KOBO WRITING LIFE INDEPENDENT PUBLISHERS PROGRAM TERMS & CONDITIONS LAST UPDATED: [Aug 2, 2012]

These Terms are a binding agreement between Kobo Inc. (together with its affiliates [where “affiliates” means any entity that directly or indirectly controls, is controlled by, or is under common control with Kobo Inc.], “Kobo”, “we” or “us”) and the individual identified in the Contact Information Form for Kobo Writing Life (“you” or “Publisher”) with respect to your participation in Kobo Writing Life, a “do it yourself” digital publishing service program from Kobo, for the publishing of written works provided in electronic format that shares in likeness what commonly defines the traditional conception of a book or whole novel as produced by a publisher for print (“eBook”). Kobo’s Terms of Use, Privacy Policy and Content Policy are a key part of these Terms and are also binding on you. If Publisher is a corporate entity or another individual, the individual that accepts these Terms on behalf of Publisher guarantees to Kobo that they are authorized to do so and are able to bind Publisher to these Terms. Your acceptance of these Terms is enforceable against you and/or the entity or person that you represent when you agree to these Terms, and you may not use Kobo Writing Life unless you agree to the Terms.

SECTION 1. AMENDMENTS AND SECURITY.

1.1 Changes to these Terms. Kobo reserves the right, at its sole discretion, to change, modify, add, or delete portions of these Terms at any time as set out herein. These Terms (except rights and fees terms) may be changed unilaterally by Kobo from time to time by posting such changes on our website, and such changes shall become effective once you use Kobo Writing Life following such posting (which use shall be deemed conclusively to indicate acceptance of such changes). Changes to those sections of these Terms relating to rights and fees will be effective and binding on you either 30 days after posting or on the date you (i) expressly accept the changed Terms or (b) make additional Works available to Kobo via Kobo Writing Life.

YOU ALWAYS HAVE THE RIGHT TO CEASE YOUR PARTICIPTION IN KOBO WRITING LIFE AND WITHDRAW YOUR WORKS FROM SALE AT ANY TIME IF THE TERMS ARE NOT ACCEPTABLE TO YOU.

1.2 Security. In order to participate in Kobo Writing Life, you must be at least 18 years old or the legal age of majority in your place of residence and have an active and valid Kobo Writing Life account. When you create your Kobo Writing Life account, you must provide us with accurate and complete information. Please be sure to provide us with up to date contact information for you so we know how to reach you. We encourage you to use “strong” passwords (passwords that use a combination of upper and lower case letters, numbers and symbols) with your account. You are solely responsible for the activity that occurs on your account, and you agree to keep your account login and password secure. You must immediately notify Kobo of any compromise of your credentials you become aware of and any unauthorized use of your account. You may have only one Kobo Writing Life account at a time.

SECTION 2. PARTICIPATION IN KOBO WRITING LIFE.

2.1 Delivery. During the period that you participate in Kobo Writing Life, Publisher shall provide Kobo with novels, short stories, articles or chapters (“Works”) and the associated metadata from time to time, and Kobo may make such Works available to Kobo’s end users who have registered for an account on Kobo’s eReading Service (“Users”) through the eReading Service in accordance with the terms set out in these Terms. You are responsible for ensuring the accuracy of the Works (and their compliance with our Content Terms and Terms of Use) and metadata and you will notify us promptly of any errors.

2.2 Rights. You authorize Kobo and grant Kobo all necessary rights and license to distribute, transmit electronically and sell your Works that have been converted to eBook format by you or by us to Users within the territories specified by you for such Works. As used in these Terms, “eReading Service” means the online service offered by Kobo that provides Users with access to discover, read and purchase eBooks through multiple interfaces including Kobo’s website, mobile applications, dedicated ereading devices, web applications or “widgets”, and other Kobo applications. Without restricting the generality of the foregoing, Kobo may:

2.3 Ownership. As between you and Kobo, Kobo expressly acknowledges that you own or are licensor to all right, title and interest in and to the Works. All rights in the Works not expressly granted hereunder are reserved by Publisher. Publisher acknowledges that Kobo owns all right, title and interest in and to the eReading Service, including all intellectual property rights therein, where “intellectual property rights” means all rights arising from or in respect of the following, whether protected, created or arising under the laws of Canada, the United States or any other jurisdiction: (i) business names, trade names, registered and unregistered trade-marks and service marks; (ii) patents; (iii) copyrights, copyright registrations, writings and other copyrightable works of authorship, including computer programs, databases and documentation therefore; and (iv) proprietary and non-public business information including trade secrets, know-how, inventions, discoveries, improvements, concepts, ideas, methods, processes, designs, formulae, technical data, drawings, specifications, research and development information and other proprietary and non-public information. Kobo’s rights are protected by U.S., Canadian and international intellectual property laws.

