ATRINSIC
 
MASTER SERVICES AGREEMENT
 
This Master Services Agreement is made as of March 26, 2010 and effective as of
July 1, 2009 (“Effective Date”), between:
 
(1)           Atrinsic, Inc., a Delaware corporation, with its principal place
of business located at 469 7th Avenue, 10th Floor, New York NY 10018
(“Atrinsic”) and
 
(2)           Brilliant Digital Entertainment, Inc., a Delaware corporation
whose principal place of business is located at 12711 Ventura Boulevard, Suite
210, Studio City, California 91604 (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” or jointly
as the “Parties”.
 
WHEREAS, Atrinsic is engaged in the business of providing mobile messaging and
Billing Method (as defined herein) services;
 
WHEREAS, BDE desires to create a new online channel, product and service
providing its end-users, buyers and customers with content subscription services
to be billed through a Billing Method aggregator providing billing and
collection services; and
 
WHEREAS, BDE desires to engage Atrinsic to perform certain messaging, billing
and collection services in connection with BDE’s content subscription service.
 
NOW, THEREFORE, in consideration of the foregoing premises and the covenants
hereinafter contained and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties hereto agree as
follows:
 
1.
Definitions and Interpretation

 
 
1.1.
The following Definitions shall apply to this Agreement:

 
 
1.1.1.
“Affiliates” of a Party shall mean any corporation, company, or other entity
more than fifty percent (50%) of whose outstanding shares or securities
(representing the right to vote for the election of directors or managing
authority) are owned, directly or indirectly (beneficially or of record) or
controlled by such Party for so long as such control exists;

 
 
1.1.2.
“Agreement” shall mean this Master Service Agreement and any Service Order Forms
executed among the Parties, as such may be amended or supplemented from time to
time by written agreement of the Parties;

 
 
1.1.3.
“Allocated Number” means any specific telephone or text number or code (such as
a short code) to be entered by Subscribers, allocated to the BDE for the BDE
Services, either dedicated to the BDE or to be shared with one or more other
customers of Atrinsic;

 
 
1.1.4.
“Ancillary Websites” means the websites, other than the Website or any other
website operating under the BDE brand, offering, referring or in any way
advertising or marketing the Website or BDE Services;

 
 
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1.1.5.
“Atrinsic Data” means data, which is provided or generated in the course of
Atrinsic’s provision of the Atrinsic Services, excluding BDE Data;

 
 
1.1.6.
“Atrinsic Rights” means all Intellectual Property Rights owned by or licensed to
Atrinsic prior to or after the Effective Date, including but not limited to
those Intellectual Property Rights involved in any aspect of the Atrinsic
Services, the Platform or any device, software or data used in connection
therewith, including without limitation the Atrinsic Data;

 
 
1.1.7.
“Atrinsic Services” means Billing Method services and/or other services set
forth in Section 2 of this Agreement or a Service Order Form provided by
Atrinsic to BDE in accordance with Section 2 of this Agreement;

 
 
1.1.8.
“Billing Method” means LEC, credit card, mobile and/or other direct to consumer
billing and collection methods as agreed between the Parties from time to time
through which Subscribers are billed for the Subscription Service.

 
 
1.1.9.
“Billing Operator” means any (i) mobile network operator, (ii) LEC operator,
(iii) credit card company, or (iv) other third party which is directly or
indirectly engaged in the performance of any of the Atrinsic Services or the BDE
Services;

 
1.1.10.
 “Billing Operator Change” means any change in the services, prices, conditions
or terms for services provided to Atrinsic or the BDE by a Billing Operator;

 
1.1.11.
 “Change” shall mean a Change in Law or a Billing Operator Change;

 
1.1.12.
 “Change in Law” shall mean the enactment or amendment of any law or regulation
by any Governmental Body after the Effective Date;

 
1.1.13.
 Intentionally deleted;

 
1.1.14.
 “BDE Content” means any information, data, files, or messages, including any
Content (as defined in Section 3.1.1) provided by or on behalf of the BDE, any
Third Party Provider, or a Subscriber using BDE Services for (i) transmission by
Atrinsic, directly or indirectly, to a Billing Operator or Subscribers or (ii)
transmission to the BDE, any Third Party Provider or a Subscriber in connection
with the Subscription Service;

 
1.1.15.
 “BDE Data” means data relating to the BDE Services or use of the BDE Services,
which is provided by BDE or generated in the course of Atrinsic’s provision of
the Atrinsic Services;

 
1.1.16.
 “BDE Rights” means all Intellectual Property Rights owned or licensed by BDE,
including but not limited to those Intellectual Property Rights involved in any
aspect of the BDE Services, including, without limitation, the BDE Data;

 
1.1.17.
 “BDE Services” means the service(s) operated or offered by BDE for providing
the Subscription Service to Subscribers, including the distribution and/or
transmission of any BDE Content;

 
1.1.18.
 Intentionally deleted;

 
1.1.19.
 “Intellectual Property Rights” means all copyright (including but not limited
to rights in computer software), patents, trademarks, trade names, trade
secrets, registered and unregistered design rights, database rights and
topography rights, all rights to bring an action for passing off, any other
similar form of intellectual property or proprietary rights, statutory or
otherwise, whether registrable or not and shall include applications for any of
them, all rights to apply for protection in respect of any of the above rights
and all other forms of protection of a similar nature or having equivalent or
similar effect to any of these which may subsist anywhere in the world;

 
 
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1.1.20.
 “Governmental Body” means any foreign, federal, state, municipal, political
subdivision or other governmental department, commission, regulatory authority
or board, bureau, agency or instrumentality;

 
1.1.21.
 “LEC” means a local exchange carrier;

 
1.1.22.
 “Marketing Services Agreement” means that certain Marketing Services Agreement
of even date herewith between BDE and Atrinsic;

 
1.1.23.
 “Outpayment” shall have the meaning set forth in Section 5.1;

 
1.1.24.
 “Platform” means the application services platform(s), and associated systems
and network connections, owned and operated by Atrinsic or by suppliers or
partners of Atrinsic, which is used to provide the Atrinsic Services;

 
1.1.25.
 “Protocol Specification” means the protocols to be used by the BDE in order to
access the Atrinsic Services, as notified by Atrinsic to the BDE from time to
time;

 
1.1.26.
 “Service Interface” means the method to be used by the BDE to connect to the
Platform;

 
1.1.27.
 “Service Order Form” means any documents regarding the Atrinsic Services to be
provided hereunder agreed to between the Parties in a writing that is made a
part of this Agreement from time to time;

 
1.1.28.
 “Subscriber” means any end-user, customer or other buyer of the Subscription
Service;

 
1.1.29.
 “Subscription Service” means the music subscription service offered by the BDE
on Website which requires the payment of a recurring subscription fee;

 
1.1.30.
 “Taxes” means any federal, state, local or foreign government tax, fee, duty,
surcharge, or other tax-like charge that is required by applicable law to be
collected from BDE by Atrinsic or payable by Atrinsic in connection with the BDE
Services or Atrinsic Services (excluding any taxes based on Atrinsic’s income);

 
1.1.31.
 “Term” means the duration of this Agreement, as set forth in Section 10.1 of
this Agreement;

 
1.1.32.
 “Third Party” means any and all persons or entities not a Party to this
Agreement;

 
1.1.33.
 “Third Party Provider” means any Third Party that has entered into an agreement
with BDE to provide any or all of the BDE Services; and

 
1.1.34.
 “Website” means the website, located at www.kazaa.com, operated by or for BDE
to market and/or provide or otherwise make available the BDE Services.

