Exhibit 10.15
DATED FEBRUARY 1, 2002
(1) Q COMM INTERNATIONAL, INC.
(2) WGR LIMITED
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DISTRIBUTION AGREEMENT
LAYTONS
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Bristol, London, Manchester and Surrey
Tel: 00000 000000
Fax: 00000 000000
Email: xxxxx.xxxxxxxxx @xxxxxxx.xxx
Ref 6/1118528/14568.005/
DATE: THE 1st DAY OF FEBRUARY 2002
PARTIES
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1. Q COMM INTERNATIONAL, Inc., a corporation organised under the laws of
the state of Utah and having its principal place of business at 0000
Xxxxx 0000 Xxxx, Xxxx, Xxxx 00000-0000 ("Q Comm") of the first part;
and
2. WGR LIMITED, a limited liability company registered in England under
number 04156629 and having its registered office at 0 Xxxx Xxxx,
Xxxxxxx Xxxx, Xxxxxx, XX0 0XX Xxxxxx Xxxxxxx ("WGR") of the second
part.
AGREEMENT
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In consideration of the mutual covenants and agreements contained herein, the
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. DEFINITION AND INTERPRETATION
In this Agreement the words defined above shall have the meanings
ascribed to them and the following words and expressions shall have
the meanings shown:
"Business Day" any day between Monday and Friday inclusive, but
excluding statutory bank holidays in England and
national holidays in the United States of
America;
"Confidential
Information" the substantive terms of this Agreement,
information or material about current or
proposed products, pricing and marketing
strategies, competitive or market analysis and
data, statistics on product performance,
customer lists and other information relating to
a party's business plans and processes, business
and marketing plans and strategies, non-public
business and technology information, trade
secrets, computer source code, any written
materials marked as confidential. Confidential
Information does not include information that a
party can prove: (a) is now or later becomes
generally available to the public without fault
of the party who received such information
("Recipient") from the other party
("Discloser"); (b) was rightfully in Recipient's
possession prior to its disclosure by Discloser;
(c) is independently developed by Recipient
without the use of any Confidential Information
of Discloser; or (d) is obtained by Recipient
without obligation of confidentiality from a
third party who has the right to disclose it;
"Data Element" any unique combination of words, numerals,
codes, PINS or graphics (such unique combination
shall be considered a whole Data Element)
transmitted by Processing Services whether
processed from WGR's data centre host computer
or some other host computer to any one or group
of specific POS Terminals and which, separately
or together, represent the prepaid purchase of
one specific Product;
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"Electronic Top-Up" any method (other than by way of PINS) which
enables the automatic electronic re-charge of a
pre-pay mobile phone;
"Encumbrance" a mortgage, charge, pledge, lien, option,
restriction, right of first refusal, right of
pre-emption or other third party right or
interest or claim or any other encumbrance or
security interest of any kind or any other type
of preferential arrangement having similar
effect;
"Escrow Agreement" an agreement either in the form annexed as
Schedule 2 or in another form reasonably agreed
between the parties to reflect the release
conditions specified in Clause 7, which Q Comm
will enter into with its escrow agent;
"E-Voucher" any method which enables the electronic
generation of PINS for the recharge of a pre-pay
mobile phone;
"Extended Services" those post-termination rights granted to WGR as
specified in Clause 13.1;
"Extended Services
Period" a period of twelve (12) years commencing upon
the date of termination of this Agreement
pursuant to Clause 13 in which WGR is entitled
to Extended Services;
"Operating Software" Q Comm's proprietary software necessary to
operate and/or maintain the POS System and run
the applications thereon (but excluding the
software residing in the POS Terminals),
together with all updates, enhancements and
modifications thereof;
"Performance Period" each of the consecutive periods, beginning
immediately at the end of the Trial Period, that
WGR has within which to order a cumulative
minimum number of POS Terminals pursuant to
Clause 3.3, the first four being 6 months each
and the remaining three being 12 months each;
"PINS" unique personal identification numbers used for
validating payments by the bearers of such
personal identification numbers;
"POS System" Q Comm's proprietary point-of-sale activation,
distribution and reporting system registered in
the US under the name Qxpress(TM) (including any
peripheral equipment provided by Q Comm or
acquired by WGR for use in conjunction
therewith) and the Processing Services provided
by Q Comm to WGR, which permits a Retail Dealer
to dispense Products at the point-of-sale, as
the same may be developed or modified by Q Comm
hereafter. References to the POS System shall
include any competing or successor systems
developed now or hereafter by Q Comm;
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"POS Terminal" a machine installed at a Retail Dealer's
Location to transmit and receive financial and
other data to and from the POS System;
"Processing Services" those Data Element management, dispensing and
reporting services to be provided by Q Comm (as
the same are more particularly specified in
Schedule 3) to or on behalf of WGR in connection
with the sale of Products by Retail Dealers
using the POS System;
"Products" those prepaid cellular and non-cellular services
using E-Voucher or Electronic Top-Up, and
whether delivered by any unique combination of
words, numerals, codes, PINs, graphics or
Electronic Top-Up which are available directly
or indirectly to WGR from the networks, other
Products suppliers and Processing Services
providers, including prepaid cellular and
non-cellular telephone services;
"Retail Dealers" retail sellers and other persons supplied by WGR
or any other member of WGR's Group with POS
Terminals;
"Retail Value" the price paid by the consumer for the Products
without any deduction for discounts and without
any deduction of any value added tax included in
such price;
"Service Provider" either WGR, a member of WGR's Group or one or
more providers of third party services with whom
WGR contracts to provide the Data Elements
necessary for the Products to be issued through
the POS System;
"Software Specifications" has the meaning set forth in Clause 9.3.1;
"Systems Software" together, the Operating Software and Terminal
Software;
"Transaction" The Retail Value of Products sold through the
POS System;
"Transaction Fees" the fees payable by WGR pursuant to Clause 5;
"Terminal Software" Q Comm's proprietary software residing on the
POS Terminals comprising the POS Terminal
operating system necessary to activate the POS
Terminals and ancillary equipment and use the
POS System, together with all updates,
enhancements and modifications thereof;
"Term" the term of this Agreement, as defined in Clause
2.1, but not including any post-termination
period during which the Extended Services are
provided;
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"Territory" together and separately the geographical area
defined by the present external borders of those
countries listed in Schedule 1; and
"Trial Period" The three month period that commences on the
first day of the calendar month following Q Comm
having supplied the initial ten (10) POS
Terminals (including Terminal Software) to WGR
and with the Operating Software installed,
connected to such POS Terminals, and functional,
and expiring at the close of business on the
last day of the third calendar month from such
date.
1.2 In this Agreement (except where the Agreement expressly otherwise
provides or the context otherwise requires):
1.2.1 any reference to a Clause or Schedule is to the relevant clause or
schedule of this Agreement and any reference to a Sub-Clause is to
the relevant sub-clause of the Clause in which it appears;
1.2.2 clause headings are included for convenience only and shall not
affect the interpretation of this Agreement;
1.2.3 use of the singular includes the plural and vice versa;
1.2.4 use of any gender includes the other genders;
1.2.5 any reference to "persons" includes natural persons, firms,
partnerships, companies, corporations, associations,
organisations, governments, states, foundations and trusts (in
each case whether or not having separate legal personality);
1.2.6 references to a "party" shall mean the original parties to this
Agreement and their successors-in-title and permitted assigns;
1.2.7 any undertaking by a party not to do an act or thing shall be
deemed to include an obligation not to cause, permit or suffer
such act or thing to be done by another person under the control
(as the expression "control" is defined, as at the date hereof, in
Section 840 of the Income and Corporation Taxes Act 1988), of that
party or, as the case may be, under the control of another person
over whom that party is able to exercise the relevant powers of
prevention;
1.2.8 references to "agreement", "approval", "consent" or
"authorisation" or words of similar effect, shall mean a consent
or approval or authorisation given in advance in writing signed by
or on behalf of the party whose consent or approval or
authorisation is to be given and, unless the Agreement expressly
requires otherwise, refers to a consent or approval or
authorisation which may be given or withheld in the absolute
discretion of that party and, if given, may be given on such terms
as that party thinks fit;
1.2.9 any reference to an English legal term for any action, remedy,
method of judicial proceeding, legal document, legal status,
court, official or any legal concept or thing shall, in respect of
any jurisdiction other than England, be deemed to include a
reference to what most nearly approximates in that jurisdiction to
the English legal term;
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1.2.10 any phrase introduced by the terms "including", "include", "in
particular" or any similar expression shall be construed as
illustrative and shall not limit the sense of the words preceding
those terms;
1.2.11 where any period is prescribed in this Agreement as being "from",
"after" or "following" a date or event, that period shall commence
on the day following that date or event and shall end at close of
business on the last day of the period so specified;
1.2.12 a reference to any time of day shall be a reference to GMT, and a
reference to close of business on any date is, unless expressly
provided otherwise, a reference to 5.00 p.m. on that date;
1.2.13 reference to writing includes any method of reproducing words on
paper;
1.2.14 any reference to another document or any provisions of another
document shall be construed as a reference to such document or
provision as it is in force for the time being and as amended in
accordance with its terms or, as the case may be, with the
agreement of the relevant parties or the consent of a specified
party;
1.2.15 the terms "holding company", "parent undertaking", "body
corporate", "subsidiary" and "subsidiary undertaking" have the
respective meanings set out in sections 736, 740 and 258 of the
Companies Xxx 0000; "Group", in relation to a body corporate,
means (i) that body corporate, (ii) any other body corporate which
is its holding company or parent undertaking (iii) any other body
corporate which is its subsidiary or subsidiary undertaking and
(iv) any other body corporate which is a subsidiary or subsidiary
undertaking of its holding company or parent undertaking;
1.2.16 any reference to a statute, statutory provision or subordinate
legislation ("legislation") shall (except where the context
otherwise requires) be construed as referring to such legislation
as amended and in force from time to time and to any legislation
which re-enacts or consolidates (with or without modification) any
such legislation;
1.2.17 all amounts referred to in this Agreement shall be exclusive of US
sales taxes, UK and European value added tax and other analogous
taxes; and
1.2.18 performance by any member of WGR's Group of the obligations of WGR
under this Agreement shall be deemed for all purposes to be
performance by WGR; provided that WGR shall retain ultimate
responsibility and liability for all actions and omissions of any
member of WGR's Group in connection with their performance under
this Agreement.
