Sample Business Contracts

Distribution Agreement - inc. and M2 Software Equity LLC

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                                BUSYBOX.COM, INC.


                            M2 SOFTWARE EQUITY, LLC

                             DISTRIBUTION AGREEMENT

     This distribution agreement ("Agreement") is entered into as of the date
specified on the signature page ("Effective Date") by and between, inc., a Delaware corporation located at 701 Battery Street, 2nd
Floor, San Francisco, California 94111 ("Busybox") and M2 Software Equity,
LLC, a California limited liability company locate at 119 East Union Street,
Suite D, Pasadena, California 91103 ("M2").


R1.   Busybox commercially distributes digital media content, principally
      through its Web site

R2.   M2 commercially distributes digital media content, principally through
      physical distribution channels.

R3.   The parties desire to collaborate for the purpose of leveraging and
      commercially exploiting their respective assets and distribution

R4.   The parties hereby agree to be bound under the terms and conditions of
      this Agreement.

                              TERMS & CONDITIONS

1.    APPOINTMENT OF DISTRIBUTOR: Each party appoints the other as a
      non-exclusive distributor of certain digital media content as more fully
      described below.

2.    LICENSED CONTENT: Each party shall select and specify its respective
      digital media content subject to this Agreement ("Licensed Content"),
      which shall be more fully set forth in contemporaneous or subsequent
      Exhibit(s) hereto signed by such party's authorized representative.

2.1   MASTER: Each party shall at its own expense deliver the Licensed
      Content to the other party in the form of cassette, CD-ROM or such other
      suitable storage medium containing the respective digital files

3.    LICENSE: Each party grants to the other party a revocable,
      royalty-bearing, worldwide, non-exclusive license under the licensing
      party's intellectual property rights (including copyright, trademark,
      moral and related rights) to copy, reproduce, sub-license (pursuant to
      End-User License Agreement more fully described below), distribute and
      promote licensing party's Licensed Content, as well as to advertise
      and promote the



      licensing party's trade identity and branded image, inclusive of
      applicable trademarks and service marks, with respect to the same as
      more fully set forth below.

3.1   REVOCATION: The licensing party may at any time upon confirming written
      notice to the other party revoke the license granted above with respect
      to any and all of such Licensed Content previously licensed; provided,
      however, that the licensee may for a period of thirty (30) days
      thereafter continue to distribute such revoked Licensed Content which
      has already been reproduced from the Master(s) and is in licensee's
      inventory ("Inventory").

3.1.1 INVENTORY PURCHASE: The above notwithstanding, the licensing party may
      elect to reimburse licensee for its duplication cost for such Inventory,
      payment terms net-30, in which case the licensee shall have no further
      rights of any kind with respect to the same.

3.2   END-USER LICENSE: All Licensed Content distributed to end users shall
      be subject to an end-user license Agreement ("End-User License
      Agreement") in the form of a template provided by or approved by the
      licensing party.

4.    ROYALTY RATES: The royalty rates and payment terms for all Licensed
      Content under this Agreement shall be set forth in contemporaneous or
      subsequent Exhibit(s) hereto signed by both party's authorized

5.    ADVERTISING & PROMOTION: All advertising and promotion by one party of
      the other party's trade identity and branded image, inclusive of
      applicable trademarks and service marks, shall be subject to that
      party's prior written approval, which shall not be unreasonably
      withheld. Each party shall submit to the other party all proposed
      advertising and promotional materials, including press releases, at
      least fourteen (14) days prior to such proposed use, and all such
      submissions shall be deemed approved unless approval is expressly
      withheld by written notice delivered to the requesting party at
      least seven (7) days prior to such proposed use, and such notice
      specifies the reason approval is withheld.