 
1.2.
Headings are included in this Agreement for ease of reference only and shall not
affect the interpretation or construction of this Agreement.

 
1.3.
Unless the context otherwise requires, the singular includes a reference to the
plural and vice versa.

 
 
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2.
Atrinsic Responsibilities

 
 
2.1
During the Term, Atrinsic, or a Third Party directed by Atrinsic, will:

 
 
2.1.1
Use commercially reasonable efforts to provide the Atrinsic Services to BDE
within North America (the particular territories to be serviced within North
America and the Billing Operators to be utilized therein are to be determined by
mutual agreement of the Parties) and Atrinsic shall comply with all applicable
foreign, federal, state and local laws, rules and regulations in providing the
Atrinsic Services;

 
 
2.1.2
Use commercially reasonable efforts to operate any online storefront of the BDE
Services on the Website or any Ancillary Websites as described in the applicable
Service Order Form;

 
 
2.1.3
Use commercially reasonable efforts to provide Billing Method services and
manage Billing Method-related relationships including, but not limited to,
applicable Billing Operators and aggregators as described in the applicable
Service Order Form;

 
 
2.1.4
Use commercially reasonable efforts to manage all messaging services in
compliance with all applicable FTC Rules and Regulations, the CAN-SPAM Act, the
standards of practice established by the Mobile Marketing Association from time
to time (“MMA Guidelines”) and other applicable state and federal laws, each as
amended and current at the time of the applicable messaging;

 
 
2.1.5
Use commercially reasonable efforts to manage all first level customer care, as
may be determined by mutual agreement of the Parties from time to time, provided
to Subscribers;

 
 
2.1.6
And hereby does grant to BDE with a limited, non-exclusive, non-transferable
(except as provided in Section 7.2 hereof) and royalty-free license, to use the
Platform for all BDE Services in compliance with this Agreement;

 
 
2.1.7
Use commercially reasonable efforts to promptly notify BDE of Billing Operator
Changes following Atrinsic’s notification by the Billing Operator of the Billing
Operator Change; and

 
 
2.1.8
Provide BDE, on a daily basis, with data pertaining to the volume of Subscriber
confirmed subscribed, message confirmed received by a Billing Operator and users
confirmed successfully billed.

 
 
2.2
During the Term, Atrinsic will be responsible for obtaining all short codes to
be used in connection with the Atrinsic Services provided to BDE.  As between
Atrinsic and BDE, Atrinsic shall exclusively own all right, title and interest
in and to all such short codes and during the Term all rights to use and exploit
short codes will be for the benefit of the BDE Services.  Upon expiration or any
termination of the Agreement, Atrinsic shall be entitled to continue use of such
short codes with another content services provider; and

 
 
2.3
Subject to the representations and warranties of BDE contained herein and BDE’s
performance of its obligations hereunder, Atrinsic will ensure that its
collection, access, use and disclosure of Subscriber information shall comply
with all applicable foreign, federal, state, and local laws, rules and
regulations as they may be amended from time to time, including without
limitation (i) the Federal Communications Commission’s Customer Proprietary
Network Information rules and regulations implementing 47 USC 222 (the CPNI
rules) (ii) the California Online Privacy and Disclosure Act of 2003, and (iii)
laws governing marketing by telephone, direct mail, e-mail, wireless text
messaging, fax , and any other mode of communication (collectively, “Privacy
Laws”). Atrinsic shall at all times perform its obligations hereunder and make
available the Atrinsic Services in such a manner as not to knowingly cause
Atrinsic to be in material violation of any applicable laws or regulations,
including any Privacy Laws.  For purposes of its obligations under this Section
2.3, the acts or omissions of Atrinsic’s employees, agents, representatives,
contractors other than BDE and Airarena Pty Ltd., subcontractors, or Affiliates
(and such Affiliates’ employees, agents, representatives, contractors, or
subcontractors) shall also be deemed the acts or omissions of Atrinsic.

 
 
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2.4
During the Term, Atrinsic shall not solicit licenses to Content from the Labels.

 
3
Conditions to Atrinsic Provision of Atrinsic Services to BDE

 
 
3.1
During the Term, BDE, or a Third Party Provider directed by BDE, will:

 
 
3.1.1
Provide at its own expense, all necessary rights and licenses from content
owners (the “Labels”) for music, audio and other content files and offerings
(the “Content”) to be provided as part of the Content Services. BDE shall
thereafter supply said licensed content as part of the Subscription Services;

 
 
3.1.2
Be responsible for integrating, incorporating and making available on the
Website all Content in connection with the Content Services;

 
 
3.1.3
Report and pay to the Labels all royalties, licenses, fees and expenses related
to the licensed Content (“Royalties”);

 
 
3.1.4
Be responsible for obtaining any and all rights necessary to provide BDE
Services within the agreed territories and with the agreed Billing Operators;

 
 
3.1.5
Conform to the Protocol Specification for the relevant Service Interface as
provided to BDE by Atrinsic from time to time.  Atrinsic will notify BDE at
least thirty (30) days in advance of any change in the Protocol Specification;

 
 
3.1.6
Connect only to the Service Interface specified for BDE by Atrinsic using only
the names and passwords notified to BDE by Atrinsic from time to time;

 
 
3.1.7
Supply complete and accurate instructions and information to Atrinsic to the
extent reasonably necessary for the performance of the Atrinsic Services, in
accordance with such timescales as Atrinsic may reasonably require;

 
 
3.1.8
Promptly notify Atrinsic of Billing Operator Changes following BDE’s
notification by the Billing Operator of the Billing Operator Change;

 
 
3.1.9
Ensure that the BDE Services and BDE Content shall comply with all applicable
foreign, federal, state, and local laws, rules and regulations as they may be
amended from time to time, including without limitation those that apply to
advertising or marketing practices.  For purposes of its obligations under this
Section 3.1.10, the acts or omissions of BDE’s employees, agents,
subcontractors, Third Party Providers, representatives or Affiliates (and such
Affiliates’ employees, agents or representatives) shall also be deemed the acts
or omissions of BDE;

 
3.1.10
Provide all reasonable assistance to Atrinsic, including providing copies of
relevant documentation, books and records, in connection with Atrinsic’s
compliance with any requirements or conditions which are at any time imposed by
any Governmental Body and which are applicable to or affect the BDE Services,
BDE Content and/or the Atrinsic Services;

 
3.1.11
Provide, subject to reasonable confidentiality protections, any Governmental
Body or Atrinsic with such information or material relating to the BDE Services
or a future BDE Services as any Governmental Body may reasonably request in
order to carry out any investigation in connection with (i) the BDE Services or
(ii) BDE's relationship with Atrinsic or with a Third Party Provider.

