Exhibit 10.1
AGREEMENT BETWEEN EDUCATIONAL VIDEO CONFERENCING, INC.
AND ADELPHI UNIVERSITY, FOR THE OFFERING OF INTERACTIVE
TELEVIDEO COURSES
W I T N E S S E T H
AGREEMENT made this 13th day of May, 0000 xxxxxxx Xxxxxxx Xxxxxxxxxx,
Xxxxxx Xxxx, Xxx Xxxx (hereinafter "Adelphi"), and Educational Video
Conferencing Inc., (hereinafter "EVC") a New York corporation with offices
located at 000 Xxxx Xxxxxx Xxxx, Xxxxxxx, Xxx Xxxx 00000.
WHEREAS, Adelphi is a not-for-profit institution of higher education duly
certified by the Education Department of the State of New York and accredited by
the Middle States Association to offer undergraduate and graduate courses, and
WHEREAS, EVC is a domestic corporation engaged in the business of providing
access to such courses to students by way of Interactive Televideo, and
WHEREAS, Adelphi and EVC wish to enter into a mutually beneficial agreement
whereby EVC will provide access to Adelphi courses to such students,
NOW, THEREFORE in consideration of $10.00 in good funds paid by EVC to
Adelphi, as well as the mutual covenants contained herein, the parties hereby
agree as follows:
1. a) EVC shall have the right, for the duration of this agreement and any
renewal hereof, in conjunction with Adelphi, to offer courses included in the
Adelphi Undergraduate Business and MBA programs and General Education courses
via Interactive Televideo/Distance Learning (hereinafter "ITV/DL") commencing
with the Fall Semester, 1997.
b) For the purposes of this agreement, ITV/DL shall be defined as live,
two way video conferencing, either over desktop computers or video conferencing
room systems, as the case may be, in which the student can see and hear the
professor/instructor and the professor/instructor can see and hear the
individual student. In addition, subject to both parties written approval,
ITV/DL may be defined as two-way audio, one-way video.
c) EVC and Adelphi agree that the minimum class size for the offering of
an ITV/DL course shall be FOURTEEN (14) students, unless the parties mutually
agree to offer a course with less than FOURTEEN (14) students.
2. EVC will provide, either directly or through corporate contracts, all
hardware (except personal computers, modems, keyboards and monitors which shall
be provided by the students), software, accessories and telecommunications
equipment (collectively referred to as "equipment") necessary to provide access
for Adelphi courses to ITV/DL students. Students taking courses on desktop
computers must have computers with the technological capacity to receive EVC's
interactive transport signal and function as an ITV/DL desktop system. The
parties acknowledge that it is the goal of EVC to solicit students from
corporations with substantial tuition reimbursement, and that EVC shall address
all student equipment issues In any event, Adelphi shall not be responsible for
the cost of any equipment whatsoever.
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED AS TO CERTAIN PORTIONS OF THIS
EXHIBIT.
3. a) EVC is responsible for and shall pay all such costs for marketing,
advertising, promotion, etc. regarding EVC's offering of access to Adelphi
courses. Adelphi shall provide to EVC copies of all brochures, catalogues,
posters, etc. applicable for courses being offered.
b) Adelphi will, whenever feasible, include ITV/DL courses, offered
through EVC, in any course advertisements, promotions, marketing plans, etc.,
which may be directed at the target market.
c) Adelphi will prepare and provide to EVC copies of class schedules,
course4 descriptions and necessary registration materials to be offered through
EVC.
4. Adelphi assumes no responsibility or cost for obtaining or providing
telecommunication signal transport for students dialing in for courses.
5. Adelphi shall provide rooms capable of becoming teaching stations. This
includes the installing and maintaining of adequate telephone lines (T-1, ISDN
and regular telephone lines), electrical outlets and lighting. EVC shall inform
Adelphi by June 1, 1997 of the number of classrooms required for the Fall 1997
semester. Subsequent to the Fall 1997 semester, EVC shall advise Adelphi of any
additional room requests ninety (90) days prior to the date classes are to be
offered. The teaching stations are to be installed and paid for by EVC. Ass
equipment in the teaching stations provided by EVC shall remain the exclusive
property of EVC.
