Exhibit 10
MIDDLE NETWORK REGION AGREEMENT
(MEXICO)
THIS AGREEMENT is made and effective as of the 30th day of May 2006,
BETWEEN:
MIDNET (CANADA), INC.
a British Columbia corporation with an office at
Suite 300 - 1055 Xxxx Xxxxxxxx Xxxxxx Xxxxxxxxx, X.X.
X0X 0X0
("MIDNET")
AND:
FUNDAMENTAL STRATEGIES, INC.
a California corporation
with an office at 00000 Xxx Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx
00000
("FUNDAMENTAL")
WHEREAS:
A. MidNet provides wholesale private data and enables video telephony
networking services (the "MIDNET SERVICES") to it's clients through its
private "Middle Network" (the "TMN");
B. MidNet desires to establish territories globally for the purpose of
building distribution channels (the "CHANNELS") for MidNet services;
C. Fundamental provides business development services (the "FUNDAMENTAL
SERVICES") for companies desiring to do business in Mexico;
D. MidNet desires for Fundamental to establish the Mexico territory for MidNet
Services;
E. Fundamental desires to establish the Mexico territory for MidNet Services.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged by the Parties, the Parties covenant and agree
with each other as follows:
1. DEFINITIONS AND INTERPRETATION
1.1. DEFINITIONS
In this agreement unless the context otherwise requires:
"AGREEMENT" means this agreement;
"ASSIGNMENT" means the transference of this Agreement by Fundamental
to a third party acceptable to MidNet;
"CONFIDENTIAL INFORMATION" means all information which one of the
Parties will have access to or come into possession of which is
confidential and proprietary to the other Party and which is either
declared to be confidential or proprietary in nature and includes, but
is not limited to , the terms and pricing for the Products and
Services, all information contained on or accessible through the
Partner Portal, as defined hereafter, any information disclosed by any
third party which the third party is obligated to treat as
confidential or proprietary to one of the Parties hereto, trade
secrets, know-how, processes, standards, product specifications,
marketing plans and techniques, cost and financial pricing figures,
all client or customer information (including without limitation their
names, financial information, address or telephone number), all
systems software applications, all software/systems source and object
code, data, documentation, program files, flow charts, and all
operational procedures;
"DEVICE AUTHENTICATIONS" means devices authenticated or to be
authenticated by TMN;
"PARTY" means either Fundamental or MidNet as is appropriate in
context and "PARTIES" means both or either of Fundamental and MidNet
as is appropriate in context;
"XPORT SERVER" means computers designed and provided by MidNet to
support Device Authentications and communications services for TMN.
1.2. HEADINGS
The division of this Agreement into articles, sections, and/or
subsections and the provision of headings for all or any of them are
for convenience of reference only and shall not affect the
interpretation of this Agreement.
1.3. USAGE
In this Agreement, unless there is something in the subject matter or
context inconsistent therewith:
(a) words importing the singular shall include the plural and vice
versa; and
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(b) words importing gender shall include masculine, feminine and
neuter genders.
1.4. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the Province of British Columbia and the federal laws of
Canada applicable therein.
2. RELATIONSHIP OF THE PARTIES
2.1. NOT A PARTNERSHIP
This Agreement does not and shall not be construed to create a
partnership, joint venture, agency or any other business relationship
which would authorize either Party to act on behalf of the other or in
the name of the other. Each of the Parties is and will remain
completely independent of the other.
3. RESPONSIBILITIES OF THE PARTIES
3.1. MEXICO REGION COMPANY
3.1.1. Fundamental is to establish the Mexico Region Company;
3.1.2. Fundamental is to allocate 10% of the outstanding and issued
shares and one seat on the Board of the Mexico Region Company
to MidNet;
3.1.3. Fundamental shall pay to MidNet five million USD ($5,000,000)
for the first Mexico Region;
3.1.4. The Mexico Region Company will form MidNet (Mexico) with
MidNet;
3.1.5. MidNet (Mexico) will form MidNet (Mexico City) with the Mexico
Region Company.
3.2. MEXICO REGION RESELLER RIGHTS
3.2.1. The Mexico Region Company has reseller rights for further
Regions to be established in the United Mexican States.(Mexico)
3.2.2. The first Region to be established by the Mexico Region Company
will be Mexico City.