2.4 Territorial Rights. The territory of the rights and license granted in these Terms are worldwide, except that Publisher may expressly identify and limit Kobo’s territorial rights for each of the Works. Kobo shall make commercially reasonable efforts to limit access to each Publisher Work offered as an eBook through the eReading Service to User accounts from the specific geographic territory(ies) identified by Publisher, if any.

2.5 Digital Rights Management. At your request, the Works will be rendered on the eReading Service in a manner that prevents Users from copying and printing the content of the Works. If this option is enabled, the eReading Service may still allow the copying of short quotes not to exceed 600 characters to allow the User to share short passages via a social media tool (e.g. Twitter, Facebook, etc). All versions of the eReading Service use advanced security methods to protect the content in transit, and locally, by employing encryption and hash algorithms. We will respond promptly to your requests for information about any alleged copyright infringement or other unauthorised use of the Works.

SECTION 3. TERM AND TERMINATION.

The term of these Terms shall commence as of the date you accept them and shall continue until terminated by you or by us. We may (i) terminate or suspend these Terms and your access to Kobo Writing Life at any time, provided that we will notify you promptly after such termination at the email address we have on file and (ii) temporarily remove or suspend any of your Works from sale at any time for any reason or no reason. You may suspend or terminate your participation in Kobo Writing Life and request withdrawal of your Works from sale at any time by giving us at least 10 days written notice. Upon termination of these Terms, and except as otherwise provided in these Terms, Kobo shall immediately cease selling or otherwise distributing all of your Works, provided that Kobo may maintain archival copies of the Works solely to permit any authorized continuing access by any User who has purchased a copy of such Works via the eReading Service prior to the termination of these Terms, provided that such continuing access is not in violation of any legal mandate and that we will continue to protect your Works from theft, unauthorized access, copying or retransmission, infringement, unauthorized manipulation or any other misappropriation. Kobo shall delete all such archival or other copies of each of the Works at such time as it reasonably determines it has no continuing obligation to provide continuing access to the eBook based on such Works.

SECTION 4. PRICING, BILLING AND PAYMENTS

4.1. Retail Price and Standard Terms. You shall provide Kobo with the Suggested Retail Price (“SRP”) for the eBook, which shall be exclusive of any value-added, goods and service, sales or similar taxes (“Taxes”). Except where Publisher’s Works qualify to participate in the Independent Publisher Program (“IPP”) set out below, Kobo shall pay Publisher 45% of the SRP for each of Publisher’s eBooks sold (“Standard Terms”). Kobo shall, in its sole discretion, set the actual selling price paid by the User (“ASP”) for each Publisher eBook and may also display or add any Taxes to the ASP as separate items or included in the ASP.

4.2 IPP Terms. Kobo shall pay Publisher 70% of the SRP (“IPP Terms”) for the sale for each eBook sold for Publishers who meet the following criteria (collectively the “IPP Criteria”):

Kobo may, at its sole discretion, add to the IPP Territories or modify IPP Criteria from time to time in accordance with the terms set out herein. Any changes to IPP Terms or IPP Criteria will apply to all books provided by Publisher under the IPP.

4.3 Currency. Kobo may allow for the submission of SRP for multiple countries and in multiple currencies (“MSRP”) and Publisher may provide MSRP for all, one, or a combination of those options. However, you must choose a single currency in which you will be paid. If you do not wish to set a specific currency for SRP or MSRP, Kobo will default to a USD SRP (converted by us or set by you) as the baseline for the sale of your eBooks.

