Exhibit 10.4
STRATEGIC PARTNERSHIP AGREEMENT
This Agreement is made this 12th day of May, 2000 by and between
Inter-Con/PC, Inc. a Minnesota corporation, with offices at
0000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxx Xxxxxxx, XX (hereinafter
"Inter-Con");
NIKKO CO., LTD., a corporation existing under the laws of
Japan with offices at 0-00-00, Xxxxxxx, Xxxxxxxxxx-Xx, Xxxxx,
000-0000, Xxxxx (hereinafter"NIKKO"); AND
Maxwood Technology LTD, a corporation existing under the laws
of Hong Kong, with offices at Xxxx 0000, 00X Xxxxx Xxxxxxxx
Xxxx., 13 XXX Xxxx Street, Hunghon (hereinafter "Maxwood").
RECITALS
WHEREAS, Inter-Con has invented and developed certain computer devices
that permit the user to access the internet using a television set as the
computer's monitor; and
WHEREAS, the aforesaid devices are known as Set Top Boxes; and
WHEREAS, as a result of its development work Inter-Con has acquired and
owns substantial patent and other intellectual property rights including
considerable know-how, experience, proprietary information, and other business
information relating to its Set Top Boxes; and
WHEREAS, the parties desire to manufacture and sell the Set Top Boxes
that are made subject to this Agreement; and
NOW, THEREFORE, in consideration of the promises and of the mutual
covenants and agreements hereinafter contained, the parties hereby agree as
follows:
AGREEMENT
ARTICLE I
STRATEGIC PARTNERSHIP
Section 1 FORMATION. NIKKO and Inter-Con shall organize a company to
market the Set Top Box Products and other agreed to products and services. The
marketing company shall be named NIKKO Multi Media Company, L.L.C., and shall be
organized as a limited liability company at a place to be mutually determined by
the partners. NIKKO and Inter-Con shall each be issued 50% of the membership
interests of NIKKO Multi Media Company, L.L.C. (hereinafter said limited
liability company is referred to as the "Marketing Company").
Section 1.2 PRODUCT TO BE SOLD. The Marketing Company shall initially
sell various versions of Inter-Con's Set Top Box Products. Additional products
may be made subject to this Agreement upon the written consent of all of the
parties to this Agreement.
Section 1.3 CAPITALIZATION: The partners NIKKO and Inter-Con/PC will
each contribute $25,000 (US) to the new Company and each will receive 50% of the
stock.
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NIKKO Multi Media, Inc.
50% 50%
NIKKO IPCN
$25,000 $25,000
Section 1.3 INTER-CON'S GRANTS MARKETING COMPANY THE EXCLUSIVE LICENSE
AGREEMENT TO THE MARKETING COMPANY. Inter-Con grants the Marketing Company the
exclusive, world-wide right to make, use, and sell the Set Top Box Products.
Inter-Con's transfer of its rights to the Set Top Box Products pursuant to this
Section 1. Marketing Company will agree to pay a Licenses Fee equal to 5% of the
purchase price paid to manufacture.
Section 1.4 NIKKO'S CONTRIBUTION. NIKKO shall loan money for operations
to the Marketing Company, pursuant to a budget prepared by the Marketing Company
and approved by NIKKO. Said loans shall be used to pay the costs of making the
Set Top Box Products ready for production, to pay Maxwood for units manufactured
by it and to pay the cost of marketing and selling the Set Top Box Products.
Said loan (s) by NIKKO to the Marketing Company by NIKKO will be reimbursed to
NIKKO from the Marketing Company's net profits at 8% interest and as agreed to
by the parties.
Section 1.5 PARTNER PROFIT SHARING. NIKKO and Inter-Con shall equally
share in all profits generated by the Marketing Company through Set Top Box
Product sales, and other agreed to product and service sales. Distributes of
profits will be 50/50.
ARTICLE TWO
DEVELOPMENT AND MANUFACTURING
Section 2.1 DEVELOPMENT. The parties shall cooperate in the design,
production, sales and marketing of the Set Top Box Products. Said cooperation
shall include but not be limited to assistance in solving any problems with and
making improvements in the Set Top Box Products.
Section 2.2 SELECTION OF MANUFACTURER. Maxwood shall recommend to
Marketing Company one or more entities to manufacture the Set Top Box Products.
The selection of the entity or entities to manufacture said product shall
require the consent of both NIKKO and Inter-Con.
Section 2.3 MONITORING. Inter-Con and Maxwood shall monitor for
quality, cost and delivery the work of the entity or entities selected to
manufacture the Set Top Box Products to the satisfaction of the Marketing
Company.
Section 2.4 MAXWOOD'S FEE. For new products that it develops, the
Marketing Company shall pay Maxwood a fee equal to 5% of the cost paid by the
Marketing Company for the Set Top Box Products sold by it. Said fee shall be
paid within ninety days of the close of each business month in which sales of
the Set Top Box Products occur. There shall be a 5% reserve for refunds.
Section 2.5 INTER-CON'S FEE. The Marketing Company shall pay Inter-Con
a fee equal to 5% of the cost paid by the Marketing Company for the Set Top Box
Products sold by it and, as identified in Article One section 1.3 of this
document. Said fee shall be paid within ninety days of the close of each
business month in which sales of the Set Top Box Products occur. There shall be
a 5% reserve for refunds.
Section 2.6 GUARANTEE. Each party hereby guarantees to each other party
the prompt payment of any fee due to the party under this Agreement.
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ARTICLE THREE
MARKETING
Section 3.1 EXCLUSIVE. Except or allowed otherwise by Section 3.2, the
parties agree that the Set Top Box Products and other agreed to products and
services shall be sold exclusively through the Marketing Company. No party shall
sell the Set Top Box Products in its own name or indirectly through others.
However, each party reserves any right which it may have to make and sell
products other than the Set Top Box Products.
Section 3.2 OTHER BRAND NAMES. Any party may purchase Set Top Box
Products from the Marketing Company and resell said products under brand names
that are different from the brand names used by the Marketing Company in selling
the Set Top Box Products.
ARTICLE FOUR
TERM
Section 4.1 ADJUSTMENTS. The parties shall meet during January and July
of each year to consider changes in the fees provided in Article Two of this
Agreement. Any change in one or both of said fees shall be made only with the
written consent of all of the parties to this Agreement.
Section 4.2 TERMINATION. This Agreement shall remain in force from the
date hereof until any party terminates it by giving the other parties written
notice of termination. Said notice shall set forth a date of termination that is
not less than Twelve (12) months after the date that said written notice is
given. The withdrawing party shall be responsible for their pro-rata share of
the losses incurred to the point of termination.
INTER-CON/PC, INC.
By /s/ Xxxxxxx X. Xxxxxxxx
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Its Chairman and CEO
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NIKKO CO., LTD.
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By /s/
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Its
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MAXWOOD TECHNOLOGY, LTD.
By /s/
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Its
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The validity of this document is subject to the delivery of two working samples
for the Model 1000 and Model 6000 to the Marketing Company on or before 26 May
2000.
Model 1000 will have software with browser for Internet Access and working
keyboard and will use the TV as a monitor.
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