A membership agreement is a legal contract between a member of a group and that group governing the terms and conditions of membership. These agreements address the subject member’s privileges and obligations; the rules he or she must abide by; and the benefits he or she will receive as a member. Membership agreements vary widely according to the association for which the member seeks membership. These agreements can address membership to a limited liability company, a condo association, or an Internet Social Networking Site such as Facebook or MySpace. The agreements should also address the term of the membership, how the membership may be terminated, and how membership may be renewed. The association’s privacy policy, as well as a disclaimer of liability, may also be included.

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Membership Agreements are necessary to become a part of an affiliate program. Affiliate programs extremely popular with online marketers. Almost every store or service provider with an Internet portal or presence (”advertiser”) that offers products (e.g. Netflix, Amazon, and Best Buy for starters) runs an affiliate program. An affiliate is one who promotes another websites products or services and receives a commission from the advertiser every time a user is referred to their site from the affiliate’s marketing efforts. To become an affiliate member, one must register with the advertiser’s program and consent to the terms and conditions of its programs.

The conditions of membership agreements usually address certain issues. For starters, the affiliate must have a website, and must agree not to promote sexually explicit material, violence, illegal activities, or discrimination. The affiliate’s website and its promotional methods must be approved by the advertiser. The agreement should also address how much the affiliate will get paid for each referral, and how often the affiliate receives payment. It is common for advertisers to pay out on Net-15 basis, which means the affiliate gets paid on the 15th of each month.

The agreement should also advise the affiliate as to how the affiliate receives compensation. Most affiliate programs today payout affiliates on a Cost-Per-Action or “CPA” basis, meaning the affiliate only gets paid if the user buys the advertiser’s product, signs up for the advertiser’s service, or takes another action that the advertiser desires the user to take. Some advertiser’s still pay affiliates on a Cost-Per-Click or “CPC” basis, meaning the affiliate will receive a commission for each user who clicks on the advertiser’s banner or text link and is referred to the advertiser’s website, regardless of whether a purchase is made.

Finally, the membership agreement should address the advertiser’s policy on keyword bidding. Some advertisers prohibit affiliates from bidding on keywords without their express written permission. Other advertisers allow bidding on keywords, however, most do not allow affiliates to bid on the advertiser’s trademark or any misspellings of the trademark. Often, the affiliate may not bid on the trademark of the advertiser’s partners either.

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Membership Agreements, in the context of becoming a member of an Internet community, are a legal contracts between the user of the site and operator of the community. Sometimes referred to as Terms and Conditions, a user must agree to the terms of the membership agreement in order to join the community. Usually, the user symbolizes his assent to the terms of the agreement by clicking a box next to the phrase that reads something to the effect of: “I have read and hereby agree to the terms of the membership agreement.” This agreement, similar in structure to most other contacts, usually addresses the following issues:

1. Description of Services. The website is providing certain services to the user. The agreement should describe these services so that the user knows what service he or she is receiving in return for either a subscription payment, if any.

2. Membership Term and Terms for Renewal of Membership. The agreement should outline what benefits the member is entitled to and for how long these benefits last. The agreement should also address whether the membership will be automatically renewed, and if not, what the member can do to renew it.

3. Consent to Membership Terms. Generally there will be rules governing a member’s conduct within the community or while using the website. The membership agreement must present these rules and restrictions, thereby giving the member adequate notice of what rules he or she must abide by. Likewise, the agreement should outline what the penalties are for a member who breaks these rules.

4. Disclaimer of Liability by the Website. The member must be aware that the website owner is not liable for any claims that may arise out of another member’s misconduct. This important provision gives notice that the member is “assuming the risk” by using the service. In theory, this provision also protects the owner from any copyright or trademark violations that members on the site may commit. In reality, courts in some instances have found website operators liable for copyright violations committed by members when the owner of the website had actual knowledge of the violation and took no action to remove the infringing material.

5. Contact Information. Ideally the owner should provide the member with its contact information so the member can contact the owner if he or she has any complaints about the service. Federal law dictates that the site owner provides such contact information either in the membership agreement or on another non-conspicuous place on the site. (Note that if the agreement does not contain the owner’s contact information, a member may be able to ascertain the owner’s information on www.GoDaddy.com using GoDaddy’s “WhoIs” feature. This applies only if the owner registered the site with GoDaddy.)

These are the most important provisions of a membership agreement that governs the terms and conditions of using a website. Other boilerplate provisions addressing issues such as Governing Law, Privacy Rules, and Rights of the Member to terminate the agreement may also be included.

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