AGENCY AGREEMENT (Terms of Distributorship) The purpose of the terms set forth below are to identify the benefits which accrue to bonafide distributors of the Offshore Advisor (OA). All terms defined herein do not constitute a contract as such, purely the amount(s) of commission payable to distributors who, in signing and returning this letter of understanding to the offices of the OA, agree to accept these terms. Agent: (Or Distributor) - may be either an individual, corporation or other organized body or association who may choose to promote the sale of subscriptions for the OA to third parties, and benefit monetarily through doing so, as set forth below. Publisher: Offshore Inc. It is hereby understood and agreed that; 1. The Publisher will pay the Agent, Thirty Percent (30%) of the subscription price received for every subscription which is sold by the direct efforts of the agent. a) A bonafide Agent is one who by entering into this agreement, will be designated an Agency Number which will be affixed to all authorized subscription offers for the OA distributed by said agent and will be the means from which the commissions due to the Agent are calculated. b) In the first instance, the Agent as described herein will be considered a "Primary" or "L1" Agent. 2. Each bonafide Agent may recruit as many sub-agents as desired. Each bonafide sub-agent or "Secondary" or "L2" Agent will be entitled to the amount of Twenty Five Percent (25%) of the subscription price of each subscription which is sold by their direct efforts. a) Each L2 Agent that is registered with OA through the direct efforts of an L1 Agent will be designated an Agency Number which coincides with the Agency Number of the "L1" Agent and will be the means from which the commissions due to both Agents are calculated. b) The L1 Agent will receive Five Percent (5%) of the subscription price of every subscription which is sold by the direct efforts of the L2 Agent. 3. Each bonafide L2 Agent may also recruit as many sub-agents as desired. Each bonafide Third Level Agent or "L3" Agent will be entitled to the amount of Twenty Percent (20%) of the subscription price of each subscription which is sold by their direct efforts. a) Each L3 Agent that is registered with OA through the direct efforts of an L2 Agent will be designated an Agency Number which coincides with the Agency Number of the "L2" Agent and will be the means from which the commissions due to all Agents are calculated. b) Both the L1 & L2 Agents will each receive Two and One Half Percent (2.5%) of the subscription price of every subscription which is sold by the direct efforts of the L3 Agent. 4. Remuneration levels above are consistent with the 12 month period from the receipt of the subscription fee(s) and will carry a residual commission of Two and One Half Percent (2.5%) payable yearly (Pro- Rata) for renewal subscriptions. Such payment will coincide with the subject renewal. 5. Three Agents that have the largest volume of paid subscriptions for that year will be chosen annually, on the anniversary of the first paid issue. This is purely volume of sales on an individual level, exclusive of any sub-agent sales. Those with the greatest volume will be invited to choose from a list of awards which will range from all-expense paid trip(s), free registrations to events relative to the activities of the OA, and/or cash, carefully placed investments in similar amounts etc. 6. L1 and L2 agents will also be credited for 5% of the volume of their Sub-Agents. This override volume will accrue with individual sales volume as additional individual volume. 7. L2 and L3 agents who wish to participate at the L1 agency level may do so by qualifying as fully accredited agents for a period of not less than Two (2) consecutive months, with a minimum of 10 subscriptions per month in each of those two months. Upon achieving this level of sales, each L2 or L3 agent may request L1 status. a) As L2 and L3 Agents become L1 Agents, the recruiting agent will be provided with a further level of residual income in the form of Two and One Half Percent (2.5%) of the volume of the paid subscriptions from every subscription which is sold by the direct efforts of the new L1 Agent. b) Each new L1 Agent will have full rights and benefits as are available to any L1 Agent. c) Each Sub Agent who may be recruited by a "cloned" L1 Agent will have full rights and benefits as available to any other Sub Agent, including the right to achieve L1 status themselves. 8. Residual commissions (those paid on volume of sales of the levels below L1 Agent) will accrue up to and including but no more than 3 levels of successive new L1 Agents. a) Residual commissions will be paid to the beneficiaries of the receiving agent, for such time as there are commissions payable through the original efforts of the agent due such commissions, or until such time as the OA should cease to trade. 9. No Agent may claim to be an employee or paid representative of the Publisher. Each Agent is an independent contractor who shall not alter the terms of nor deface any offer to subscribe issued by the Publisher. The agent will be responsible for his/her own tax or other business expenses and must be aware that the Agents conduct as an independent contractor is in no way the responsibility of the Publisher. 10. The Publisher, it's employees, successors and/or assigns, assume no liability to all or any agents beyond the amount(s) of total commission earned. Any dispute that may arise in regard to the payment of or receipt of any amount which may or may not be contested, shall be arbitrated by independent counsel and audit, the cost of which shall be the responsibility of the party found to be in default. Agreed to this ____ day of ___________, 199 Signed: ___________________________________ (Agent) Name:(printed)___________________________________ Address: ___________________________________ Tel:(___) ___-____ ___________________________________ Fax:(___) ___-____ * Office Use Only * Agency #:_________________ Agency Level: ____ Introducing Agent #:_______ Registration Date:___/___/____ A.L.I.D. _____________