6. All equipment is the sole and exclusive property of EVC, including but
not limited to any and all patents, copyrights and trademarks, if any,
associated therewith. All classroom, course and program materials or other
information supplied by Adelphi, and all rights and interests in said material
will remain the sole and exclusive property of Adelphi.
7. a) EVC is responsible for the maintenance, repair and/or replacement,
when necessary, of televideo equipment supplied to Adelphi for ITV/DL courses.
b) EVC will provide reasonably prompt service for repair or replacement
of defective interactive televideo equipment and software as necessary.
c) EVC shall provide and Adelphi will be responsible for the reasonably
prompt repair and/or replacement of interactive televideo equipment located at
Adelphi which may be damaged through improper or unauthorized use.
d) Adelphi is responsible for the repayment to EVC of the cost of
replacement of any EVC equipment which is lost or stolen while in Adelphi's
custody and control within 60 days of Adelphi being notified of the theft or
loss.
8. Neither party shall utilize the other's name or any associated names,
trademarks, copyrights, etc., without prior written consent. Such permission
shall not be unreasonably denied.
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9. a) EVC will provide initial faculty development reasonably required for
the offering of Adelphi courses through EVC. Thereafter, Adelphi agrees to
provide faculty or personnel who have received said initial training to assist
EVC in training any new faculty or personnel. EVC shall provide any updated
training which may from time to time become necessary hereunder.
b) Adelphi shall be responsible for obtaining the services of all
faculty participating in the ITV/DL courses, including but not limited to said
faculty's salary, benefits (if any) and verification of qualifications. EVC
assumes no responsibility for any costs associated therewith.
10. EVC is solely responsible to provide site locations for ITV/DL students
to participate in Adelphi courses. Adelphi assumes no responsibility for
obtaining or maintaining said sites, nor for any rent or other costs associated
therewith.
11. EVC is not responsible for curriculum, course content, faculty
qualifications, course materials or any other aspect of the academic content of
any courses offered hereunder. However, Adelphi acknowledges the expertise of
EVC in delivering ITV/DL courses and agrees to be receptive to EVC input as to
modification of course content and method of delivery consistent with required
academic standards.
12. EVC agrees to make every reasonable effort to maintain its equipment in
good working order. However, EVC is not responsible for service or repair delays
or interruption of service caused by strikes, labor actions, power outages
(other than those limited to site locations alone), acts of God or other matters
beyond EVC's control.
13. Adelphi hereby acknowledges that the ITV/DL program is targeted toward
the non-traditional student market and therefore agrees to offer ITV/DL courses
at dates and times appropriate to the target market, but only between the hours
of 8:00 a.m. and 11:00 p.m., seven days per week. The parties acknowledge that
implementing the foregoing may require the cooperation of certain Adelphi
collective bargaining units, insofar as same may be reasonably necessary and
Adelphi agrees to use all reasonable efforts to staff classes during that time.
14. a) The parties hereby acknowledge that this agreement is not intended
by the parties to facilitate the offering of college degrees, degree programs or
a course of study which may lead to a degree or certificate, and neither party
shall represent or advertise that the ITV/DL programs shall result in the
awarding of degrees or that it is a degree program or a course of study leading
to a degree or certificate.
b) In the event that, after offering individual classes, the parties
desire to modify the program in order to offer degrees or degree programs
through ITV/DL, the parties agree that appropriate accreditation for degree
programs will be sought from the Middle States Association of Colleges and
Schools, so as not to negatively impact on Adelphi's current accreditation with
N.Y.S. Department of Education and/or Middle States.
c) In the event that degrees, degree programs and/or courses of study
leading to a degree or certificate, are offered pursuant to sub paragraph
"14. b)" above, then and in that event all other provisions of this agreement
shall apply with equal force and effect to said courses or classes offered in
conjunction therewith.
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d) Adelphi shall attempt to obtain and/or maintain all New York State
Department of Education, Middle States Association, and any other approval and
accreditation necessary to the offering of college courses and credits under the
applicable New York State law. Should Adelphi lose its accreditation at any time
during the term of this agreement or any renewal hereof, EVC shall have the
right to cancel this contract at the end of the semester in progress, if
applicable, or immediately if no semester is underway.