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2. APPOINTMENT AND LICENSE AS EXCLUSIVE DISTRIBUTOR
2.1 Q Comm appoints WGR, and WGR hereby agrees to accept such appointment,
as an exclusive distributor, subject to the provisions of Clause 3
herein, of the POS System, having the other rights set out in this
Agreement, in the Territory for the period commencing on the date
hereof and continuing thereafter for a minimum Term of sixty (60)
months, unless this Agreement is earlier terminated (i) by not less
than twelve (12) months notice given by either party at any time
forty-eight (48) months or more from the first day of the first month
of the first Performance Period or (ii) pursuant to the provisions of
this Agreement.
2.2 Both parties shall use their respective best endeavours as to procure
that the Trial Period commences within six (6) months of date of this
Agreement.
2.3 This Agreement shall be effective only after its execution by
authorised officers of Q Comm and WGR.
2.4 Q Comm grants to WGR the rights and license, as Q Comm's distributor in
the Territory throughout the Term, to supply the POS System to Retail
Dealers within the Territory only; provided, however, that such
territorial restriction shall not prevent WGR from responding to
unsolicited requests from individual customers outside the Territory.
The foregoing includes a license to market, sublicense and distribute
the Terminal Software, as pre-loaded by Q Comm or its designate on the
POS Terminals, to Retail Dealers within the Territory. Such rights and
licenses shall be exclusive for the period and to the extent set forth
in Clause 3, and shall thereafter be non-exclusive. Each sale of a POS
Terminal to a Retail Dealer shall be made pursuant to a fully executed,
written agreement (the "Customer Agreement"), in a commercially
reasonable form, licensing such Retail Dealer to use the POS Terminal
and the Terminal Software, and containing terms at least as protective
of and beneficial to Q Comm as the following:
o The Customer Agreement shall state that the Systems Software is
licensed, not sold, to the Retail Dealer.
o The Customer Agreement shall state that the Retail Dealer is prohibited
from copying, modifying, reverse engineering, decompiling or
disassembling the Terminal Software or any other component of the POS
Terminal or from using it for any purpose other than the authorized POS
System except to the extent permitted by law notwithstanding this
limitation.
o The Customer Agreement shall contain terms reserving title to, and all
intellectual property rights in, the POS System and the Terminal
Software save as set out above.
2.5 WGR may exercise its distribution rights granted above, either
personally, through members of the WGR Group or through third party
distributors, resellers, dealers and sales representatives
(collectively, "Distributors"). WGR shall require each Distributor to
agree in writing that it will comply with the applicable restrictions
of this Agreement, and shall ensure that all Distributors comply with
such terms.
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2.6 Q Comm warrants the Operating Software in accordance with the terms of
Clause 9.3 of this Agreement.
2.7 During the Term, Q Comm undertakes not to cease to operate the POS
System or otherwise withdraw or restrict those Processing Services,
support services and other ancillary services as specified in Schedule
3 made available to WGR, except pursuant to the terms and conditions of
this Agreement.
2.8 If WGR elects to use the Licensed Marks and for so long as it continues
to use the Licensed Marks, WGR agrees to use its reasonable endeavours
to market and sell the POS System to Retail Dealers within the
Territory. WGR shall refrain from making any representations,
warranties or guarantees to any Distributors or third parties or the
trade with respect to the specifications, features or capabilities of
the Systems Software or the POS System that are deceptive, misleading
or otherwise inconsistent with the Systems Software or the POS System.
WGR covenants to the Q Comm that it will conduct business in a manner
that reflects favourably at all times on Q Comm's products and
services, and the good name, good will and reputation of Q Comm.
2.9 WGR shall not reproduce, copy, modify, localize, translate or create
derivative works of any portion of the POS System or Systems Software,
except with Q Comm's consent. WGR agrees not to reverse engineer,
disassemble, decompile or otherwise attempt to derive source code,
trade secrets, programming concepts or methods or Confidential
Information from the Systems Software, except to the extent permitted
by law notwithstanding this limitation. This Clause 2.9 will not apply
if the Source Code is released to WGR pursuant to Clause 7. Any breach
of this Clause 2.9 shall be deemed a material breach of this Agreement
for the purposes of Clause 12.2.
2.10 Subject to the licenses and rights granted herein, the parties
acknowledge that Q Comm owns all right, title and interest in and to
the POS System and its technology and the Systems Software, including
all intellectual property rights therein, all documentation related
thereto, and the Licensed Marks (as defined in Clause 2.13), including
all intellectual property rights therein. Nothing in the Agreement
shall be construed to grant either party any rights in and to any
software, technology, intellectual property or other property of the
other, except as expressly provided herein. Q Comm reserves all rights
not expressly granted herein.
2.11 Q Comm and WGR agree to use reasonable endeavours to assist in
obtaining relevant intellectual property registration within the
Territory.
2.12 Q Comm and WGR will use their respective best endeavours to get BABT
approval to TBR 21 (or equivalent) in each country for the POS System.
The costs shall be borne equally by Q Comm and WGR.
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2.13 Q Comm grants to WGR and to its authorized Distributors a nonexclusive,
non-transferable license within the Territory, at WGR's option, to use
the "Qxpress" xxxx and Q Comm's name (the "Licensed Marks"), in
connection with WGR's authorized marketing and promotion of the POS
System, subject to the following terms:
2.13.1 if WGR elects to use the Licensed Marks (rather than private-label
the POS System), then marketing and sales literature relating to
the POS System shall include the Licensed Marks in reasonably
conspicuous type, as approved by Q Comm in advance of such use;
2.13.2 any use by WGR of the Licensed Marks shall be in compliance with Q
Comm's trademark usage guidelines provided to WGR, as they may be
reasonably modified by Q Comm from time to time, and appropriate
legal standards. The initial or most prominent use of a Licensed
Xxxx in all materials shall be followed by the appropriate
trademark symbol ((R) or TM). Q Comm shall have the right to
review and approve, prior to publication, any advertisements,
marketing materials or other items developed by WGR that utilize a
Licensed Xxxx. WGR agrees not to apply to register any Licensed
Xxxx (or any word or combination of words that is confusingly
similar to a Licensed Xxxx) either as a trademark, service xxxx,
trade name, corporate name or domain name anywhere in the world,
or use such Licensed Marks in any manner other than as expressly
permitted by this Agreement. All goodwill accrued through use of
the Licensed Marks by WGR shall inure to the benefit of Q Comm;
and
2.13.3 if Q Comm decides to register a Licensed Xxxx, file this
Agreement, or take any other similar actions in any country in the
Territory, WGR will reasonably cooperate in such actions at Q
Comm's own expense.
2.14 If Q Comm is approached by a third party interested in acquiring a
country license inside the Territory, WGR will use reasonable
endeavours in negotiating with Q Comm to facilitate such third party
country license.
2.15. WGR shall not supply the POS System to Retail Dealers or customers in
North and South America, provided that nothing herein shall preclude
WGR from supplying the POS System to Retail Dealers or any customer,
wherever located, who purchases the POS System with a view to their use
within the territory of any Member State of the European Union.
2.16 The parties agree that WGR shall have a non-exclusive license under the
terms of this Agreement for the country groups listed on Schedule 5 and
that at such time that WGR has reached, in Q Comm's discretion, a
satisfactory level of performance, such level to be discussed by the
parties in good faith, Q Comm will discuss an exclusive distributorship
for such country groups.
