AGREEMENT
BETWEEN
BEIJING PURPLE STARS APPRAISAL CO,LTD
AND
ASIA PAYMENT SYSTEMS (HK) LTD.
THIS AGREEMENT("AGREEMENT") IS MADE ON THE MARCH 17TH , 2005
BETWEEN:
BEIJING PURPLE STARS APPRAISAL CO,. LTD, with its principle office at Room
508,Xxxxx Xxxx Xxxx Di Building X-0,Xx.00, Xxxxxx Xxxxxx, Xxxxxxx Xxxxxxxx,
Xxxxxxx, Xxxxx (hereafter referred As BPS)
AND
ASIA PAYMENT SYSTEMS (HK) LIMITED with it's principal offices at 00xx Xxxxx, Xxx
Xxxxxxxx Xxxxxx , 0 Xxxxxxxxx Xxxxx , Xxxxxxx , Xxxx Xxxx ( hereafter referred
to as "APAY")
WHEREAS
(1) BEIJING PURPLE STARS APPRAISAL CO. LTD. is an official appraisal agent
licensed by the Chinese government to provide appraisal services to the
municipal government and to the public . In addition, BPS provides credit files
and credit rating services to the banks and financial institutions in Beijing.
(2) ASIA PAYMENT SYSTEMS (HK) LIMITED is a wholly owned subsidiary of Asia
---------------------------------
Payment Systems Inc.(NASD OTCBB:APYM)and is engaged in providing credit card
processing system services and related applications;
NOW IT IS HEREBY AGREED AS FOLLOWS:
1. JOINT CO-OPERATION
The parties agreed to form a partnership to undertake the joint co-operation in
Beijing, which will create an international standard file format credit bureau
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Service for the purpose of gathering, storing, and selling credit file data to
clients both in China and abroad, subsequently it will also provide, including
but not limited to, professional merchant credit card and loyalty card
processing services to merchants and financial institutions in China
2. CO-OPERATION TERMS:
(1) LEGALITY:
The parties agree that government sanction is essential to the intended joint
co- operation. Upon execution of this agreement, BPS is responsible to apply and
to obtain the government permits and/or approval necessary for the project
roll-out.
(2) TERMS AND CONDITIONS:
Subject to the government sanction and permits, the parties agreed to roll out
the joint business co-operation under the terms as follows:
2.1 The parties agreed that immediately after the signing of this Agreement APAY
and BPS will jointly launch a Six (6) months pilot project, to explore the most
feasible, cost effective and efficient business models for the establishment and
launching of card processing and credit bureau services for which APAY can
become the sole service provider in Beijing and which may also move to wards a
Co-operative Joint Venture (CJV) or other formal partnership set up.
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2.2 BPS will provide facilities, offices, staff and local support as well as the
platform set up as per "PROJECT PROPOSAl" (see APPENDIX A) for the launching the
pilot project business.
2.3 BPS will provide up to 300,000 individual and/or business credit file for
the International standard format credit file data base establishment and for
the Subsequent credit reference services operation.
2.4 BPS will assist APAY with local merchants, small to medium size banks,
and/or credit unions for the experimentation of "APAY THIRD PARTY PAYMENT
PROCESSING" services .Ultimately APAY and/or BPS/APAY Jointly will become the
contracted international third party card payment Processing service provider in
Beijing.
2.5 APAY will provide business plans, operational management, project know- How
,technical supervision, staff training, international standard technology And
international business interface setup and implementation.
2.6 APAY will be responsible to provide an international acceptable standard
Credit file format, to create an international standard credit file database and
To offer it to the major international credit agencies.
2.7 APAY will provide all necessary support to BPS for their effort in pitching
The potential merchants and/or banks to the third party payment process Services
and business experiments.
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2.8 The parties agreed to form a project team to undertake the business planning
and project implementation. The project team will manage the day to day
business, will execute the business plan agreed and approved and will report to
both parties on a weekly bases through out the period of pilot project
implementation. The parties further agreed, based on the pilot project
development, they may discuss and decide the business model as well as the
formation for the partnership and/or future co-operation latest at the 5th month
of pilot project operation.
2.9 The parties agreed, upon the final parties business co- operation formation
set up ( Co-operated Joint Venture, Joint Venture or any other formation), all
existing business, assets and revenue will be rolled over to the new joint
company as a continuation of the parties business co-operation.
