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EXHIBIT 10.18
LICENSE AGREEMENT
ENTERED INTO IN VANCOUVER, BRITISH COLUMBIA, this 3RD day of MARCH, 2001
BETWEEN: XXXX-XXX.XXX, INC., a Florida corporation duly constituted under
the laws of Florida, having its head office or principal place of
business at 000-000 X. Xxxxxx Xx., Xxxxxxxxx, XX, X0X 0X0
(hereinafter referred to as the "LICENSOR")
AND: CHINABUSINESSCHAIN GROUP, LLC., a corporation duly constituted
under the laws of California, having its head office or principal
place of business at 000 X. Xxxx Xxxxxx, Xxxxx #000, Xxxxxxxx,
XX, 00000 (hereinafter referred to as the "LICENSEE")
PREAMBLE
WHEREAS the Licensor has created and is the owner of the "PHON-NET Direct
Connect" software (the "Software") that enables a detailed description of the
Software's functionalities and specifications being attached to this License
Agreement (the "Agreement") and identified as Schedule A;
WHEREAS Licensee intends to use the Software in conjunction with Licensee's
other ventures and new ventures to distribute Software;
WHEREAS the Licensor agrees to license the Licensee with the Software, subject
to the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the aforementioned premises and the mutual
covenants hereinafter set forth, the Preamble forming integral part of this
Agreement, the parties agree as follows:
SECTION 1
DEFINITIONS
1.1. For the purposes of the Agreement, unless otherwise expressly provided,
the following terms shall have the meaning set forth below:
"Effective Date" means the date referred to at the beginning of the
present Agreement;
"License Fee" means the costs charged to the Licensee as described
in section 3 and Schedule B hereof;
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"Licensed Know-How" means and includes any and all technical
information, processes, uses, compositions, detailed
design information and any and all modifications,
improvements and developments thereof owned by the
Licensor and necessary for the use of the Software;
"Licensee's Core Business" means Licensee's business of allowing
manufacturers, retailers, product and service
marketers and packaged goods companies to distribute
PHON-NET Direct Connect to connect consumers to
retailers by telephone while viewing the retailer's
web page;
"Territory" means China, Taiwan and Hong Kong exclusively;
"User Database" means the database comprising of all information
generated through the use of the Software pursuant
to this Agreement, during the term of this Agreement
and any renewal periods thereafter; and
SECTION 2
LICENSE AND RIGHTS PERTAINING TO THE SOFTWARE
2.1. The Licensor represents and warrants that it has the rights to use and
license the Software, that the present license is granted to the
Licensee pursuant to and in respect of those foregoing rights and that
the Licensor has full power and authority to enter into and perform
this Agreement.
2.2. Subject to the terms and conditions of the present Agreement, the
Licensor grants to the Licensee during the term of this Agreement, the
exclusive right to use, market and sublicense the Software in the
Territory.
SECTION 3
LICENSE FEE
3.1. For the duration of this Agreement and any renewal periods thereafter,
the Licensee shall pay to the Licensor, in US funds, on a quarterly
basis for licenses sold in the quarter, the License Fee, the amount and
particulars of which are further detailed in Schedule B annexed hereto
and forming part of this Agreement.
SECTION 4
TERM AND TERMINATION
4.1. Unless otherwise terminated and subject to subsection 4.2 hereof, this
Agreement shall end twenty-four (24) months from the date of execution
of this Agreement.
4.2. The Licensee may, in its sole discretion, renew the term of this
Agreement for an additional twenty-four (24) month period from the
expiry of the term provided for at subsection 4.1 hereof or any lesser
or greater term as may be agreed to by the parties, by providing at
least thirty
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(30) days written notice to the Licensor prior to the expiry of the
term provided for at subsection 4.1 hereof and provided that such
minimum number of units as may be agreed to by Licensor and the
Licensee prior to expiry of the initial 24 month term of this Agreement
(the "Initial Term") have been purchased by the Licensee during the
Initial Term. In the event the parties have not agreed on such number
of minimum units prior to expiry of the Initial Terms, the Licensee and
Licensor shall appoint an agreed upon arbitrator to determine the
number.