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3. EXCLUSIVITY
3.1 During the Trial Period, the first Performance Period, and renewable
for each subsequent Performance Period as set forth below (the
"Exclusive Period"), subject to the terms of this Clause 3 and the
remaining terms of this Agreement, Q Comm agrees to grant WGR the
Exclusivity Rights (as defined below). If, at the end of any
Performance Period, WGR is in material breach of this Agreement
entitling Q Comm to terminate this Agreement pursuant to Clause 12,
then Q Comm shall be entitled to serve a sixty (60) day notice pursuant
to Clause 3.2. Further, if WGR has not met its minimum purchase
requirements set forth in this Clause 3, Q Comm shall be entitled to
serve a one (1) month's notice pursuant to Clause 3.2. WGR's exclusive
rights during the Exclusive Period (the "Exclusivity Rights") shall be
as follows: subject to the terms and conditions of this Agreement, Q
Comm acknowledges and agrees that during the Exclusive Period it has no
right to appoint other distributors or agents to sell or to market to
retailers or other potential users of the POS System in any part of the
Territory, and that Q Comm has no right to directly, or indirectly
through any member of Q Comm's Group, to market the POS System to
retailers or other potential users in any part of the Territory.
3.2 If, at the end of any Performance Period, WGR fails to meet its minimum
purchase requirements described in Clause 3.3, Q Comm shall be
entitled, forthwith upon giving WGR one (1) month's notice of such
intent, to treat WGR's rights as a distributor under this Agreement, as
non-exclusive within any country group in the Territory in which WGR
has failed to meet its minimum purchase requirements for the applicable
Performance Period. For the avoidance of doubt, this shall be the sole
and exclusive remedy of Q Comm for such failure. If Q Comm believes
that the Exclusive Period should not be renewed for any other reason
(pursuant to Clause 3.1 for a material breach of this Agreement), Q
Comm shall be entitled forthwith to treat WGR's rights as a distributor
as non-exclusive within any country group in the Territory, upon giving
WGR sixty (60) days written notice of termination of exclusivity, and
an opportunity to cure the default or other reason for non-renewal
during such notice period.
3.3 Minimum purchase requirements of POS Terminals. Upon the signing of
this Agreement, WGR agrees to order and purchase ten (10) POS
Terminals. WGR's minimum purchase requirements for each country group
in the Territory, separately and cumulatively, during the Performance
Periods shall be as set forth in Schedule 4. For the avoidance of doubt
POS Terminals shall be deemed ordered for a particular country group
provided that the relevant order specifies the number of POS Terminals
that are assigned to that country group.
3.4 Subject to Clause 4.13, if WGR fails to meet any minimum purchase
requirements for any country group in any Performance Period, but
subsequently orders sufficient POS Terminals so as to meet the
requisite cumulative purchase requirements of that country group before
notice from Q Comm is served withdrawing WGR's exclusive rights for
such country, then Q Comm shall be deemed to have waived the right to
so vary WGR's rights in respect of that specific shortfall in the
number of POS Terminals ordered.
3.5 Subject to Clause 14, upon termination of the Exclusive Period and the
Exclusivity Rights pursuant to the terms of this Agreement, WGR
acknowledges and agrees that Q Comm shall have the right to and may
appoint other non-exclusive distributors or agents to sell or to market
to retailers or other potential users of the POS System in any country
where the rights of WGR have become non-exclusive, and that Q Comm
shall have the right to market to retailers or other potential users of
the POS System in any such country.
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3.6 All purchase orders placed by WGR at any time on or before close of
business on the last day (whether or not a Business Day) of the
relevant Performance Period shall be deemed to be validly placed,
except a purchase order for which WGR has not, on or before that last
day, paid in full the fifty per cent (50%) initial deposit of the
purchase price (excluding any additional monies required for carriage
and/or freight) required pursuant to Clause 4.5. For the avoidance of
doubt, none of the monies remitted by WGR expressly in respect of POS
Terminals may be applied by Q Comm in satisfaction of any other sum
owed by WGR to Comm.
3.7 Additionally, if an unrelated third party purchases thirty-five percent
(35%) or more of the publicly-traded shares in Q Comm, or all or
substantially all of the assets of Q Comm, then Q Comm or its
successor-in-interest shall have the right to terminate WGR's exclusive
rights under this Agreement upon eighteen (18) months prior written
notice. All other rights of WGR and Q Comm under this Agreement,
including WGR's rights with respect to ongoing service and support,
shall continue to survive as set forth herein. For purposes of clarity,
under this Clause 3.7, WGR's exclusive rights shall terminate eighteen
(18) months after Q Comm provides notice of such termination to WGR.
3.8 If Q Comm breaches the rights of WGR under this Agreement to
exclusivity within the whole or any part of the Territory, then WGR may
(without prejudice to any other right or remedy available to it)
terminate this Agreement pursuant to the terms of Clause 12.
4. ORDERS FOR POS TERMINALS AND PAYMENT
4.1 Q Comm shall sell the POS terminals with full legal and beneficial
ownership free from all Encumbrances of whatever nature; provided that
Q Comm shall retain full ownership of all intellectual property rights
with respect to the POS Terminals and the Terminal Software and other
technology contained therein and related thereto. Q Comm shall,
forthwith upon receipt of the full amount of the fifty per cent (50%)
deposit for any order, order the requisite number of POS Terminals
(identifying such POS Terminals by their serial numbers). Title in each
POS Terminal shall pass to WGR immediately upon receipt of the full
payment therefor, and Q Comm shall take whatever steps are necessary at
that time to vest title in WGR.
4.2 Subject always to receipt of the requisite fifty percent (50%) deposit,
Q Comm shall deliver the relevant POS Terminals to a freight forwarder
(who shall act as agent of WGR) located within the state of Utah as is
nominated by WGR for the purpose of taking delivery. Q Comm shall give
WGR no less than fourteen (14) days notice of any delivery. Risk of
loss or damage in POS Terminals shall pass forthwith to WGR upon such
authorised freight forwarder accepting delivery of the same. WGR shall
be responsible and bear the costs of insurance and freight incurred in
respect of the period after such acceptance.
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4.3 Notwithstanding that delivery of POS Terminals shall be deemed to take
place in Utah, WGR shall have a period of fourteen (14) days from the
date when the POS Terminals have been first received by or on behalf of
WGR at any location in the Territory to inspect the POS Terminals and
to reject such POS Terminals for reason of defect or other fault. WGR
shall notify Q Comm on or before the next Business Day following the
expiry of the acceptance period of those POS Terminals rejected for
defect or other fault, giving serial numbers and a brief description of
the defect or fault found. Without prejudice to its other remedies
under this Agreement, WGR shall not have the right to reject any POS
Terminals after the expiry of the fourteen (14) day period and WGR's
failure to reject any POS Terminals during such fourteen (14) day
period, shall be deemed WGR's acceptance of such POS Terminals. WGR
shall only be entitled to reject those POS Terminals properly found to
have defects or damage originating prior to delivery of such POS
Terminals to WGR's authorized freight forwarder, and shall not have the
right to reject an entire consignment of POS Terminals by reason of any
proportion of POS Terminals in that consignment being defective.
4.4 The responsibility and costs of installation of POS Terminals with
Retail Dealers and their subsequent maintenance and repair shall,
except as expressly provided in this Agreement, be borne by WGR.
4.5 WGR shall pay to Q Comm a deposit of fifty percent (50%) of the
purchase price of POS Terminals for which Q Comm has notified a
delivery date pursuant to Clause 4.2 by no later than close of business
four (4) Business Days prior to the notified delivery date. If Q Comm
can only deliver the order in whole or part at a later date, then WGR
shall be obliged to pay the requisite deposit (or proportion thereof)
on or before the close of business on the fourth (4th) Business Day
prior to the notified delivery date. Save as expressly provided in this
Agreement, WGR shall not be entitled to reject a delivery by reason
only that Q Comm is unable to deliver any or only some of the POS
Terminals on the date specified by WGR in its order or that Q Comm is
unable to deliver the POS Terminals ordered in a single consignment.
4.6 WGR shall be entitled to amend the requested delivery dates and
quantities of any order at any time prior to close of business on the
thirtieth (30th) Business Day prior to the requested delivery Date
after which time such order shall be irrevocable and binding upon WGR.
4.7 Subject to the forecasting requirements set forth in Clause 4.8 below
and the provisions of Clause 4.14, Q Comm undertakes to deliver POS
Terminals ordered, in accordance with the procedures laid down in this
Agreement, on the latest to occur of close of business on the delivery
date specified in the relevant order by WGR (as the same may have been
amended pursuant to Clause 4.6).
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4.8 WGR shall provide Q Comm with a written non-binding six-month rolling
forecast (the "Forecast") estimating the number of POS Terminals to be
ordered by WGR during each month of such period, in order for Q Comm to
order adequate units of POS Terminals from the manufacturer thereof.
WGR shall update such Forecast on a monthly basis. Such Forecasts shall
be binding upon WGR thirty (30) days prior to the beginning of the
month forecasted. If WGR's actual orders exceed the number of units
forecasted (at least thirty (30) days in advance) for any given month
by twenty percent (20%) or more, Q Comm shall use reasonable endeavours
to fill such excess orders, but WGR shall not be entitled to terminate
this Agreement with respect to the non-delivery such excess number of
units. Subject to the foregoing, and without prejudice to its other
remedies under this Agreement, if in relation to any order Q Comm is
unable to deliver all the POS Terminals so ordered within sixty (60)
days of the due date for delivery, then (subject to the force majeure
provisions set forth in Clause 11), WGR shall be entitled to terminate
this Agreement.
