Exhibit 10.27
SCTN/WELCOME REAL-TIME XL SMART ALLIANCE - DRAFT MOU
SCTN /WELCOME REAL-TIME
XL SMART ALLIANCE
MEMORANDUM OF UNDERSTANDING
July 6th, 2001
This Memorandum of Understanding ("MOU") for an alliance to develop and market a
common interoperable smart card applet for loyalty solutions is effective July
6, 2001 (the "Effective Date") by and between each of:
o Schimatic Cash Transactions Xxxxxxx.xxx, Inc., or, if assets relevant to
this agreement are assigned thereto as described in this agreement, its
successor in interest Smart Chip Technologies, LLC, a Nevada limited
liability company, doing business as Smart Chip Technologies, ("SCTN") with
its head office at 000 Xxxx 0000 Xxxxx, Xxxx Xxxx Xxxx, XX, XXX 00000.
o Welcome Real-time, a French Societe Anonyme, registered with the Trade and
Companies Register of Aix-en-Provence, having its registered offices
located at Europarc de Pichaury, 000 Xxx Xxxxxx Xxxxxxxx, 00000
Xxx-xx-Xxxxxxxx Xxxxx 0, Xxxxxx.
Each of SCTN and Welcome Real-time are referred to herein individually as a
"Party" and collectively as the "Parties".
WHEREAS:
A. Each of the Parties is in the business of supplying goods and/or
services relating to a loyalty payment solution;
B. Both Parties recognize the benefits of interoperability among competing
systems;
C. Welcome Real-time offers card issuers an interoperable applet for smart
cards (known as "the XLSmart applet") and offers loyalty software
providers the ability to render their systems compatible with the
XLSmart applet (thus becoming "XLSmart Compatible Solutions
Providers");
D. XLSmart Compatible Solutions Providers are free to develop specific
features covered by any of Welcome Real-time's patents, as long as such
features only function with cards equipped with the XLSmart applet;
E. SCTN has intellectual property including patents which are relevant to
and which WRT desires to be integrated into the XLSmart product
offerings.
F. The Parties wish to collaborate toward creating interoperability
between the Parties' systems;
G. The Parties wish to collaborate on the joint development of a broad
industry standard for loyalty applications driven by customer carried
smart devices.
NOW THEREFORE, IN CONSIDERATION of the mutual benefits to be derived from this
MOU, the Parties agree as follows:
1 PURPOSE. The following are the intentions of the Parties:
1.1 It is the intent of the parties to develop a cooperative pricing scheme
which WRT would offer its loyalty customers
1.2 The parties will seek to outline the principles upon which SCTN's
intellectual property will be added to the XLSmart Applet to further
the development and marketing of a broad industry standard for
multi-application smart cards.
1.3 The Parties will co-operate in:
a) the promotion of the XLSmart Applet to card issuers and to
loyalty software providers;.
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b) the continued development and support of the XLSmart Applet;
c) the initial rollout and related marketing activities
2. THE XLSmart Applet
2.1 The XLSmart Applet shall be comprised of the following components from
each respective Party as follows (each a "Component" and collectively,
the "Components"):
2.1.1 SCTN will provide and represents that it is the absolute and sole
proprietor of its proprietary smart card-based loyalty program based on
US patent # 5,806,045 as well as extensions of said patents to various
countries in the world.
2.1.2 Welcome Real-time will provide and represents that it is the absolute
and sole proprietor of French Patents FR-9600678 (known as the
"Real-time RFM" patent, covering the dynamic allocation and management
of services relating to entries, visits or cumulative spending at
designated merchants) and FR-9504162 (known as the "e-coupon" patent,
which allows a smart card to receive and process coupons valid for
discounts on specific items scanned at a point of sale device), as well
as extensions of said patents to various countries worldwide;
2.1.3 Welcome Real-time will additionally provide the software applet itself,
running on multiple card platforms.
3. BRAND NAME AND INTELLECTUAL PROPERTY
3.1 Welcome Real-time's XLSmart system includes a card applet (known as the
XLSmart applet) that is placed within a smart card, and an acceptance
symbol (known as the XLSmart acceptance symbol) that may optionally be
placed on the back of the card. In order to build brand name
distinctiveness, the Parties agree to "XL Smart" as the brand name and
corresponding xxxx for the XLSmart Applet (the "Brand Name"). The brand
name is owned by Welcome Real-time. The use of this brand name by the
Parties is TO BE DETERMINED.
3.2 SCTN's Brand Names. The parties agree that SCTN's brand names including
but not limited to LoyaltyCentral, will remain the property of SCTN and
that the use of such brand names by WRT is TO BE DETERMINED.