6.    WARRANTIES: Each party represents and warrants the following with
      respect to the Licensed Content delivered and licensed by it:

      - That it owns all right, title and interest in such Licensed Content;

      - That it has procured all necessary or applicable releases; and,

      - That it has not granted rights to any third party which would
        conflict with the rights granted to the other party under this

7.    INDEMNITY: Each party shall defend, indemnify, and hold the other party
      harmless from and against all liability, loss, damage, cost



      and expense, including reasonable attorneys' fees, paid or incurred by
      the other party in connection with the former party's breach of any
      representations and warranties above; provided, however, that the
      indemnifying party shall have the right to participate in the defense
      of all such claims.

8.    BOOKS & RECORDS: Each party shall maintain accurate and up-to-date
      books and records of account with respect to all Licensed Content
      distributed by it ("Books"). Each party may, once within any 12-month
      period, request an audit of the other party's Books to be performed by
      a reputable certified public accounting firm. The scope of such audit
      shall be limited to review and disclosure of information in the Books
      relevant to the calculation and payment of royalties to the other
      party. All costs and expenses of the audit shall be directly borne by
      the auditing party, unless the audit reveals a discrepancy of greater
      than FIVE percent (5%), in which case the costs and expenses of the
      audit shall be borne by the audited party.

9.    CONFIDENTIALITY: Developer shall respect and strictly preserve the
      confidentiality of all information of consequence obtained from Busybox
      in the course of performance of this Agreement ("Confidential
      Information"). Confidential Information shall include, among others,
      the technologies, trade secrets, business plans and activities,
      customers, and finances of Busybox and its clients and customers.

10.    TERM AND TERMINATION: This Agreement shall take effect as of the
       Effective Date and continue in effect through March 30, 2001 ("Initial
       Term"), thereafter automatically renewing for successive one-year terms
       ("Renewal Term(s)") until otherwise terminated as set forth below.

10.1   FOR CAUSE: If either party breaches any material term or condition
       under this Agreement and fails to cure such breach with thirty (30)
       days following written notice thereof, the non-breaching party may
       terminate this Agreement immediately upon confirming written notice.

10.2   WITHOUT CAUSE: Either party may terminate this Agreement, effective
       upon expiration of the Initial Term or any Renewal Term, as applicable,
       upon ninety (90) days prior written notice.

11.    INTEGRATION: This Agreement is the complete agreement between the
       parties respecting all subject matter addressed herein, superseding
       any and all prior oral or written understandings between the
       parties relating thereto. In the event of any conflict between this
       Agreement, and any Exhibit hereto, the terms and conditions of this
       Agreement shall prevail.

12.    MODIFICATION: This Agreement may be modified in whole or in part only
       in writing signed by the authorized representatives of the parties.

13.    GENERAL: If any provision of this Agreement is found illegal or
       unenforceable, the legality and enforceability of the other



      provisions of this Agreement will not be affected. No failure of either
      party to exercise or enforce any of its rights hereunder will act as a
      waiver of such rights.

14.   GOVERNING LAW & JURISDICTION: This Agreement shall be interpreted and
      governed by the laws of the state of California, excluding its body of
      law relating to conflicts of law. All disputes between the parties
      arising under this Agreement shall be finally decided through binding
      arbitration before Judicial Arbitration & Mediation Services, Inc.
      ("JAMS/ENDISPUTE") in San Francisco, California, and judgement on any
      arbitration award may be entered in any court having jurisdiction
      over the parties or their assets. Notwithstanding the foregoing, the
      provisions of this section shall not prohibit either party from seeking
      injunctive relief to protect its intellectual property rights. The
      prevailing party in any dispute under or in connection with this
      Agreement will be entitled to recover reasonable attorneys fees and
      costs of proceedings.

This Agreement is hereby executed as of this date, February 11, 2000, by and
between Busybox and M2.

BUSYBOX.COM, INC.:                           M2 SOFTWARE EQUITY, LLC:

By:         /s/                          By:            /s/
   ---------------------------               --------------------------

Name: Robert S. Sherman                  Name:
President & Chief Operations Officer     Title:
                                         Fed ID:



                                   EXHIBIT A

                        SUPPLEMENTAL TERMS & CONDITIONS


     1.1 Busybox shall provide commercial distribution of M2 content through
it's web site WWW.REELSTOCK.COM and other web sites that it manages.