4.9 Q Comm shall be entitled to invoice WGR for the remaining fifty percent
(50%) of the purchase price of any POS Terminals (adjusted for any POS
Terminals properly rejected by WGR pursuant to Clause 4.3) at any time
on or after delivery to the freight forwarder.
4.10 WGR shall pay to Q Comm the remaining fifty percent (50%) within
fourteen (14) days of the later to occur of (a) the POS Terminals
having been first received by or on behalf of WGR at any location in
the Territory and (b) the date of invoice therefor. If for whatever
reason WGR does not pay in full by due date then Q Comm shall be
entitled to serve a further notice, specifying the breach and requiring
WGR to make good such default in full without set-off within a further
fourteen (14) days of service of that notice. Such notice shall operate
to make time of the essence and Q Comm shall have the right to
terminate this Agreement forthwith should WGR fail to make payment in
full on or before close of business on the fourteenth (14th) day after
service of the notice. Interest shall accrue and be payable to Q Comm
by WGR on any amounts fourteen (14) days past due at the rate of one
and one-half per cent (1.5%) per month on the outstanding balance from
time to time.
4.11 Q Comm warrants that POS Terminals will be complete and perform to
specification, at the time of delivery. If any POS Terminal (other than
a POS Terminal rejected as unfit for its particular purpose pursuant to
Clause 4.3, to which this Clause 4.11 shall not apply) requires to be
repaired due to manufacturing failure or defect, Q Comm shall provide
replacement spare parts free of charge for a period of eighteen (18)
months' from the date of purchase (i.e. the date when title passed to
WGR) of such POS Terminal, but the cost of effecting any such repair
shall be borne by WGR. Q Comm will provide an adequate float of
terminal parts and WGR shall be required to return a defective part to
Q Comm in order to receive a free replacement therefore. During the
Extended Services Period Q Comm, upon request from WGR, shall continue
to provide replacement parts to the float but Q Comm may charge WGR for
any replacements and spare parts. The charges that Q Comm may levy for
any particular type of part must be such that the aggregate charges for
all the terminal parts that makes a complete terminal cannot exceed the
total cost of the last single terminal delivered during the Term.
4.12 Subject to Clause 4.13, the prices payable by WGR over the whole Term
for POS Terminals are as follows:
Number of Units Inc. Mag Swipe Inc. Mag Swipe & media Display
0-1,500 $378.00 per Terminal $446.00 per Terminal
Next 10,000 $315.00 per Terminal $383.00 per Terminal
Thereafter $300.00 per Terminal $358.00 per Terminal
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4.13 The above prices are subject to upward change on not less than one
hundred eighty (180) days' written notice from Q Comm to WGR. Q Comm
shall only be entitled to impose price increases to the extent of any
increase in costs and providing reasonable evidence of such increase to
WGR. If the price increase is greater than a cumulative of five percent
(5%) per annum then WGR shall have the right to postpone the next order
(and all subsequent orders) whose delivery date falls after such price
increase comes into effect until the earlier to occur of (i) pricing
returning to that level above or (ii) the expiry of six (6) months
after the delivery date of that order so postponed by WGR. The said
period of suspension shall be added to the end of the Performance
Period in which it occurs and all subsequent Performance Periods shall
be deferred accordingly. Subject to the foregoing, WGR shall comply
with its minimum purchase obligations under Clause 3.3 in order to
maintain exclusivity. Q Comm undertakes to WGR that should it reduce
the cost of POS Terminals that it charges generally to its other
customers as a result of a reduction in its own production costs, then
it will promptly notify WGR accordingly and reduce the prices charged
to WGR to those same general levels for POS Terminals delivered after
the price reductions first come into effect.
4.14 Q Comm undertakes to use reasonable endeavours to notify WGR within
seven (7) days of receipt of the relevant order if it is not able to
supply in compliance with any order placed by WGR and to specify
therein its best estimate of the quantities and delivery dates that it
can achieve so as to fulfil the order. If Q Comm so notifies WGR of any
change in delivery dates and/or quantities, then WGR shall at its
election (a) accept the revised delivery schedule proposed by Q Comm or
(b) have the right to withdraw the order (subject always to WGR having
to comply with its minimum purchase obligations in order to maintain
exclusivity) and thereby be released from its obligation to be
irrevocably bound by such order pursuant to Clause 4.6.
4.15 For avoidance of doubt, nothing in this Agreement requires WGR to buy
POS Terminals exclusively from Q Comm.
5. PRODUCTS AND TRANSACTION FEES
5.1 In respect of Products sold by Retail Dealers via the POS System, WGR
shall pay to Q Comm a percentage of the Retail Value of all such
transactions put through the POS System via all POS Terminals installed
by WGR or its designate.
5.2 The percentage payable by WGR to Q Comm pursuant to Clause 5.1 shall be
calculated as follows (all exchange rates shall comply with Clause 10.2
of the Agreement):
Monthly Sales (Retail Value) in Transaction Fee as a percentage
Pounds Sterling (%) of Retail Value
(less than) 4,000,000 0.38%
4,000,000 to 8,000,000 0.35%
8,000,001 to 12,000,000 0.33%
12,000,001 to 16,000,000 0.30%
16,000,001 to 20,000,000 0.28%
20,000,001 to 24,000,000 0.25%
24,000,001 to 28,000,000 0.23%
28,000,001 to 32,000,000 0.20%
32,000,001 to 36,000,000 0.18%
36,000,001 + 0.15%
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For the avoidance of doubt, the relevant percentage shall apply to all
transactions in the relevant month and not only to those transactions
falling within the pounds sterling upper and lower limits.
5.3 The Retail Value of transactions shall be calculated on a calendar
month basis and no adjustment shall be made to the above table for
months of differing lengths.
5.4 Q Comm shall be entitled to invoice WGR for the Transaction Fees due in
any calendar month on the first day after the end of the relevant
calendar month.
5.5 WGR shall pay to Q Comm the full amount of the Transaction Fees
invoiced by Q Comm (less any amount that Q Comm properly owes WGR under
the terms of this Agreement) within fourteen (14) days of the date of
the invoice therefor. If for whatever reason WGR does not pay in full
by the due date, then Q Comm shall be entitled to serve a further
notice, specifying the breach and requiring WGR to make good such
default within a further fourteen (14) days of service of that notice.
Such notice shall operate to make time of the essence and Q Comm shall
have the right to terminate forthwith this Agreement should WGR fail to
make payment in full of the full amount properly due to Q Comm in
respect of the amount originally invoiced by Q Comm on or before close
of business on the fifteenth (15th) day after service of the notice.
Interest shall accrue and be payable to Q Comm by WGR on any amounts
fourteen (14) days past due at the rate of one and one-half per cent
(1.5%) per month on the outstanding balance from time to time.
6. PROCESSING AND SUPPORT SERVICES TO BE PROVIDED BY Q COMM
6.1 At the beginning of the Trial Period, upon WGR's receipt of its initial
order of ten (10) POS Terminals loaded with the Terminal Software, Q
Comm shall deliver the necessary Operating Software to WGR and assist
WGR in installing such Operating Software at its data centre. WGR is
licensed to use the Operating Software solely for the purposes of
operating the POS System. WGR shall not disclose, sell or otherwise
transfer the Operating Software to any third party. WGR will supply Q
Comm with space and connectivity to WGR's data centre(s) for Q Comm to
install, at its expense, a transaction server and related Operating
Software to manage the transactional data related to this Agreement.
WGR shall also provide an outbound telephone connection for Q Comm's
server. Q Comm will pay the telecommunications charges for such
connection.
6.2 Q Comm shall throughout the Term provide to WGR free of charge those
Processing Services, support services and other ancillary services as
specified in Schedule 3.
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7. SOFTWARE ESCROW AGREEMENT
7.1 Within six (6) months hereof Q Comm shall procure that WGR has the
benefit of the Escrow Agreement in relation to the Systems Software,
permitting the escrow agent to release to WGR, pursuant to the terms of
the Escrow Agreement, the up-to-date source code for the Systems
Software, together with all necessary password/encryption details
required to access the code (the "Source Code") if any of the following
events occur (each a "Release Event"):
7.1.1 Q Comm files for liquidation or winding up or passes any
resolution for the winding up of Q Comm, in each case without a
permitted successor to this Agreement; or
7.1.2 any order be made, whether by any creditor or otherwise, for the
liquidation or winding up of Q Comm, and such order is not
dismissed within sixty (60) days of the date of entry thereof.
7.2 The Escrow Agreement will contain, inter alia, provisions for
arbitration in the event that WGR requests release of the Source Code
and Q Comm objects to the request, provisions relating to the
preservation of the security and confidentiality of the Source Code
and provisions recognizing Q Comm's ownership of the Source Code and
all rights therein.
7.3 In the event of release of the Source Code, WGR shall be granted a
limited license, for the remainder of the Term and (if applicable)
the Extended Services Period, to use the Source Code solely to
correct programming errors in the Systems Software and to maintain
the POS System for Retail Dealers to the extent permitted by this
Agreement, to the exclusion of any other right and purpose. WGR shall
have no right to sub-license the Source Code to others. Any
prohibitions, restrictions and limitations under this Agreement
applicable to the Systems Software also apply to the Source Code.
