Ad or other Media Agency Agreement
This
Agency Agreement ("Agreement") is made and effective this
_________________ (Date), by and between ("Agency") and
_______________________ (Your Firm) (“Media User”).
Agency
is in the business of providing media agency services for a fee.
Media
User desires to engage Agency to render, and Agency desires to render to Media
User, certain Agency services, all as set forth.
NOW,
THEREFORE, in consideration of the mutual agreements and covenants herein
contained,
the parties hereto agree as follows:
1. Engagement.
Media
User engages Agency to render, and Agency agrees to render to Media User,
services in connection with Media User's planning, preparing and placing of
advertising and other media services for certain of Media User's products as
follows:
______________________________________________________________________
A.
Analyze Media User's current and proposed products and services and
presentations and potential markets.
B. Create, prepare and submit to Media User for
its prior approval advertising ideas, media suggestions, and other such related
programs.
C. Prepare and submit to Media User for its
prior approval estimates of costs and expenses associated with proposed
advertising ideas and programs prior to any such implementation or financial
commitment.
D. Design and prepare, or arrange for the
design and preparation of advertisements, public relations, and other such
materials.
E. Perform
such other services as Media User may request from time to time such as, but
not limited to, direct mail ad preparations, speech writing, publicity and
public relations work, market research and analysis, and other similar and
related activities.
F. Order advertising space, time or
other means to be used for publication of Media User's advertisements, at all
times endeavoring to secure the most efficient and advantageous rates
available. All such activities to be
approved in advance by the Media User unless otherwise written and stipulated.
G. Proof for accuracy and completeness of
insertions, displays, broadcasts, or other forms of advertisements.
H.
Audit invoices for proper and agreed upon space, time, material preparation and
charges.
2.
Products.
Agency's
engagement shall relate to the following products and services of Media User:
______________________________________________________________________.
3.
Exclusivity.
Agency
shall be the Agency in the United States and worldwide for Media User with
respect to the products described in Section 2 above, unless otherwise
specified in this section:
______________________________________________________________________.
4. Compensation.
A. Agency shall receive an amount equal to
___ percentage of the gross charges levied by media for advertising placed by
Agency pursuant to this Agreement; and
after volume discount, of the charges of suppliers of services or
properties, such as finished art, comprehensive layouts, type composition,
photostats, engravings, printing, radio and television programs, talent,
literary, dramatic and musical works, records and exhibits, purchased by Agency
on Media User's authorization during the term of this Agreement; provided
that: No percentage will be added to
Agency charges for packing, shipping, express, postage, telephone, telex, fax,
travel expenses and other out of pocket expenses of Agency personnel.
B. For those items where Agency is not
compensated on a commission basis, Media User shall pay Agency on an hourly
basis for services provided hereunder.
The rate will be determined by the type of services provided and the
person or persons providing such services, but in no event shall the rate
exceed ________ per hour. Media User may
elect in advance to be charged on this hourly rate basis. If Media User fails to notify Agency of its
choice, it shall be presumed that Media User elected to be charged on a
percentage basis.
C. In the event that Agency undertakes, at
Media User's request subject to Media User's prior approval, special projects
such as those described in Section I.F above, Agency shall prepare an estimate
of total charges for any such special project in advance, including any charges
for materials or services purchased from outside vendors. In the event that Media User elects to
proceed with the special project based upon Agency's estimated cost, Agency
shall perform the services with respect to such special project at its
estimated cost, subject to modification as mutually agreed by the parties.
D.
For any special project or other services provided by Agency pursuant to this
Agreement upon which the parties have not agreed as to charges, Media User
shall pay
Agency
at its regular percentage rates, as stated in Section 4.A above.
E. Media User shall not be obligated to
reimburse Agency for any travel or other out-of-pocket expenses incurred in
the performance of services pursuant to this Agreement unless expressly agreed
by Media User in advance.
5.
Billing.
A. Agency shall invoice Media User for all
media costs where possible in advance of Agency's payment date to allow for
prepayment by the Media User so that Media User may receive the benefit of any
available prepayment or similar discount.
For any media purchase or service for which Agency is not entitled to a
commission, Agency shall ensure that the charges to Media User are net of all
agency commissions and discounts.