 
 
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3.2
BDE will submit a reasonably detailed description of each BDE Service before
commercial launch to Atrinsic for Atrinsic’s and each Billing Operator’s review
and approval by filling out a form supplied by Atrinsic, in a format determined
by Atrinsic, which will assist Atrinsic and the Billing Operators in evaluating
whether the BDE Services fulfill the requirements of this Agreement and the
requirements of the relevant Billing Operators.  Atrinsic may in its sole and
reasonable discretion reject any or all BDE Services submitted for
approval.  After the date that Atrinsic notifies BDE in writing of its
acceptance of such BDE Service, BDE will not make any changes to such BDE
Services without obtaining prior approval from Atrinsic.

 
 
3.3
BDE will be solely responsible for its Third Party Providers and subcontractors
and their compliance with the terms of this Agreement.  BDE agrees that Atrinsic
shall not be responsible for making any payments to any Third Party Provider or
BDE subcontractor, except as expressly provided herein.

 
 
3.4
BDE will be solely responsible for any legal liability arising out of or
relating to the BDE Content and BDE Services (whether transmitted on its own or
on any Third Party’s behalf).  If Atrinsic is notified or otherwise becomes
aware of BDE Content which violates the material requirements of this Agreement,
Atrinsic may (but shall not be required to) investigate the allegation and
determine, in its sole and reasonable discretion, whether to send BDE a written
request to remove such BDE Content from the BDE Services including a description
of the violation of this Agreement resulting from the BDE Content.  If BDE does
not dispute the alleged violation and refuses such request or fails to cure the
violation within twenty-four (24) hours of receipt of the request, Atrinsic may
(but shall not be required to), in its sole and reasonable discretion,
immediately block such BDE Content.  Atrinsic shall not be liable for any
damages incurred by BDE because of any such action in accordance with this
Section 3.4.

 
 
3.5
BDE will ensure that its collection, access, use and disclosure of Subscriber
information shall comply with all applicable foreign, federal, state, and local
laws, rules and regulations as they may be amended from time to time, including
without limitation Privacy Laws. BDE shall at all times perform its obligations
hereunder and make available the BDE Services in such a manner as not to
knowingly cause Atrinsic to be in material violation of any applicable laws or
regulations, including any Privacy Laws.  For purposes of its obligations under
this Section 3.5, the acts or omissions of BDE’s employees, agents,
representatives, contractors other than Atrinsic, subcontractors, Third Party
Providers, or Affiliates (and such Affiliates’ employees, agents,
representatives, contractors, or subcontractors) shall also be deemed the acts
or omissions of BDE.

 
 
3.6
Without limiting Section 3.1 above, BDE agrees that BDE and its Third Party
Providers will not offer or provide BDE Services that:

 
 
3.6.1
To the best of its knowledge, transmit or allow to be transmitted any BDE
Content that violates the requirements of any Billing Operator through which BDE
Content is transmitted;

 
 
3.6.2
To the best of its knowledge, transmit or allow to be transmitted any BDE
Content that is false, inaccurate, misleading, unlawful, harmful, threatening,
abusive, harassing, tortuous, defamatory, vulgar, obscene, libelous, invasive of
another’s privacy, hateful, or racially, ethnically, or otherwise objectionable;

 
 
3.6.3
Transmit or allow to be transmitted any BDE Content that it does not have a
right to make available under any law or under contractual or fiduciary
relationships;

 
 
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3.6.4
To the best of its knowledge, transmit or allow to be transmitted any Content or
any BDE Content, that infringes any Intellectual Property Rights or rights of
publicity or privacy of Atrinsic or any third party;

 
 
3.6.5
Utilize any unsolicited or unauthorized advertising, promotional materials,
“junk mail”, “spam”, or any other forms of solicitation;

 
 
3.6.6
Violate the MMA Guidelines;

 
 
3.6.7
Interfere with or disrupt the Atrinsic Services or servers or Billing Operator
networks connected to the Atrinsic Services, or disobey any requirements,
procedures, policies, or regulations of networks connected to the Atrinsic
Service;

 
 
3.6.8
To the best of its knowledge, transmit or utilize any (a) viruses, worms, Trojan
horses, or other code that might disrupt, disable, harm, erase memory, or
otherwise impede the operation, features, or functionality of any software,
firmware, hardware, wireless device, computer system or network, (b) traps, time
bombs, or other code that would disable any software based on the elapsing of a
period of time, advancement to a particular date or other numeral, (c) code that
would permit any Third Party to interfere with or surreptitiously access any
Subscriber personal information, or (d) content that causes disablement or
impairment of Atrinsic or Billing Operator services or equipment;

 
 
3.6.9
Intentionally or unintentionally violate any applicable local, state, national
or international law, or any regulations having the force of law; or

 
3.6.10
Provide any material support or resources (or conceal or disguise the nature,
location, source, or ownership of material support or resources) to any
organization designated by the United States government as a foreign terrorist
organization pursuant to section 219 of the Immigration and Nationality Act.

 
4
Other Responsibilities of the Parties

 
 
4.1
Neither Party shall make any public announcement regarding this Agreement and/or
the subject matter of this Agreement, unless such announcement has been approved
in writing in advance by both Parties, provided that such approval shall not be
required in the event such public announcement is required by law, including the
rules and regulations of the Securities Exchange Commission.

 
5
Price, Payment and Currency

 
 
5.1
Atrinsic shall furnish BDE with monthly invoice reports beginning October 1,
2009 (which such first report shall include all such relevant information for
the period beginning on the Effective Date through August 31, 2009) from each
relevant Billing Operator showing the payment amounts received by such Billing
Operator from Subscribers of the BDE Services and the chargebacks by such
Billing Operator for such BDE Services not more than 60 days in arrears as well
as an anticipated budget for the following three month period. Atrinsic shall
issue a statement to BDE calculating the monthly Net Profit (as defined below),
which shall include amounts set forth in Section 5.2, and shall pay to BDE the
“Outpayment” which shall equal (i) the actual amount of any Royalties payable to
the Labels as a result of the provision of BDE Services under this Agreement
monthly without offset, plus (ii) 50% of Net Profit for the applicable period,
subject to reduction and offset pursuant to Section 5.3. BDE shall be
responsible for calculating and reporting the amount of such Royalties to
Atrinsic prior to the payment of any Outpayment.

