SOFTWARE SALES AGREEMENT
AGREEMENT dated September 24, 1999 ("Closing Date") by and
between XXxxxxxx.xxx, Inc., a Florida corporation, with an
address at 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx Xxxxx, XX
00000 (hereinafter referred to as "Purchaser") and Classified
Project Inc., a Delaware corporation, with an address at 0000
Xxxxxxx Xxxxxx, Xxxxx 000, Xxx Xxxxxxxxx, XX 00000 (herein
referred to as "Vendor").
WITNESSETH:
Whereas Purchaser and Vendor have executed a binding letter of
intent ("LOI") dated as of September 12, 1999 for the purposes of
setting forth the parties' rights and obligations in
connection with Purchaser's purchase and Vendor's sale of
Vendor's proprietary auction engine
software and source code developed by Vendor for use in
connection with Vendor's Web based auction Web site,
XxxXxxxxxXxxxxxx.xxx, (which software, along with all of its
source code is hereby collectively referred to as the "Assets");
and
Whereas Purchaser has agreed to purchase and Vendor has agreed to
sell exclusively to Purchaser, the Assets, which Assets are sold
in an "as is" condition, without warranty of any sort, either
express or implied, except as is expressly specified below; and
Whereas Purchaser has agreed to acquire the Assets from Vendor
for an aggregate price of US$38,560.00 (the "Purchase Price") in
the form of a convertible payment obligation, payable upon the
date of execution of the Agreement (the "Closing Date") as
specified below and which method of payment has been approved by
Vendor; and
Whereas both parties have agreed to work toward the execution of
this Software Sales Agreement (the "Agreement") based upon and
incorporating the basic terms of the transaction as are otherwise
set forth in the LOI and with the understanding that time is of
the essence for the execution of such A2reement;
NOW THEREFORE, the parties hereby agree as follows, to wit:
Article 1. DEFINITIONS
For the purpose of this Agreement, the following terms shall have
the following meanings:
1.1 Assets
The term "Assets" means Vendor's proprietary computer auction
engine software and its source code developed and previously or
currently used by Vendor in connection with Vendor's Web based
auction Web site, XxxXxxxxxXxxxxxx.xxx, along with any and all
Versions (as defined below) thereof produced on or prior to the
date hereof.
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1.2 Version(s)
The term "Version(s)" shall mean any release, addition, update or
version of any computer software.
1.3 Modification
The term "Modification" means any and all derivative works of the
Assets developed through any modification, enhancement,
extension, or addition of or to the Assets which may be
incorporated into any Product(s) (as defined below).
1.4 Product(s)
The terms "Product(s)" mean(s) any and all computer software
products or services developed, distributed, displayed or sold by
Purchaser or Purchaser's successors or licensees.
1.5 Deliverable(s)
The term Deliverable(s) means any and all material, item,
electronic file, software program etc., comprising or included as
part of the Assets, and/or any component thereof, as is to be
delivered to Purchaser in accordance with this Agreement.
Article 2. OBJECT OF THIS AGREEMENT
Subject to the terms and conditions hereof, for the consideration
specified below, Vendor hereby agrees to sell (and hereby sells)
and to deliver the Assets, including all rights therein and
thereto, for and including any and all Versions thereof, to
Purchaser.
Article 3. DELIVERY SCHEDULE
3.1 The delivery schedule consists of the schedule dates set
forth in Schedule A attached hereto, and which are subject to
modification by Vendor and Purchaser upon their mutual written
consent.
3.2 All files which comprise or are included in the
Assets, and which are incorporated into the Deliverables shall be
delivered to Purchaser on a CD-ROM, in an uncompressed, clearly
labeled and formatted, via delivery method and to an address all
as reasonably specified by Purchaser. Notwithstanding the
foregoing, if Vendor makes known to Purchaser in advance the
extant format of the Deliverables and/or the manner or mode of
its intended means of Delivery, and Purchaser accepts same in
writing, the latter shall have precedence.
Article 4. GRANT; NO RESTRICTIONS
4.1 Grant
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Subject to the terms and conditions of this Agreement, Vendor
hereby acknowledges that Purchaser shall be free to and shall
have the right to do any or all of the following:
4.1.1 to utilize, incorporate, reproduce, display, distribute,
market, advertise and promote the Assets in or in connection with
Purchaser's Products;
4.1.2 to modify any and all aspects of the Assets to develop any
Modification therein or thereto, and to utilize, incorporate,
reproduce, display, distribute, market, advertise and promote the
Modified Software in or in connection with Purchaser's Products;
4.1.3 to sell to third parties the Assets and or any rights
therein or thereto, as described in 4.1.1 and 4.1.2 above, or
otherwise;
4.1.4 to grant to each end-user of the Purchaser's Products a
license to use same for its internal purposes or otherwise;
4.1.5 to credit or to refer to Vendor as the originator of the
Software;
4.1.6 to refrain from doing any of the foregoing; and/or
4.1.7 any other purpose desired by Purchaser.