3.2.3. Each Region, including the Mexico Region, will be sold for four
million USD ($4,000,000) for a minimum of one million
(1,000,000) Device Authentications and one million USD
($1,000,000) for four hundred (400) xPort servers, for a total
of five million USD ($5,000,000);
3.2.4. Each Region purchaser will receive four hundred (400) xPort
servers with one million (1,000,000) pre-purchase Device
Authentications upon payment, at twelve thousand five hundred
USD ($12,500) and two thousand five hundred (2,500) Device
Authentications per xPort server;
3.2.5. The Mexico Region Company will receive a 10% fee upon final
payment from other Region purchasers in Mexico City.
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3.2.6. Upon full payment for the first Mexico Region the Mexico Region
Company is granted first right of refusal for all Regions in
Central and South America.
3.3. MEXICO REGION RIGHTS
3.3.1. Establish a territory of one million (1,000,000) households in
Mexico City for a minimum of one million (1,000,000) device
authentications;
3.3.2. Region divisions within Mexico City are to be established by
the Mexico Region Company;
3.3.3. Franchise divisions with each region are to be established by
each Region Company
3.3.4. Each Region Company may sell 10 Franchises within its Region,
as well as ten (10) outlets per Franchisee and one (1) kiosk
per building within the Franchisee's territory;
3.3.5. The Franchise Program will be provided by MidNet and each
Region Company will comply with the conditions of the Program.
4. USE OF NAME
Neither Party will use the name of the other in any news release, public
announcement, advertisement or other form of publicity, without the prior
consent of the other Party.
5. TERM AND TERMINATION
5.1. TERM OF THE AGREEMENT
Upon full payment the initial term shall be seven (7) years from the
date of signing. Thereafter, this Agreement will renew automatically
from year to year unless cancelled in writing by either Party giving
the other written notice of such cancellation a minimum of sixty (60)
days before the end of the then current term.
5.2. TERMINATION FOR DEFAULT
Either Party may terminate this Agreement, effective immediately, if
the other commits a material breach of it, commits any material
fraudulent act in performing any of its obligations or makes any
material misrepresentation to the other or commits an act of
malfeasance or misfeasance in the performance of its or his duties or
is unable or unwilling to perform its obligations and duties under
this Agreement which circumstances will include, but not be limited
to:
(a) if a receiver, trustee in bankruptcy or similar officer is
appointed to take charge of any of its assets; or
(b) if it files for relief under any applicable bankruptcy laws.
5.3. TERMINATION FOR NON-PAYMENT
This Agreement will terminate on May 31, 2007, in the event that:
(a) full payment has not been received by MidNet for the region; or
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(b) an Assignment has not been made to an acceptable third party.
6. CONFIDENTIALITY
6.1. CONFIDENTIAL INFORMATION
Each of the Parties acknowledges that in the course of their
relationship pursuant to this Agreement, each (the "RECEIVING PARTY")
will have access to or come into possession of Confidential
Information of the other Party (the "DISCLOSING PARTY"), and that the
disclosure of such Confidential Information to third parties or to the
general public would be detrimental to the best interests and business
of the Disclosing Party.
6.2. EXCEPTIONS TO CONFIDENTIAL INFORMATION
Notwithstanding the definition of Confidential Information and the
provisions of section 6.1, "Confidential Information" does not include
information or data, which the Receiving Party can prove, is:
(a) publicly known at the time of disclosure;
(b) already known by the Receiving Party at the time it receives
the information;
(c) provided to the Receiving Party by a third party that is not
under obligation to keep such information confidential; or
(d) independently developed by the Receiving Party without use of
any Confidential Information of the Disclosing Party.
6.3. LIMITATIONS ON USE
The Receiving Party will not, during the term of this Agreement or at
any time thereafter:
(a) disclose any Confidential Information to any person;
(b) use or exploit, directly or indirectly, the Confidential
Information for any purpose other than the proper purposes of
the Disclosing Party; or
(c) disclose for any purpose, other than those of the Disclosing
Party, the private affairs of the Disclosing Party or any other
information which the Receiving Party may acquire during the
term of the Agreement with respect to the business and affairs
of the Disclosing Party, whether acquired in the course of
carrying out the Agreement or incidentally.