 
 
5.2
“Net Profit” means:

 
 
5.2.1
All amounts actually received and collected by Atrinsic from Billing Operators
with respect to the BDE Services, plus

 
 
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5.2.2
All amounts (net of costs as agreed between the Parties) actually received and
collected by Atrinsic with respect to any other Kazaa-branded products or
services other than the BDE Services, less

 
 
5.2.3
Amounts incurred (including any such amounts which were unpaid and/or unrecouped
by Atrinsic during any prior months) with respect to:

 
 
5.2.3.1
Any Taxes,

 
 
5.2.3.2
All verified charges and fees assessed by Third Parties relating to such
payments (including, without limitation, those levied by any aggregator, the
paying and payee bank or other financial institution or any credit card merchant
payment processor) (collectively, the “Charges and Fees”),

 
 
5.2.3.3
Any charge or deduction made by any Billing Operator from payments due to
Atrinsic relating to BDE Services (collectively, the “Billing Operator
Deductions”),

 
 
5.2.3.4
Any refunds, rebates, uncollectible amounts, bad debt, fraud, and chargebacks
other than Billing Operator Deductions,

 
 
5.2.3.5
Any Royalties,

 
 
5.2.3.6
All other charges or expenses approved in advance by Atrinsic and BDE and
incurred by Atrinsic or advanced by Atrinsic to BDE in connection with the
provision of the Atrinsic Services or the BDE Services, including, but not
limited to, (i) Third Party charges and advanced funds which were previously
invoiced to BDE, (ii) any costs or expenses advanced by Atrinsic to BDE in
respect of any costs or expenses incurred in connection with the Management
Services Agreement between BDE and Airarena Pty Ltd. (the “Airarena Agreement”),
and (iii) any costs or expenses which are preapproved by BDE and incurred in
connection with Atrinsic’s provision of support services on behalf of BDE
pursuant to Section 6, and

 
 
5.2.3.7
Any amounts payable to Atrinsic pursuant to any other agreement between BDE and
Atrinsic including the Marketing Services Agreement.

 
 
5.3
Payments of any Outpayment may be offset in whole or in part and retained by
Atrinsic in the event and to the extent of any amounts that remain outstanding
and unpaid to Atrinsic by BDE pursuant to Section 15 hereof.

 
 
5.4
During the Term and for two (2) years following the expiration or termination of
this Agreement, BDE shall have the right to conduct an inspection and audit,
through a designated national independent certified public accounting firm, of
relevant records in order to verify the correctness of the Outpayments reported
by Atrinsic and Atrinsic shall promptly pay BDE the amount of any underpayment
revealed by the audit; provided that, (i) such audits are conducted at
reasonable times during regular business hours and with reasonable advance
written notice, (ii) such audits are conducted not more than once every year,
(iii) BDE shall be responsible for payment of all fees and expenses associated
with such audit, unless the auditor finds a discrepancy of greater than ten
percent (10%) of the audited amount, in which event Atrinsic shall reimburse BDE
the amount of the audit fees and expenses, (iv) and the information and
materials reviewed or obtained in such audit shall be protected as Atrinsic’s
Confidential Information (as defined in Section 11.1).

 
 
5.5
In the event that any Billing Operator or Governmental Body advises Atrinsic
that the BDE is or has been in violation of any law or regulation which in good
faith is not disputed, through no fault of Atrinsic, Atrinsic shall be entitled
to act on any request, recommendation, order or directive by such Billing
Operator or Governmental Body to withhold any sums payable to the BDE until the
BDE pays to the Billing Operator or Governmental Body (as the case may be) all
sums due for payment of fines, penalties, administrative charges or other sums
payable to the Billing Operator or Governmental Body or to one or more
Subscribers by reason of a final and non-appealable order of a Governmental
Body, and, if BDE refuses to pay such amount, Atrinsic shall be entitled to pay
the same out of the monies withheld.

 
 
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5.6
Notwithstanding anything contained herein to the contrary, in no event shall
Atrinsic be required to incur any cost, expense, charge or fee hereunder or
advance any funds to BDE or any Third Party in respect of any Atrinsic Services,
BDE Services or otherwise if greater than $5,000,000 (or such other amount as
mutually agreed in writing) remains unrecouped by Atrinsic and/or unpaid to
Atrinsic pursuant to Sections 5.2.3 or 5.3 hereof.

 
6
Subscriber Communications.  Except as expressly provided herein and to the
extent such services are not provided by Atrinsic on behalf of BDE:  (a) BDE
will be responsible for providing, or arranging for the provision of, all
support services with respect to the BDE Services; (b) BDE agrees that it will
prominently provide contact information (at a minimum an e-mail address) for
BDE’s customer service (i) at the same time and location (i.e. on the same web
page or in the same message) as Subscribers register for the BDE Services or
otherwise opt-in to receiving BDE Content, and (ii) at a location easily
accessible to a Subscriber to allow the Subscriber to access the contact
information after the Subscriber has registered for the BDE Services or opted in
to receiving BDE Content.  BDE acknowledges that, except as expressly provided
herein or to the extent such services are not provided by Atrinsic on behalf of
BDE, Atrinsic has no obligation to provide any Subscriber support
services.  Atrinsic shall give BDE ninety (90) days prior written notice before
Atrinsic may  materially diminish the support services provided on behalf BDE
hereunder.   Under such circumstances whereby Atrinsic no longer provides such
services on behalf of BDE, if a Subscriber contacts Atrinsic in relation to the
BDE Services, Atrinsic shall redirect or transfer such Subscriber to the support
facilities of BDE, or, if such a transfer is not, in Atrinsic’s opinion,
reasonably practicable, for any reason (including, without limitation, by reason
of any unwillingness by the Subscriber to be redirected to the BDE), then
Atrinsic may itself provide an initial response to the query or complaint.
 Without limiting the foregoing, BDE acknowledges that Billing Operators may
levy fees or charges for Subscriber support services relating to BDE Services,
regardless of whether the Billing Operator, Atrinsic, or BDE has provided
Subscriber support, and that Atrinsic may recover from BDE or offset against
amounts payable to BDE hereunder any and all such fees and charges assessed by a
Billing Operator.  Further, BDE and Atrinsic acknowledge and agree that Atrinsic
may recover any and all preapproved costs and expenses incurred by Atrinsic in
providing the services described in this Section in accordance with Section
5.2.3.6 and Section 10.5.

 
7
Assignment

 
 
7.1
This Agreement may not be assigned by a Party without the prior written consent
of the other Party.

 
 
7.2
Notwithstanding Section 7.1,

 
 
7.2.1
Either Party may assign this Agreement and such Party’s rights and obligations
hereunder without the consent of the other Party to an Affiliate so long as such
Party remains liable for its obligations hereunder.

