RENO, Nev., Dec. 21 /PRNewswire-FirstCall/ -- MidNet, Inc. (OTC Bulletin Board: MIDX) creator, owner, and operator of The Middle Network(TM), announced today that it has entered into an agreement with Thornton & Associates Ltd. to build distribution channels for The Middle Network in India. Under the terms of the agreement Thornton will establish a company in Delhi State, India, to manage the Delhi Region. This new company will also assist in establishing MidNet (India), a corporate entity that will oversee MidNet's national activities in India, and will also assist in the forming of MidNet (Delhi), a regional subsidiary for Delhi State. Thornton will pay MidNet $5.0 Million USD for the first region in Delhi State, and will have the right to sell additional regions in Delhi State for $5.0 Million each. MidNet will share 10% of region fees with Thornton. The fee for the first Delhi State region includes the registration of one million authenticated devices on The Middle Network. Device registrations and authentications will be through MidNet's security solution provided in part by Uniloc USA, Inc., and will be priced at $4 each. In addition, the region fee includes the provision of 400 servers to manage the authentications of registered devices and the communication between devices. Device authentications will be used primarily to ensure privacy and security for users of video telephony services -- including VoIP -- and data communications. The parties expect that the minimum monthly residual revenues from video telephony will average $10 per subscriber. "The region model being developed through this agreement will form the template for other regions globally," says Tilo Kunz, MidNet's president and CEO. "The objective is to provide incentives to third parties within targeted regions, such as India, to support MidNet in building out The Middle Network globally. MidNet will revenue-share with region companies. The focus will be on residual services, in particular, services that enable video telephony. Our intention is to minimize our overheads in these territories, while motivating the region companies to maximize product and service revenues. MidNet's goal is to maintain a 20% to 40% gross margin for its services. Discussions have commenced for three other regions but further signings will be postponed until the Company is comfortable that the region model has first been proven in India." "We have been working for four years to bring the MidNet Project to India," says Bob Thornton, president and CEO of Thornton & Associates Ltd. "We are delighted that both the market and technologies have matured to the point where we can realize significant penetration in one of the world's greatest and fastest growing economies. The market potential for MidNet-enabled services in India is currently estimated at twenty million household, business, and government subscribers. We expect to secure a dominant position in this emerging industry by establishing The Middle Network in this region now." About MidNet, Inc. MidNet is the creator, owner, and operator of The Middle Network(TM), a commercial complement to the Internet. The Middle Network(TM) is purpose-built for video telephony, providing high-speed, high-capacity private connectivity with device-specific authentication for enhanced security. Organizations and individuals can create, manage and distribute valuable intellectual properties, and collaborate with greater privacy and security on The Middle Network(TM). Forward Looking Statements The statements made in this press release are forward-looking and are based on current expectations that are subject to a number of uncertainties and risks, and actual results may differ materially. The uncertainties and risks include, but are not limited to, the ability of MidNet or the company to execute effectively its business plan, changes in the market for MidNet's proposed network services, changes in stock and business market activity, realization of anticipated customers, seasonality, the development of new products and services, the enhancement of existing products and services, competitive pressures (including price competition), systems failures, economic and political conditions, changes in customer behavior and the introduction of competing products having technological and/or other advantages. Statements made in this document that are not purely historical are forward-looking statements, including any statements as to beliefs, plans, expectations, or intentions regarding the future. The company assumes no obligation to update information concerning its expectations. For more information about MidNet Inc., please visit www.midnetinc.com or call 1-800-624-1066. SOURCE MidNet, Inc.