7.4 WGR recognizes and agrees that the Source Code is the valuable
proprietary and confidential information of Q Comm. WGR agrees to
hold same in confidence and to preserve its confidentiality in the
event that it shall be entitled to use the Source Code. The WGR
further agrees not to disclose the Source Code to any third party
save only under conditions of confidentiality and by a written
agreement so as to enable the third party to correct programming
errors in the Systems Software and to maintain the POS System for
Retail Dealers to the extent permitted by this Agreement.
7.5 WGR agrees that in the event it obtains access to the Source Code
pursuant to the Escrow Agreement, it will take all necessary steps to
prevent unauthorized disclosure of the Source Code.
7.6 At the end of the Term or (if applicable) the Extended Services
Period, after WGR has obtained Source Code pursuant to the terms
hereof, WGR will return to Q Comm or its successor or assigns the
Source Code.
15
7.7 WGR shall be liable to Q Comm for all direct and indirect,
consequential, special and incidental damages resulting from any
unauthorized disclosure of the Source Code by the WGR or any person
for whom it is at law responsible. To the extent, if any, that this
provision conflicts with the provision of any other agreement, this
provision shall prevail.
7.8 For certainty, except to the extent specifically identified in the
Escrow Agreement, neither WGR nor any third party shall be entitled
to Source Code. Ownership of the Source Code and all rights therein
remain with Q Comm at all times.
7.9 The release of the Source Code to WGR shall in no way impair Q Comm's
right to receive license fees in connection therewith, or the rights
of Q Comm's creditors, assigns or successors in interest.
7.10 In the event that such terms are varied or a new Escrow Agreement is
entered into with a mutually acceptable replacement escrow agent,
then Q Comm shall procure that WGR has the benefit thereof within
thirty (30) days thereof. WGR agrees to pay the annual registration
fees payable to any such Escrow Agent so as to enable WGR to be a
beneficiary under the terms of the Escrow Agreement.
8. WGR REPRESENTATIONS AND WARRANTIES
WGR represents and warrants to Q Comm as follows:
8.1 that it has the power and authority to perform its obligations under
this Agreement, and such performance will not breach any separate
agreement by which WGR is bound;
8.2 that it will comply with the laws, rules and regulations of all
applicable countries in connection with its distribution of the POS
System, including all applicable export laws and controls;
8.3 that it will not make any representations or claims about Q Comm or the
POS System except those contained in Q Comm's promotional literature or
specifically authorized in writing by Q Comm; and
8.4 that neither it nor any member of its Group is in breach, as at the
date of this Agreement, of any binding contractual arrangement with LDC
Direct, Ltd. Co.
9. Q COMM REPRESENTATIONS AND WARRANTIES
Q Comm represents and warrants to WGR as follows:
9.1 that it has the power and authority to perform its obligations under
this Agreement, and such performance will not breach any separate
agreement by which Q Comm is bound;
9.2 that the specification to be provided by Q Comm to WGR for equipment to
be purchased by WGR to operate its own POS System data centres shall be
complete and accurate in all material respects and will enable WGR to
operate the POS System substantially in the manner contemplated by the
System Specification with the minimum number of POS Terminals necessary
for WGR to maintain its exclusivity in the Territory;
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9.3 that for a period of eighteen (18) months after the date of this
Agreement, the Systems Software, if properly used by WGR and the Retail
Dealers, shall provide in all material respects, the facilities and
functions described in the product description of the Systems Software
and the operating manuals and other literature provided by the Q Comm
to WGR at the date of this Agreement, as the same are annexed to this
Agreement for the purposes of identification (the "Software
Specifications"); provided, however, that the warranty shall not apply
in the event the Systems Software is modified or altered in any manner
other than by Q Comm or used with any hardware or POS Terminal not
provided by or certified by Q Comm; and
9.4 that any subsequent modifications to the Systems Software will not
materially reduce the facilities and functions of the original Software
Specifications.
9.5 If Q Comm breaches any of the representations and warranties set forth
in Clauses 9.2, 9.3 and 9.4 at any time during the Term, then WGR shall
notify Q Comm of the breach, giving reasonable details of the nature of
the breach and requiring Q Comm to remedy the same in full within sixty
(60) days of service of that notice. Such notice shall operate to make
time of the essence and WGR shall have the right to terminate this
Agreement should Q Comm fail to make good all the breaches on or before
close of business on the sixtieth (60th) day after service of the
notice.
9.6 EXCEPT FOR THE WARRANTIES SET FORTH IN CLAUSES 4 AND 9, THE POS SYSTEM,
THE POS TERMINAL AND THE SYSTEMS SOFTWARE ARE PROVIDED ON AN "AS IS"
BASIS. Q COMM DOES NOT WARRANT THAT ITS PRODUCTS OR SERVICES WILL BE
ERROR FREE OR UNINTERRUPTED, OR THAT ALL NON-CONFORMITIES CAN OR WILL
BE CORRECTED. Q COMM EXPRESSLY DISCLAIMS ALL OTHER WARRANTIES,
CONDITIONS AND REPRESENTATIONS, INCLUDING BUT NOT LIMITED TO IMPLIED
WARRANTIES, CONDITIONS AND REPRESENTATIONS OF FITNESS FOR ANY
PARTICULAR PURPOSE OR INTENDED USE, NON-INFRINGEMENT OF THIRD PARTY
RIGHTS, AND MERCHANTABILITY.
9.7 IN NO EVENT SHALL Q COMM BE LIABLE TO WGR OR TO ANY THIRD PARTY FOR ANY
DAMAGES WHICH OCCUR AT ANY TIME AFTER THE DATE OF THIS AGREEMENT
THROUGH THE LAST DAY OF THE TRIAL PERIOD AND ARISE OUT OF THE
INSTALLATION OF THE POS SYSTEM, THE SYSTEMS SOFTWARE OR Q COMM"S
SERVICES RELATED THERETO. WGR AGREES TO INDEMNIFY Q COMM FOR ANY CLAIMS
AND DAMAGES ARISING OUT OF WGR'S FAILURE TO PROVIDE Q COMM'S
DISCLAIMERS OF WARRANTIES AND LIABILITIES UNDER THIS AGREEMENT (OR
DISCLAIMERS OF WARRANTIES AND LIABILITIES NO LESS PROTECTIVE OF Q COMM
THAN THE DISCLAIMERS UNDER THIS AGREEMENT) TO DISTRIBUTORS, CUSTOMERS
OR OTHER THIRD PARTIES.
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9.8 SUBJECT TO CLAUSE 9.9, IN NO EVENT SHALL Q COMM BE LIABLE TO WGR OR TO
ANY THIRD PARTY FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE
DAMAGES ARISING OUT OF THE POS SYSTEM, THE SYSTEMS SOFTWARE OR Q COMM'S
SERVICES, INCLUDING LOST PROFITS AND LOST DATA, WHETHER LIABILITY IS
ASSERTED IN CONTRACT OR TORT (INCLUDING NEGLEGENCE AND STRICT PRODUCT
LIABLITY) AND IRRESPECTIVE OF WHETHER Q COMM HAS BEEN ADVISED OF THE
POSSIBILITY OF ANY SUCH LOSS OR DAMAGE. SUBJECT THERETO, IN RELATION TO
CLAIMS OR DAMAGES ARISING IN THE PERIOD PRIOR TO THE COMMENCEMENT OF
THE SECOND PERFORMANCE PERIOD, IN NO EVENT SHALL THE AGGREGATE
LIABILITY OF Q COMM FOR ANY CLAIMS OR DAMAGES ARISING OUT OF OR RELATED
TO THIS AGREEMENT EXCEED THE TOTAL OF THE AMOUNTS PAID TO Q COMM BY WGR
IN THE PERIOD IMMEDIATELY PRECEDING THE EVENT WHICH GAVE RISE TO THE
CLAIM. IN RESPECT OF CLAIMS OR DAMAGES ARISING IN THE SECOND
PERFORMANCE PERIOD AND THEREAFTER, IN NO EVENT SHALL THE AGGREGATE
LIABILITY OF Q COMM FOR ANY CLAIMS OR DAMAGES ARISING OUT OF OR RELATED
TO THIS AGREEMENT EXCEED THE TOTAL OF THE TRANSACTION FEES PAID TO Q
COMM BY WGR (GROSSED UP BY THE AMOUNT OF ANY SUMS PROPERLY DEDUCTED
FROM SUCH PAYMENTS BY WGR BY WAY OF SET-OFF IN ACCORDANCE WITH TERMS OF
THIS AGREEMENT) IN THE TWELVE (12) MONTH PERIOD IMMEDIATELY PRECEDING
THE EVENT WHICH GAVE RISE TO THE CLAIM.
9.9 NONE OF THE LIMITATIONS SET FORTH IN CLAUSE 9.8 SHALL APPLY IN RELATION
TO ANY LOSS OR DAMAGE SUFFERED BY WGR BY REASON OF Q COMM BREACHING THE
RIGHTS OF WGR UNDER THIS AGREEMENT TO EXCLUSIVITY WITHIN THE WHOLE OR
ANY PART OF THE TERRITORY.