4.3. The Licensor or the Licensee may terminate this Agreement at any time,
after written notice, for breach or default by the other party, unless
the other party has remedied such breach or default to the satisfaction
of the party complaining, within thirty (30) days after receipt by the
breaching party of said written notice of such default. A waiver by a
party of its right to terminate this Agreement due to any particular
breach or default shall be construed as a continuing waiver. In the
event where the Licensor has breached the exclusivity granted to the
Licensee under subsection 2.2 hereof, the Licensee, after having
provided a written notice to the Licensor detailing the breach and
providing a reasonable period to cure such breach, shall be relieved
from paying the License Fee, until such a time where the Licensor has
provided to the Licensee assurances and evidence that such breach has
been cured.
4.4. This Agreement shall be terminated as of right, without notice or
formality if (a) either party proceeds to a liquidation of its assets;
(b) either party hereto makes an assignment of all its property for the
general benefit of its creditors, or if a bankruptcy petition is filed
against it and a final judgment is rendered pronouncing its bankruptcy;
(c) if a receiver, trustee, liquidator or any person possessing similar
powers is appointed to administer or liquidate either party's assets.
4.5. No termination of this Agreement shall prejudice the Licensor's rights
hereunder to the License Fee provided for in subsection 3.1 and to the
User Database provided for in section 7, in respect of sales or
licensing agreements which have been concluded prior to the termination
of this Agreement but for which an invoice has not been issued or
payment has not been received, as the case may be.
SECTION 5
CONFIDENTIALITY
5.1. The Licensor and the Licensee agree to treat as confidential any
information disclosed to the other as it relates to the system use and
marketing of the Software both during and after the duration of this
Agreement. The Licensor and the Licensee shall use reasonable care,
consistent with the measures taken to safeguard each of their own
confidential information, to ensure that, each of their directors,
officers, employees, agents, representatives and customers to whom
confidential information needs to be disclosed to allow full execution
of this Agreement, shall keep all such information confidential.
5.2. Additionally and notwithstanding the standard of confidentiality
provided for in subsection 5.1
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hereof, the Licensee's actual and future business strategy as it
relates to the Software shall be treated as confidential information by
the Licensor.
SECTION 6
OTHER OBLIGATIONS AND REPRESENTATIONS
6.1. Nothing in this Agreement shall be construed as:
(a) granting any license or rights to the Licensee other than
those rights granted hereby with respect to the Software; or
(b) creating a partnership or employer/employee relationship, but
the relationship between the parties is acknowledged and
agreed to be that of arm's length independent contractors
contracting with each other.
6.2. The Licensor warrants that within the Territory, the Software is not
infringing on any existing copyrights, patents or trade-marks owned by
third parties; if any claim is made against the Licensee or a sub
licensee concerning a possible infringement on existing similar
software, the Licensor agrees to forthwith indemnify and save the
Licensee harmless of and from any consequences that may reasonably flow
therefrom in the form of any actions or proceedings taken by third
parties or others effected as a result thereof. Without limiting the
generality of the above, the Licensor hereby expressly agrees to assume
liability for, and to indemnify, protect, and hold harmless the
Licensee and its agents, employees, and sub licensees against any and
all losses, damages (including punitive, special and consequential
damages), liabilities, expenses, costs (including reasonable attorneys'
fees), penalties and obligations, loss of expected revenues, arising
out of or incurred in connection with any reasonable claim, demand,
action, suit or proceeding of any kind by any third party in any way
relating to the Software. For the duration of this agreement, Licensor
shall maintain an insurance coverage of at least $1,000,000 to cover
for third party claims of any nature including copyright infringement,
and will name Licensee as a co-insured.
6.3. The Licensor warrants that the Software shall be free from defects in
material and workmanship, and shall conform to the specifications and
functionalities set forth in Schedule A hereof. Furthermore, the
Licensor warrants that the Software shall conform to any other
specifications, drawing, samples or instructions given at any time and
from time to time by the Licensee, provided that conformity, as defined
with consideration to accepted industry standards, is achievable and
provided the Licensor is afforded the time necessary to complete the
required work. The Licensor shall compensate the Licensee forthwith of
any loss of expected revenues stemming from the inability of the
Software to perform up to the specifications described in Schedule A
hereof and those required from time to time by the Licensee.
