card Fee $20.00 (* Minimum Card Load $10.00) Card Activation/Issuance Fee Included in Initial Card Fee Monthly Fee $1.95 per month Pin Selection Fee waive per change Card Load Fees Other waived per action or transaction ATM Transaction Fees Withdrawal (in U.S.) $1.50 per withdrawal Withdrawal (outside U.S.) $4.50 per withdrawal Other N/A Pinned POS Purchase waived per transaction Cash Advance $5.00 per advance Card-to-Card Transfer Fees waived per transfer Customer Service Fees VRU Fee Waived Representative-assisted $1.50 per call Online Access N/A per access Lost or Stolen Card Fees $10.00 per card Express Delivery of Replacement Card $15.00 per card Administrative Fee to Close Account for Fraudulent Activity $10.00 per account Overdraft Fee* $25.00 per overdraft Return Item Fee Waived per return Account on File Fee for Expired Cards Only $5.00 per month Maximum Card Load Limit $8,000.00 per day Maximum Card Balance Limit $8,000.00 Maximum ATM Withdrawal Limit 3 transactions or $400.00 per day Maximum POS Transaction Limit 3 transactions or $1,000.00 per day *If Fraudulent activity is detected a NSF fee could be charged. SCHEDULE C Royalty Fees Item Fee In the USA 1. Reloadable Card Fee Initial Sale Royalty $X.XX 2. Reloadable, Gift & Payroll Card Royalty1 XX% of Program Profit Out of the USA 1. Reloadable Card Fee Initial Sale Royalty $X.XX 2. Reloadable, Gift & Payroll Card Royalty1 XX% of Program Profit “Program Profit Distribution Percentiles” is discretionary as agreed upon by each partnering organization or individual contract signer, if not signing as an organization. “Program Profit” is defined as net proceeds to FS from bank after all transaction fees, bank costs and operating expenses. SCHEDULE D Gift Card Initial Sale Royalty Fees Item Fee Royalty In the USA 1. Gift Card Fee Initial Sale Royalty $3.95 $0.40 $4.95 $0.60 $5.95 $0.80 Outside of the USA 1. Gift Card Fee Initial Sale Royalty $3.95 $0.55 $4.95 $0.83 $5.95 $1.10 FOOTNOTES – INITIAL HERE ____________ _____________________________________________________ 1 Royalty is earned based on unused funds at the time of card expiration. Expired cards are billed the account on file fee until balance is zero. No expiration fee can be charged until 5yrs has expired (* Gift Card Only) 2 A monthly royalty shall be paid to “IND NAME”, provided that with respect to the group, at least $100 of revenue is due.