6.4. REQUIRED DISCLOSURE
Notwithstanding the foregoing, the Receiving Party will be entitled to
disclose Confidential Information if required by law provided that the
Receiving Party will promptly notify the Disclosing Party, consult
with the Disclosing Party and cooperate with the Disclosing Party in
any attempt to enjoin, to resist or narrow such disclosure or to
obtain an order or other assurance that such information will be
accorded confidential treatment.
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6.5. SURVIVAL OF CONFIDENTIALITY
All covenants of confidentiality herein shall survive the Term of this
Agreement by three (3) additional years counting from the date of
termination of this Agreement.
7. MISCELLANEOUS
7.1. NO WAIVER
The failure by either Party to enforce or take advantage of any of the
provisions of this Agreement shall not constitute nor be construed as
a waiver of such provisions or of the right subsequently to enforce or
take advantage of each and every such provision.
7.2. DISPUTES
The Parties will attempt to settle any claim or controversy relating
to this Agreement through consultation and negotiation in good faith
and a spirit of mutual cooperation. If those attempts fail, then a
mutually acceptable mediator, chosen by the Parties within forty-five
(45) days after written notice from one of the parties to the other,
demanding mediation, will mediate the dispute. Neither party may
unreasonably withhold consent to the selection of a mediator. The
Parties will share the costs of the mediation equally and each shall
bear its own costs. Any dispute which the parties cannot resolve
between themselves through negotiation or mediation within ninety (90)
days after the date of the initial demand for mediation may then be
submitted to the courts for final resolution. Nothing in this
paragraph will prevent either party from resorting to judicial
proceedings if:
(a) good faith efforts to resolve the dispute under these
procedures have been unsuccessful; or
(b) interim relief from a court is necessary to prevent serious and
irreparable injury to one party or to others.
7.3. NOTICES
Any formal notice between the Parties hereto will be in writing and
may be delivered by any method, including email, provided receipt is
acknowledge by the receiving party or it may be either personally
delivered or sent by facsimile or by registered mail to the
appropriate party at the address noted for that party on the first
page of this Agreement, or such other address as may be designated by
a party in a written notice sent to the other party in accordance with
this paragraph. Any notice or other communication sent by registered
mail will be effective seven calendar days from the day that it was
sent, or if by any other method in accordance with this paragraph, the
day following its receipt.
7.4. ASSIGNMENT
7.4.1. Fundamental may assign this Agreement to a third party
acceptable to MidNet
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7.4.2. Fundamental shall be paid a 10% fee in the event of an
assignment, payable upon receipt of full payment for the Region
by the assignee to MidNet
7.4.3. In the event of an assignment the fee payable to Fundamental(at
Fundamental's discretion) may be paid in the form of cash or
MidNet stock at the discretion of MidNet
8. GENERAL
8.1. ENTIRE AGREEMENT
This Agreement and all documents contemplated by or delivered under or
in connection with this Agreement constitute the entire Agreement
between the Parties with respect to the subject matter of this
Agreement, and supersede all prior agreements, negotiations,
discussions, undertakings, representations, warranties and
understandings, whether written or oral, express or implied, statutory
or otherwise.
8.2. AMENDMENT
No amendment, supplement, or restatement or termination of any
provision of this Agreement is binding upon the Parties hereto unless
it is in writing and signed by an authorized representative of each
Party to this Agreement at the time of the amendment, supplement,
restatement or termination.
8.3. SEVERABILITY
If any provision or any portion of any provision of this Agreement
shall be held unlawful or unenforceable, the balance of such provision
and all other provisions hereof shall nonetheless in all respects
remain binding and effective and shall be construed in full force and
effect to the extent lawfully permissible.
8.4. TIME OF ESSENCE
Time is of the essence in the performance of the terms and conditions
of this Agreement.
8.5. ENUREMENT
This Agreement enures to the benefit of and binds the Parties and
their respective heirs, executors, administrators, successors and
permitted assigns.
8.6. COUNTERPART SIGNATURE AND FACSIMILE DELIVERY
This Agreement may be executed in two or more counterparts and may be
delivered by facsimile, each of which will be deemed to be an original
and all of which will constitute one agreement, effective as of the
Effective Date.
THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK
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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives:
FUNDAMENTAL STRATEGIES, INC. MIDNET (CANADA), INC.
Per: Per:
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Authorized Signatory Authorized Signatory
Xxxxx Xxxxxx Xxxx Xxxx
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Title: president / CEO Title: president / CEO
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