 
 
7.2.2
Either Party may assign this Agreement, and its rights and obligations
hereunder, to any Third Party that acquires all or substantially all of such
Party’s stock or assets relating to that portion of such Party’s business that
is related to the subject matter of this Agreement, provided that the Third
Party to whom the Agreement is assigned assumes all of the obligations of the
assigning Party under this Agreement.

 
 
7.3
Any attempted assignment, delegation, or transfer in contravention of this
Section 7 shall be null and void.

 
 
9

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8
Amendments to the Agreement as Required by Law or Billing Operators.  The BDE
Services, BDE Content and Atrinsic Services are subject to requirements imposed
by the relevant Billing Operators, and to laws or regulations imposed by
Governmental Bodies, which may change or be amended from time to time.  The
Parties agree to work together in good faith to amend the terms of this
Agreement that do not comply with any such changes or amendments so that this
Agreement complies with such requirements, laws and regulations.

 
9
Suspension of Service

 
 
9.1
Atrinsic may, in its sole discretion, suspend provision of any or all of the
Atrinsic Services at any time, but for a period of no longer than thirty (30)
days, in the event that:

 
 
9.1.1
Atrinsic is entitled to terminate this Agreement pursuant to Section 10.2;

 
 
9.1.2
Atrinsic is obliged or advised to comply with an order, instruction, directive
or request of a Governmental Body or Billing Operator which necessitates that it
do so, in the reasonable judgment of Atrinsic; or

 
 
9.1.3
BDE is in material breach of any of its obligations under Section 3 of this
Agreement and BDE fails to cure such breach within fifteen (15) days of BDE’s
receipt of notice of the breach.

 
 
9.2
Atrinsic and the Billing Operators shall have the right (but not the obligation)
to access and review BDE Content transmitted through the Atrinsic Services,
provided that the Parties acknowledge and agree that Atrinsic has no obligation
to review or filter such content, solely as necessary to identify a potential
breach of the terms of this Agreement, including Section 3.5. To the extent that
Atrinsic discovers an actual or potential breach, Atrinsic may suspend any or
all of the Atrinsic Services to BDE for as long as it reasonably deems
necessary, in its sole discretion, until Atrinsic determines BDE is not in
breach or BDE corrects such non-compliance.

 
 
9.3
Where Atrinsic determines, in its discretion, it is practicable to do so, then
Atrinsic shall effect any such suspension only in respect of those BDE Services
which are affected by the matters referred to in this Section 9. Atrinsic will
notify BDE a reasonable amount of time in advance of any suspension of the BDE
Services affected under this Agreement.

 
10
Term

 
10.1
This Agreement shall become effective as of the date hereof and will, unless
sooner terminated as provided below, remain in effect for three (3) years after
the Effective Date and will automatically renew for successive one year periods,
unless either Party provides written notice of termination at least 90 days
prior to the expiration of a term (the “Term”).

 
10.2
Either Party may terminate this Agreement upon written notice to the other Party
immediately, in the event that (i) the other Party becomes insolvent, files a
petition in bankruptcy or makes an assignment for the benefit of its creditors;
(ii) the other Party materially breaches its obligations under this Agreement
and fails to cure the breach within thirty (30) days after receiving written
notice; or (iii) one or more of the Billing Operators upon which the provision
of Atrinsic Services hereunder is dependent and which account for a substantial
portion of the revenues collected from Billing Operators terminates its
provision of services to Atrinsic.

 
10.3
Intentionally deleted.

 
10.4
Notwithstanding anything to the contrary contained in this Agreement, the
provisions of this Section and Sections 1, 5.4 (for 2 years only), 10.4, 10.5,
11, 12, 14, 15 and 16 of this Agreement will survive the termination of this
Agreement.  Further, any other provisions that by their nature are intended to
survive will also survive termination of this Agreement.  Upon termination or
expiration of this Agreement, each Party shall use its commercially reasonable
efforts to cooperate with the other to effect a smooth and orderly
transition.  From the time that a notice of termination is received by either
Party until the effective termination date, each Party shall use it commercially
reasonable efforts to cooperate fully with any newly appointed Party performing
the duties contemplated hereunder.  Any costs and expenses incurred in the
transition of services contemplated hereunder shall be borne by BDE.

 
 
10

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10.5
BDE’s obligation to pay Atrinsic any and all accrued payment obligations which
remain unrecouped and/or unpaid from time to time and/or upon the expiration or
termination of the Term for any reason (the “Unrecouped Amounts”) shall survive
the termination of this Agreement and shall be secured pursuant to the terms of
that certain Security Agreement by and between BDE and Atrinsic of even date
herewith.  Such Unrecouped Amounts shall include, but are not limited to (i) any
verified and pre-approved charges, including, but not limited to Third Party
charges and advanced funds which were previously invoiced to BDE, payable by
Atrinsic in connection with the provision of the Atrinsic Services or the BDE
Services (including any such charges which were unpaid and/or unrecouped by
Atrinsic during any prior periods during the Term), (ii) any costs or expenses
incurred in connection with Atrinsic’s provision of support services on behalf
of BDE pursuant to Section 6 (including any such charges which were unpaid
and/or unrecouped by Atrinsic during any prior periods during the Term), (iii)
any costs or expenses paid by Atrinsic on behalf of BDE or advanced to BDE in
respect of any costs or expenses incurred pursuant to the Airarena Agreement
(including any such charges which were unpaid and/or unrecouped by Atrinsic
during any prior periods during the Term and any charges which are payable
following the termination of the Airarena Agreement), and (iv) any amounts
payable to Atrinsic pursuant to any other agreement between BDE and Atrinsic
including, without limitation, the Marketing Services Agreement (including any
such amounts which were unpaid and/or unrecouped by Atrinsic during any prior
periods during the Term).  All Unrecouped Amounts (if any) remaining upon the
expiration or termination of the Term shall be paid by BDE on a monthly basis
over a period of six (6) months until repaid against monthly net profit
generated by the BDE Services following the end of the Term (the “Tail
Period”).  Following the expiration of the Tail Period, any remaining Unrecouped
Amounts shall become due and payable by BDE to Atrinsic in
full.  Notwithstanding the foregoing, in no event shall BDE be required to pay
any Unrecouped Amounts in excess of $2,500,000 in the aggregate (less any other
amounts paid to Atrinsic as ‘Unrecouped Fees’ pursuant to the Marketing Services
Agreement).