3. CONFIDENTIALITY
The parties acknowledge that they may obtain certain Confidential Information
(whether in documented form or otherwise) from each in pursuance of this
agreement, and which information is of a commercially sensitive and/or
confidential nature . Therefore, the "NON-DISCLOSURE AGREEMENT" which the
parties executed on December 13th, 2004 will remain in full enforce until
further agreement to be reached.
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4. INTELLECTUAL PROPERTY
4.1 Neither party assigns any of its intellectual property rights to the other
under this MOU. Any intellectual property rights in any software or content
developed or provided by a party remains the sole property of that party. Both
parties agree that they shall not use the other party's trade marks, service
marks, trade names and/or logos in any manner whatsoever without the prior
written consent of the other party
4.2 It is further agreed and declared by either parties that any intellectual
property rights arising out of the use of the Confidential Information or any
existing intellectual property of the Disclosing Party whether by the Disclosing
Party or by the Recipient, the same shall be the absolute property of the
Disclosing Party and the Recipient shall execute such required documentation and
to do such act as reasonably required by the Disclosing Party to give effect to
this proprietary right of the Disclosing Party.
5. ASSIGNMENT.
Neither party shall assign this Agreement or any interest herein, nor delegate
any obligation hereunder without the prior written consent of the other party.
6. GOVERNING LAW.
This Agreement, together with its Appendix, shall be governed by the laws of the
People's Republic of China. For the avoidance of doubt, this agreement will be
governed throughout the entirety of this agreement by using Chinese as a basis
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For determination of the intent of both parties and the legality of the clauses
herein. Use of another language within this agreement will serve only as a means
to facilitate understanding by all parties.
7. LIMITATION OF LIABILITY.
In no event shall either party be liable for indirect, consequential,
incidental, special or punitive damages, or for loss of use, lost profits or
loss of goodwill, whether arising under theories of contract, tort (including
negligence) or otherwise. Each party's total liability hereunder, shall not in
the aggregate exceed any sums due or paid hereunder.
8. HEADINGS.
The headings in this letter are intended principally for convenience and shall
not, by themselves, determine the rights and obligations of the parties to this
Mandate.
9. NOTICES.
All notices, requests, demands, and other communications required by, or made in
connection with, this agreement or the transactions contemplated by this
agreement, shall be in writing and shall be deemed to have been duly given on
the date of delivery, if delivered in person, or three days after mailing if
mailed by certified or registered mail, postage prepaid, return receipt
requested, addressed as follows:
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If to APYM : x/x Xxxx Xxxxxxx Xxxxxxx
Xx. 0000-0000, B&H Xxxxx
Xx. 00, Xxxxxxxx Xxx. Shekou, Shenzhen
Guangdong Province, P.R. China Post Code: 518067
Or by fax to (00) 000 00000000
If to BPS : The address listed in this agreement or by fax to:
(00) 00-00000000
10. SEVERABILITY.
If any provision of this agreement is held to be unenforceable for any reason,
Such provision shall be adjusted rather than voided, if possible, in order to
achieve The intent of the parties to the maximum extent possible. In any event,
all other Provision of this agreement shall be deemed valid and enforceable to
the full extent possible.
11. WAIVER.
The waiver of any term or condition contained in this Agreement by any party
shall not be construed as a waiver of a subsequent breach or failure of the same
term or condition or a waiver of any other term or condition contained in this
Agreement.
12. ENTIRE AGREEMENT.
This agreement contains all of the terms and conditions agreed upon by the
parties
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Relating to the agreement and supersedes any and all prior and contemporaneous
agreement, negotiations, correspondence, understanding and communications of the
parties, whether oral or written, respecting the subject matter hereof except
for the NON-DISCLOSURE AGREEMENT signed by Asia Payments Inc. and Beijing Purple
Star Appraisal Co., Ltd on December 13th, 2004.
IN WITNESS WHEREOF the parties have executed this Agreement on the day and year
Above written.
Signed for and on behalf of Signed for and on behalf of
Beijing Purple Stars Appraisal Co., Ltd Asia Payment Systems(HK)
Limited
Signed: Signed:
Name: Name: Xxxx Xxxxx
President/CEO
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APPENDIX A
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CHINA CREDIT BUREAU
INTERNATIONAL CREDIT FILE FORMAT
SERVICE VENDOR
PROJECT PROPOSAL
March 14, 2005
Summary
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Nowadays, it is important for an individual and/or business to have a good
credit history if it wants to grow. It is also important for banks and lenders
to obtain extensive history information on applicant(s), in order to make the
right decision on each received application.