B. Charges for production materials and
services shall be billed by Agency upon completion of the production job or, if
cash discounts are available, upon receipt of the supplier's invoice.
C.
On all outside purchases other than for media, Agency shall attach to the
invoice evidence of the supplier's charges.
D. All cash discounts on Agency's purchases
including, but not limited to, media, art, printing and mechanical work, shall
be available to Media User, provided that Media User meets Agency's requisite
billing terms and there is no outstanding undisputed indebtedness of Media User
to Agency at the time of the payment to the supplier.
E.
Rate or billing adjustments shall be credited or charged to Media User on the
next regular invoice date or as soon thereafter as otherwise practical.
F.
Invoices shall be submitted in an itemized format and shall be paid by Media
User within sixty (60) days of the invoice date.
6. Competitors.
During
the term of this Agreement, Agency shall not accept employment from, render
services to, represent or otherwise be affiliated with any person, firm,
corporation or entity in connection with any product or service directly or
indirectly competitive with or similar to any product or service of Media User
with respect to which the Agency is providing any service pursuant to this
Agreement, without the advance approval of the Media User. Media User shall not unreasonably withhold
this approval.
7.
Cost Estimates.
Agency shall not initiate billable
work on any project pursuant to this Agreement without first estimating costs
for preparation, including copy, service, layout, art, engraving, typography,
processing, paste up and production.
After determining the estimated cost, completion of the work shall be
subject to Media User's prior approval.
8.
Audit Rights.
Agency
agrees that following reasonable prior notice any and all contracts,
agreements, correspondence, books, accounts and other information relating to
Media User's business or this Agreement shall be available for inspection by
Media User and Media User's outside accountants, at Media User's expense and
during the normal business hours of the Agency.
9.Ownership and Use.
A. Agency shall insure, to the fullest
extent possible under law, that Media User shall own all right, title and
interest in and to, including copyrights, trade secret, patent and other
intellectual property rights, with respect to any copy, photograph,
advertisement, music, lyrics, video, or other work or thing created by Agency
or at Agency's direction for Media User pursuant to this Agreement and utilized
by Media User.
B. Upon termination, Media User agrees
that any advertising, merchandising, package, plan or idea prepared by Agency
and submitted to Media User (whether submitted separately or in conjunction
with or as a part of other material) which Media User has elected not to
utilize, shall remain the property of Agency, unless Media User has paid Agency
for its services in preparing such item.
Media User agrees to return to Agency any copy, artwork, plates or other
physical embodiment of such creative work relating to any such idea or plan
which may be in Media User's possession at termination or expiration of this
Agreement. Notwithstanding this, Media
User has the unconditional right to pay for any of these materials or
activities at the rate agreed upon in this Agreement and thereby these materials
and activities would fall under the Section 9.A ownership and use rights
accruing to Media User.
C. Materials and advertisements created by
Agency pursuant to this Agreement may be used by Media User outside the United
States without additional compensation, provided that Media User shall be
responsible for any additional expense associated with such use, such as
charges for translation and amounts due talent.
IO.
Indemnification and Insurance.
A. Agency shall indemnify and hold Media
User harmless with respect to any claims, loss, suit, liability or judgment
suffered by Media User, including reasonable attorney's fees and costs, based
upon or related to any item prepared by Agency or at Agency's direction,
including, but not limited to, any claim of libel, slander, piracy, plagiarism,
invasion of privacy, or infringement of copyright or other intellectual
property interest, except where any such claim arises out of material supplied
by Media User and incorporated into any materials or advertisement prepared by
Agency. Agency agrees to procure and
maintain in force during the term of this Agreement, at Agency's expense, an
Agency liability policy or policies having a minimum limit of at least
______________, naming Media User as an additional insured and loss payee under
such policy or policies.
B. Media User agrees to indemnify and hold
Agency harmless with respect to any claims, loss, liability, damage or judgment
suffered by Agency, including reasonable attorney's fees and court costs, which
results from the use by Agency of any material furnished by Media User or where
material created by Agency or at the direction of Agency subject to the
indemnification in subsection A. above is materially changed by Media User.