15. a) Adelphi shall be responsible for all of its own administrative
functions (admissions, etc.) associated with the offering of ITV/DL courses
through EVC. EVC will reasonably assist with the administrative functions of
admissions and academic advising.
b) Adelphi will provide all necessary administrative forms,
applications, catalogues, etc., and written instructions to EVC in advance and
it is understood by the parties that EVC is merely a conduit and assumes no
liability whatsoever for the accuracy or correctness of the information in said
forms provided by Adelphi nor for return of any of the aforesaid documents to
Adelphi.
c) Adelphi shall hire an employee, who is subject to EVC's approval, to
work at Adelphi on a part time or full time basis as registration demand
requires. This employee shall be responsible for all aspects of the admission
process for students applying to Adelphi under this contract. A job description
detailing the responsibilities is attached as Exhibit "B". The employee shall
report directly to Executive Director of Admissions at Adelphi. Adelphi shall
pay the employee and the employee's salary and benefits shall be deducted from
the monthly payment set out in paragraph 16a to EVC by Adelphi. The employee is
an Adelphi employee and shall be subject to all Adelphi's policies and
procedures, programs and benefits. EVC shall reimburse Adelphi for all
recruitment expenses.
d) EVC has the right to recommend termination of the employee to Adelphi
University. If, after the University's personnel procedures are completed, the
employee is not terminated, that employee shall be reassigned within the
University and a new employee shall be hired under the terms set forth in
paragraph (15) above.
16. a) Adelphi shall pay to EVC, on the 10th day of each month, [*] and
retain [*] of the adjusted gross tuition actually collected by Adelphi the
preceding month, from any source whatsoever, from or on behalf of any student
registered for courses being offered through EVC's ITV/DL program, said payments
to commence the month immediately following the collection of any such tuition
by Adelphi.
b) For the purposes of this agreement, adjusted gross tuition shall mean
tuition less any refunds or deductions for a check returned for insufficient
funds, loss of financial aid, refunds or cost of collection, etc., it being
understood that cost of collection includes the use of outside agencies only,
not the expense incurred by Adelphi personnel collection tuition.
[*] Confidential Portion.
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c) Adelphi shall present to EVC, along with each monthly payment, a
written list of any an all adjustments or credits utilized to compute the
aforementioned "adjusted gross tuition", which list shall include the student's
name and social security number, together with a brief description of the reason
for the adjustment.
d) Commencing on December 10, 1997, and continuing on the 10th day of
every month thereafter, Adelphi will supply EVC with a list of all students who
have applied to Adelphi, and/or registered for courses through EVC, the said
list to include as available, each student's name, address, telephone number,
social security number, registration status, student loans and payment status.
e) EVC shall have the right, on a semi-annual basis, to examine the
books and records of Adelphi, pertaining to all students taking courses through
EVC, in order to audit and adjust any accounts due and owing the respective
parties.
f) EVC shall require that each student registering for a course offered
through EVC sign a waiver and release granting EVC access to said student's
records, said waiver and release form to be provided to Adelphi by EVC, the
format of which shall be subject to Adelphi's approval, which approval shall not
be unreasonably withheld.
17. Simultaneously with the signing of this agreement EVC's parent company,
Interactive Learning Systems, Inc. and Adelphi shall enter into a warrant
agreement. The warrant shall grant Adelphi an option to purchase 75,000 shares
of common stock of Interactive Learning Systems, Inc. at a purchase price per
share equal to 120% of the Initial Public Offering price of such common stock.
This option shall be exercisable at any time beginning one year from the
effective date of the registration statement and ending six years after the date
of such registration statement. The complete terms of the warrant agreement are
annexed as Exhibit A.
18. a) Adelphi will provide a minimum of six (6) rooms which will
accommodate teaching stations in order to facilitate all ITV/DL courses
emanating from its campus and will grant EVC, its agents and subcontractors,
reasonable access to said facilities as is required for proper installation,
operation, maintenance and repair of all equipment contemplated herein,
including but not limited to ITV/DL equipment and telephone lines. All such
vendors shall maintain appropriate insurance as approved by Adelphi's Associate
Director of Business Affairs.
b) Classrooms at Adelphi equipped for ITV/DL may not be used by the
University for any class, function or other purpose, without the prior written
permission of EVC.
c) EVC equipment may be used by Adelphi for purposes which do not
infringe on the rights of EVC hereunder, or tend to impact negatively on the
success of the program contemplated by this agreement, with the prior written
permission of EVC, whenever the said equipment is not in use by EVC.
