ROYALTIES STANDARDIZED RULES

June 1, 2016

Ø On the first day of every month, all orders for the previous month are released onto the RATS website for certification.

Ø You have three (3) business days to certify all orders. After the deadline, all orders not yet certified will be ‘force-certified’.

Ø You have the option to zero out a job not used or a portion of a job, edit route quantities actually mailed, before final certification approval.

Ø All jobs must be certified, even the edited orders and orders zeroed out.

Ø Any jobs that were certified by mistake or force-certified that were not actually mailed can be credited the following month upon written notification via email to judkins70@gmail.com and lynn@compactlists.com.

Ø ROYALTY is the revenue paid to the owner of the territory used.

Ø BOUGHT COST is the amount the renter pays for the use of the list.

Ø PROCESSING Fee is $0.50/M.

There is an incentive plan in place for customers who order more than 5,000,000 records per year. [To receive the incentive rate, you MUST email judkins70@gmail.com and lynn@compactlists.com with the customers six-digit Customer ID number]

NOTE: These prices do not include Processing Fees.

Ø

§ The Royalty for such customers, those who order over 5 million records per year, is $1.40/M.

§ The Royalty, for all other customers, is $1.90/M.

§ The Bought Cost, for customers who order over 5 million records per year, is $1.70/M.

§ The Bought Cost, for all other customers, is $2.20/M.

§ The difference between the Royalty and the Bought Cost, $0.30/M, is retained by NAAD.

Ø The following table best explains Royalty and Bought Cost for basic NRD list rental:

Cust. Yearly Volume Bought Cost Total Cost to Renter Royalty

(incl. Proc. Fee) to list owner

Over 5 million $1.70/M $2.20/M $1.40/M

Under 5 million $2.20/M $2.70/M $1.90/M

Ø The Premium, or supplemental fee for RESPlus orders, is $1.00/M, no matter how many records have names appended.

Ø NAAD pays a royalty of $0.50/M to Compact Information Systems for the actual number of RESPlus names used.

The residual is used to cover the cost of merging the CIS Consumer data each month.

Ø Descriptions of columns in Bought Reports:

o Total Count Used = RESelect Count + RESPlus Count

o RESelect Count = Count Used (RESelect orders)

o RESPlus Count = Count Used (RESPlus orders)

o RESelect Cost = RESelect Count x (Royalty Fee + Processing Fee) / 1000

o RESPlus Cost = RESPlus Count x (Royalty Fee + 1.00 + Processing Fee) / 1000

o Names Bought = Count of Actual Names received (in a RESPlus order)

o Net to Names Broker = Count of Actual Names received x 0.50 / 1000

o There is no Bought Cost or Royalty paid for Simplified records.

o Unused Counts = Counts zeroed out in Certification step

o Unused Processing Cost = Counts zeroed/1000 x 0.25

NOTE: There is NO Royalty paid for Unused Counts

§ The $0.25 is a discounted Processing Fee

§ The decision for Unused Processing Costs was made at the NAAD meeting in July’02

§ This applies to ‘Type A – Reports Only’ orders that are zeroed out as well.

§ ‘Type A – Reports Only’ Cost = Unused Count/1000 x 0.30 (.25 to CIS, .05 to NAAD)

Ø Net Usage Orders – When only a portion of an order was actually mailed.

§ There will be a Processing Fee of $0.25/M for the unused portion. This is a discounted Processing Fee.

Ø There will be no Processing Fee for the second and subsequent usage of a Multi-use order.

Ø There will be no FTP fee for Multi-use orders placed by a Resident List customer.

Ø NO RESPlus orders will be accepted for Net Names.

Ø There will be no Bought Cost or Royalty paid for Simplified records.