Contract Version Date: 03/03/2008 Booklocker.com, Inc. provides publishing services and marketing tools for self-published authors as well as online bookstores where authors can list and sell their books. The company is not a publisher and retains no exclusive rights to the author's Work. Self-published authors are their own publishers and are free to list and sell their works elsewhere. There are no time limitations imposed by this agreement and it may be terminated by either party, for any reason, immediately by e-mailed request, with or without cause. This Agreement is between Booklocker.com, Inc. (including WritersWeekly.com, Booklocker.com), hereafter referred to as the "Company", and the Author or duly authorized legal representative (herein represented as "Author"), in regards to the Work (herein represented as "Work") named at the end of the contract and shall be considered legal and binding in all countries, and its separate or conglomerate governments. I. CLAUSES REGARDING RIGHTS GRANTED TO COMPANY The author grants the non-exclusive right to sell the Work in digital format, including, but not limited to: computer disk, data bases, CD ROM, and any and all other computer and computer related or digital based storage medium, known and unknown. If the Author has registered the Work for the Company's print-on-demand service, the author grants the company the non-exclusive right to publish the Work in print format through print-on-demand. Print on Demand authors are not required to list the electronic version of their book for sale with the Company. Company claims no other rights to the Work. II. CLAUSES REGARDING WORK SUBMITTED The Author hereby states that the Work submitted to the Company is free and clear of any counts of libel, plagiarism, breach of privacy or misrepresentation of facts. The Author also states that the Work, if biographical or "as told to the Author" is, to the best of the Author's knowledge, factual and true. The Author agrees to pay the Company's legal fees and any resulting judgment against the company if legal action arises from any known or unknown libel, plagiarism, breach of privacy or misrepresentation of facts, whether known or unknown by the author, medical and/or legal damages, copyright infringement or any other legal dispute related to the authenticity, character or content of the Author's books. The Author hereby states that the Work does not infringe on the privacy of any third party; that he or she is owner of any trademarks and/or trade names associated with the Work; that the Work does not constitute obscenity, hate literature or illegal content and that the author has the right to enter into this Agreement. The Author states that the Work is not currently in the public domain and that the Author is the sole owner and copyright holder of the work, with full power to enter into this contract. The Author states that if the Work has previously been published in whole or in part, that author currently holds all copyrights to the Work and that the author is legally permitted to enter into this agreement. The Author releases the Company from any responsibilities relating to any legal actions incurred by the contents of the Work or the Author. Author agrees to not enter into any agreements with any person, firm or corporation that will conflict with the rights granted to the Company as stated in this contract without first terminating Author's contract with the Company. Since the Company does not own any rights to the Work, the Author will register and retain all copyrights and apply for a Library of Congress Control Number (LCCN) if they choose to do so. The Company reserves the right to stop advertising and selling books and to freeze all unpaid royalties for any author whose book(s) are involved in a legal dispute or pending legal dispute. The Author agrees to submit Work according to the Company's specifications. If, during the existence of this Agreement any entity makes unauthorized use of the author's Work, it is the sole responsibility of the author to take legal action as may be required to restrain such wrong or to seek damages and the author shall bear all costs and expenses and, subsequently, the Author shall keep all remunerations resulting from the legal actions. The author is responsible for keeping the Company current on any and all email address and mailing address changes. The Company will be forced to terminate an author's contract without notice if the author does not respond to the Company's communications. If an Author uses an email service that filters incoming email for spam, this may create communication difficulties for the Company and the Author. The Author is encouraged to provide the Company with at least two email addresses from different services to further prevent communication difficulties. III. CLAUSES REGARDING THE FORMAT OF WORK The Company sells Works in two formats: electronic (ebook) and Print-On-Demand (POD). Works in electronic format are delivered to the customer as digital files. The Author acknowledges that because of the digital nature of these files, it is possible for them to be replicated and distributed illegally once they are purchased by the customer and outside of the control of the Company. The Author agrees to not hold