4.2 Trademarks / Copyrights
Trademarks and trade names, along with any copyrights under which
Purchaser may have heretofore marketed the Assets are hereby
exclusively assigned to Purchaser. This Agreement gives Purchaser
no rights in any of Vendor's trade marks, other than those
established by virtue of prior registration or publication
concerning the Assets, and the Assets alone.
Article 5. PAYMENTS
As full consideration for all rights and licenses granted to
Purchaser under Article 4 of this Agreement, Purchaser shall pay
to Vendor the sum of US $38,560 ("Purchase Price") which sum
shall be made payable as follows:
5.1 Purchaser shall pay to Vendor the Purchase Price on or
before 120 days following the Closing Date (the "Effective
Date"). Interest shall be accrued at an annualized rate of 9.0%
per annum beginning on the Closing Date, added to the Purchase
Price and paid by the Purchaser to the Vendor in the same
currency as Purchase Price amount, but only payable on the date
that the Purchase Price is paid.
5.2 At the election of Vendor, at any time on or before
the Effective Date, Vendor may elect that the Purchase Price plus
the accrued interest, as at that date, be converted to common
stock in the share capital of the Purchaser at a conversion rate
of US$ 1.00 per share, subject to regulatory approval if
necessary. Said election shall be executed in whole and not in
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part. This notice of conversion shall be submitted to Purchaser
by Vendor in written form, authorized by an officer or director
of the Vendor. If such conversion is effected, all debts to
Vendor payable by Purchaser shall be deemed as paid in full and
settled. This conversion transaction shall be referred to as the
"Put" option.
5.3 At the election of Purchaser, on the first business day
immediately prior to the Effective Date, if the trailing 30 day
average closing trading price of its share capital is greater
than US$4.00/share, with no single day closing below
US$4.00/share, Purchaser may trigger conversion of the Purchase
Price plus accrued interest as of that date, into common stock of
its share capital at a conversion rate of US$ 1.00 per share,
subject to regulatory approval, if necessary. Said election shall
be executed in whole and not in part. This notice of conversion
shall be submitted to Vendor by Purchaser in written form,
authorized by an officer or director of Purchaser. If such
conversion is effected, all debts to Vendor payable by Purchaser
shall be deemed as paid in full and settled. This conversion
transaction shall be referred to as the "Call" option.
5.4 If neither the Put option nor the Call option is
exercised by the Effective Date, then Purchaser will prepare and
deliver instructions to its banking institution to complete a
wire transfer of the Purchase Price plus accrued interest as of
that date, before 3:00 p.m. pacific time, to be deposited in the
account of Vendor. Vendor's banking information shall be attached
hereto as Schedule "B" and made a part hereof so as to mitigate
any risks of misinformation affecting this transaction. This
payment of debt shall be referred to as the "Payment".
5.5 If neither the Put option nor the Call option is
exercised, and Purchaser fails to meet the terms of the Payment,
all of the Assets and the exclusive ownership of the Assets shall
be immediately returned to Vendor, and Purchaser shall have no
further rights of any kind or nature relating to the Assets.
5.6 All payments to Vendor pursuant hereto shall be in the
form of check or other form of payment reasonably requested by
Vendor, and shall be addressed to Vendor in care of the address
set forth in Article 9 hereof.
Article 6. WARRANTIES AND REPRESENTATIONS
6.1. Assets Sold "As Is"
The Assets are sold in their present form "as is" which means
that Vendor makes no warranty or other representation concerning
the suitability of the Assets for Purchaser's purpose, nor that
the software which comprises the Assets is error free, nor with
respect to any other matter related to the Assets or the sale
thereof to Purchaser, except that Vendor does represent and
warrant (i) that it has no knowledge of any claim that the Assets
infringe any patent, copyright, trade secret or other
intellectual property right of any third party, and (ii) that it
has the full right and power to enter into this Agreement. The
liability of Vendor for any breach or breaches of any of the
foregoing representations and warranties shall be limited to the
consideration received by Vendor in accordance with Article 5
hereof.
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Article 7. TERM AND TERMINATION
7.1 Term
This Agreement shall come into force on the date first above
written and unless terminated pursuant to Article 7.2 hereof,
shall continue on in perpetuity.
7.2 Termination
If either party fails to comply with any of the material terms
and conditions of this Agreement, the other party may, at its
option, terminate this Agreement upon ten (10) days written
notice to the defaulting party. Any such notice shall specify the
nature of the breach, and the purported and/or desired remedy for
same. Upon receipt of such notice, the receiving party shall have
a period of ten (10) days in which to cure such breach.
7.3 Effect of Termination
In the event of termination of this Agreement by reason of
Purchaser's breach thereof, Purchaser shall discontinue use of
the Assets until such time same has been otherwise cured. In the
event of termination of this Agreement by reason of Vendor's
breach thereof, Purchaser shall have the right to withhold
payment or any un-remitted portions thereof until such time same
has been otherwise cured. These remedies are cumulative, and
exercise of any one shall not restrict a party from pursuing any
other remedies which may be at its lawful disposal.