In highly developed countries, banks and lenders tend to inquire as to an
individual's or company's credit reference on each received application from
more than one independent credit agency, in order to have a subjective review
and analysis for decision making. Therefore, these credit agencies play a very
important role between the applicant and lenders. In the US, there are several
major independent credit agencies, ("D&B"-Commercial Credit Information;
Experian, Equifax and Trans-Union-Consumer Credit Files). These major US
agencies have established internationally recognized credit rating standards and
services through the years of their business development. They have stored,
packaged and provided credit files to their clients at an average fee of US
$1.00/per transaction each year up to a billion transactions, they have turned
this service into a multi-billion dollar business. In China, there is still not
a unified credit rating standard as well as independent, internationally
recognized professional credit reference agency. Over the last few years,
Chinese banks and lenders have given lending facilities based on relationships,
government policy, or credit information which might not be professionally
obtained and verified. Within the last two years, millions of bank credit cards
have been delivered to the consumers with such consumer credit based on all
kinds of "proof of salary" issued by the employers, which has created a great
deal of risk, potential debt, and/or bad loans for both the financial
institution and individuals.
This irregular situation has drawn serious attention from the society and the
Chinese government has been taking tough measures to control the problem.
However, in a rapidly growing market economy, government regulation alone will
not be able to fix the problem as more and more businesses and/or individuals
continuously seek credit and financing facilities. Further, as the Chinese
Government continues to adopt greater "open door" policies, foreign banks and
related financial companies will enter into the Chinese financial market this
year and these incoming foreign banks will badly need qualified credit data base
information as they grow their consumer and commercial lending into the China
market. Therefore, urgent demand exists today and will increase for
internationally recognized Commercial/Consumer credit standard and rating
systems. This has opened a "window of opportunity" to someone who can lead to
set up the internationally recognized credit rating bureau and systems in China.
Asia Payment Systems (NASD OTCBB:APYM) is a company specialized in payment
processing business. The company executives have had long management experience
in major international banking and/or payment processing firms, which makes the
company unique and with excellent connections both within the international
banking industry and consumer credit card market. Recently, As the company
successfully completed the System set up to handle the massive card payment
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transactions for Japan Duty Fee Shops in Japan and now in Hainan China , APYM
has begun shifting its focus to China. It is the purpose of APYM to cooperate
with Strong China Credit File/Bureau partners to jointly provide world class
credit bureau services as well as the subsequent 3rd Party payment processing
services to the financial industry and consumers in China and, as needed,
elsewhere in Asia.
Beijing Purple Star Appraisal Co. (BPS) is a licensed appraisal company by the
central government and has been years in providing appraisal as well as credit
reference services to both the government and the public.
It is strategically important and in the advantage of both APYM and BPS if they
could form a partnership to capture this window of opportunity and to take the
lead in the credit rating business in China, by launching a project co-operation
in the establishment of an international standard credit bureau system in
Beijing.
MISSION
It is the mission of the project co-operation to develop an international
standard credit file system and core information database to provide, on a per
file basis, individual and consumer credit history and rating to qualified
clients, and with the same platform to provide world class third party payment
processing services to the financial institution and merchants in China and
abroad.
PROJECT OVERVIEW
Creation of a core centralized system for storing Chinese consumer credit files
will allow for a network to be deployed whereby, on a per file basis, the
Chinese consumer database information can be sold to prospective clients. By
providing the output in an internationally recognized format, the database
information can be sold to International Financial Institutions, Foreign large
store merchants (i.e. WalMart, Carrefour), Auto Loan agencies (i.e. Ford, GM,
VW, Audi, Mercedes), Luxury goods retailers (DFS, CARTIER, LVMH, Gucci, Prada,
etc.) and many other marketing and merchandise firms.
(A) APYM FOCUS:
In terms of the Chinese Credit Bureau agency platform development, APYM will
provide technical services and consulting on an as needed basis to the project
as well as direct investment in a partnership designed to generate profits as a
result of providing Chinese consumer credit file information to international
clients in an internationally accepted data format. APYM will also provide full
database and network services to the venture once all parties agree to the form
of cooperation and services to be offered.
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It is the intention of APYM to provide support, management, advice, technical
and other resources towards both an International Commercial Standard File
Bureau as well as an international style Consumer Credit File which will be
built upon international standards with international partners such as D&B,
Experian, Equifax, or Trans Union, etc. Such an international focus will work
well as a joint cooperation effort with our local Chinese Credit Bureau partner
as both sides are able to bring their specific expertise to the success of the
joint effort. In due time when the bureau is ready to be a qualified
international player, APYM will work to bring the investment from these major
player and/or to turn the co-operation into a subsidiary of these world class
agencies as co-operation exit strategy.
