EXHIBIT 10.11
LICENSE AND SERVICES AGREEMENT
This Agreement, entered into this 19th day of April 2002, is by and
between eWorldMedia, Inc., a Nevada corporation ("EWorldMedia"), and
CaptureQuest, Inc., a Utah corporation ("CaptureQuest").
RECITALS:
A. CaptureQuest provides integrated Technology, Software and Services
that utilize "rich media" television style content for email and on-line
advertising.
B. EWorldMedia is a network marketing company desiring to offer various
products, one of which would allow its customers to subscribe to a service
to create their own rich media email campaigns of advertisements using a
series of templates designed by Capture Quest or others and distribute the
television style commercials to various email addresses furnished either by
CaptureQuest or others.
C. EWorldMedia desires to use CaptureQuest's Services, Software and
Technology to design a Customized System built to EWorldMedia's
specifications and to create several templates for creating the television
style commercials in various business markets.
D. CaptureQuest is willing to provide certain delivery services for the
email campaigns of EWorldMedia's subscribers.
E. CaptureQuest is willing to design the Customized System and to create
the Templates in the timeframe and at the prices set forth herein.
F. CaptureQuest is also willing to provide the ongoing delivery services
set forth herein in return for an ongoing commitment of EWorldMedia to pay
to CaptureQuest a percentage of the revenues generated from the sale of
Subscriptions as set forth herein.
G. CaptureQuest and EWorldMedia previously entered into a letter of
intent dated March 6, 2002, (the "Letter of Intent") which the parties
intend to supersede with this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and
obligations set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, it is hereby
agreed that:
1. Definitions
1.1 "Agreement" means this written agreement between CaptureQuest and
EWorldMedia.
1.2 "Bug" means an error in the Customized System or the Templates
which affect or impair the functionality of the Customized System or the
Templates, and which causes repeated and repeatable malfunctions.
1.3 "CGI" or "Common Gateway Interface" means the standard method of
writing computer code to enable an interactive computer program on one
Internet server to communicate with users located at remote Internet
servers.
1.4 "Customized System" means the collaboration of web pages, web
site, images and graphics applied to and integrated with CaptureQuest's
Technology and Software allowing EWorldMedia a private label email
marketing product for their customers.
1.5 "Derivative Work" means any modifications made to any computer
source code, object code, CGI code, or HTML code.
1.6 "Domain Name" or "Name" is the alpha-numeric name associates with
EWorldMedia's Web site, Web pages, or electronic mail.
1.7 "HTML Code" means hypertext xxxx-up language, which is the
language commonly used for developing the appearance of Web sites.
1.8 "Intellectual Property Rights" means all manifestations of rights
relating to Intellectual Property, including any and all trademarks,
service marks, certification marks, collective membership marks, logos,
commercial symbols, product names, trade names and Internet domain names,
and includes, with respect to any of the forgoing, any and all applications
and registrations under the laws of the United States of America, of any of
its States, under the laws of any and all other countries and
jurisdictions, and under any applicable international laws, conventions and
treaties.
1.9 "Internet" means the global computer network comprising
interconnected networks using standard Protocols.
1.10 "Project Manager" means a person designated by EWorldMedia who
shall be deemed as EWorldMedia liaison with CaptureQuest, and who shall
have power to act as EWorldMedia project manager in order to make ongoing
decisions under Section 2 of this Agreement, which are binding upon
EWorldMedia. The initial Project Manager shall be Xx Xxxxxx.
1.11 "Protocols" means a set of rules that regulate the way data is
transmitted between computers and includes the TCP/IP protocols.
1.12 "Services" means the services provided by CaptureQuest to
eWorldMedia for the purpose of designing customized private label templates
for advertisements using CaptureQuest's Technology and Software.
2
1.13 "Software" means the computer software programs owned or licensed
by CaptureQuest that are designed to create customized email marketing
campaigns, deliver such campaigns or track their success.
1.14 "Subscription" means the initial or monthly renewable right sold
by EWorldMedia to various customers to use the Customized System to create
email campaigns as contemplated herein, which right would terminate when
the Subscription period ends or when the Subscription is terminated.
1.15 "Technology" means the Software and related Intellectual
Property, including all proprietary documents and other materials
containing proprietary Intellectual Property Rights of CaptureQuest or of
licensors of CaptureQuest, including software code, software tools,
hardware designs, algorithms, user interface designs architectures class
libraries, objects and documentation (both printed and electronic), and
network designs throughout the world (in each case whether owned by
CaptureQuest or licensed to CaptureQuest from a third party), as well as
continuations, derivative works, improvements, enhancements and extensions
of any such items that are conceived, invented, made, reproduced to
practice or developed during the term of this Agreement by CaptureQuest and
eWorldMedia, excepting only items that are not uniquely applicable to
eWorldMedia.
1.16 "Web page" means each individual screen display contained in
EWorldMedia Web site.