the Company liable if such a situation should occur. Works in POD format are delivered to the customer as physical books and printed on a per order basis. A Work in POD format come in two forms: Black and white-interior print books: 1.) SOFTCOVER, glossy color cover, printed on 55lb. Creme (8.5 x 11 paperbacks are printed on 55lb. White) 2.) HARDCOVER, glossy color jacket on cover, printed on 55lb. Creme. Works can only be in POD format if the Author is accepted in the Company's POD program, pays the required fees and delivers the Work per the Company's specifications. If a Work in POD format is in both softcover and hardcover forms, a new ISBN is the required for each edition. Author will be charged a separate setup fee for each edition. Authors can choose to have the book in just one edition if they so desire, and thus pay only one set-up fee. The default form of a Work in POD format will be softcover. The Author must specifically request a Work in POD format be placed in hardcover form. Works in electronic format are not required to have an International Standard Book Number (ISBN). Works in POD format are required to have an ISBN. Authors of POD books may assign an ISBN owned by themselves to the Work. If the Author desires, the Company will assign an ISBN that it owns at no additional charge. In the case of a Work in POD format that has been assigned an ISBN owned by the Company, the Author acknowledges the following: 1.) All sales for the Work must be processed by the Company because it is the owner of the ISBN and all orders for a Work are sent to the owner of that Work's ISBN. However, if an author chooses to use their own ISBN, orders going through Ingram will come to Booklocker (who is under contract with Ingram), not to the author. Bookstores using Books in Print to obtain ordering information will order through the owner of the ISBN but may also order through Ingram at their option. Authors using their own ISBN must register their own book with Books in Print. 2.) Upon termination of this contract, the ISBN is unassigned from the Work and decommissioned. ISBNs are not transferrable and can't be used on a book printed by more than one printer. A new ISBN must be assigned each time a book is republished, regardless who owns the ISBN. IV. CLAUSES REGARDING THE ANNUAL REVIEW OF WORKS' SALES On an annual basis, the Company reviews the sales of all Works and makes a determination of which Works it will continue selling. If a Work is not averaging a sales rate of at least five copies per month, the Company reserves the right to remove the Work and terminate the contract with the Author. V. CLAUSES REGARDING SERVICE PROVIDED BY THE COMPANY The Company provides services to support the Author in the publishing and sale of the Work. Those services include: 1.) making the Author's Work available to the consumer though Booklocker.com in either ebook and/or POD format (if Work is enrolled in the Company's POD program). 2.) fulfilling orders for the Work by processing the customer's payments and delivering the Work in the format the customer paid for. 3.) handling customer support inquiries. 4.) distributing the author's commissions of each sale of the Work to the Author on a monthly basis provided the author's unpaid commissions exceed $20.00. 5.) providing, for a fee, the optional services of cover design and formatting, as well as manuscript preparation services. The Company does not offer in-house editing but can provide a list of freelance editors on request. The Company does not earn any referral fees or anything whatsoever for referring authors to these editors. VI. CLAUSES REGARDING CHARGES OF COMPANY There is no set-up fee and no annual hosting fee to list Works in ebook format, provided the Work is approved by the Company and has been submitted to the Company per its specifications. The Company charges a $299.00 set-up fee ($99 for returning authors) and a $1.50 per month hosting fee for a Work in POD format that is in softcover form. The Company charges a $299.00 set-up fee and a $1.50 per month hosting fee for a Work in POD format that is in hardcover form. RETURNING AUTHORS (active authors previously published in print by the Company) are only charged $99 (one third price) in setup fees for their second and subsequent books accepted and published by the Company. This special includes color-interior books as well. However, color-interior books require payment of a formatting fee (varies by book length). This special does not affect the formatting fee. Hosting and other fees, such as cover art (cover art is optional) remain the same. Hosting fees are charged on an annual basis. Authors are notified by email when the hosting fee is due. The company may, at its discretion, deduct the annual fee from royalties due or charge the author's credit card on file. The hosting fee is effective once the Author registers for the POD program. The first annual hosting fee of $18 will be charged to the author's credit card along with the setup fee. Hosting fees are not refundable and are not prorated. If the Author wants to terminate their contract before the next hosting fee is due, they must email the Company at least one month prior to the anniversary date of their book's publication. If the printer bills the Company