Article 8. ASSIGNMENT
This Agreement shall inure to the benefit of and be binding upon
the parties hereto and their successors and assigns, but neither
this Agreement, nor any rights and obligations hereunder, shall
be assigned by either party hereto to any other person, firm or
corporation or other entity, without the express written consent
thereto of the other party, which consent shall not be
unreasonably withheld. Any assignment or transfer of a part or
whole of this Agreement in violation of this Article shall be
null and void and of no effect.
Article 9. NOTICE
Any notice to be given to any party hereto hereunder shall be
given in writing and delivered personally, or by certified mail
(with appropriate postage prepaid), or in the form of a facsimile
transmission, followed immediately by a confirmation letter by
certified mail. Such notice shall be directed to the following
address, or facsimile number of such party or such other address,
or facsimile number as such party may designate by written notice
given to the other party. Each such notice shall become effective
(i) if given by mail, seven (7) calendar days after being
deposited in the mail, or (ii) if delivered by facsimile, when
received by such party.
To Vendor: 0000 Xxxxxxx Xxxxxx,
Xxxxx 000,
Xxx Xxxxxxxxx, XX 00000
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Facsimile No. 650-341-1395
Attn: Xxxxx Xxxxxxxxxx
To Purchaser: 0000 Xxxxxxxx Xxxxxxxxx,
Xxxxx 000,
Xxxxxxx Xxxxx, XX 00000
Facsimile No. 000-000-0000
Attn.: Xxxxxx Xxxxxx,
General Counsel
Article 10. GOVERNING LAW
This Agreement shall be governed in all respects by, and
construed in accordance with, the laws of the State of California
applicable to agreements entered into entirely within such State.
Article 11. MISCELLANEOUS
11.1 This Agreement constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and
supersedes the LOI and any and all other prior agreements and
understandings between them with respect hereto.
11.2 Neither this Agreement nor any of the terms hereof maybe
amended, supplemented, waived or modified orally, but only by an
instrument in writing signed by an authorized signatory of each
party hereto.
11.3 At no time shall the failure of any party to require
performance by the other party of any of its obligations
hereunder constitute or be construed by any party as a waiver of
the right to require such performance at any time thereafter. A
waiver by either Party of any remedy for any breach hereof shall
not be taken as a waiver of any remedy with respect to any
succeeding breach hereof.
11.4 The parties hereto shall act in all matters pertaining to
this contract as independent contractors. Nothing in this
Agreement shall constitute or be deemed as constituting a
partnership between the parties hereto. This Agreement shall not
be construed to authorize either party hereto to act as an agent
for or representative of the other party, or to authorize either
party to assume or create any obligations on behalf of the other
party.
11.5 The headings of this Agreement are for convenience only and
shall not define, modify or otherwise affect the construction of
any of the provisions hereof.
11.6 This Agreement may be executed simultaneously in several
counterparts, each of which shall be deemed an original, and all
of which together shall constitute one instrument.
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11.7 Upon Purchaser's reasonable request, Vendor agrees to
execute such additional documents, including Exhibit "A" attached
hereto and made a part hereof ("Short Form Assignment"), which
are intended to further effectuate the intentions of this
Agreement.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized representatives to execute this Agreement as of the
day and year first above written.
Vendor: Purchaser:
Classified Project Inc. XXxxxxxx.xxx, Inc.
By:\s\ Xxxx Xxxxx By: \s\ Xxx Xxxxxx
--------------------- ---------------------
Printed name: Xxxx Xxxxx Printed name: Xxx Xxxxxx
---------- ----------
Title: Officer Title: Authorized Signatory
----------------- --------------------
Date: Sept. 24, 1999 Date: Sept. 28/99
------------------ ---------------------
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Exhibit "A"
SHORT FORM ASSIGNMENT
For good and valuable consideration, the undersigned ("Assignor")
does hereby sell, grant, convey and assign unto XXxxxxxx.xxx,
Inc. ("Assignee"), any and all rights in and to that certain
auction engine computer software created by Assignor for
Assignor's web-based auction site, along with any source code
thereto (collectively, the "Assets").
This Assignment shall be construed in accordance with the laws of
the state of California and shall be binding upon and shall inure
to the benefit of the parties hereto and their respective
successors, licensees and assigns.
IN WITNESS VTHEREOF, Assignor has executed and delivered this
Assignment as of the _ day of September, 1999.
ASSIGNOR
Classified Project, Inc.
By: \s\ Xxxx Xxxxx
-----------------------
Authorized Signatory
WITNESS
By: ______________
Address: __________________
__________________
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Schedule "A"
DELIVERY DATE
Delivery Date: Within 72 hours of Purchaser's execution of this
Agreement
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Schedule "B"
VENDOR'S BANKING INFORMATION
Citibank, N.A.
New York, NY
ABA# 000000000
Account# 00000000
Name: The Washington Post Company Corporate Control
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