Information or data obtained by Agency from Media User to substantiate claims
made in advertising shall be deemed to be "material furnished by Media
User to Agency."
C. In the event of any proceeding,
litigation or suit against Media User by any regulatory agency or in the
event of any court action or other proceeding challenging any advertising
prepared by Agency, Agency shall assist in the preparation of the defense of
such action or proceeding and cooperate with Media User and Media User's
attorneys.
11.
Term.
The term of this Agreement shall
commence on _____________ and shall
continue in full force and effect until terminated by either party upon at
least sixty (60) days prior written notice, provided that in no event (except
breach) may this Agreement be terminated prior to __________. The rights,
duties and obligations of the parties shall continue in full force during or
following the period of the termination notice until termination, including the
ordering and billing of advertising in media whose closing dates follow then
such period.
12. Rights Upon
Termination.
A. Upon termination of the Agreement,
Agency shall transfer, assign and make available to Media User all property and
materials in Agency's possession or subject to Agency's control that are the
property of Media User, subject to payment in full of amounts due pursuant to
this Agreement.
B. Upon termination, Agency agrees to
provide reasonable cooperation in arranging for the transfer or approval of
third party's interest in all contracts, agreements and other arrangements with
advertising media, suppliers, talent and others not then utilized, and all
rights and claims thereto and therein, following appropriate release from the
obligations therein.
13.
Default.
In the event of any default of any
material obligation by or owed by a party pursuant to this Agreement, then the
other party may provide written notice of such default and if such default is
not cured within ten (IO) days of the written notice, then the nondefaulting
party may terminate this Agreement. In
addition, the only damages collectible by Agency shall be the exact amounts
due; no other damages, for any reason whatsoever, may be assessed against Media
User including, but limited to, punitive damages and unreasonable termination
charges, and any other such claim. This
provision shall be broadly interpreted in the favor of the Media User by any
Court of competent jurisdiction.
14.
Notices.
Any notice required by this
Agreement or given in connection with it, shall be in writing and shall be
given to the appropriate party by personal delivery or by postage prepaid, or
recognized overnight delivery services such as Federal Express.
If
to Media User: _______________________
_______________________
If
to Agency: _______________________
_______________________
15.
Headings in this Agreement.
The
headings in this Agreement are for convenience only, confirm no rights or
obligations in either party, and do not alter any terms of this Agreement.
16.
Entirety of Agreement.
The terms and conditions set forth
herein constitute the entire agreement between the parties and supersede any
communications or previous agreements with respect to the subject matter of
this Agreement. There are no written or
oral understandings directly or indirectly related to this Agreement that are
not set forth herein. No change can be
made to this Agreement other than in writing and signed by both parties.
17.
Governing Law.
This
Agreement shall be construed and enforced according to the laws of the State of
________________ and any dispute under this Agreement must be brought in this
venue and in no other.
In
Witness whereof, the parties have executed this Agreement as of the date first
written above.
________________________ ____________________________
Agency Media
User
Ad or Media Agency Agreement
Review List
This
review list is provided to inform you about the document in question and to
assist you in completing it.
1.
This
Agreement is primarily of benefit to the Agency. As a result, you as the Media User should be
able to exact substantially better terms for your company in return for making
this medium or long-term agreement.
Favorable terms should apply to getting as many extra services at no or
minimal charges, as well as negotiating a favorable hourly or percentage rate. You should review this exercise as no
different than in negotiating terms with any outside vendor when
predictability, volume, and a long-term agreement are of substantial value to
them with all of their customers.
2.
If
you can not obtain favorable terms, you should consider tabling the Agreement
other than to assure that all materials involving them are out rightly owned by
your company with no further payments due them.
This Agreement has provisions that apply to this concern and can be
extracted from it for your firm’s benefit.
3.
Each
party should review the terms of the Agency Agreement to make sure you are both
comfortable with all of the provisions, particularly concerning:
Agency's dealings with other companies
Media User’s dealings with other agencies
Ownership of advertisements and other materials
- As a practical matter, print at least two copies and have them signed in the original so both parties have an original for their records.
- Laws do vary somewhat from state to stat and are modified by both statute and legal precedent over time. This is always a good reason to have a lawyer review any agreement, including this one, for hidden problems.
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