for that year and the Author hasn't yet terminated their contract, the Author must pay for the entire hosting fee for that year, even if they choose to terminate their contract at that time. The fee is non-refundable and can't be pro-rated. The fee must be paid in full each year if the Author hasn't terminated their contract prior to the anniversary date of the book's publication. If the Company does not receive a response from the author to the Company's emails and/or author messaging system post(s) within 10 business days, the Company may be forced to terminate the author's contract without further notice by the Company. The Company can't continue to sell an Author's book if the Author isn't responding to the Company's communications. However, the annual fee will still be due if the Company does not receive notice of the author's intent to terminate their contract at least 30 days before the anniversary date of the publication of their book(s). It is time-consuming and expensive for the Company to remove and then re-add books to the systems. If an author wishes to relist a terminated title, a relisting fee of $99.00 must be paid to reactivate a terminated title. The Company may, at its discretion and for any reason, choose not to relist a terminated title. The Company will not deem a Work in POD format to be final without the Author's approval. Therefore, the responsibility of deeming a Work in POD format to be final and ready for sale is borne by the Author. If errors are discovered later that were in the final version of the manuscript approved by the Author, the Author agrees to pay a new set-up fee of $199.00 to have the errors corrected. If the errors are such that they result in making the work unsellable, the Company may remove the Work from all sales channels until the errors are corrected. If the errors were the result of the Author's mistakes, a new setup fee must be paid for the corrections before the Company will put the book on the market. The Company charges additional fees for optional services of cover design. Authors are NOT required in any way to use the Company's cover design services. This service is provided as a convenience to the Author. Authors may use their own cover designer provided that designer designs the cover to the Company's specs. We understand that authors occasionally need to cancel their Booklocker.com contract for a variety of reasons. If you are a new Author and request a refund after your card is charged, but before any file transmissions or formatting work is completed on your book, that is fine. However, Booklocker.com will retain a 25% cancellation fee to cover labor and transaction costs associated with processing the cancellation. By agreeing to this contract, you state that you understand a 25% cancellation fee will apply to all POD setup fee, original cover art orders and annual POD file hosting fees. However, if any file transmissions have occurred or work has begun on your book or cover art, no refunds are permitted. Except as noted in the paragraph above, refunds are not permitted for POD set-up fees, annual hosting fees, or cover art design. VII. CLAUSES REGARDING THE PRICING OF WORKS The Author is allowed to set the list price of the Work to whatever the Author would like, provided the price is at or above the Company's minimum list prices. The minimum price for Works in ebook format is $5.95. No Work for sale in ebook format can have a list price of less than $5.95. Note that Works in ebook format that have a list price of less than $8.95 are subject to a royalty rate of 50%. Ebooks priced $8.95 or higher receive a 70% royalty rate. The minimum price for works in POD format is based on number of pages. The minimum prices are as follows: BLACK AND WHITE INTERIOR BOOKS number of pages: up to 108 minimum list price SOFTCOVER: $11.95 HARDCOVER: $21.95 number of pages: 109 to 150 minimum list price SOFTCOVER: $12.95 HARDCOVER: $23.95 number of pages: 151 to 200 minimum list price SOFTCOVER: $13.95 HARDCOVER: $24.95 number of pages: 201 to 250 minimum list price SOFTCOVER: $14.95 HARDCOVER: $26.95 number of pages: 251 to 300 minimum list price SOFTCOVER: $15.95 HARDCOVER: $28.95 number of pages: 301 to 350 minimum list price SOFTCOVER: $16.95 HARDCOVER: $30.95 number of pages: 351 to 400 minimum list price SOFTCOVER: $17.95 HARDCOVER: $31.95 COLOR INTERIOR BOOKS: number of pages: up to 24 minimum list price SOFTCOVER: $11.95 number of pages: 25-48 minimum list price SOFTCOVER: $14.95 number of pages: 49-100 minimum list price SOFTCOVER: $22.95 number of pages: 101-148 minimum list price SOFTCOVER: $30.95 number of pages: 149-200 minimum list price SOFTCOVER: $37.95 (Color interior books are only available in paperback format.) Prices increase in similar increments on lengthier books. The minimum list price of Works with more than 400 pages is determined on an individual basis. The Company can't manufacture black and white interior POD books that exceed 740 pages. The Company can't manufacture color-interior POD books that exceed 480 pages. The Author is free to sell the Work through sales channels other than those controlled by the Company. However, the Author agrees not to sell the EBOOK VERSION of the Work though outside sales channels for a list price that is