Tapjoy Publisher Agreement: Term Sheet

 

 Tapjoy   Contact Name: Chris Akhavan   Address:  111 Sutter Street, 13th Floor
Contact Number: 415-640-1664 City:  San Francisco State:  CA    Zip:  94104
Email: ca@tapjoy.com

 

Publisher Name: Andover   Contact Name:  Benjamin Lewis   Address:  350
Broderick St Contact Number: 734-657-4910 City: San Francisco State:  CA   Zip: 
94117 Email: ben.lewis@gmail.com

 

Principal Terms

 

Direct Payment Revenue – share to Publisher   100% Alternative Payment Revenue –
share to Publisher   70% Payment Terms   Net 30 Marketing Credits   $50,000 per
title Development Credits   $225,000 Recoupment Amount   $50,000 total
Exclusivity Period   24 months Applications covered by this Agreement  

All existing publisher Applications

All Applications launched during the Agreement Period

Projected Launch Date   August 1st, 2011 Operating Systems covered by this
Agreement   iOS and Android Additional Terms   20% transfer bonus

 

By its signature below, Publisher represents that it has read, understands and
agrees to the Additional Terms and Conditions attached hereto (the “Terms and
Conditions”), and agrees that such Terms and Conditions are incorporated herein.
This Term Sheet and the Additional Terms and Conditions collectively constitute
the “Agreement.”

 

IN WITNESS WHEREOF, the parties have executed this Agreement through their duly
authorized representatives as of the last date set forth below.

 

Tapjoy:   Publisher: Signature:   Signature: Printed Name: Mihir Shah   Printed
Name: Benjamin Lewis Title: CEO   Title:  Partner Date:     Date:  

 

Tapjoy/Andover Agreement1CONFIDENTIAL

 

 

Additional Terms and Conditions

 

The following Terms and Conditions shall be deemed incorporated by reference
into the attached Term Sheet (the “Term Sheet”) entered into between Tapjoy,
Inc. (“Tapjoy”) and the publisher identified in the Term Sheet above (the
“Publisher”).  The Terms and Conditions and the attached Term Sheet collectively
constitute the “Agreement.”

 

1. Definitions

 

“Advertisements” means all advertisements, offers or other marketing actions
powered by Tapjoy within an Application, whether occurring within or outside of
Tapjoy’s offerwall.

 

“Alternative Payment Revenue” means revenue derived from the Alternative Payment
Service, less deductions for fraud, charge-backs, refunds, credit card
processing fees, uncollected amounts, agency fees, marketing credits and
referral fees.

 

“Alternative Payment Service” means Tapjoy’s service that incentivizes Users’
completion of Actions (as defined herein) in response to Advertisements
presented anywhere within an Application. Actions is defined to include the
installation of third party applications, completion of specified actions within
3rd party applications or on specified URLs, activation of third party services,
participation in surveys, interaction with video and/or audio content, visits to
prescribed geographic locations, transmitting messaging, and any other action
for which Advertisements provide incentive to Users.

 

“Application(s)” means those Publisher application(s) as specified in the Term
Sheet.

 

“Cross-Promotion Service” means Tapjoy’s service, interface and solutions that
allow Publisher to cross-promote any application(s) or properties that it owns
within the Application(s). For clarity, Publisher may not utilize the
Cross-Promotion Service for any third party applications (including those of its
partners or affiliates).

 

“Development Credits” means payments provided by Tapjoy to Publisher as
described in the Term Sheet. These payments are intended to assist Publisher in
launching the Application(s) more quickly.

 

“Direct Payment Revenue” means revenue resulting from payments from Users for
virtual goods or currency in an Application, whether such payments originate via
use of credit card, stored value or debit card, PayPal transfer, bank transfer,
mobile billing or any other such direct payment source, less deductions for
fraud, charge-backs, refunds, credit card processing fees or uncollected
amounts.

 

"Exclusivity Period" means the period during which Publisher agrees to utilize
the Alternative Payment Service for the Applications and is prohibited from
utilizing any services similar to the Alternative Payment Service from other
venders. The Exclusivity Period shall be for the duration specified in the Term
Sheet plus any Renewal Period, and shall commence on the date that the first
Application(s) begins utilizing the Alternative Payment Service and is made
available to Users.