(B) FEATURE SERVICES:
(1) To obtain and to store up to [redacted]business and individual credit
files;
(2) To package and to rate the data file with international standard;
(3) To offer credit files at a competitive charge to the services, first
to the foreign agencies and financial institutions then to the
domestic banking and lending companies;
(4) To provide education and assistance to the domestic business and
individuals to build up and/or to repair their credit histories;
(5) To form alliances with major international agencies in moving towards
the future joint venture business in China.
(C) SET UP REQUIREMENTS:
(6) License and/or permits (under BPS) to conduct the project and
services;
(7) Initial supply of 300,000 business/or individual credit files;
(8) A secured data center with servers, secured ISP and high standard
telecommunication capability both for voice and data transmissions;
(9) A call center initially with enough full time staff;
(10) Facilities for marketing, managerial, administrative operations;
(E) HARDWARE AND SOFTWARE REQUIREMENTS;
The ultimate sizing of the systems will always be an unknown since it will grow
in terms of commercial users and the customer data. Thus the system should be
scalable enough to accommodate large potential growth. The products and
hardware sizing here reflect such scalability (as additional processing power
and disk is needed they can simply be added and integrated into the existing
solution) and is provided as an initial estimate. However, the cost of a
localized 3rd party credit bureau package itself has not been Included here.
This can either be developed or a purchased "off-the-shelf" with the
recommendation being an already existing commercial package to be customized.
Should a partner be selected then the cost of the product will be offset.
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With Microsoft coming on as a future partner/investor we will continue our
strategy of deploying our systems on Microsoft products and technologies.
The database systems need to be separated in OLAP (On-Line Analytical
Processing) and Data Warehouse systems. The Web Servers are separated for
internal and external access. The selected Netscreen firewall will be able to
handle a private network and DMZ network zone. An additional router should be
used as an additional "firebreak" for the private network.
The hardware selected should be from a name brand supplier, such as HP or IBM.
Dual Xeon Processor model should be selected with SCSI interfaces (with dual
external channels) to support the external disk array.
It is assumed that an Internet connection and all the necessary equipment for it
are already in place.
As per the diagram, the following systems will be deployed for the Credit
Bureau:
Software:
- OLAP DATABASE
This is the online system used for real-time updates.
[redacted]
- DATA WAREHOUSE
This is the query and analysis system used for data analysis.
[redacted]
- WEB SERVERS
Internal 1 Server. The Application Server is also housed here, used for
handling Incoming data.
External 1 Server, [redacted] for external user authentication (tied into
Netscreen).
- FIREWALL
[redacted]. Same brand as deployed in our China office And on the DFS
networkA single router to be deployed as an additional private Network
"firebreak".
- ISCRS
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APYM International Standard Credit Rating System
HARDWARE AND ESTIMATED COST
-----------------------------------------------------------------------------
SOFTWARE COST (US$) UNITS TOTAL
-----------------------------------------------------------------------------
OS Windows2003 Enterprise [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Database [redacted] [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Security [redacted] [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
The Portal [redacted] [redacted] [redacted] [redacted]
Management
Platform
-----------------------------------------------------------------------------
ISCRS APYM Credit Rating System [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Customization Software localization [redacted] [redacted]
-----------------------------------------------------------------------------
HARDWARE
-----------------------------------------------------------------------------
Servers [redacted] [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Disk Array [redacted] [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Firewall [redacted] [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Router [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Switch [redacted] [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
Misc. Cables & other equipment. [redacted] [redacted] [redacted]
-----------------------------------------------------------------------------
GRAND TOTAL [REDACTED]
-----------------------------------------------------------------------------
These costs are exclusive of design, implementation and test services
PROJECTED TIME TABLE
Assuming the above captured requirements are, will be met, the projected time
frame for the business roll out is 180 days, which will include;
(1) Facility set up, hardware testing, feasibility study, staff training
and operation platform set up;
(2) Project promotion, service establishment for credit standard, rating
system, data base, credit build-up and repair system;
(3) Interface with major international agencies including initial
alliances agreements;
(4) Start offering entry rights and/or credit files to foreign agencies.
(5) Start offering "credit build-up" "credit repairing" program and/or
membership to BPS employees and affiliates as well as other selective
market sectors;
(6) Running full functional operation moving towards the larger scale
operation.
-END-
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