3.3 New Intellectual Property Created. The Parties acknowledge that in the
process of developing the XLSmart Applet and integrating the
Components, technologies may be created to which new intellectual
property rights ("New IP Rights") will attach. The Parties agree that
any such New IP Rights will be owned by the Party or Parties that
created the technology.
4. COMMERCIAL AGREEMENT
4.1 Within 90 days of the Effective Date of this Agreement, the Parties
shall enter into a commercial agreement (the "Agreement") which shall
include without limitation, standard terms for agreements of this
nature and the following:
4.1.1 Subject to agreement on sublicensing terms, a grant by SCTN to Welcome
Real-time, of a non-exclusive, limited, world-wide license to market,
distribute and sub-license SCTN's Components for use solely with the
XLSmart Applet under the Brand Name.
4.1.2 Terms and conditions for the use of the Components including without
limitation, prohibiting the marketing of individual Components.
4.1.3 Provision for each Party to retain ownership of its respective
Components that are proprietary to such Party and are in part or
holistically required for the XLSmart Applet.
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4.1.4 Terms and conditions for co-marketing of the XLSmart Applet including
without limitation, guidelines for acquiring new business as well as
apportioning of sales and profits.
5. THE BUSINESS RELATIONSHIP
5.1 Notwithstanding the Agreement, any or all of the Parties may: (i) work
together to promote the XLSmart Applet on an ad hoc basis and to
jointly pursue marketing and business initiatives and activities in any
specific global market segment, including without limitation, the
financial services, retail, and others (the "Market Segments") and (ii)
pursue other co-marketing, teaming, partnering and alliance agreements
with each other.
5.2 Immediately after the Effective Date, the Parties shall commence work
as may be required on (i) a business plan, (ii) a marketing plan, (iii)
a project plan; and (iv) a detailed project schedule to determine the
viability of a formal alliance and ensure XLSmart Applet market
readiness as early as possible.
5.3 Each Party will provide at the engineering or technical level at no
charge to the other Parties, technical support as reasonably requested
to accomplish (i) the functional compatibility of all the XLSmart
Applet Components and (ii) the continued development and upgrading of
each Party's respective components in the XLSmart Applet for improved
functionality and the best operational integration of the XLSmart
Applet.
5.4 The Parties shall cooperate to produce marketing materials for the
XLSmart Applet. Each Party shall have the right to reproduce or
otherwise use the XLSmart Applet marketing materials of the other
Party. Such materials may be used in an individual Party's marketing or
in Alliance-wide marketing and selling activities agreed upon by the
Parties.
5.5 5.6 The Parties agree to establish a steering committee, which will
meet regularly as mutually agreed for the purpose of ensuring the
success of the XLSmart Applet and its activities surrounding technical,
marketing and sales activities including current and future preferred
vendors and suppliers of the parties.
5.7 In order to put forth the best commercially viable effort to ensure
optimal market driven pricing practices, the Parties shall meet on a
quarterly basis as mutually agreed to review and discuss the XLSmart
Applet pricing in relation to other competitive market solutions.
5.8 None of the Parties may use the name, logo or intellectual property of
another Party or any affiliate of another Party, without the other
Party's prior written approval.
5.9 This MOU does not create, and shall not be construed to create, any
joint venture or partnership between the Parties. No officer, employee,
agent, servant or independent contractor of any Party shall be at any
time be deemed to be an employee, servant, agent or contractor of any
other Party for any purpose. The Parties are each independent
contractors, not employees, agents or representatives of each other. No
Party has the right to bind any other Party to any agreement except as
may be specifically provided herein.
5.10 The Parties agree that where consents are required, such consents shall
not be either unreasonably delayed or unreasonably withheld.
5.11 Each Party shall be responsible for its own expenses in connection with
this MOU.
5.12 Each Party agrees that the Parties will be under no obligation
whatsoever to enter into further agreements with each other, as a
result of this MOU.
6. TERM AND TERMINATION
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6.1 The Parties agree to use reasonable efforts to negotiate and conclude
the Agreement as set out in section 4.1. The terms of the Agreement
will supersede the terms of this MOU.
6.2 The term of this MOU is 90 days from the Effective Date, unless
extended by agreement of the Parties.
There will need TO BE DETERMINED payment terms for auditing,
performance criteria, and termination for non-compliance.