4.4 Taxes. Each Party shall pay on behalf of itself, in addition to any other amounts payable under these Terms, any sales, use, excise, value-added, services, consumption, personal property, gross receipts or any other similar taxes that may be levied or imposed by any taxing jurisdiction upon such Party by reason of the transactions contemplated under these Terms, including Taxes.

4.5 Reporting and Payment. Provided Publisher is not in breach of its obligations under these Terms, for each of your eBooks sold to a User Kobo will pay you the applicable amounts (i.e. under Standard Terms or IPP Terms), net of refunds, bad debt and Taxes. Kobo will make payment to Publisher and provide associated sales reporting on a monthly basis, with all payments and reports to be made within forty-five (45) days following the end of the applicable month. Kobo may accrue and withhold payments until the total amount due is $100. You are responsible for reviewing all sales reports relating to your Works. If you identify any errors or omissions in such reports, Kobo shall not be obligated to correct any such errors or omissions, or any resulting shortfalls, unless you provide written notice of such errors or omissions within six (6) months of receipt of the subject reports.

SECTION 5. REPRESENTATIONS, WARRANTIES AND INDEMNITIES

5.1 You represent, warrant and covenant to Kobo that (i) you have the rights, power and privileges to execute, deliver and perform your obligations under these Terms and the execution, delivery and performance of these Terms have been duly authorized by Publisher; (ii) you have all necessary rights to make the grant and assignment of rights Publisher has made to Kobo under these Terms and its submission of the Works hereunder and the use of the Works in the eReading Service does not violate any obligation Publisher owes to any third party or infringe upon the intellectual property rights of any person, including the author of the Works; (iii) you will be solely responsible for obtaining and paying for any and all necessary clearances, rights and licenses for the Works to permit the exercise of the rights granted under these Terms without any further obligation by us, including any payments due to any other copyright holders, co-authors and/co-administrators; (iv) the Works do not and will not infringe upon any common law or statutory right in any other literary, dramatic or other material and no material in the Works violates any intellectual property rights or any other proprietary rights of any person, firm or corporation and the Works contain no libellous or unlawful material or instructions that may cause harm to any person, firm or corporation; (v) Publisher’s trademarks, trade names, logos, designs, and icons do not infringe upon or violate any trademark or other intellectual property right of any other person, firm or corporation; and (vi) there is no outstanding claim or litigation pending against or involving the title, ownership and/or copyright in the Works, or in any part of it, or in the rights which are covered by these Terms.

5.2 Publisher agrees to defend, indemnify and hold harmless Kobo and its affiliates, and their respective officers, directors and employees, from and against any and all claims, demands, suits, actions, causes of action and/or liability, of any kind whatsoever, for damages, losses, costs and/or expenses (including legal fees and disbursements) resulting from: (i) damages to persons or property, personal injury or death caused by the negligent or willful acts or omissions of Publisher arising in connection with these Terms; (ii) any and all breaches by Publisher of any representations, warranties, covenants, terms or conditions of these Terms; and (iii) any claim Publisher in the performance of its commitments hereunder has infringed, violated or misappropriated any third party’s right, including, without limitation, any intellectual property right. Kobo may, at its own expense, participate in the defense and settlement of any claim or action with our own counsel.

SECTION 6. LIMITATION OF LIABILITY

KOBO WRITING LIFE IS PROVIDED “AS IS” AND KOBO DISCLAIMS, ANY REPRESENTATIONS, WARRANTIES OR CONDITIONS, EXPRESS OR IMPLIED, REGARDING THE PRODUCTS AND SERVICES CONTEMPLATED BY THIS AGREEMENT INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF MERCHANTABILITY, MERCHANTABLE QUALITY OR FITNESS FOR A PARTICULAR PURPOSE AND THOSE ARISING BY LAW, STATUTE, USAGE OF TRADE OR COURSE OF DEALING. KOBO MAKES NO REPRESENTATION, WARRANTY OR CONDITION, EXPRESS OR IMPLIED, WITH RESPECT TO THE ADEQUACY OF THE EREADING SERVICE, THE CONTENT OR THE KOBO WEBSITE FOR ANY PARTICULAR PURPOSE OR WITH RESPECT TO ITS ADEQUACY TO PRODUCE ANY PARTICULAR RESULT. YOU ACKNOWLEDGE AND AGREE THAT KOBO CANNOT ENSURE THAT YOUR WORKS WILL BE PROTECTED FROM THEFT OR MISUSE OR THAT USERS WILL COMPLY WITH ANY OF OUR CONTENT USAGE RULES. WE WILL HAVE NO LIABILITY ARISING FROM A FAILURE OF ANY SECURITY SYSTEM.