 
11
Confidentiality

 
11.1
Confidentiality Obligations.  Each Party agrees to regard and preserve as
confidential all information related to the rights and obligations of the other
Party under this Agreement and the business and activities of the other Party,
their clients, licensors, suppliers and other entities with whom such other
Party does business, which may be obtained by such Party from any source or may
be developed or disclosed as a result of this Agreement, including the economic
and financial terms and conditions contained in or otherwise referenced by this
Agreement (the “Confidential Information”).  Each Party agrees to use the
Confidential Information of the other Party hereto solely to perform its
obligations under this Agreement and not for any other purpose (whether for its
own benefit or the benefit of any other Party), agrees to hold the Confidential
Information of the other Party hereto in trust and confidence and agrees not
disclose Confidential Information of the other Party hereto to any person, firm
or enterprise.  Each Party agrees to protect the Confidential Information of the
other Party hereto with at least the same security measures (but no less than
commercially reasonable security measures) that such Party uses to protect its
own Confidential Information or trade secrets.  Even when disclosure is
permitted, each Party agrees to limit access to and disclosure of each other
Party’s Confidential Information solely to its employees on a “need to know”
basis for purposes directly related to the performance of the Party’s
obligations hereunder. Notwithstanding the foregoing, each Party may disclose
the other Party’s Confidential Information pursuant to applicable law or
regulation or compulsion of proper judicial or other legal process including,
without limitation, to satisfy a Party’s public disclosure requirements under
state and federal securities laws; provided, however, that, if legally permitted
to do so, the disclosing Party shall provide prompt notice of the same prior to
such required disclosure such that the other applicable Party may seek a
protective order or other appropriate remedy to safeguard, restrict and/or limit
the disclosure of such Confidential Information.

 
11

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11.2
Exceptions.  For purposes of this Agreement, Confidential Information includes,
without limitation, information about each Party’s operations, services, trade
secrets, proprietary and competitive information, financial information,
computer programs, algorithms, application programming interfaces, design,
technology, ideas, know-how, processes, formulas, compositions, data,
techniques, improvements, inventions (whether patentable or not), works of
authorship, business and product development plans, customers and other
information concerning each Party’s actual or anticipated business, research or
development, information that is marked “Confidential” or information which is
received in confidence by a Party or for a Party from any other person or
entity; provided, however, that information shall not be considered Confidential
Information to the extent, but only to the extent that such information (a) is
or becomes publicly available through no fault, default or breach of or by the
receiving Party, (b) is or was rightfully acquired by the receiving Party from
another without restriction or obligation of confidentiality or (c) if such
information is or was independently developed by the receiving Party without use
of or reference to Confidential Information of the other Party.  The foregoing
notwithstanding, either Party may disclose the other Party’s Confidential
Information as required by applicable law or regulation or by a valid order of a
court or government agency with appropriate jurisdiction over the Parties and
the subject matter of the information, but only to the extent of and for the
purposes of such law, regulation or order and only after the other Party is
afforded a reasonable opportunity, to the extent permitted by law, to oppose
such disclosure or seek protection against further disclosure of the
information.

11.3
Non Solicitation.  Each Party agrees that during the Term of this Agreement and
for a one (1) year period after termination of this Agreement, such Party will
not (1) directly or indirectly solicit, induce, encourage or attempt to solicit
or induce any employee of the other Party to discontinue his or her employment
with such Party; (2) usurp any opportunity of the other Party that such Party
becomes aware of from any other Party during the term of this Agreement; or (3)
directly or indirectly interfere with, solicit, induce or attempt to influence
any person or business that is an account, customer or client of the other Party
that such Party becomes aware of from the otherParty except for the benefit of
such other Party.

11.4
Upon expiration or termination of this Agreement, each receiving Party shall
return or destroy, at the disclosing Party’s election, all Confidential
Information of the disclosing Party in the receiving Party’s possession or
control, provided, however, that Atrinsic shall be entitled to retain SMS
message logs, accounting records and related documentation containing BDE’s
Confidential Information for seven (7) years following the date such materials
were created.  Subject to the limitations of Section 11.3, the obligations
described in this Section 11 shall survive the termination or expiration of this
Agreement.

 
11.5
Both Parties agree that a breach of any of the obligations set forth in this
Section 11 would irreparably damage and create undue hardships for the other
Party. Therefore, the non-breaching Party shall be entitled to seek immediate
court ordered injunctive relief to stop any apparent breach of this Section 11,
such remedy being in addition to any other remedies available to such
non-breaching Party.

 
 
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12
Intellectual Property Rights

 
12.1
Ownership of all Atrinsic Rights shall vest in and remain with Atrinsic. Subject
to Section 12.2 and Section 2.1.6, Atrinsic does not by this Agreement grant BDE
any right, title, license or interest in or to any Atrinsic Rights, including
any software or documentation, or in any related patents, copyrights, trade
secrets or other proprietary or intellectual property rights.  BDE shall acquire
no rights of any kind in or to any Atrinsic trademark, service mark, trade name,
logo or product or service designation under which Atrinsic’s products or
services were or are marketed (whether or not registered) and shall not use the
same for any reason, except as expressly authorized in writing by Atrinsic prior
to such use, but in no event for a period longer than the Term.

 
12.2
Notwithstanding the foregoing, Atrinsic shall and hereby does license to the BDE
for the Term only such use of the Atrinsic Rights as are required by the BDE to
use the Atrinsic Services (including any documentation or software which
Atrinsic makes available to the BDE for use pursuant to this Agreement) for the
Term.

 
12.3
Ownership of all BDE Rights shall vest in and remain with BDE. Subject to
Section 12.4, BDE does not by this Agreement grant Atrinsic any right, title,
license or interest in or to any BDE Rights, including any software or
documentation, or in any related patents, copyrights, trade secrets or other
proprietary or intellectual property rights. Atrinsic shall acquire no rights of
any kind in or to any BDE trademark, service mark, trade name, logo or product
or service designation under which BDE’s products or services were or are
marketed (whether or not registered) and shall not use same for any reason
except as expressly authorized in writing by BDE prior to such use, but in no
event for a period longer than the Term.

 
12.4
Notwithstanding the foregoing, BDE shall and hereby does license to Atrinsic
only such use of BDE Rights as are required by Atrinsic to provide the Atrinsic
Services for the Term.

 
12.5
Any license granted under this Section 12 as well as Section 2.6 shall be
non-transferable (except as provided in Section 7.2 hereof), non-sublicensable,
non-exclusive and royalty-free and shall be limited to the Term in respect of
the Atrinsic Services or BDE Services to which the license relates and shall be
granted only for the purpose of fulfilling the respective Party’s rights and
obligations under this Agreement.

 
12.6
Neither Party shall reverse engineer, decompile or disassemble any software
covered by the other Party’s Intellectual Property Rights.

 
13
Warranties; Disclaimers

 
13.1
Each Party represents and warrants to the other Party that:

 
13.1.1
it has the full corporate right, power, and authority to enter into this
Agreement and to perform its obligations hereunder;

 
13.1.2
its execution of this Agreement and performance hereunder do not and will not
violate any agreement to which it is a  party or by which it is bound; and

 
13.1.3
when executed and delivered, this Agreement will constitute the legal, valid and
binding obligation of such Party, enforceable against it in accordance with its
terms.