 

“Marketing Credits” means the non-monetizable and non-transferrable credits that
are provided by Tapjoy to Publisher as described in the Term Sheet. Marketing
Credits can only be utilized in lieu of other forms of payment to Tapjoy and
only for the promotion and distribution of the Application(s) within Tapjoy’s
network. For avoidance of doubt, Marketing Credits have no cash value.

 

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“Optional Services” means the Cross-Promotion Service, Virtual Currency Hosting
Service, Virtual Goods Hosting Service and other Tapjoy services which will be
provided free-of-charge upon Publisher’s written request to Tapjoy.

 

“Projected Launch Date” means the date at which Publisher intends to publically
launch the first Application and is specified in the Term Sheet.

 

“Recoupment Amount” means the amount of Alternative Payment Revenue otherwise
payable to the Publisher that will be permanently withheld by Tapjoy in order to
recover Marketing Credits and/or Development Credits included in the Term Sheet.
For clarity, distribution of Alternative Payment Revenue to the Publisher per
the percentages stipulated in the Term Sheet will not begin for an Application
until the full amount of Marketing Credits and/or Development Credits have been
recovered by Tapjoy.

 

“Renewal Period” means the period associated with any auto-renewal of the
Agreement as described in the section Term; Termination.

 

“Tapjoy Services” means the Alternative Payment Service and, if activated upon
written request by Publisher, the Optional Services.

 

“Users” means the end users of the Application(s).

 

“User Data” means all data and information generated by Users during their
interactions with the Application(s) and in conjunction with the Tapjoy
Services.

 

“Virtual Currency Hosting Service” means the hosting service, interface and
solutions that Tapjoy can provide to enable Publisher to host and manage a
virtual currency system for the Application(s).

 

“Virtual Goods Hosting Service” means the service, interface and solutions that
Tapjoy can provide to enable Publisher to host and manage a virtual goods system
for the Application(s).

 

2. Services

 

2.1. Services; Implementation. Publisher agrees to display all Advertisements
and use the Tapjoy Services in accordance with this Agreement. Publisher shall
comply with any placement and delivery requirements, any requirements to
implement code and any technical specifications that are provided by Tapjoy at
any time to enable proper display of the Advertisements on a reasonably balanced
schedule.  Any exceptions must be approved by Tapjoy in writing.  Publisher will
be solely responsible for any and all costs Publisher incurs for the display of
the Advertisements in accordance with such specifications and for any
programming related to the same which Publisher elects to undertake.  

 

2.2. No Alteration or Aggregation. Unless Tapjoy approves specifically in
writing: (i) Publisher may only use the Tapjoy Services (including any SDK) as
provided by Tapjoy, without modification; (ii) Publisher shall not modify or
alter the content, text or appearance of any Advertisements, or aggregate one or
more Advertisements with other offers (for example, by creating an aggregate
offerwall that combines Advertisements with offers from services other than the
Tapjoy Services); and (iii) Publisher shall not use any other services that
provide to Users virtual goods or currency in exchange for acting on promotional
offers, or other services similar to the Tapjoy Services, in connection with any
Application, unless and until Publisher permanently ceases to use the Tapjoy
Services in connection with such Application.

 

Tapjoy/Andover Agreement3CONFIDENTIAL

 

 

2.3. Exclusivity. During the Exclusivity Period Tapjoy will be the exclusive
provider of, and Publisher will not retain any third party to provide, any
services similar to the Alternative Payment Service for the Application(s).
Publisher acknowledges that the Marketing Credits and/or Development Credits and
the Publisher revenue shares set forth in the Term Sheet are in partial
consideration for Exclusivity and, therefore, in the event Publisher uses third
party services similar to the Alternative Payment Service for the Application(s)
during the Exclusivity Period (an “Exclusivity Breach”), the Publisher shall
promptly pay Tapjoy a sum equal to the cumulative amount of Marketing Credits
and/or Development Credits plus difference between the following: (1) revenue
received by Publisher up to the time of the Exclusivity Breach; and (2) revenue
that Publisher would have received if the Term Sheet stipulated an Alternative
Payment Revenue – share to Publisher equal to Tapjoy’s standard non-exclusive
publisher revenue share agreements; in addition to any other remedies available
to Tapjoy at law or in equity. Publisher further acknowledges that this payment
is neither a penalty for nor a total estimate of all the damages Tapjoy may
suffer in the event of Publisher’s breach of this Section 2.3.