6.4. During the term of this Agreement and any renewal periods thereafter,
the Licensor will provide
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to the Licensee, free of charge, any new updates of the Software as
well as any improvements made to the Software as soon as those updates
and improvements are completed and in any event no later than two
business days from their commercial release, or other official release
within any stage of the development process. As well, the Licensor will
provide the Licensee with the required level of support and training.
6.5. During the term of this Agreement and any renewal periods thereafter,
the Licensee will be responsible for data entry, sales materials,
implementation, monitoring and maintaining a sales plan/program for the
Software, designing, building and managing a web site through which the
Software may be accessed via the Internet.
SECTION 7
RIGHTS TO THE USER DATABASE
7.1. The parties to this Agreement agree that the User Database and all
copyright and other intellectual and proprietary rights therein are and
will remain, through the duration of this Agreement and after its
expiry, the property of the Licensor.
7.2 Upon execution and during the term of this License Agreement, the
Licensor shall deposit, at its own costs, the most current version of
the source code and any supporting documentation in paper or other
suitable fixed form developed for the software (the "Materials") with a
trust company. In addition, the Licensor shall provide the trust
company from time to time improvements, modifications, updates or
changes to the Materials. In the event of a default such as bankruptcy,
insolvency or breach by Licensor, Licensor agrees to guarantee Licensee
full and complete access to Software server for the full term of the
contract and any renewal periods of the contract. Licensee will always
be able to use to their fullest capacity the Software in the listed
territory for the duration of the contract. The Trust Company will have
access to the Materials to ensure 100% term use.
SECTION 8
REPRESENTATION AND CONTACT
8.1 Both the Licensee and the Licensor will designate a contact person
responsible for regular reviews of data and projections between the
Licensor and the Licensee in order for both parties to adequately
perform their respective obligations.
SECTION 9
GENERAL PROVISIONS
9.1. Any notices or requests which the parties may be required to give
pursuant to this Agreement shall
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be sent by fax or by registered mail, postage prepaid, to the addresses
set out below:
If to the Licensor, at:
----------------------
Xxxx-Xxx.xxx, Inc.
000-000 X.Xxxxxx Xx.
Xxxxxxxxx, XX
X0X 0X0
Attention: Xxxxx Xxxxxxx
President and CEO
Telephone: (000) 000-0000
Fax: (000) 000-0000
If to the Licensee, at:
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ChinaBusinessChain, Group, LLC.
000 X. Xxxx Xxxxxx, Xxxxx #000
Xxxxxxxx, XX
00000
Attention: Xxxx Xxxx Xxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
and shall be deemed to have been received three (3) days after the date
of mailing or fax.
9.2. This Agreement sets forth the entire agreement and understanding
between the parties as to the subject matter hereof and neither of the
parties shall be bound by any conditions, definitions, warranties or
representation with respect to the subject matter hereof, other than as
expressly provided in this Agreement.
9.3. This Agreement shall be governed by and interpreted in accordance with
the laws of Florida, U.S.A. applicable therein.
9.4. In the event that any section or subsection is held to be invalid or
unenforceable or inapplicable by a court of competent jurisdiction,
such invalidity or unenforceability shall not affect the remainder of
the provisions hereof, but such part shall be fully severable, and this
Agreement shall be construed and enforced as if such invalid or
unenforceable or inapplicable part had never been inserted herein and
the parties do hereby agree that they would have signed this Agreement
without such invalid or unenforceable part included herein.
9.5. This Agreement will be binding upon the respective parties hereto, and
their assignees, provided that neither party shall assign this
Agreement or any rights herein without the other party's written
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consent. It is understood however that Licensee shall have the right to
assign this Agreement to one of its affiliates upon written notice to
Licensor.
9.6. The obligations in section 5 and in subsections 6.2 and 6.3 shall
survive the termination of this Agreement.
IN WITNESS WHEREOF the parties have caused this Agreement to be executed by
their respective officers duly authorized, as of the date first mentioned in
this Agreement.
(Licensor) XXXX-XXX.XXX, INC.