less than the list price the Author is selling the EBOOK for through the Company's sales channels. VIII. CLAUSES REGARGING ROYALTY PAYMENTS The Company's sales and fulfillment system allows the Author to view a report of royalties owed over the Internet via the World-Wide Web, in addition to the date and time of each sale for the Authors Work. The Company's sales and fulfillment system is the final authority in determining how many copies of a Work have been sold. If the Author believes the Company's sales and fulfillment system is in error, the Author may order an audit of the system by a third party. However, if the Author requests an audit, the Author agrees to pay all costs associated with said audit. Royalties are only paid on sales deemed final. Criteria for deeming a sale final are as follows: 1.) the sale has been processed by the Company's sales and fulfillment system, and 2.) the proceeds of the sale have been deposited in the Company's bank account. Only when these two criteria have been met, will royalties be credited to an author's account. Sales deemed final may be reversed in the following circumstances: 1.) The customer requests a refund. 2.) A credit card is used for the purchase and the card holder later issues a chargeback, which is defined as a refusal to pay because the customer deems the charge unauthorized. 3.) The customer pays with a check that is returned because of insufficient funds. 4.) Any possible credit card fraud involving an order for the Author's Works. 5.) Any pattern of suspected fraud, including any pattern of fraudulent orders suspected by Booklocker.com or any other bookseller or distributor. If a pattern of fraudulent orders, or a single, large fraudulent order, are suspected, the author's contract may be terminated immediately, regardless of the source of the fraud, and all funds will be put on hold pending the outcome of any investigation. Authors will not be paid royalties for orders placed at bookstores that are not picked up and paid for by the ordering customer. Because of the slow nature of credit card companies, a chargeback may take several months to resolve. For this reason, sales deemed final may be reversed at any time. If a sale deemed final is reversed and the royalty has already been paid to the Author, the amount of the royalty paid will be deducted from future royalties owed to the Author by the Company. If future royalties owed to the Author by the Company are insufficient to cover the cost of sales that have been reversed, the Author is responsible for refunding the money to the Company within 30 days. Royalty payments are processed and mailed on the 5th business day of each month. The Company observes standard holidays recognized in the United States. Royalty payments are paid in US dollars by check. Royalty payments are only made on author accounts with outstanding balances of $20.00 US or more accrued by the last day of the previous month. Accounts with outstanding balances of less than $20.00 US are not paid until they reach $20.00 US or until the account is terminated, whichever happens first. For co-authored Works where more than one individual owns the rights to the Work, the Company will distribute one check payable to both/all authors or to a company owned by both/all authors and designated as the Authors' Book's designated payee. The Company can not distribute separate royalty checks to authors of co-authored works. All Authors of Works published by the Company MUST complete this contract and register as an Author with the Company. Per United States federal tax law, the Company must obtain the social security number, along with the name and address, of all Authors who are Unites States citizens. For this reason, the Company must request and keep on file the Author's social security number when the Author's contract is submitted. The Company will not re-issue missing royalty checks (those that don't arrive at their destination) for a minimum of four weeks. Mail does go astray, though rarely. Forwarded mail takes longer to arrive. Cancelled checks are expensive to process. Banks don't always catch cancelled checks and occasionally allow them to clear. For all of these reasons, the Company allows extra time to determine what has happened to checks that don't arrive promptly at their destinations. Please ensure you send your new address to Booklocker as soon as possible after moving. And, always expect a prompt confirmation from the Company via email that your new address has been received and processed. Login to your author account to request an address change. IX. CLAUSES REGARDING SALES CHANNELS The Company has a variety of sales channels through which it can sell the Author's Work, each paying different royalty rates and having different conditions of participation. These are the Company's current sales channels: Booklocker.com - the Company's principal sales channel. All accepted Works are eligible to be listed for sale in Booklocker.com. The royalty rates for Booklocker.com are: a Work in ebook format with a list price of $8.95 or more, 70% of the list price is paid to the Author; a Work in ebook format with a list price of $8.94 or less, 50% of the list price is paid to the Author; with a Work in POD format, 35% of the list price is paid to