 

2.4. Terms of Payment.  After it recoups the Recoupment Amount (if any), Tapjoy
shall pay Publisher the revenue share of Alternative Payment Revenue set forth
in the Term Sheet.  Such payments shall be made on the terms set forth in the
Term Sheet provided that amounts payable of less than $250 will be held until
amounts due equal or exceed $250. Publisher shall be solely responsible for the
payment of, and shall pay when due, all applicable federal and state taxes,
including any sales, use, excise or transfer taxes and other taxes associated
with payments to Publisher under this Section 2.4 (except for taxes assessed on
Tapjoy’s net income), and shall indemnify Tapjoy for all costs, losses,
liabilities and expenses, including penalties, arising from any failure to do
so. Further, Publisher will provide a monthly statement to Tapjoy that documents
the calculation of Direct Payment Revenue due to Tapjoy per the Term Sheet.
Tapjoy will deduct its Direct Payment Revenue share from any amounts owed to
Publisher under this Section 2.4.  In the event that for more than sixty days,
the aggregate amounts owed to Publisher are less than the Direct Payment Revenue
share owed to TapJoy, Tapjoy will send an invoice to Publisher for amounts owed.
Such invoice shall be due and payable within thirty days of receipt.

 

2.5. Fraud.  Tapjoy will not be obligated to pay for any fraudulent actions
generated by any person, bot, automated program or similar device in connection
with any Advertisements provided by Tapjoy, as reasonably determined by Tapjoy.
Tapjoy shall use commercially reasonable efforts to notify Publisher of such
fraudulent activity within seven days after the end of the month in which the
fraudulent activity occurred. Neither party will be obligated to make a payment
to the other party based on: (a) any purchase of virtual goods or virtual
currency through any fraudulent or invalid means, including the fraudulent use
of credit cards or other means of payment; or (b) purchases of virtual goods or
currency that are refunded or subject to a credit card charge-back. In the event
that either party does not make a payment pursuant to this Section 2.5

, such party shall, at that time, provide reasonable documentation to the other
party with respect thereto.

 

2.6. Content.  Tapjoy agrees not to transmit any Advertisements to Publisher
that are unlawful, defamatory, libelous, harassing, abusive, fraudulent or
obscene, or technically incompatible with the delivery platform.  Publisher may
also request that Tapjoy block Advertisements from a list of specified domain
names, which list may be updated by Publisher at Publisher’s reasonable
discretion.  Tapjoy will use commercially reasonable efforts to block
Advertisements from such domains for display on the Application(s). 

 

2.7. License to User Data. Publisher hereby grants to Tapjoy a royalty-free,
fully paid up, sub-licensable, transferable, nonexclusive, worldwide and
perpetual right and license to reproduce, display, distribute, create derivative
works from and otherwise use the User Data only to fulfill Tapjoy’s obligations
under this Agreement and to improve Tapjoy’s services.

 

3. Marketing. Publisher hereby grants to Tapjoy a royalty-free, fully paid up,
sub-licensable, transferrable, nonexclusive, worldwide and perpetual license to
reproduce, display, distribute and otherwise use the trademarks, service marks,
logos or other indicia of origin associated with Publisher solely for the
purpose of indicating that Publisher is a client of Tapjoy in Tapjoy’s
advertising, marketing or other promotional materials.

 

Tapjoy/Andover Agreement4CONFIDENTIAL

 

 

4. Application License. If Publisher receives any Marketing Credits or
Development Credits hereunder, Publisher agrees to grant and hereby grants
Tapjoy a royalty-free, fully paid up, sub-licensable, transferable,
nonexclusive, worldwide, and perpetual license to copy, display, perform, create
derivative works of, distribute, operate, monetize and otherwise use the
Application(s). However, Tapjoy may exercise the rights granted under this
Section 4 only if: (a) Publisher becomes insolvent, files for any form of
bankruptcy, makes any assignment for the benefit of creditors, or ceases to
conduct business during the course of the Agreement; and (b) Tapjoy has yet to
successfully recoup the full Recoupment Amount.