 
13.2
BDE represents and covenants that neither BDE nor any Third Party Provider will
access or use the Atrinsic Services, except in accordance with this Agreement,
and that the BDE Services and BDE Content will comply with the requirements of
Section 3.6 above.

 
13.3
Notwithstanding anything herein to the contrary, Atrinsic expressly disclaims,
and shall have no responsibility or any liability of any kind for transmission
errors in, corruption of, or the security of BDE’s data or content carried over
wireline or wireless telecommunication providers’ facilities and
networks.  Without limiting the foregoing, Atrinsic expressly disclaims and
shall in addition have no responsibility or any liability of any kind for the
acts or omissions of any Billing Operator in connection with the Atrinsic
Services or the BDE Services.

 

 
13

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13.4
Notwithstanding anything else in this Agreement to the contrary, Atrinsic’s
entire liability and BDE’s sole and exclusive remedy for nonperformance of the
Atrinsic Services shall be the termination of this Agreement as set forth in
Section 10 of this Agreement.

 
13.5
EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN THIS SECTION 13, ATRINSIC
DISCLAIMS ANY AND ALL WARRANTIES CONCERNING THE ATRINSIC SERVICES AND/OR
ATRINSIC RIGHTS, WHETHER EXPRESS OR IMPLIED OR STATUTORY, INCLUDING, WITHOUT
LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE, NON-INFRINGEMENT, QUIET ENJOYMENT, SATISFACTORY QUALITY, AND
ACCURACY.  WITHOUT LIMITING THE FOREGOING, ATRINSIC DOES NOT WARRANT THAT THE
SERVICES WILL BE UNINTERRUPTED OR ERROR-FREE, AND ATRINSIC EXPRESSLY DISCLAIMS
(A) ANY LIABILITY RESULTING FROM ANY SUBSCRIBER OR OTHER MOBILE OPERATOR
SUBSCRIBER SENDING MESSAGES TO AN ALLOCATED NUMBER INSTEAD OF ANOTHER NUMBER OR
CODE, OR VICE VERSA, AND (B) ANY LIABILITY IN RESPECT OF ANY BDE CONTENT, OR
INSTRUCTIONS SUPPLIED BY BDE THAT ARE INCORRECT, INACCURATE, ILLEGIBLE, OUT OF
SEQUENCE, OR IN THE WRONG FORM, OR ARISING FROM THEIR LATE ARRIVAL OR
NON-ARRIVAL, OR ANY OTHER ACT OR OMISSION OF BDE OR ANY OF ITS CUSTOMERS.

 
13.6
EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN THIS SECTION 13, BDE DISCLAIMS
ANY AND ALL WARRANTIES CONCERNING THE BDE SERVICES AND/OR BDE RIGHTS, WHETHER
EXPRESS OR IMPLIED OR STATUTORY, INCLUDING, WITHOUT LIMITATION, ANY IMPLIED
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE,
NON-INFRINGEMENT, QUIET ENJOYMENT, SATISFACTORY QUALITY, AND ACCURACY.  WITHOUT
LIMITING THE FOREGOING, BDE DOES NOT WARRANT THAT THE BDE SERVICES WILL BE
UNINTERRUPTED OR ERROR-FREE.

 
14
Limitation of Liability  EXCEPT TO THE EXTENT OTHERWISE PROVIDED BY APPLICABLE
LAW, IN NO EVENT SHALL EITHER PARTY OR ITS OFFICERS, DIRECTORS, EMPLOYEES, OR
AGENTS BE LIABLE TO THE OTHER PARTY UNDER ANY CONTRACT NEGLIGENCE, STRICT
LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY FOR (I) CONSEQUENTIAL, INDIRECT,
SPECIAL, EXEMPLARY OR INCIDENTAL DAMAGES OR ANY LOSS OF PROFITS, LOSS OF
BUSINESS OR LOSS OF USE EVEN IF SUCH PARTY HAS BEEN APPRISED OF THE LIKELIHOOD
OF SUCH DAMAGES OCCURRING, (II) THE COST OF PROCURING SUBSTITUTE PRODUCTS OR
SERVICES OR (III) ANY AMOUNT IN EXCESS OF THE AGGREGATE AMOUNTS PAID OR PAYABLE
TO BDE UNDER THIS AGREEMENT DURING THE TWELVE (12)-MONTH PERIOD PRIOR TO THE
DATE ON WHICH THE CLAIM OR CAUSE OF ACTION RESULTING IN LIABILITY AROSE. THE
FOREGOING LIMITATION OF LIABILITY SHALL NOT APPLY WITH RESPECT TO EITHER PARTY’S
CONFIDENTIALITY AND INDEMNIFICATION OBLIGATIONS UNDER THIS AGREEMENT.

 

 
14

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15
Indemnity

 
15.1 BDE, at its own expense, shall indemnify, defend, and hold Atrinsic, its
Affiliates, and their respective employees, officers, directors, representatives
and agents harmless from and against any and all losses, damages, liabilities,
settlements, costs and expenses (including attorneys’ fees and other legal
expenses) arising out of or related to any claim, demand, suit, action, or
proceeding initiated by a Third Party arising out of or relating to: (a) any
breach by BDE of this Agreement, (b) any BDE Services, BDE Content or other
materials or services provided by BDE or its Third Party Providers to the extent
not otherwise caused by Atrinsic or subject to indemnification by Atrinsic
pursuant to Section 15.2 hereof, or (c) an allegation that the services or
content provided by BDE to its customers violates any local, state, federal or
foreign law, rule or regulation (each, a “BDE-Covered Claim”).  Atrinsic will
provide BDE with written notice of the BDE-Covered Claim and permit BDE to
control the defense, settlement, adjustment or compromise of the BDE-Covered
Claim, and will cooperate and, at BDE’s expense and request, assist in the
defense of the BDE-Covered Claim. Notwithstanding the foregoing, Atrinsic will
have the right to employ separate counsel and participate in the defense of any
BDE-Covered Claim, provided, however, that if such counsel is necessary because
of a conflict of interest of either BDE or its counsel or because BDE does not
assume control of the defense of a BDE-Covered Claim, as reasonably determined
by Atrinsic, BDE will bear the expense of such counsel.
 