9.10 For the avoidance of doubt the parties agree that nothing contained in
this Agreement shall apply so as to restrict liability for death or
personal injury resulting from the negligence or willful misconduct of
either party.
10. PAYMENTS
10.1 All payments by WGR to Q Comm shall be made via wire transfer, in
United States dollars and deemed made upon receipt into the account by
Q Comm on the relevant invoice. Q Comm may nominate, by notice given to
WGR in accordance with this Clause 10, another account. Any such
nomination shall take effect 5 (five) Business Days after it is
received or (if later) on the date (if any) specified in the notice as
the date on which the change is to take place.
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10.2 If any payments to Q Comm hereunder require the conversion of British
Pound Sterling to U.S. dollars, the parties agree that the exchange
rate shall mean the number of U.S. dollars payable in exchange for one
British Pound Sterling as such rate is quoted in Barclays Bank plc on
the due date for any payment under this Agreement; provided, however,
that if such due date for payment occurs on a day on which the Barclays
Bank plc exchange rate is not published, the rate appearing on the next
Business Day (excepting U.S. national holidays) shall apply. If the
aforementioned exchange rate decreases below the rate of U.S. $1.20 per
one British Pound Sterling, at Q Comm's discretion, the parties may
renegotiate the pricing of the Agreement. If the United Kingdom joins
EMU (Economic and Monetary Union) during the Term of this Agreement,
the British Pound Sterling will eventually be replaced by the Euro. A
fixed rate of exchange between the Pound Sterling and the Euro will be
mutually agreed. This conversion rate will be used to convert all Pound
Sterling amounts referred on in the Agreement into Euros.
11. FORCE MAJEURE
11.1 If either party shall be prevented from or delayed in performing any of
its obligations under this Agreement as a result (direct or indirect)
of force majeure, the affected party shall immediately notify the other
party and shall use its reasonable endeavours to minimise the effect of
the "force majeure", provided that this shall not require the affected
party to settle strikes, lock-outs or other industrial disputes on
terms contrary to its wishes. In the event of force majeure, the
obligations of the party giving the notice will be suspended so far as
it is affected by the force majeure.
11.2 For the purposes of this Agreement, "force majeure" shall include
events and/or circumstances outside the reasonable control of the
affected party, including acts or restraints of government, war, civil
war, riot, terrorism, civil disturbance, strike, lock-out or other
industrial dispute, shortened hours of labour, accident, epidemic,
cellular and/or telephone network failure, stoppage of or interference
with transport facilities or non-supplies or irregular supplies of raw
or auxiliary materials or energy. The other party may require the
affected party to produce evidence of the force majeure event.
11.3 Contract fulfilment will be resumed as soon as force majeure has
ceased.
11.4 The affected party will not be liable for delay or non-fulfilment of
this Agreement resulting (directly or indirectly) from force majeure.
11.5 If the force majeure continues for more than three (3) months, the
other party may terminate this Agreement by notice in writing to the
affected party having immediate effect. If it does not exercise this
right within seven (7) Business Days of the end of the three (3) month
period, the affected party may at any time set an appropriate time
limit in which this Agreement may be terminated by either party if the
force majeure continues.
12. TERMINATION
12.1 Upon written notice to Q Comm within fifteen (15) days of the end of
the Trial Period, WGR may terminate this Agreement, without any further
liability of either party to the other, if WGR reasonably believes,
upon review of the POS System, that it will not be able to adequately
market the POS System within the Territory, sufficient to meet its
cumulative minimum purchase obligations hereunder.
19
12.2 In addition to the termination rights specifically provided elsewhere
in this Agreement, and except to the extent specifically modified by
other terms of this Agreement, either party may terminate this
Agreement if the other party commits a material breach of this
Agreement (except as modified by Clause 16.5) and fails to cure such
breach within sixty (60) days after the receipt of written notice of
such breach (except for breaches by a party of its confidentiality
obligations under this Agreement relating to Source Code, for which the
period will be ten (10) days after receipt by the breaching party of
written notice of such breach).
12.3 In addition to other rights of termination under this Agreement, either
party may (without prejudice to any other right or remedy available to
it), to the extent permitted by law, terminate this Agreement at any
time by notice to the other party, having immediate effect if the other
party shall file a petition for administration (in the case of WGR) or
(in the case of Q Comm) commence a case under Title 11 of the US Code
(the Bankruptcy Reform Act of 1978) or file for liquidation or winding
up or if any resolution shall be passed for the winding up of the other
party or any order be made whether by any creditor or otherwise for the
liquidation or winding up of the other party.
12.4 Upon the expiration or termination of this Agreement, howsoever
arising:
12.4.1 any money due from one party to the other shall become immediately
due and payable, with the right to set-off any sums properly due
to it from the other , provided that if WGR is entitled to
Extended Services pursuant to Clause 13, payment therefor will be
due on the normal due dates;
12.4.2 Either party may at the end of the Term forthwith give written
notification to the trade, in a form approved in advance by the
other party, that WGR has ceased to act as the distributor in
respect of the POS System within the Territory, provided that such
approval not be unreasonably withheld or delayed;
12.4.3 Each party shall return to the other party or destroy all
Confidential Information of the other party, and WGR shall cease
all use of Q Comm's Licensed Marks;
12.4.4 It is agreed that Clauses 1, 2.10, 8, 9, 10, 12.4, 13, 14.2, 14.4,
15, 16, 17, 18 and 20 shall survive termination of this Agreement,
except that if the Extended Service Period applies, the Clauses
referenced in Section 13.2 shall survive termination.
12.5 Any termination of this Agreement (howsoever occasioned) shall not
affect any accrued rights or liabilities of any party nor shall it
affect the coming into force or the continuance in force of any
provision hereof which is expressly or by implication intended to come
into or continue in force on or after such termination.
12.6 Upon termination of this Agreement, WGR shall have no further right to
distribute or use the POS System and all licenses hereunder shall
cease, except as expressly provided for by this Agreement.
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13. EXTENDED SERVICES
13.1 Effective immediately upon termination of this Agreement for any reason
other than due to a material breach of this Agreement by WGR or
pursuant to Clauses 12.1 or 12.2, the following shall apply
post-termination, during the Extended Services Period:
13.1.1 Q Comm hereby grants to WGR, a non-exclusive license to supply the
POS System to Retail Dealers within the Territory, including the
right to market, sublicense and distribute the Terminal Software,
as pre-loaded by Q Comm or its designate on the POS Terminals;
provided, however, such supply and distribution by WGR shall be
limited, subject to Clause 13.1.3, only to any POS Terminals
purchased or ordered by WGR immediately prior to the date of
termination or expiry. Notwithstanding any provision in this
Agreement to the contrary including Clause 13.1.5, nothing in this
Clause 13.1.1 shall oblige Q Comm to provide modifications,
enhancements, upgrades or updates to, or maintain, modify or
enhance the System Software at any time after this licence has
come into effect;
13.1.2 WGR shall continue to pay Q Comm the required Transaction Fees in
respect of Transactions processed on the POS System after
termination of this Agreement pursuant to the terms of Clause 5
where the Agreement has terminated pursuant to a notice served by
WGR pursuant to Clause 2.1 but in all other circumstances no
Transaction Fees shall be payable and the aforesaid license shall
be royalty-free;
13.1.3 WGR may continue to purchase from Q Comm additional POS Terminals
for Retail Dealers who were existing WGR customers as of the date
of termination, but otherwise shall not be entitled to order any
further POS Terminals from Q Comm; and
13.1.4 Subject to Clause 13.1.1, WGR shall be entitled to relocate its
POS Terminals or to appoint further or substitute Retail Dealers
to sell Products via those POS Terminals.
13.1.5 WGR shall continue to maintain and support the Retail Dealers
using the POS System and, subject to (i) acceptance by Q Comm as
to the price it may charge therefor and (ii) the required
Transaction Fees are being paid to Q Comm in accordance with
Clause 13.1.2, Q Comm shall continue to provide support services
and other ancillary services as specified in Schedule 3 to WGR.
13.1.6 For the avoidance of doubt, where Transaction Fees are payable WGR
shall be under no implied obligation to process Products through
the POS Terminals throughout the twelve (12) year period of the
Extended Services Period and the right of Q Comm to Transaction
Fees shall be limited to Transaction Fees in respect only of such
Products as are sold via the POS System and/or the Operating
Software at any time and from time to time during that period.
13.2 For purposes of this Clause 13 only, Clause 1, the Customer Agreement
requirements in Clause 2.4, Clauses 2.5, 2.9, 2.10, 2.15, 2.16, 4.1,
4.2, 4.3 4.4, 4.5, 4.9. 4.10, 4.11, 4.15, 5, 6.1, 8, 9.1, 9.6, 9.7,
9.8, 9.9, 10, 12.4.3, 12.4.4, 13, 14.2, 14.4, 15, 16, 17, 18, 19 and 20
shall survive termination of the Agreement.