 

5. Failure to Launch Application. If Publisher receives any Development Credits
hereunder, Publisher agrees to provide regular updates to Tapjoy on Application
development progress leading up to the Projected Launch Date. If the Application
has not been launched within 90 days of the passing of the Projected Launch
Date, Publisher shall promptly make payment to Tapjoy in the amount of the
Developer Credits unless otherwise agreed in writing by Tapjoy.

 

6. Compliance with Laws.  Publisher agrees that it will display the
Advertisements and provide any data to Tapjoy as required under this Agreement
in compliance with all applicable local, state, national and international laws,
rules and regulations, including any laws regarding the transmission of
technical data exported from Publisher’s country of residence. Publisher
represents and warrants that the Application(s): (a) are in compliance with all
applicable local, state, national and international laws, rules and regulations,
and contractual obligations between Publisher and any third party; and (b) do
not violate any third party’s intellectual property or proprietary rights.
Publisher will not, will not agree to, and will not authorize or encourage any
third party to: (a) interfere or attempt to interfere with the proper working of
any of the Tapjoy Services or prevent others from using the Tapjoy Services; or
(b) use any of the Tapjoy Services for any fraudulent or unlawful purpose. 
Violation of any of the foregoing may result in immediate termination of this
Agreement, at Tapjoy’s sole discretion, and may subject Publisher to state and
federal penalties and other legal consequences. Tapjoy reserves the right, but
will have no obligation, to review Publisher’s display of the Advertisements and
use of any of the Tapjoy Services in order to determine whether a violation of
this Agreement has occurred or to comply with any applicable law, regulation,
legal process, or governmental request.

 

7. Representations and Warranties. Without limiting any other representation,
warranty or covenant herein, each party hereby represents and warrants to the
other party that: (a) it has the full right, power and authority to enter into
this Agreement; (b) this Agreement is a valid and binding obligation of such
party; (c) it has obtained and shall maintain all necessary licenses,
authorizations, approvals and consents to enter into and perform its obligations
hereunder (including, in the case of Publisher, any necessary rights or consents
from Users to allow User Data to accrue to Tapjoy pursuant to Section 2.7 ); and
(d) it will comply with all applicable laws, rules and regulations in the
performance of this Agreement.

 

8. Indemnification.  Each party agrees to indemnify, defend and hold the other
party and its affiliates and their respective officers, directors, employees,
agents, independent contractors and customers harmless from and against any
losses, costs, liabilities, damages, claims and expenses, including attorneys’
fees, arising out of any third party claims resulting from the breach of the
representations, warranties and covenants made by such party in this Agreement. 
Without limiting the generality of the foregoing, each party agrees to
indemnify, defend and hold the other party and its affiliates and their
respective officers, directors, employees, agents, independent contractors and
customers harmless from and against any losses, costs, liabilities, damages,
claims and expenses, including attorneys’ fees, arising out of any claims that
any applications (including the Application(s)), products, services or software
distributed, made available or developed by the indemnifying party infringe any
third party’s intellectual property rights, privacy, rights of publicity or
other rights.  The indemnifying party reserves the right, at the indemnifying
party’s expense, to assume the exclusive defense and control of any matter for
which the indemnifying party is required to indemnify the indemnified party and
the indemnified party agrees to cooperate with the indemnifying party’s defense
of such claims. The indemnifying party shall not enter into any settlement for
which indemnity is sought unless: (a) such settlement includes an unconditional
release of the indemnifying party from all liability on all claims; or (b) the
indemnifying party gives its prior written approval, which shall not be
unreasonably withheld or delayed.