the Author. WritersWeekly.com - the Company's sales channel for books on the topic of writing. Books are listed on WritersWeekly.com by invitation only from the Company. The royalty rates for WritersWeekly.com are: 50% of the list price is paid to the Author for a Work in ebook format; 30% of the list price is paid to the Author for a Work in POD format. Wholesale Orders Processed By the Company - the Company's sales channel for fulfilling purchase orders directly from bookstores, libraries and retail outlets. All Works in POD format are required to be for sale through this sales channel. No Work in ebook format can be for sale through this sales channel. The Company offers a 30% discount on the list price of books purchased through this sales channel. The royalty rate for this channel is: 15% of the U.S. list price is paid to the Author. The Company is required by federal law to offer all wholesale distribution channels the same discount rate. Ingram - the Company's sales channel for selling through a distributor (Ingram). Participation in this sales channel is required of all POD books. Only Works in the Company's POD program can be for sale through this sales channel. No Works in ebook format can be for sale through the this sales channel. The Company offers a 30% discount on the list price of books purchased through this sales channel. The royalty rate for this channel is: 15% of the U.S. list price is paid to the Author. Ingram listings are also picked up by Baker & Taylor and other smaller distributors. The Company does not work directly with other distributors. Ingram United Kingdom (UK) and affiliates/partners - The Company's sales channel for selling through some distributors in and near the United Kingdom (though anyone can purchase books through this channel regardless of their geographic location). Participating in this sales channel is required of all POD books. Only Works in the Company's POD program can be for sale through the this sales channel. No Works in ebook format can be for sale through the this sales channel. The Company offers a 30% discount on the list price of books purchased through this sales channel. Books listed thorugh this sales channel are priced in British Sterling Pounds at a rate comparable to the U.S. list price. The royalty rate for this channel is: 15% of the U.S. list price is paid to the Author. Order processed by Booklocker.com or WritersWeekly.com affiliates - The company permits a limited number of online and offline retailers to resell the company's POD books and ebooks for a commission. All POD books and ebooks are made available for affiliates. However, on all ebook sales, the affiliates must forward their customers' information to us for fulfillment (to prevent theft and unauthorized sale of our authors' books by any affiliate). The Company offers a 30% discount on the list price of POD and ebooks purchased through this sales channel. The royalty rate for this channel is: 15% of the list price is paid to the Author. Prizes awarded to participants in the quarterly WritersWeekly 24-Hour Short Story Contest - The Company holds a quarterly writing contest that serves as a marketing and publicity tool for WritersWeekly.com, Booklocker.com, and the writing-related books appearing on WritersWeekly.com. The company awards books to winners of the quarterly contest. Some books are offered as pre-advertised prizes and others are individually chosen by winners of the contest. All POD books and ebooks are required to be offered as prize options. While the winners do not pay for these prizes, the Company pays royalties to the authors of the books that are chosen or assigned as prizes. The royalty rate for this channel is: 15% of the list price is paid to the Author. Short Print Run Sales to Authors - the Company's method for selling directly to the Author. The Company will only sell copies of a Work through this sales channel to the Author(s) of that Work or the Author's representative. No royalties are paid to the Author on sales through this sales channel. However, for black and white interior books, the Author receives a discount of 35% of the list price on purchases of quantities up to 24 copies of the Work. On purchases of quantities of 50 or more copies of the Work, a deeper discount is offered; which is calculated based on the number of pages within the Work. Consult with Booklocker.com for author discounts based on the length of your book. Author discounts on color-interior POD books are calculated differently. Authors are charged $2.00 per book plus $0.125 per page plus a $2 handling fee per order. Authors who order 100 or more copies of their color-interior book receive an additional 10% discount off the price of their books. Sales channels can be added or removed at the Company's discretion and without prior notice. While the Company provides listings to Ingram for print books, online bookstores, such and Amazon.com, are not required to list these titles for sale. Listings offered by online bookstores are at the discretion of each particular store. Likewise, if a book is terminated and goes out of print, these online bookstores may, at their discretion, choose to leave the book page on their site, even though no new copies of the book can be purchased. Booklocker.com