Per: /s/ Xxxxx Xxxxxxx
---------------------------------------
Name: Xxxxx Xxxxxxx
Title: President and CEO
(Licensee) CHINABUSINESSCHAIN GROUP, LLC.
Authorized Signatures:
Per: /s/ Xxxx Xxxx Lin
---------------------------------------
Name: Xxxx Xxxx Xxx
Title: Vice President Operation China
Per:
---------------------------------------
Name: Vu Le
Title: President & CEO
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SCHEDULE A
SPECIFICATIONS OF THE SOFTWARE
The DIRECT CONNECT software, developed by XXXX-XXX.XXX and is designed to:
1) Allows CONSUMERS, using a single line phone/modem connection to the
Internet, to utilize the features of the DIRECT CONNECT software.
2) Allows BUSINESSES, using a DIRECT CONNECT license (one-year term), to
set up DIRECT CONNECT icons on their business web pages, allowing
consumers to utilize the features of the DIRECT CONNECT software.
CONSUMERS FEATURES AND BENEFITS INCLUDE:
- DIRECT CONNECT software is free to all consumers.
- DIRECT CONNECT software installs the first time the icon is used.
- DIRECT CONNECT software will automatically upgrade to the newest version when
clicked any time after the initial installation.
- DIRECT CONNECT features a direct (voice) connection, allowing consumers to
connect to businesses from the Internet by placing a regular phone call with
their single line phone/modem connection while viewing the business' web page.
Specifically:
Controls modem/phone connection.
b) Auto dials the business.
c) Alerts you to pick up the phone.
d) Allows the consumer to view the web page and talk to
business simultaneously.
e) When finished, the consumer hangs up and clicks the
"DONE" button.
f) The Internet link is re-established.
g) The Consumer can now talk to businesses without
logging on or off the Internet.
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- DIRECT CONNECT also features an email option for consumers to receive an email
of the business' specials, promotions, coupons, and/or information from a
business by using the e-commerce (email) button. The consumer is able to enter
any email address to receive the e-commerce email from the business. Consumers
will have free technical support (during designated business hours)
- DIRECT CONNECT also features a CallMe option for consumers using alternative
methods of connection to the Internet which do not utilize the only available
telephone line. Businesses are sent a voice message containing the number
entered by the consumer trying to contact them. The business is then prompted to
choose one of three pre-recorded responses that can be sent back to the
consumer and viewed on their computer screen. Available in North America.
Consumers will have free technical support (during designated business hours)
DOWNLOAD SPEED COMPARISONS
Current Size of Direct Connect: 348 KB
Modem Maximum Rate Approximate Time to Download in Minutes and Seconds (Mm:ss)
Rating of Download *
Actual Size Download Size **
56,600 ** 6.5 KB/second 00:54 01:24
33,600 4.2 KB/second 01:24 02:06
28,800 3.6 KB/second 01:36 02:30
BUSINESS FEATURES AND BENEFITS INCLUDE:
The business will receive a one-year license for each DIRECT CONNECT account.
Unlimited use of each DIRECT CONNECT account on business web pages.
Easy to set up by a virtual on-line program.
24 hr. a day, 7 days a week access to each DIRECT CONNECT account with
complete control over account information and features.
Illustrated printable instruction manual.
Technical support (In English only, during designated business hours - 7 days a
week, 8am-5pm PST - in North America. Xxxx-Xxx.xxx will train technical
support staff in the locale of the Licensor.)
Each account will include the features of:
A direct (voice) connection to any telephone number used by the business.
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Email specials of unlimited length can be composed in standard ASCII characters
by the business for consumers to request and receive.
The CallMe feature, which sends a pre-recorded message to businesses at the
request of a consumer to be called by that business.
DIRECT CONNECT is designed to work with a consumer's existing hardware. No
guarantee of service is offered if the consumer has no data modem with a regular
touch tone phone, or if single phone line is shared with a fax and/or custom fax
software, or if Internet connection is by ISDN, ADSL and/or cable modem, or if
computer is part of a LAN (Local Area Network) or WAN (Wide Area Network), or
any other hardware/software not identified as common for consumers. If a
consumer does not meet the pre-requisites needed to utilize the Direct Connect
software, the Direct Connect software, upon installation and not finding a
modem, will assume the consumer has a phone line available, and will display a
message stating that the CallMe feature is the only viable voice connection
feature available to that particular user at that time.