 

Tapjoy/Andover Agreement5CONFIDENTIAL

 

 

9. Disclaimers; No Warranties.  EXCEPT AS EXPRESSLY SET FORTH IN SECTION 7,
TAPJOY MAKES NO WARRANTY, EXPRESS, IMPLIED OR STATUTORY, WITH RESPECT TO ANY
MATTER, INCLUDING ADVERTISEMENTS AND THE TAPJOY SERVICES AND EXPRESSLY DISCLAIMS
THE WARRANTIES OR CONDITIONS OF NONINFRINGEMENT, MERCHANTABILITY AND FITNESS FOR
ANY PARTICULAR PURPOSE.  TAPJOY DOES NOT WARRANT OR GUARANTEE: (A) THE RESULTS
OF USE OF THE TAPJOY SERVICES INCLUDING THAT PUBLISHER WILL EARN ANY PARTICULAR
AMOUNTS (OR ANY AMOUNTS AT ALL); AND (B) THE RESULTS OF ANY CONSULTING OR
DEVELOPMENT SERVICES PROVIDED BY TAPJOY. Without limiting the generality of the
foregoing, Publisher acknowledges that the Tapjoy Services are based on an
auction model and some of the main factors that determine the revenue therefrom
are not within Tapjoy’s control.

 

10. Limitation of Liability and Damages.  UNDER NO CIRCUMSTANCES, INCLUDING
NEGLIGENCE, WILL TAPJOY OR ITS AFFILIATES BE LIABLE FOR ANY SPECIAL, INDIRECT,
INCIDENTAL, CONSEQUENTIAL, PUNITIVE, RELIANCE, OR EXEMPLARY DAMAGES THAT RESULT
FROM THIS AGREEMENT, EVEN IF TAPJOY OR A TAPJOY AUTHORIZED REPRESENTATIVE HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.  EXCEPT IN THE CASES OF
BREACHES OF SECTION 12, IN NO EVENT WILL TAPJOY’S OR ITS AFFILIATES’ TOTAL
LIABILITY TO PUBLISHER FOR ALL DAMAGES, LOSSES, AND CAUSES OF ACTION ARISING OUT
OF OR RELATING TO THIS AGREEMENT (WHETHER IN CONTRACT OR TORT, INCLUDING
NEGLIGENCE, WARRANTY, OR OTHERWISE) EXCEED THE AMOUNTS PAID OR PAYABLE TO
PUBLISHER FOR ADVERTISEMENTS ACTUALLY DISPLAYED BY PUBLISHER HEREUNDER AND TO
WHICH THE CLAIM RELATES OR $5,000, WHICHEVER IS LOWER.

 

11. Ownership.  Publisher acknowledges that Tapjoy will provide third-party
Advertisements for display on the Application(s) pursuant to this Agreement. 
Publisher agrees that it will use any data (including any usage data and
compilations thereof), information or software provided by Tapjoy to Publisher
only for the purpose of displaying Advertisements for Tapjoy on the
Application(s) as set forth in this Agreement. As between the parties, Tapjoy
and its licensors will exclusively own and retain all rights, title, and
interest in and to: (a) the Tapjoy Services, including all information and
software related thereto and all data (including any usage data and compilations
thereof but excluding any User Data) collected through the Tapjoy Services or
the Advertisements and (b) any materials, information, inventions, data or
software (and improvements and updates related thereto) which were owned by
Tapjoy prior to this Agreement or which are subsequently created by Tapjoy
(either solely or jointly with Publisher) under this Agreement. As between the
parties, Publisher and its licensors will own and retain all rights, title, and
interest in and to: (a) the Application(s); and (b) User Data. Unless otherwise
expressly provided for in this Agreement, both parties agree not to copy, alter,
modify, or create derivative works of the other party’s data, information,
software or services or otherwise use the other party’s services or any of such
party’s data, information or software in any way that violates the use
restrictions contained in this Agreement. Tapjoy does not grant to Publisher any
license, express or implied, to the intellectual property of Tapjoy or its
licensors.