7. LIMITATION OF LIABILITY
7.1 EXCEPT FOR A BREACH OF ANY OBLIGATION UNDER ARTICLE 7
(CONFIDENTIALITY); IN NO CIRCUMSTANCES SHALL ANY PARTY BE LIABLE TO
ANOTHER PARTY OR PARTIES FOR LOSS OF PROFITS, LOSS OF BUSINESS REVENUE,
FAILURE TO REALIZE EXPECTED SAVINGS, OTHER COMMERCIAL OR ECONOMIC LOSS
OF ANY KIND WHATSOEVER, NOR SHALL ANY PARTY BE LIABLE TO ANOTHER PARTY
OR PARTIES FOR ANY INDIRECT, SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES ARISING OUT OF OR IN ANY WAY RELATED TO THIS
AGREEMENT INCLUDING IN CONNECTION WITH THE OBLIGATIONS THAT ARE THE
SUBJECT MATTER OF A PROJECT PLAN, EVEN IF ADVISED OF THE POSSIBILITY OF
SAME AND REGARDLESS OF THE CAUSE OF ACTION (INCLUDING BREACH OF
CONTRACT, FUNDAMENTAL BREACH, AND NEGLIGENCE), AND
7.2 EXCEPT FOR PAYMENT OBLIGATIONS SPECIFICALLY PROVIDED FOR HEREUNDER, IN
NO EVENT WILL THE CUMULATIVE LIABILITY OF ANY PARTY UNDER THIS
AGREEMENT EXCEED US$10,000.
8. CONFIDENTIALITY
8.1 In connection with this MOU it may be necessary for a Party to exchange
confidential information ("Confidential Information") with another
Party or the other Parties. All Confidential Information shall be
exchanged under the terms of the separate Welcome Real-time
confidentiality agreement.
8.2 Notwithstanding anything contained in this Article, a Party will not
disclose the marketing plans, sales information, confidential product
information, clients or customers of any other Party to third parties
without first obtaining written permission from such other Party, and
shall not make any such disclosure without entering into a suitable
confidentiality agreement with such third party. However, each Party
may discuss and share with customers and prospective customers publicly
available product information and product literature including product
briefs and product manuals belonging to another Party.
9. Representations and Warranties
9.1 Each Party hereby represents and warrants to the other Parties as
follows:
9.1.1 No Breach of other Agreements. The execution, delivery and performance
of this MOU by such Party will not (i) result in the breach of, or
constitute a default (or an event which, with or without notice or
lapse of time or both, would constitute a default) under, any contract
or other instrument or obligation to which such Party is now bound,
(ii) result in the breach of any of the terms or conditions of, or
constitute a default under, the charter, bylaws or other governing
instruments of such Party, or (iii) violate any order, writ,
injunction, decree, or any statute, rule or regulation applicable to
such Party.
9.1.2 Exclusion of Other Warranties. EXCEPT AS EXPRESSLY PROVIDED FOR IN THIS
AGREEMENT, ALL WARRANTIES EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED
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TO, ANY IMPLIED WARRANTIES OR CONDITIONS OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE; AND THOSE ARISING BY STATUTE OR OTHERWISE IN
LAW OR FROM A COURSE OF DEALING OR USAGE OF TRADE ARE ALL EXPRESSLY
DISCLAIMED.
10. GENERAL
10.1 The Parties understand and agree that this MOU is not meant to address
all issues, which may arise in connection with the development and
marketing of the XLSmart Applet. The Parties hereby agree to work
together in good faith to negotiate and conclude the Agreement as soon
as possible.
10.2 Nothing in this MOU implies transfer of title, ownership, copyright or
other intellectual property rights from any Party to any other Party or
the Parties. This MOU is entered into between the parties in
recognition of the unique contribution of each and cannot be assigned
or sublicensed, directly or indirectly, by any party without the
express written consent of the other.
10.3 Each Party agrees to comply fully with all applicable laws and
government regulations applicable in any country or organization of
nations within whose jurisdiction the Party operates or does business,
including but not limited to, those applicable to the export and
re-export of products.
10.4 This MOU may be executed in counterparts, each of which shall be deemed
an original but all of which shall together constitute one and the same
agreement.
IN WITNESS WHEREOF this MOU and its Schedule A have been executed by the Parties
hereto as if each had been signed separately. Accepted and Agreed to:
SMART CHIP TECHNOLOGIES
Signature: /s/ Xxx Xxxxxxxx Date: July 6, 2001
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Xxx Xxxxxxxx President/CEO
WELCOME REAL-TIME
Signature: /s/ Aneace Xxxxxx Date: July 9th, 2001
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Aneace Xxxxxx President/CEO
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