INTERFACE AND INSTRUCTIONS for the Direct Connect software will be modified
jointly by both parties for clarity and understanding from the consumer's point
of view. Direct Connect will be provided with a custom interface for language
support and product branding within 40 days of this signed agreement.
DIRECT CONNECT software is designed and tested to work with Windows 9x/ME and
NT/2000.
DIRECT CONNECT is designed to work with javascript-enabled Microsoft Internet
Explorer 4.x and 5.x and Netscape Navigator 4.x, as well as AOL 5.0 or higher,
using Windows only.
ALTHOUGH DIRECT CONNECT MAY WORK WITH UNCOMMON AND/OR CUSTOM
HARDWARE/SOFTWARE USED BY CONSUMERS, DIRECT CONNECT IS DESIGNED FOR
STANDARD COMPUTERS, STANDARD DIAL-UP CONNECTIONS, AND A TOUCHTONE PHONE
(CONNECTED TO THE MODEM AND/OR SAME TELEPHONE NUMBER).
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SCHEDULE B
PARTICULARS OF THE LICENSING FEE
Distributors/Sub-distributors selling DIRECT CONNECT licenses to
businesses will have a distributor account with as many as required number of
blank accounts set up to distribute to the businesses. All accounts will be
available to view/control by the Distributors/Sub-distributors on a master
log-on screen.
XXXX-XXX.XXX reserves the right to access all master log-on screens to
verify accounts purchased/invoiced.
PURCHASE PRICE
Xxxx-Xxx.xxx, Inc., is offering PHON-NET Direct Connect to ChinaBusinessChain
Group, LLC., at a purchase price of $50.00 per annual unit, with a minimum of
5000 units, for a total of $250,000.00, payable in US funds with half payable on
the effective date of the contract and half on delivery of a Chinese language
version of the Software.
ChinaBusinessChain Group, LLC, will purchase PHON-NET Direct Connect
license units acquired in addition to the initial purchase of 5000 units at a
price of $50.00 per annual unit, payable on a quarterly basis for licenses sold
in the quarter paid within seven (7) days from the close of the quarter.
FURTHER
Xxxx-Xxx.xxx is also offering ChinaBusinessChain Group, LLC., a warrant
of 250,000 restricted shares at a purchase price of $0.25 per share, which may
be exercised within the twenty-four (24) month period of this agreement only.
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ADDENDUM TO LICENSE AGREEMENT
ENTERED INTO IN VANCOUVER, BRITISH COLUMBIA, this 30th day of April, 2001
BETWEEN: XXXX-XXX.XXX, INC., a Florida corporation duly constituted
under the laws of Florida, having its head office or principal
place of business at 000-000 X. Xxxxxx Xx., Xxxxxxxxx, XX, X0X
0X0 (hereinafter referred to as the "Licensor")
AND: ChinaBusinessChain Group, LLC, a corporation duly constituted
under the laws of California, having its head office or
principal place of business at 0000 Xxxx Xxxxxx, Xxxxx 000,
Xxxxxx, XX 00000 (hereinafter referred to as the "Licensee")
SECTION 1
ADDENDUM
1.1 The parties herein agree that the initial payment of $250,000/USD is a one
time licensing and development fee and does not constitute purchase of specific
licenses.
1.2 The distribution of the first 5000 annual licenses is assigned to the
Licensee for initial market penetration or promotion.
1.3 The parties agree to the issuance of one million annual licenses for
distribution efforts in the Territory with payments rendered by Licensee on the
first day of each month for every unit sold in the previous month.
(Licensor) XXXX-XXX.XXX, INC.
Per: /s/ Xxxxx Xxxxx
-------------------------------------
Name: Xxxxx Xxxxx
Title: Vice President of Operations
(Licensee) CHINABUSINESSCHAIN GROUP, LLC.
Authorized Signatures:
Per: /s/ Xxxx Xxxx Lin
-------------------------------------
Name: Xxxx Xxxx Xxx
Title: Vice President Operation China
Per: /s/ Vu Le
-------------------------------------
Name: Vu Le
Title: President and CEO