 

Tapjoy/Andover Agreement6CONFIDENTIAL

 

 

12. Confidentiality.  “Confidential Information” of Tapjoy shall mean: (a) the
Advertisements, prior to publication; and (b) any data (including any usage data
and compilations thereof), information or software relating to or collected
through the Tapjoy Services (except for the User Data); “Confidential
Information” of Publisher shall mean the User Data; and “Confidential
Information” of either party shall mean: (a) the existence and content of this
Agreement; and (b) any other information designated in writing, or identified
orally at time of disclosure, by the disclosing party as “confidential” or
“proprietary.” Each party will keep confidential, and neither party will use for
any purpose, or disclose to any third party, any Confidential Information of the
other party except to fulfill its obligations or exercise its rights under this
Agreement. This restriction will survive expiration or termination of this
Agreement. The foregoing restriction does not apply to information that: (a) has
been independently developed by the receiving party without access to the other
party’s Confidential Information; (b) has become publicly known through no
breach of this Section 12 by the receiving party; (c) has been rightfully
received from a third party authorized to make such disclosure; (d) has been
approved for release in writing by the disclosing party; or (e) is required to
be disclosed by a competent legal or governmental authority, provided that the
receiving party gives the disclosing party prompt written notice of such
requirement prior to disclosure and assists in obtaining an order to protect the
information from public disclosure.

 

13. Term; Termination.  This Agreement shall begin on the latest date of
execution by either party (the “Execution Date”) and remain in effect until
expiration of the Exclusivity Period (the period beginning with the Execution
Date and ending upon expiration of the Exclusivity Period being the “Agreement
Period”), unless terminated earlier as provided for in Section 6 or this Section
13. Further, the Exclusivity Period and hence the Agreement Period shall be
subject to successive one-year auto-renewals (collectively constituting the
“Renewal Period”) unless either party provides notice to the other party of its
intention to terminate the agreement with at least 30 days notice prior to the
expiration of the Exclusivity Period. In the event of a material breach by one
party, the non-breaching party may terminate this Agreement immediately without
prior notice or cure period.  In the event of any termination, both parties will
remain liable for any amounts owed to the other party prior to the date of
termination and such obligation to pay shall survive any termination of this
Agreement. Sections 2.2 , 2.4 , 2.5 , 2.6 , 2.7, 3 through 15 shall also
survive.

 

14. Governing Law and Jurisdiction. This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without giving
effect to principles of conflicts of law.  Any dispute hereunder will be
negotiated in good faith between the parties within 45 days commencing upon
written notice from one party to the other and neither party will file an action
prior to the termination of such 45 day period. Publisher agrees that any action
at law or in equity arising out of or relating to this Agreement will be filed
only in the state or federal courts in and for Alameda County, California, and
Publisher hereby consents and submits to the personal and exclusive jurisdiction
of such courts for the purposes of litigating any such action.  Notwithstanding
the foregoing, Tapjoy may seek immediate injunctive relief in any court having
jurisdiction in the event of breach or threatened breach by Publisher of
Sections 11 or 12.

 

15. Miscellaneous.  The words “include” and “including” and variations thereof
will not be deemed to be terms of limitation, but rather will be deemed to be
followed by the words “without limitation.” This Agreement, and any rights and
licenses granted hereunder, may not be transferred or assigned by Publisher, but
may be assigned by Tapjoy to an entity that succeeds to all or substantially all
of Tapjoy’s business or assets.  Tapjoy and Publisher are independent
contractors, and neither Tapjoy nor Publisher is an agent, representative or
partner of the other.  This Agreement sets forth the entire agreement between
Tapjoy and Publisher, and supersedes any and all prior agreements (whether
written or oral) with respect to the subject matter set forth herein (with the
exception of any ongoing Publisher Agreements between the parties).  This
Agreement may be amended only by a writing executed by a duly authorized
representative of each party. Any notices under this Agreement shall be sent to
any of the contacts set forth in the Term Sheet by facsimile or nationally
recognized express delivery service and deemed given upon receipt. The waiver of
any breach or default of this Agreement will not constitute a waiver of any
subsequent breach or default, and will not act to amend or negate the rights of
the waiving party. If any provision contained in this Agreement is determined to
be invalid, illegal, or unenforceable in any respect under any applicable law,
then such provision will be severed and replaced with a new provision that most
closely reflects the original intention of the parties, and the remaining
provisions of this Agreement will remain in full force and effect.

 

Tapjoy/Andover Agreement7CONFIDENTIAL