is not responsible for books sold at the incorrect price by third parties. Authors earn royalties based on the list price of their book, not based on the sales price offered by retailers. Booklocker.com can't guarantee the successful sale and delivery of books through distributors, bookstores and other wholesale outlets. Those firms are responsible for their own sales and distribution. Wholesalers and retailers may refuse to list books for sale and may refuse to honor orders received for a variety of reasons. Booklocker.com is not responsible for the decisions and actions of other companies with regard to the marketing, sales and distribution of Booklocker.com books. X. CLAUSES REGARDING COMMUNICATION WITH AUTHORS The primary method of distributing royalty checks is via U.S. Postal Mail and in U.S. dollars. The primary method of communication with Authors shall be via email. Therefore, the Company cannot enter into any agreement with Authors who do not have access to email. If the Company can't reach the author via email, the author's contract and account must be terminated and the Work removed from all sales channels without notice. If the Author is owed royalties and the Company cannot distribute those royalties because checks are being returned to the Company by the post office, royalties owed shall be set aside for six months, beginning from the time the Author's account was terminated. If after six months the Author or Author's legally designated representative has failed to claim unpaid royalties, the royalties shall be deemed charitable funds and donated to a non-profit organization of the Company's choice. It is the Author's responsibility to notify the company when the Author's current email address and/or physical address changes. The Author must also provide the company with at least two separate email addresses from two separate Internet service providers to prevent email communication problems and delays. SPAM FILTERS Booklocker.com responds to ALL author emails. If you're not hearing from us, send a fax to 207-262-5544 and/or send us an alternative email address where we can attempt to send copies of your missing emails. XI. CLAUSES REGARDING THE PROMOTIONAL ACTIVITY OF AUTHORS When an Author's Work is made available for sale, the Company issues the Author a Web page at a Company URL where a customer may buy the Work. The Author is encouraged to promote this URL both online and offline. The Author is also given access to the Company's marketing area, which offers valuable advice on topics such as registering with search engines, publishing an ezine or blog to promote your work, obtaining book reviews, and more. Authors are strongly encouraged to take advantage of this free area. Booklocker.com does not "upsell" authors on marketing advice, products and services because marketing benefits both the author and the publisher. The Author may use their Booklocker.com URL in any promotion they see fit, provided that promotion is not illegal and does not have the potential to damage the Company's brand. If the Author is unsure about a specific promotional tactic, the Author is required to seek the advice of the Company before proceeding with the promotion. The Company is adamantly against the tactics of spam. Spam is defined as: 1.) sending a form email en masse to people who have not requested it, 2.) posting a form message en masse to newsgroups or discussion lists, 3.) any unsolicited electronic posting or mailing that results in complaints to the Company, the Company's web hosting service or an anti-spam group whether made by the Author of the Work or by a third party without the Author's knowledge. The Author should never use spam tactics when promoting their Work. Authors who use spam tactics when promoting their Work shall have their contract immediately terminated, their Work removed instantly from the Company's sales channels and become ineligible to do business with the Company in the future. As with any contract termination, there will be no refund issued for fees already charged. The Author will not have any rights to or in any trademark, service mark, trade name, mark or colophon used or licensed by the Company without written permission from the Company. XII. CLAUSES REGARDING THE PROMOTIONAL ACTIVITY OF THE COMPANY The Company shall have the right to use the Author's name or pen name (whichever Author specifies), likeness and biographical material for the purpose of advertising, publishing, and promoting the Work itself, its title, and all material, including characters in the Work, through their use, simulation, or graphic exploitations on or in connection with the Work or the Company. The company may, at its sole discretion, distribute excerpts and reprints of portions of the Author's titles to print, broadcast, and electronic publications or to the general public for marketing purposes. The company may, at its sole discretion, distribute a copy of the Work in electronic format to book reviewers who request a review copy. The Company only distributes books to professional book reviewers and, when possible, the Author will be notified when the book is being sent to a reviewer. The author is responsible for sending print books to reviewers, at their discretion and expense. The Company is the sole owner of all URLs (Web site addresses) on the Company's web sites. We will not post nor redirect URLs outside of our Web sites under any circumstances, including upon termination of an author's contract. While the Company promotes BookLocker.com in general, and promotes specific books when opportunities arise in interviews, etc., and while the Company provides a free marketing area for authors (free blogs, free one-on-one advice, free lists of talk shows, reviewers, etc.), authors are responsible for marketing their own books. XIII. CLAUSES REGARDING DEALS NEGOTIATED BY THE AUTHOR WITH THIRD-PARTIES The Author and the Company are independent contractors, and nothing in this Agreement will create any partnership, joint venture, agency, franchise, sales representative, or employment relationship between the parties. This agreement does not create an exclusive relationship between the Author and the Company. The Author will have no authority to make or accept any offers or representations on the Company's behalf. The Author agrees not to make any statement, written or oral, that would contradict the above. If the Author wishes to enter into a distribution deal with a third-party with which the Company has no established relationship, the Author is free to do so. However in that instance, the Author agrees to negotiate the terms as well as perform all sales fulfillment and management of the relationship. The Company has no obligation to support relationships entered into independently with third- parties by the Author, other than to sell the Work to the Author at the same standard discount it gives to all Authors. XIV. CLAUSES REGARDING THE HANDLING OF CUSTOMER INFORMATION The Company's transaction system contains personal information and buying habits of individual customers. Per the Company's Privacy Statement, this data is not shared with anyone outside of the Company. Customer information is not given to Authors as this would be a violation of the Company's Privacy Statement. XV. CLAUSES REGARDING THE HANDLING OF SALES DATA The Company's transaction system contains sales data regarding the purchase of Works. The Company owns this data. The Company shares this data with the Author in the form of royalty reports. When the Company shares this data as royalty reports, it provides the date, time, and amount for each sales transaction for a Work. The Company does not distribute customer contact information to Authors. This is done to assure the Company is complying with its own Privacy Statement, which states that it will not share data that contains the information and buying habits of individual customers with outside parties. The Company's automated system compiles weekly sales reports that provide the list of best sellers on the Company's homepage. While any book may be eligible for listing as a best seller, based on sales, the number of sales are not divulged to anyone other than the officers of the Company. XVI. CLAUSES REGARDING THE AVAILABILITY OF WORKS FOR SALE The Company shall make all reasonable efforts to keep its Web sites and publishing structure viable at all times. Temporary lapses in the site's presence on the Internet or World Wide Web occurring through natural or technical causes do not constitute an exhaustion of edition. The company can not be held responsible for any loss of sales due to website errors or downtime or World Wide Web or electronic transmission problems. The Company's printer currently has three separate POD printing facilities. The Work shall not be deemed "out-of-print" for as long as its presence remains in the Company's sales channels, unless any agreed to time limits have been reached without renewal by both the Company and the Author. However, Author and/or the Company may terminate this agreement at any time for any reason. The Company will be dismissed from its obligations in this contract if events occur outside of the Company's control, including natural disaster, acts of God, fire, power or other service outages at the Company and/or the printer's facility, or labor problems at the printer's and/or distributor's facility. Should any type of service interference occur, the Company will notify all authors and provide a good faith estimate as to when the problems will be resolved. XVII. CLAUSES REGARDING THE OWNERSHIP OF FILES The Company does not take rights from authors. Authors own the rights to files created by The Company. However: If your cover/interior is/was designed by Todd Engel: Booklocker hereby absolutely and unconditionally sells, assigns, conveys, and transfers all right, title, and interest in the Cover Design to Author, effective as of the date hereof. As used herein, "Cover Design/Interior Design" is defined as pictorial drawings, compositions, or other manifestations of book covers and/or interior book designs created for or on behalf of Author on or after the Effective Date of this Agreement. If the Cover Design/Interior Design incorporates or otherwise makes use of any separately copyrighted stock art or stock photographs, the sale, assignment, conveyance, and transfer of all right, title, and interest in the Cover Design does not convey any ownership of copyright in said underlying stock art or stock photographs, and any rights in and to said