15.2  Atrinsic, at its own expense, will indemnify, defend, and hold BDE, its
Affiliates, and their respective employees, officers, directors,
representatives, and agents harmless from and against any claim, demand, suit,
action or proceeding initiated by a Third Party to the extent not caused by BDE
or subject to indemnification by BDE pursuant to Section 15.1 and arising out of
or relating to: (a) any breach by Atrinsic of this Agreement, (b) an allegation
that the delivery of the Atrinsic Services infringes or misappropriates any U.S.
patent, U.S. copyright, U.S. trademark or any trade secret recognized as such
under the U.S. Uniform Trade Secret Act, or (c) an allegation that the Atrinsic
Services violates any local, state, federal or foreign law, rule or regulation
(each, a “Atrinsic-Covered Claim”). BDE will provide Atrinsic with written
notice of the Atrinsic-Covered Claim, permit Atrinsic to control the defense,
settlement, adjustment, or compromise of the Atrinsic-Covered Claim, and will
cooperate and, at Atrinsic’s expense and request, assist in the defense of the
Atrinsic-Covered Claim. If the Atrinsic Services become, or in Atrinsic’s
opinion are likely to become, the subject of an infringement claim, Atrinsic
may, at its sole option and expense, either (i) procure for BDE the right to
continue using the Atrinsic Services, (ii) replace or modify the Atrinsic
Services so that they become non-infringing, or if Atrinsic reasonably
determines that neither of the foregoing options commercially feasible, Atrinsic
may (iii) terminate this Agreement without any further obligation or liability
to BDE.  THIS SECTION STATES ATRINSIC’S ENTIRE LIABILITY AND BDE’S SOLE AND
EXCLUSIVE REMEDY FOR INFRINGEMENT CLAIMS AND ACTIONS.
 
16
Miscellaneous

 
16.1
Force Majeure. Except for obligations of payment, either Party’s performance of
any part of this Agreement shall be excused to the extent that it is hindered,
delayed or otherwise made impractical by the acts or omissions of the other
Party or any network operator, flood, fire, earthquake, strike, stoppage of
work, or riot, failure or diminishment of power or of telecommunications or data
networks or services not under the control of a Party, governmental or military
acts or orders or restrictions, terrorist attack; or any other cause (whether
similar or dissimilar to those listed) beyond the reasonable control of that
Party and not caused by the negligence of the non-performing Party (collectively
referred to as “Force Majeure” below.  If any Force Majeure condition(s)
occur(s), the non-performing Party shall make reasonable efforts to notify the
other Party of the nature of any such condition and the extent of the delay, and
shall make reasonable, good faith efforts to resume performance as soon as
practicable.

 
16.2
No Waivers. No waiver of any provision of this Agreement by either Party shall
be effective unless made in writing. Any waiver made by such Party of any term
or condition of this Agreement shall not be deemed or construed to be a waiver
of such term or condition for the future, or any subsequent breach thereof. The
waiver of either Party of any default or breach of this Agreement shall not
constitute a waiver or any other or subsequent default or breach.

 
 
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16.3
Notices.  All notices, requests, demands or other communications that are
required or may be given pursuant to the terms of this Agreement shall be in
writing and shall be deemed to have been duly given (i) on the date of delivery,
if personally delivered by hand, (ii) upon the third day after such notice is
deposited in the United States mail, if mailed by registered or certified mail,
postage prepaid, return receipt requested, (iii) upon the date of delivery, if
notice is sent by a nationally recognized overnight express courier with
tracking capabilities, (iv) by fax upon written confirmation with a confirmation
copy sent by mail, or (v) on the day of transmission if by email delivery.  Such
notices shall be given to the Parties at the address set forth above with a
confirmation copy sent by mail.  Any Party may, at any time by giving five (5)
days’ prior written notice to the other Party, designate any other address in
substitution of the foregoing address to which such notice will be given.

 
16.4
Severability. If any provision of this Agreement is held to be prohibited by or
invalid under applicable law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
this Agreement.

 
16.5
Relationship of the Parties. The relationship of the Parties established by this
Agreement is that of independent contractors, and this Agreement does not create
an agency, employment, partnership or joint venture relationship between the
Parties.  Each Party acknowledges and agrees that the business relationship and
activities contemplated by this Agreement are non-exclusive and that nothing in
this Agreement prohibits either Party from participating with Third Parties in
similar business arrangements as those described herein.

 
16.6
Dispute Resolution. The Parties agree to attempt to resolve any disputes arising
out of this Agreement pursuant to the terms of this Section.

 
16.6.1
Management Resolution. Any dispute arising under this Agreement shall first be
referred to BDE’s President and Atrinsic’s CEO (“Management Resolution”) for
resolution.

 
16.6.2
Mediation. In the event the attempt at Management Resolution fails to resolve
the dispute within thirty (30) days of either Party providing written notice to
the other Party of the commencement of the Management Resolution process, either
Party may refer the dispute to non-binding mediation (“Mediation”) for
resolution. The Mediation shall be held at a mutually agreed to location and at
a mutually agreed to time before a mutually agreed to certified mediator.

 
16.6.3
Arbitration.  In the event the attempt at Mediation fails to resolve the dispute
within thirty (30) days of either Party providing written notice to the other
Party requesting Mediation to resolve the applicable dispute, either Party may
refer the dispute to binding arbitration in Los Angeles, California
(“Arbitration”) for final resolution administered by the American Arbitration
Association under its Commercial Arbitration Rules.

 
16.7
Governing Law; Venue; Jurisdiction. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California without giving
effect to the conflicts of law provisions thereof.  For any action to compel
arbitration or enforce an arbitration award or seek injunctive relief pursuant
to this Agreement, the Parties hereby expressly consent to the jurisdiction and
venue of the state and/or federal courts located in Los Angeles County,
California and BDE hereby expressly waives any objection to such venue based
upon forum non-conveniens or otherwise.

 
16.8
Attorneys’ Fees and Costs. In the event of any arbitration, action to compel
arbitration or enforce an arbitration award or seek injunctive relief pursuant
to this Agreement, the prevailing Party in such action shall be entitled to an
award of their reasonable attorneys’ fees and costs through arbitration, trial
and all levels of appeal.

 
 
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16.9
Entire Agreement. This Agreement constitutes the complete and exclusive
statement of agreement among the Parties with respect to the subject matter in
this Agreement and replaces and supersedes all prior and contemporaneous
agreements, understandings and statements by and between the Parties. No
representation, statement, condition or warranty not contained in this Agreement
will be binding on the Parties or have any force or effect whatsoever.

 
16.10
Amendments. Except as otherwise provided herein, no amendment, modification or
change to this Agreement shall be effective unless it is in writing and signed
by both Parties

 
16.11
Counterparts. This Agreement may be signed and executed in one (1) or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one Agreement.  A facsimile signature shall be deemed
an original for purposes of evidencing execution of this Agreement.

 
[Signature Page Follows]
 
 
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IN WITNESS WHEREOF, each of the undersigned Parties has caused its duly
authorized representative to execute this Agreement as of the Effective Date.
 

 
BDE:
     
Brilliant Digital Entertainment, Inc.
       
By:
   
Name: 
   
Title:
         
ATRINSIC
 
Atrinsic, Inc., a Delaware corporation
       
By:
   
Name:
   
Title:
 

 

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