19. Adelphi News and Public Relations Department will provide reasonable
cooperation with EVC in promoting Adelphi ITV/DL course offerings.
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20. Adelphi and EVC will, whenever possible, cooperate in applying for and
obtaining any grants, awards, stipends, fellowships, etc., which are mutually
beneficial to the parties.
21. Adelphi shall maintain academic control over all courses and will be
receptive to EVC input as to ITV/DL presentation, as said forth in paragraph
eleven (11) above.
22. Adelphi will assign at least one person who at all times will act as
liaison between Adelphi and EVC.
23. Term of Agreement
a) The basic term of this agreement shall be FIVE (5) YEARS.
b) The parties hereby acknowledge the necessity for allowing ITV/DL
students continuity and ongoing access to courses and programs.
c) In light of the foregoing, the parties agree that commencing
September 1, 1998, and every September 1st thereafter, this agreement shall
automatically be extended for an additional period of ONE (1) YEAR, subject to
the conditions hereinafter contained.
d) In the event that either party should desire not to automatically
extend this agreement, then and in that event, such party shall so notify the
other in writing, by Certified Mail, Return Receipt Requested, no later than
June 1st of any given year, after which the agreement will not be extended for
an additional ONE (1) YEAR, but will have only the FOUR (4) YEARS of the
existing term remaining.
24. Non-Disclosure and Non-Compete
a) Adelphi acknowledges that by entering into this agreement it will be
gaining access to certain technology, procedures and markets which are the
property and trade secrets of EVC. Adelphi agrees that, for the duration of this
agreement and any extensions hereof, as well as for a period of ONE (1) YEAR
immediately following any termination or expiration thereof, Adelphi will use
its best efforts to make sure that none of its employees disclose, directly or
indirectly, to any person, corporation or entity, any of the procedures,
technology, software, hardware, etc., employed by EVC in providing Interactive
Computer or Televideo Communication services in connection herewith, and will
not knowingly grant access for any competitor or potential competitor to view,
examine, copy and/or photograph, any of the procedures (including training
manuals, if any), technology, equipment, software, etc., as referred to above,
without the prior written permission of EVC. Adelphi hereby acknowledges that
any violation of this section will cause irreparable harm to EVC.
b) Adelphi further agrees that it will not disclose to any person,
corporation or entity the terms of this agreement without the prior written
consent of EVC.
c) During the term of this agreement, Adelphi agrees not to offer ITV/DL
classes independently of EVC, to any company under contract with EVC. It Adelphi
terminates this contract, Adelphi agrees not to offer any ITV/DL courses to
companies under contract with EVC at the time of the termination, for a one year
period. Each year at renewal and upon request, EVC shall provide Adelphi
University with a list of all companies under contract with EVC.
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25. Damages Limitation
a) It is expressly agreed and understood that neither party shall be
liable for incidental, special or consequential damages for any breach or
violation of this agreement.
26. The foregoing constitutes the entire agreement between the parties, and
any other agreements or representations, whether verbal or written, if not
contained herein, are void, of no effect, and are not binding upon the parties.
27. No valid modification, amendment, or deletion may be made to this
agreement except in writing and executed by the parties in substantially the
same manner as this agreement.
28. Any and all notices required hereunder shall be by Certified Mail,
Return Receipt Requested, to each party's last known address and shall be deemed
given at the time of mailing.
29. If any portion of this agreement shall be found to be void, voidable or
unenforceable, it shall not effect the validity of the remainder of the
agreement.
30. The parties agree that any disputes or disagreements arising hereunder
or in connection herewith shall be settled by binding arbitration before the
American Arbitration Association at their offices located in Garden City, New
York and that any judgment awarded thereunder may be entered in any court of
appropriate jurisdiction, and will have full force and effect therein.
31. This agreement shall be construed in accordance with, and governed by,
the laws of the State of New York.
In witness whereof the parties have hereunto set their hands and seal the
date first appearing above.
Educational Video Conferencing, Inc.
By: /s/ Xx. Xxxx X. XxXxxxx
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Xx. Xxxx X. XxXxxxx, President
Adelphi University
By: /s/ Xxxxxxxxx Xxxxxxxxx
--------------------------------
Xxxxxxxxx Xxxxxxxx
Vice President of Finance & Treasurer