KOBO AND ITS AFFILIATES SHALL IN NO EVENT BE LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL, CONSEQUENTIAL, PUNITIVE OR EXEMPLARY DAMAGES, INCLUDING, WITHOUT LIMITATION, LOSS OF REVENUE, DATA OR LOSS OF PROFITS, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT OR IN TORT INCLUDING NEGLIGENCE, ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT EVEN IF SUCH KOBO IS APPRISED OF THE LIKELIHOOD OF SUCH DAMAGES OCCURRING; AND KOBO’S AND ITS AFFILIATE’S LIABILITY ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT SHALL NOT EXCEED THE AMOUNTS PAID BY KOBO TO PUBLISHER HEREUNDER FOR THE EIGHTEEN MONTH PERIOD PRECEDING ANY CLAIM.

Kobo will not be liable to Publisher for any failure or delay in the performance of its obligations hereunder caused by any event or circumstances beyond Kobo’s control.

SECTION 7. CONFIDENTIALITY.

You will not issue any press release or any other public disclosure about these Terms and your participation in Kobo Writing Life without our consent. Each party shall keep all information disclosed or obtained as a result of the relationship of the Publisher and Kobo under these Terms, and shall not disclose any information regarding such matters without the prior approval of the other party. Without limiting the generality of the foregoing, you agree not to disclose any information we disclose to you, including communications between you and us, anything about our business, customers, marketing, any sales data sent to you from us with respect to your Works or any other information we make available to you as a result of your participation in Kobo Writing Life. The obligations of confidentiality in this clause shall not extend to any matter which the other party can show: (i) is in or has become part of the public domain, other than as a result of a breach of the obligations of confidentiality under these Terms; (ii) was in its written records prior to these Terms becoming effective; (iii) was independently disclosed to it by a third party entitled to disclose the same; (iv) is required to be disclosed under any applicable law, or by order of a court or governmental body or other competent authority, or (v) is required to be disclosed to a third party as a result of a partnership with or affiliation with such third party, on the condition that such third party is bound in writing by confidentiality obligations at least equivalent to those set out in this clause.

SECTION 8. GENERAL PROVISIONS.

All notices required under these Terms or other communications required or permitted under these Terms shall be done through the email communicated to Kobo via Kobo Writing Life portal and via notification within user login to the portal. If you want to send us a notice, please use the following email: writinglife@kobo.com. All terms which by their nature are intended to survive termination of these Terms shall survive such termination. Kobo controls the eReading Service from its offices within the Province of Ontario, Canada. The eReading Service can be accessed from all provinces and territories of Canada and from other countries around the world. As each of these jurisdictions have laws that may differ from those of the Province of Ontario, by accessing the eReading Service, you agree that all matters relating to access to, or use of, the eReading Service, or any other hyperlinked website, shall be governed by the laws of the Province of Ontario and the federal laws of Canada applicable therein. You also agree and hereby submit to the non-exclusive personal jurisdiction and venue of the courts of the Province of Ontario and acknowledge that you do so voluntarily and are responsible for complying with all local laws. These Terms, the Kobo Content Policy and Terms of Use are the entire agreement and understanding of the Parties with respect to the subject matter hereof and supersede all prior and contemporaneous agreements, understandings, negotiations and proposals, oral or written. Except as otherwise set out in these Terms, these Terms may be amended or modified only in writing signed by each of the Parties. These Terms may not be assigned by either Kobo or Publisher in whole or in part, without the other party’s prior written consent. Notwithstanding the foregoing, Kobo may, without prior notice, assign these Terms or any of its rights and obligations hereunder to any third party without notice or consent and Publisher may assign all of Publisher’s rights and obligations under these Terms to any third party without consent in connection with the sale of all or substantially all of Publisher’s assets, but Publisher must give Kobo prompt written notice of the assignment.

Schedule A IPP Territories