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13.3 The parties may mutually agree to terminate the Extended Services
Period of the Agreement. Either party may terminate the Extended
Services Period of the Agreement and the obligations and
responsibilities of the parties related thereto set forth in this
Clause 13, if the other party commits a material breach of such
obligations and fails to cure such breach within sixty (60) days after
the receipt of written notice of such breach (except for breaches by a
party of its confidentiality obligations relating to Source Code set
forth in Clause 16 of the Agreement, for which the period will be ten
(10) days after receipt by the breaching party of written notice of
such breach). Upon such termination WGR's rights and licenses granted
hereunder and as set forth in the applicable provisions of the
Agreement shall immediately cease. At the time of termination of the
Extended Services Period, pursuant to this Clause 13.3, the Clauses
listed in Section 12.4.4 of the Agreement (except Clause 13) shall
survive such termination.
14. NON-SOLICITATION
14.1 Except as expressly permitted by this Agreement, Q Comm undertakes not
to, directly or indirectly during the Term, supply POS Terminals or
otherwise make available the POS System to Retail Dealers who, to Q
Comm's knowledge are still under contract with either WGR or any member
of the WGR Group.
14.2 Except as expressly permitted by this Agreement, for a period of
eighteen (18) months after the end of the Term Q Comm undertakes not to
(and shall use reasonable endeavours to procure that its authorised
distributors shall not) directly or indirectly solicit any Retail
Dealers who are, to Q Comm's knowledge, under contract during that
period with either WGR or any member of the WGR Group to supply them
with POS Terminals or otherwise make available to them the POS System,
provided that this restriction shall not prevent either Q Comm or any
of its authorised distributors after the end of the Term from supplying
POS Terminals to Retail Dealers who are under contract with either WGR
or any member of the WGR Group in response to unsolicited requests.
14.3 Nothing in this Agreement shall either directly or indirectly prevent
or restrict Q Comm from supplying end-users, independent retailers or
service providers, including Retail Dealers, with any spare parts
relating to the POS Terminals.
14.4 Unless otherwise expressly agreed to in writing, neither party shall,
directly or through any member of its Group, solicit for employment or
hire (as an employee, consultant or otherwise) any person employed by
the other party or retained by the other party as a consultant at any
time when such person is employed or engaged by such other party or
during the six (6) months after such employment or engagement ends.
This provision will remain in effect during the Term and for a period
of one (1) year after expiration or termination of this Agreement.
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15. NOTICES
15.1 Any notice, request or other communication given in connection with
this Agreement shall be in writing and may be delivered by hand, or
sent by facsimile, or by post, pre-paid recorded delivery or special
delivery post within the United Kingdom (or prepaid international
recorded mail if sent outside the United Kingdom), to the address of
the relevant party set out below.
15.2 The persons authorised to receive notices and the addresses and
facsimile numbers for the purposes of this clause 11 are as follows:
To Q Comm:
Person: Xxxxxxx Xxxxxxxx
Address: 0000 Xxxxx 0000 Xxxx. Xxxx, XXXX 00000-0000
Facsimile: 001 801 2229555
To WGR:
Person: Xxxxx Xxxxxx
Address: 00-00 Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxx XX0 0XX
Xxxxxx Xxxxxxx
Facsimile: 044 208 408 5411
15.3 The parties may nominate, by notice given to the other in accordance
with this Clause 15, another person, address or facsimile number for
the receipt of notices or copy notices. Any such nomination shall take
effect 5 (five) Business Days after it is received or (if later) on the
date (if any) specified in the notice as the date on which the change
is to take place.
15.4 Any such notice, request or other communication pursuant to this
Agreement shall be deemed to have been received:
15.4.1 if delivered by hand before 5.00 p.m. on any Business Day, at the
time of delivery, and otherwise at 10.00 a.m. on the next Business
Day;
15.4.2 if sent by prepaid recorded or special delivery post or prepaid
international recorded airmail, at the time of delivery;
15.4.3 if sent by post (other than by prepaid recorded or special
delivery post), two (2) Business Days from the date of posting;
and
15.4.4. if sent by facsimile, two hours after transmission if sent before
3:30 p.m. on a Business Day, and otherwise at 10.00 a.m. on the
next Business Day.
23
15.5 In proving the service of the same, it will be sufficient to prove that
the envelope containing such notice was addressed to the address of the
relevant party set out in this clause and delivered either to that
address or into the custody of the postal authorities as a prepaid
recorded or special delivery or international recorded airmail letter,
or in the case of a facsimile, that such facsimile was duly despatched
to the facsimile number of the addressee.
15.6 Notice given under this Agreement shall not be validly served if sent
by email.
16. CONFIDENTIALITY
16.1 Each party (as Recipient of Confidential Information from the other
party, as Discloser) agrees that it shall not disclose to any person or
use for any purpose, except as expressly permitted by this Agreement,
any Confidential Information of Discloser. Recipient may disclose
Confidential Information only to its employees, independent contractors
and advisors who need to know such information, and who are bound to
keep such information confidential. Recipient shall give Discloser's
Confidential Information at least the same level of protection as it
gives its own Confidential Information of similar nature, but not less
than a reasonable level of protection. Recipient shall maintain
Confidential Information in a safe and secure place and shall not copy
Confidential Information except to the extent necessary for the
purposes of this Agreement. All confidentiality obligations shall
survive until five (5) years after termination of this Agreement.
16.2 In addition to the exclusions set forth in Clause 16.1, a disclosure of
Confidential Information that (i) is required to be disclosed by law or
judicial order (provided that prior written notice of such required
disclosure is given to Discloser as soon as practicable in order to
give Discloser the chance to object to the disclosure or to seek a
protective order), or (ii) is necessary to establish the rights of
either party hereunder, shall not be considered to be a breach of this
Agreement.
16.3 Each party agrees that money damages would not be a sufficient remedy
for any breach of the obligations herein and that the disclosing party
shall be entitled to specific injunctive relief as a remedy for any
such breach. Such remedy shall not be deemed to be the exclusive remedy
for the breach of obligations herein but shall be in addition to all
other available legal or equitable remedies.
16.4 Each party has the right to review and approve, prior to publication,
the content of any press releases or public communications issued by
the other party relating to this Agreement. Approval shall not be
unreasonably withheld or delayed beyond three (3) Business Days from
receipt of finished copy, or an otherwise mutually agreed upon time.
The parties agree to reasonably cooperate with each other in providing
appropriate quotes and other requested information for press releases.
No party shall otherwise make (and the parties shall use all reasonable
endeavours to each procure that no person connected with them shall
make) an announcement of any kind about this Agreement or the
transactions contemplated in it or any ancillary matter before, save
and to extent as may be required by law or the rules of any competent
regulatory authority.
24
16.5 To the extent permissible by law, each party hereby agrees, without
prejudice to its other rights and remedies at law, to waive its right
to terminate this Agreement by reason only of a breach of this Clause
16, or to rely on any such breach, when taken in conjunction with any
breach of another provision of this Agreement, as forming part of any
course of conduct amounting to a material breach of this Agreement,
entitling that party to terminate this Agreement, provided always that
nothing in this Clause 16.5 shall preclude the right of a party to
terminate pursuant to Clause 12.2 by reason of a breach by the other
party of its confidentiality obligations under this Agreement relating
to Source Code.
17. THIRD PARTY RIGHTS
No person, other than a person who is a party to this Agreement, has
any rights under the Contracts (Rights of Third Parties) Xxx 0000 or
(to the extent permitted by law) under any analogous law of the State
of Utah, to rely upon or enforce any term of this Agreement but this
does not affect any right or remedy of a third party which exists or is
available apart from that Act.
18. GENERAL
18.1 Each provision of this Agreement is severable and distinct from the
others. The parties intend that every such provision shall be and
remain valid and enforceable to the fullest extent permitted by law. If
any provision of this Agreement shall be held to be illegal or
unenforceable by a court or authority of competent jurisdiction, such
provision(s) shall be modified, if possible, to the minimum extent
necessary to make it valid and enforceable, or if it cannot be so
modified, then severed, and the enforceability of the remainder of this
Agreement shall not be affected.
18.2 Neither a single or partial exercise or temporary or partial waiver by
any of the parties of any right, nor the failure by that party to
exercise in whole or in part the right or to insist on the strict
performance of any provisions of this Agreement, nor the
discontinuance, abandonment or adverse determination of any proceedings
taken by that party to enforce any rights or any such provisions shall
(except for the period or to the extent covered by such temporary or
partial waiver) operate as a waiver of, or preclude any exercise or
enforcement or (as the case may be) further or other exercise or
enforcement by that party of, that or any other right or provision. The
giving by a party of any consent to any act which by the terms of this
Agreement requires such consent shall not prejudice the right of that
party to withhold or give consent to the doing of any similar act in
the future.
18.3 This Agreement may be entered into in any number of counterparts but,
taken together, shall constitute one instrument.
18.4 The parties shall not be entitled, save as otherwise permitted in this
Agreement, to set off any sums which it owes to another party against
any sums payable to it by the other party.
18.5 Each party to this Agreement shall pay its own costs of and incidental
to this Agreement and the sale and purchase agreed to be made.