     1.2 M2 shall provide distribution for Busybox content through M2's
multiple direct mail and catalog distribution channels including but not
limited to Dynamic Graphics, Corbis, Digital Vision,, the
Video Library, Eyewire, AVID Education Centers, AVID Resellers, Islip Media,
Hot Shots, Cool Cuts, Media 100 Platinum Resellers, Film & Video Stock
Shots. Busybox shall have the right to approve M2 distribution partners,
which will not be unreasonably withheld.

     1.3 Busybox shall provide M2 the video clips on D-1 or digibeta formats.
M2 will digitize the clips in the format necessary for mastering for the
distribution channels.

     1.4 Busybox shall provide Busybox the video clips of their choice on D-1
or digibeta formats.

     1.5 M2 and Busybox shall each provide the other with monthly reports
from their distribution channels within 30 days of the end of each month,
showing the gross sales of the others content by distribution channel.

     1.6 Busybox shall review their current footage resources and future
footage acquisitions plans and submit a plan to fulfill at Busybox option
(based on acceptable footage) the following general categories to be filled
in January, February and March:

     Active Children
     Active Seniors
     Architectural Icons
     Archival 60's
     Archival 70's
     Archival 80's
     Archival Communications
     Archival Sports
     Archival Technology
     Beauty and Health
     Body Beautiful
     Business on the Move
     Business Situations (4)
     Computer Technology
     Domestic Animals
     Engineering Icons



     Factory at Work
     Family Life
     Home & Garden
     Junior Executives
     Medical (4)
     Office Icons
     Romantic Moments
     Senior Executives
     Time Lapse - City
     WW 1
     WW 2

     The following titles to be filled by May 1, 2000.

     Active Lifestyles
     Anytown USA 1&2
     Archives: 1900's
     Business 1 & 2
     City Facades
     City Life
     Clouds & Skies
     Digital FX
     Exotic Locations
     Exploring Space
     Face of Industry 1 & 2
     Faces of the Century
     Fast Forward
     Intriguing Locations
     Natural Textures
     Natures Backdrops
     Natures Creatures
     Planetary Movements
     Rest & Relaxation
     Scenic Water
     The Great Outdoors
     Transportation 1 & 2
     Travel & Leisure 1 & 2
     Under the Sea
     Urban Sprawl
     Water Reflections


     2.1 Busybox Licensed Content: M2 shall pay Busybox a royalty of twenty
percent (20%) of the gross proceeds from the sale and sublicensing of Busybox
Licensed Content.

     2.1.1 M2 shall pay Busybox a royalty of forty
percent (40%) of the gross proceeds from the sale and sub-licensing of
Busybox Licensed Content transacted through, a Web site
owned and operated by M2.

     2.2 M2 LICENSED CONTENT: Busybox shall pay M2 a royalty of twenty percent
(20%) of the gross proceeds from the sale and sub-licensing of



     M2 Licensed Content transacted through or any other
Busybox affiliated Web site.

     2.3 PAYMENT TERMS: All royalty payments shall be made within 30 days of
receipt and shall be accompanied by a reasonably detailed accounting for
the relevant royalty period, identifying the number and identity of the
Licensed Content sold and sub-licensed, and including a calculation of the
royalty payment.

          This SCHEDULE A is subject to all terms and conditions contained in
the Agreement.

     This Agreement is hereby executed as of this date, February 11, 2000, by
and between Busybox and M2.

BUSYBOX.COM, INC.:                           M2 SOFTWARE EQUITY, LLC:

By:         /s/                          By:            /s/
   ---------------------------               --------------------------

Name: Robert S. Sherman                  Name:
President & Chief Operations Officer     Title:
                                         Fed ID: