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Since 15 May 2001
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Affiliates Program Agreement

This Agreement contains the complete terms and conditions that apply to your participation in the gifts.com Affiliates Network, and the establishment of links from your Web site to the gifts.com Web site. As used in this agreement, "you" means (and "your" refers to) the applicant seeking to participate hereunder in the Affiliate Network, "we" means (and "us", "our" and "ours" refer to) gifts.com, a division of gifts.com, Inc., and "Product" means any and all items offered for sale by us on the gifts.com Web site.

THIS IS A LEGAL AGREEMENT BETWEEN YOU AND GIFTS.COM. BY CLICKING ON THE "APPLY" BUTTON AT THE END OF THIS OPERATING AGREEMENT, YOU AGREE THAT (a) YOU HAVE READ THIS AGREEMENT AND UNDERSTAND ALL OF ITS CONTENTS AND (b) YOU WILL BE BOUND BY ALL OF THE TERMS AND CONDITIONS IN THIS AGREEMENT.

1 Enrollment in the Network
To begin the enrollment process, you will submit a complete Affiliate Network Application via our Web site. We will evaluate your application in good faith and will notify you of your acceptance or rejection. We may reject your application if we determine, in our sole discretion, that your site is unsuitable for the Affiliate Network for any reason, including, but not limited to, if your site: incorporates images or content that is in any way unlawful, harmful, threatening, defamatory, obscene, harassing or racially, ethically or otherwise objectionable such as sites that: depict sexually explicit images; promote violence; promote discrimination based on race, sex, religion, nationality, disability, sexual orientation, or age; promote illegal activities or incorporates any materials which infringe or assist others to infringe on any copyright, trademark or other intellectual property rights (collectively "Content Restrictions").

2 Promotion of our Affiliate Relationship
As an Affiliate Site, we will make available to you (via gifts.reporting.net) banner advertisements, button links to our site and/or text links to our site, containing, the gifts.com logo and words identifying the products or promotions on our site (each of these links sometimes being referred to herein as "Links" or, individually, as a "Link"), which, subject to the terms and conditions hereof, you may display as often and in as many areas on your site as you desire. The Links will serve to identify your site as a member of our Affiliate Network and will establish a link from your site to ours.

3 Utilizing our Links on Your Site
In utilizing the Links, you agree that you will cooperate fully with us in order to establish and maintain such Links. All Affiliate Sites shall display such graphic images prominently throughout your site as you see fit and with our consent. You shall not alter, modify or expand the Links in any way; however, a Link may be modified and/or expanded with our written consent. Each Link connecting users of your site to our site will in no way alter the look, feel, or functionality of our site. We have the right, in our sole discretion, to monitor your site at any time and from time to time to determine if you are in compliance with the terms of this Agreement.

4 Order Processing
We will be responsible for providing all information necessary to allow you to make appropriate Links from your site to our site; however, all Links must be approved by us. We will process orders placed by customers who follow the Links from your site to the gifts.com site. We reserve the right to reject orders that do not comply with certain requirements, which we periodically may establish. We will be solely responsible for all aspects of order processing and fulfillment, including order entry, payment processing, shipping, cancellations, returns and related customer service. We will track the volume and amount of sales generated by your site and will make unaudited reports summarizing this sales activity available to you through our site. The form, content, and frequency of the reports may vary from time to time at our discretion. To permit accurate tracking, reporting, and fee accrual, you must ensure that the Links between your site and our site are properly formatted.

5 Commission Determination
Subject to the terms and conditions of this Agreement, we will pay you referral fees on all product sales to third parties. For a product sale to generate a commission, the customer must follow a link from your Web site to the gifts.com Web site, purchase a product using our automated ordering system, accept delivery of the product at the shipping destination, and remit full payment to us. Commission on returned products and refunds will be deducted from your next quarterly payment.

6 Commission Rates
Commission rates will be based on the amount actually paid to us for purchases, excluding amounts collected by us for sales taxes shipping, handling and similar charges, amounts due to credit card fraud and bad debt, and credits for returned goods ("Net Sales"). The Commisions Rate is subject to change at any time or from time to time, in our sole and absolute discretion. You will be notified of any change in the Commission Rate.

7 Commission Payment
We will pay your commissions on a calendar month basis. Approximately 30 days following the end of each calendar month, we will send you a check for the commissions earned on Net Sales of Product that we shipped during that quarter, less any taxes that we are required by law to withhold. However, if the commissions payable to you for any quarter are less than $50.00, we will hold those commissions until the total amount due is at least equal to $50.00.

8 Policies and Pricing
Customers who buy Products through the Affiliate Network will be deemed to be customers of gifts.com. Accordingly, all gifts.com rules, policies, and operating procedures concerning customer orders, customer service, and sales will apply to those customers. We may change our policies and operating procedures at any time. For example, we will determine the prices to be charged for Products sold under the Affiliate Network in accordance with our own pricing policies. Product prices and availability may vary from time to time. Because price changes may affect items that you already have listed on your site, you may not include price information in your descriptions. We will use commercially reasonable efforts to present accurate information, but we cannot guarantee the availability or price of any particular Product.

9 Non-Exclusive Limited License and Use of gifts.com Logos and Trademarks
We grant you a non-exclusive, non-transferable, revocable right to access our site through links solely in accordance with the terms of this Agreement, and solely in connection with such links, to use our logos, trade names, trademarks and similar identifying material (collectively "Licensed Material") solely for the purpose of selling Products on your site for gifts.com. You may not alter, modify or change the Licensed Material in any way. You are only entitled to use the Licensed Material to the extent you are a member, in good standing, of the Affiliate Network.

You shall not make any specific use of any Licensed Material for purposes other than selling Products for gifts.com, without first submitting a sample of such use to us and obtaining our prior written consent. You agree not to use the Licensed Material in any manner that is disparaging or that otherwise portrays gifts.com in a negative light. We reserve all of our rights in the Licensed Material, and all other intellectual property rights. We may revoke the rights granted to you pursuant to this section at any time by giving you written notice. You shall obtain no rights in and to the Licensed Material. The rights granted to you pursuant to this section shall terminate upon the effective date of the expiration or termination of this Agreement.

10 Non-Exclusive Limited License and Use of Affiliates Logos and Trademarks
You grant to us a non-exclusive license to utilize your names, titles, logos, and trademarks (collectively the "Affiliate Marks"), and to advertise, market, promote, and publicize in any manner our rights hereunder; provided, that we shall not be required to so advertise, market, promote, or publicize. You hereby represent and warrant that you are the sole and exclusive owner of the Affiliate Marks and have the right and power to grant to us the license to use same in the manner contemplated herein, and such grant does not or will not breach, conflict with, or constitute a default under any agreement or other instrument applicable to you or binding upon you; or infringe upon any trademark, trade name, service mark, copyright, or other proprietary right of any other person or entity. This license shall terminate upon the effective date of the expiration or termination of this Agreement.

11 Obligations Regarding Your Site
You will be solely responsible for the development, operation, and maintenance of your site and for all materials that appear on your site. You hereby represent and warrant to us that materials posted on your site do not violate or infringe upon the rights of any third party, and that materials posted on your site are not libelous or otherwise illegal. We disclaim all liability for all such matters. Further, you will indemnify and hold us harmless from all claims, damages, and expenses relating to the development, operation, maintenance, and contents of your site.

12 Term of the Agreement
The term of this Agreement will begin upon our acceptance of your Affiliate Network Application and will end when terminated by either party. Either party may terminate this Agreement at any time, with or without cause, by giving the other party notice of termination. You are only eligible to earn a commission on sales occurring during the term of the Agreement, and commissions earned through the date of termination will remain payable only if the related orders are not cancelled or returned. We reserve the right to withhold your final payment for a reasonable time to ensure that the correct amount is paid.

13 Modification
We may modify any of the terms and conditions contained in this Agreement, at any time and in our sole discretion. Notice of any change by e-mail, to your address on our records, or the posting on our site of a change notice or a new agreement, is considered sufficient notice to you of a modification to the terms and conditions of this Agreement. Modifications may include, but are not limited to, changes in the scope of available commission fees, commission schedules, payment procedures, and Affiliate Network rules. If any modification is unacceptable to you, your recourse is to terminate this Agreement. Your continued participation in the Affiliate Network following our posting of a change notice or a new agreement on our site will constitute binding acceptance of the change. Except for any such modifications, this agreement constitutes the sole and entire agreement of the parties.

14 Relationship of Parties
You and gifts.com are independent contractors, and nothing in this Agreement will create any partnership, joint venture, agency, franchise, sales representative, or employment relationship between the parties. You will have no authority to make or accept any offers or representations on our behalf. You will not make any statement, whether on your site or otherwise, that reasonably would contradict anything in this section.

15 Disclaimers
We make no express or implied warranties or representations with respect to the Affiliate Network or any Product or other items sold through the Affiliate Network (including, without limitation, warranties of fitness, merchantability, non-infringement, or any implied warranties arising out of course of performance, dealing, or trade usage). In addition, we make no representation that the operation of our site will be uninterrupted or error-free, and we will not be liable for the consequences of any interruptions or errors.

16 Representations and Warranties You hereby represent and warrant to us as follows:
a. This Agreement has been duly and validly executed and delivered by you and constitutes your legal, valid, and binding obligation, enforceable against you in accordance with its terms. b. The execution, delivery, and performance by you of this Agreement and the consummation by you of the transactions contemplated hereby will not, with or without the giving of notice, the lapse of time, or both, conflict with or violate: any provision of law, rule, or regulation to which you are subject; any order, judgment, or decree applicable to you or binding upon your assets or properties; any provision of your by-laws or certificate of incorporation, or any agreement or other instrument applicable to you or binding upon your assets or properties. c. No consent, approval, or authorization of, or exemption by, or filing with, any governmental authority or any third party is required to be obtained or made by you in connection with the execution, delivery, and performance of this Agreement or the taking by you of any other action discussed herein. d. There is no pending or, to the best of your knowledge, threatened claim, action, or proceeding against you, or any affiliate of yours, with respect to the execution, delivery, or consummation of this Agreement, or with respect to your trademarks, and, to the best of your knowledge, there is no basis for any such claim, action or proceeding.

17 Confidentiality
Except as otherwise provided in this Agreement or with the consent of the other party hereto, each of the parties hereto agrees that all information including, without limitation, the terms of this Agreement, business and financial information, customer and vendor lists, and pricing and sales information, concerning us or you, respectively, or any of our affiliates provided by or on behalf of any of them shall remain strictly confidential and secret and shall not be utilized, directly or indirectly, by such party for its own business purposes or for any other purpose except and solely to the extent that any such information is generally known or available to the public through a source or sources other than such party hereto or its affiliates. Notwithstanding the foregoing, each party is hereby authorized to deliver a copy of any such information (a) to any person pursuant to a subpoena issued by any court or administrative agency, (b) to its accountants, attorneys, or other agents on a confidential basis, and (c) otherwise as required by applicable law, rule, regulation, or legal process including, without limitation, the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, and the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

18 Limitations of Liability
We will not be liable for indirect, special, or consequential damages, or any loss of revenue, profits, or data, arising in connection with this Agreement or the Affiliate Network, even if we have been advised of the possibility of such damages. Further, our aggregate liability arising with respect to this Agreement and the Affiliate Network will not exceed the total commission fees paid or payable to you under this Agreement.

19 Indemnification
You hereby agree to indemnify, defend, and hold harmless gifts.com and its subsidiaries and affiliates, and their directors, officers, employees, agents, shareholders, partners, members, and other owners, against any and all claims, actions, demands, liabilities, losses, damages, judgements, settlements, costs, and expenses (including reasonable attorneys' fees) (any or all of the foregoing hereinafter referred to as "Losses") insofar as such Losses (or actions in respect thereof) arise out of or are based on (a) any claim that our use of the Affiliate Marks infringes on any trademark, trade name, service mark, copyright, license, intellectual property, or another proprietary right of any third party, (b) any misrepresentation or alleged breach of a representation or warranty or alleged breach of a covenant and agreement made by you herein, or (c) any claim related to your site including, without limitation, content therein not attributable to us.

20 Independent Investigation
YOU ACKNOWLEDGE THAT YOU HAVE READ THIS AGREEMENT AND AGREE TO ALL ITS TERMS AND CONDITIONS. YOU UNDERSTAND THAT WE MAY AT ANY TIME (DIRECTLY OR INDIRECTLY) SOLICIT CUSTOMER REFERRALS ON TERMS THAT MAY DIFFER FROM THOSE CONTAINED IN THIS AGREEMENT OR OPERATE WEB SITES THAT ARE SIMILAR TO OR COMPETE WITH YOUR WEB SITE. YOU HAVE INDEPENDENTLY EVALUATED THE DESIRABILITY OF PARTICIPATING IN THE AFFILIATE NETWORK AND ARE NOT RELYING ON ANY REPRESENTATION, GUARANTEE, OR STATEMENT OTHER THAN AS SET FORTH IN THIS AGREEMENT.

21 Governing Law
This Agreement will be governed by the laws of the United States and the state of New York, 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 New York and you irrevocably consent to the jurisdiction of such courts. You may not assign this Agreement, by operation of law or otherwise, without our prior written consent. Any purported assignment in violation hereof shall be null and void. Subject to that restriction, this Agreement will be binding on and enforceable against the parties and their respective successors and assigns. Our failure to enforce your strict performance of any provision of this Agreement will not constitute a waiver of our right to subsequently enforce such a provision or any other provision of this Agreement.

 
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