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18.6 This Agreement (together with any schedules and attachments hereto and
any documents referred to herein) constitutes the whole agreement
between the parties hereto relating to its subject matter, to the
entire exclusion of any heads of agreement, memoranda or other
agreement or understanding of any kind between the parties preceding
the date of this Agreement and in any way related to the subject matter
hereof, and no variations hereof shall be effective unless made in
writing and signed by the relevant parties.
18.7 The parties are independent contractors, and this Agreement shall not
be construed to create any agency, franchise or partnership between the
parties. Neither party has the authority to bind the other or to incur
any liability or otherwise act on behalf of the other.
18.8 WGR acknowledges that Q Comm is subject to certain United States laws,
including but not limited to the Foreign Corrupt Practices Act of 1977
and any amendments thereto, which apply to activities carried out on Q
Comm's behalf outside the United States. Subject to prior notification
by Q Comm, WGR agrees neither to take nor omit to take any action if
such act or omission might cause Q Comm to be in violation of any such
laws, and where pursuant to this undertaking WGR is required to take
any action or to cease or amend its conduct or business practices, it
shall be granted a reasonable time within which to comply, having
regard to all the circumstances, including the cost to WGR of
compliance.
19. ASSIGNMENT
This Agreement shall be binding upon and enure for the benefit of each
party's successors and personal representatives (as the case may be)
and, save as expressly permitted in this Agreement, none of the rights
of the parties under this Agreement may be assigned or transferred
without consent of the other party, which shall not be unreasonably
withheld. However, a party may assign this Agreement to a subsidiary,
affiliate or other related entity, or to a third party in connection
with the acquisition of assets or stock of the assigning party by such
third party, upon written notice to the other party, provided that the
assignee accepts all of the assignor's ongoing duties and obligations
under this Agreement jointly and severally with the original party to
this Agreement whose rights are being assigned.
20. GOVERNING LAW AND JURISDICTION
20.1 The validity, construction and performance of this Agreement shall be
governed by and construed in accordance with the laws of England and
Wales
20.2 Each party irrevocably agrees to submit to the non-exclusive
jurisdiction of the courts of England and Wales
20.3 Each party irrevocably consents to any process in any legal action or
proceedings arising out of or in connection with this Agreement being
served on it in accordance with the provisions of this Agreement
relating to service of notices. Nothing contained in this Agreement
shall affect the right to serve process in any other manner permitted
by the laws of the country in which service is to be effected.
26
20.5 In the event of any dispute before any court of competent jurisdiction
in the United States of America, the prevailing party shall be entitled
to recover from the non-prevailing party all attorneys' fees and costs
incurred by the prevailing party in connection with such dispute,
regardless of whether such dispute results in the filing of a lawsuit.
20.6 The parties agree that the United Nations Convention on Contracts for
the International Sale of Goods shall not apply in any respect to this
Agreement or the parties hereto.
This Agreement has been executed on the date set out on page 1.
Q COMM INTERNATIONAL, INC.
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------------
Signature
Name: Xxxxxxx Xxxxxxxx
---------------------------------------
Title: President
--------------------------------------
WGR LIMITED
By: /s/ Xxxxx Xxxxxx
-----------------------------------------
Signature
Name: Xxxxx Xxxxxx
---------------------------------------
Title: Chairman
--------------------------------------
27
SCHEDULE 1
- Territory by Country & Region
Country Group
1. The United Kingdom A
2. Ireland A
3. Spain B
4. Portugal B
5. France C
6. Switzerland C
7. Italy D
8. Malta D
9. Germany E
10. Austria E
11. Belgium F
12. Holland F
13. Luxembourg F
14. Czech Republic H
15. Greece H
16. Poland H
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SCHEDULE 2
- Pro-forma Escrow Agreement -
[TO BE ADDED WHEN COMPLETED]
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SCHEDULE 3
- Processing and other Services -
1. Processing Services:
QXPRESS 200
System Overview
The QXPRESS 200 terminal, in concert with the Q Comm Data Center, is designed to
initiate, print and process transactions for various prepaid services. This
combination of remote terminal (Qxpress) and host computer (Q Comm Data Center)
provides Merchants, Brokers and Carriers a network that facilitates the
promotion, sale, collection of money, and multi-level distribution channel
reporting. In addition, the Data Center, which is the heart of the system, is
able to provide various Prepaid Services, Interactive Training (via Qxpress
Merchant Display), Reports On-Demand and Point of Purchase advertising (via
Qxpress Media Display). The combination of the Data Center and the Qxpress
terminal not only processes transactions but also provides a suite of
information management tools to assist Merchants, Brokers, Carriers and others.
Additional services controlled by the Data Center include Data Base management,
Custom Reporting, Automated Clearing House (ACH), Carrier Relations and Pin
Management.
2. Support Services:
2.1 WGR shall be responsible for and shall provide appropriate and
knowledgeable first-line customer support for the POS System. If WGR is
unable to answer a customer inquiry after reasonable efforts, a designated
employee of WGR may confer with Q Comm as reasonably necessary during Q
Comm's regular business hours, but WGR shall not refer customers directly
to Q Comm.
2.2 Technical Support to WGR. Q Comm shall provide WGR with a reasonable amount
of telephone and e-mail-based consultation and technical support services.
WGR may telephone Q Comm's offices for support during Q Comm's regular
business hours, 9:00 a.m. to 5:00 p.m. Mountain Time on weekdays (Monday -
Friday), except holidays. After-hours, weekend and holiday support is
available via digital pager. Q Comm shall make reasonable endeavours to
respond technical support requests and to correct errors, with respect to
the most current version of the POS System, within the following time
periods:
Severity Levels:
i) Severity 1 ("Critical") means an error in the POS System that
causes the POS System to be inoperable or unusable for a
significant number of Retail Dealers.
ii) Severity 2 ("Important") means an error in the POS System
causing a significant loss of POS System functionality for a
significant number of Retail Dealers.
iii) Severity 3 ("Minor") means all other errors.
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Upon receiving notice of an error, Q Comm will give WGR written
acknowledgement of receipt of such notice. Q Comm will use
reasonable endeavours to make such acknowledgement as follows:
i) Severity 1 or 2 - within 1/2 hour during regular business hours
and within two (2) hours during off-business hours (for
telephone/beeper requests only).
ii) Severity 3 - within two (2) business days.
Q Comm will use reasonable endeavours and, with respect to Severity 1
and 2 errors, begin diligent efforts to provide a temporary or
permanent resolution for the error within the following time frames:
i) Severity 1: within 4 hours of acknowledging receipt of the
error.
ii) Severity 2: within 24 hours of acknowledging receipt of the
error.
iii) Severity 3: at Q Comm's discretion, within 7 days of
acknowledging the receipt of the error or in a future
release of the POS System.
WGR agrees to cooperate with Q Comm in providing documentation and
information as Q Comm may reasonably request, so that Q Comm can
verify and reproduce the reported error.
2.3 Enhancements. From time to time during the Term, Q Comm may make
upgrades, enhancements, and modifications (collectively, "Updates") to
the POS System to improve and enhance the POS System, as it deems
appropriate in its discretion, by adding or improving features and
performance and otherwise responding to feedback and requests from WGR,
Distributors and Retail Dealers. Q Comm shall make such Updates
available to WGR upon commercial release thereof, and such Updates
shall be licensed pursuant to the terms of this Agreement.
2.4 On-Site Assistance. Upon WGR's request, Q Comm will furnish qualified
personnel for on-site assistance to WGR or Customers to resolve errors.
In such event, WGR or the Customer shall pay Q Comm at its then current
time and materials rates for the time of required personnel and
reimburse Q Comm for reasonable travel and living expenses of such
personnel incurred in rendering the requested assistance.
3. Training.
Q Comm shall provide WGR with a one-day training session with respect to the Q
Comm System during the Trial Period, prior to WGR's first distribution of the
POS System, at WGR's main offices and upon a mutually agreed-upon date (which
shall be concurrent with Q Comm's visit to assist in setting up the data centre
and to install its server, as described in Clause 6.1). The parties may agree in
writing upon any additional training sessions desired by WGR, with such
additional sessions to be provided at WGR's expense.
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SCHEDULE 4
- Minimum Purchase Requirements -
Minimum purchases by individual country or (as applicable) in groups (defined by
group A to H as per schedule 1).
Performance Periods
Group Trial Period 1. 2. 3. 4. 5. 6. 7.
A 10 490 1,200 2,160 3,360
B 50 300 540 840
C 200 400 720 1,120
D 0 300 540 840
E 300 1,700 3,060 4,760
F 100 400 720 1,120
G 0 300 540 840
H 100 400 720 1,120
Total 10 1,240 5,000 9,000 14,000 20,000 25,000 30,000
Cumulative 1,250 6,250 15,250 29,250 49,250 74,250 104,250
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SCHEDULE 5
- Non-exclusive Country Groups
Country Group
1. Rumania I
2. Hungary I
3. Slovakia I
4. Latvia I
5. Lithuania I
6. Ukraine I
7. Israel I
8. Russia I
9. Denmark G
10. Finland G
11. Norway G
12. Sweden G
33