stock art or stock photographs are expressly limited to their use in the Cover Design/Interior Design and said stock art or stock photographs may not be used in any way apart from the Cover Design/Interior Design. If your cover design/interior design is/was designed by another designer: You need to check with that designer concerning your rights. The Company STRONGLY advises authors to have work-for-hire agreements signed by any freelancer working on your book's interior or cover before hiring them so the author can use that work in perpetuity without fear of copyright infringment accusations from disgruntled ex-designers. A sample work-for-hire agreement can be found here: http://www.creativebusiness.com/pdf_free/CBworkforhire.pdf XVIII. GENERAL CLAUSES The Company will not enter into a business relationship with an author or company that competes, either directly or indirectly, with Booklocker.com. The Company shares sensitive, strategic information with authors. To share this information with individuals and firms who may have the opportunity to use this information in competition with Booklocker would, of course, be a bad business decision. The contract of any Author who lists their book with Booklocker.com and then begins to compete with the Company, either directly or indirectly, is subject to termination. If Booklocker determines, at its sole discretion and at any time, that an author or firm is considered a competitor, the company will immediately terminate its contract with that individual or firm. Printing costs and other fees do increase occasionally and without prior notice. All prices and fees discussed in this contract are subject to change without notice. The Company may at any time sell itself, or the majority of self, its holdings, licenses or grants. Current contracts would transfer to the new owner. If the Company is legally judged bankrupt or liquidates its business, this Agreement shall be effectively terminated and all rights granted to the Company shall be terminated. The Company will only be responsible to the Author for the unpaid royalties at the time of insolvency. For POD books, if the Company's printer is legally judged bankrupt, liquidates its business, or discontinues offering their services to the Company for any reason, or if the Company terminates its relationship with the printer, this Agreement for POD books shall be effectively terminated and all rights granted to the Company shall be terminated. The Company will only be responsible to the Author for the unpaid royalties at the time of insolvency. During the course of this contract and beyond, the Author may receive information relating to the Company and related entities that is not known to the general public ("Confidential Information"). Confidential Information includes, without limitation, information relating to sales consummated. The Author agrees that: 1.) all Confidential Information will remain the Company's exclusive property; 2.) the Author will use Confidential Information only as is reasonably necessary for the relationship with the Company; and 3.) the Author will not disclose Confidential Information to any individual, company, or other third party. The Company may amend any of the terms and conditions contained in this Agreement at any time and solely at its discretion. Any changes will be effective upon posting of the revisions on the Internet. The Author is responsible for reviewing the notice and any applicable changes. The Company will make every effort to contact the Author if this agreement changes, but the Company cannot be held responsible for electronic transmission problems. Changes to this agreement, however, may be posted without notice to the Author. THE AUTHOR'S CONTINUED PARTICIPATION IN THE COMPANY'S PROGRAMS AFTER THE COMPANY'S POSTING OF ANY CHANGES WILL CONSTITUTE THE AUTHOR'S ACCEPTANCE OF SUCH CHANGES OR MODIFICATIONS. IF THE AUTHOR DOES NOT AGREE TO ANY CHANGES TO THIS AGREEMENT, THE AUTHOR MUST TERMINATE THIS AGREEMENT. This Agreement will be governed by the laws of the United States of America and the state of Maine, without reference to rules governing choice of laws. Any action relating to this Agreement must be brought in the federal or state courts located in Bangor, Maine and you irrevocably consent to the jurisdiction of such courts. You may not assign this Agreement, by operation of law or otherwise, without the Company's prior written consent. Subject to that restriction, this Agreement will be binding on, inure to, and be enforceable against the parties and their respective successors and assigns. The Company's failure to enforce your strict performance of any provision of this Agreement will not constitute a waiver of our right to enforce such provision or any other provision of this Agreement subsequently. Any notice or other communication under this Agreement will be given in writing and will be delivered by e-mail. The parties agreed that except as specifically provided herein, all disputes arising under this Agreement shall be settled by binding arbitration in Bangor, Maine and submitted to the American Arbitration Association for final disposition. I HAVE READ AND UNDERSTAND THE AGREEMENT BETWEEN MYSELF AND THE COMPANY AND AGREE TO ALL TERMS AND CONDITIONS LISTED HEREIN.