1.17 "Web site" means all Web pages and domain names associated with
EWorldMedia and the Subscriptions or its products or services.
1.18 "World Wide Web" or "WWW" is a subset of the Internet, and is a
common system for browsing Internet Web sites.
2. Customized System Design and Template Creation
2.1 License and Design
2.1.1 Design of Customized System. With the cooperation and
assistance of CaptureQuest, EWorldMedia shall or has provided a written
specification sheet which graphically and textually illustrates all Web
pages that EWorldMedia wishes to incorporate into its Web site for the
Customized System, including images and graphics; the functionality
EWorldMedia desires between multiple Web pages; and the functionality
EWorldMedia desires between each Web page and users (the "Customized
System"). The Customized System shall include use of CaptureQuest's
Technology and Software.
2.1.2 Grant of License. Subject to the terms of this
Agreement, CaptureQuest hereby grants to EWorldMedia a perpetual non-
exclusive license (the "License") to use CaptureQuest's Technology and
Software solely for the purposes contemplated hereby.
3
a. Restrictions. EWorldMedia will not do, either directly
or indirectly, permit, or knowingly allow any of the following to occur:
(a) use the Technology or Software for any purpose other than the purposes
contemplated hereby, (b) disclose, display, advertise or have it made known
that the Technology and Software being utilized by the Customized System
belongs to or is powered by CaptureQuest, unless required by law following
notice to CaptureQuest.
b. Remedy/Penalty. If EWorldMedia commits or knowingly
permits or allows any infraction listed in subsection 2.1.2(a) above,
CaptureQuest shall be entitled to terminate this License and EWorldMedia
shall be responsible for any damage whatsoever to CaptureQuest resultant
from violation of such restrictions, including but not limited to, loss of
profits.
c. Termination of License. Upon termination of this
Agreement pursuant to subsection 9 below, the License to use CaptureQuest's
Technology and Software will automatically terminate. Upon termination of
this agreement by CaptureQuest, eWorldMedia will have option to purchase
the right to use Capture Quest's proprietary tools necessary to host and
manage their system.
2.1.3 Customized System Functionality. The Customized
System, utilizing CaptureQuest's Technology and Software, shall permit
EWorldMedia's customers to create their own rich-media email campaigns from
templates, which permit the agent to assign approximately eight variables
to customize their campaigns. Such variables shall include, but not be
limited to, (i) heading text; (ii) alternative text; (iii) special offer
text; (iv) contact information; (v) logo upload; (vi) single image upload;
(vii) action buttons with names and URL links; and (viii) a replay button.
The Customized System shall permit the agent to preview the campaign in
real time. After a campaign is customized, the Customized System shall
permit the agent to deliver the campaign by means of two options: (a) a
simple delivery system in which the customers can enter their own email
addresses and/or create their own groups; or (b) a third party email
delivery which enables the customers to deliver their campaigns into
demographic targeted opt-in mail lists. The Customized System shall also
include a demographic section tool for customers to choose various
demographic filters to deliver their campaigns, including, but not limited
to, filters for (1) zip code targeting; (2) gender; (3) age; (4) interest
categories or hobbies; and (5) two additional filters to be determined.
The Customized System shall also contain a tracking system to track, among
other things, (A) button clicks; (B) replays; (C) views; and (D) send-to-
a-friend. When the parties have completed the final specification sheet,
each party shall evidence approval by executing the final specification
sheet. CaptureQuest shall undertake to develop the desired Customized
System according to the specifications contained therein.
2.1.4 Creation of Templates. CaptureQuest and EWorldMedia
have agreed in concept and shall jointly work to create a specification
sheet for each template which graphically and textually illustrates a
series of thirty (30) templates divided into fifteen (15) different
business markets that EWorldMedia wishes to create for use with the
Customized System, including images and graphics; the functionality
EWorldMedia desires between the templates and the Customized System; and
the functionality EWorldMedia desires between each template
4
and users (the "Templates"). When the parties have completed the final
specification sheet, each party shall evidence approval by executing the
final specification sheet. CaptureQuest shall undertake to create each of
the desired Templates according to the specifications contained therein.
2.2 Coding
2.2.1 Method. CaptureQuest shall be responsible for any
additional code underlying the Customized System necessary for use with
CaptureQuest's Technology and Software and the Templates in accordance with
the final specification sheets, Protocols, and CGI.
2.2.2 Project Management. The parties recognize that
EWorldMedia's participation in all phases of the development of the
Customized System and the creation of the Templates is essential. As such,
Project Manager shall, in best faith, work with CaptureQuest to complete
the project on schedule.
2.2.3 Pre-Final Version Modifications.
a. Modification Method. During the initial programming,
structure layout, the interface and template development, and testing
process, CaptureQuest or EWorldMedia may propose modifications in writing
to either the Customized System or the Templates. Any proposed
modification shall be signed by both parties prior to the performance of
any work by CaptureQuest on such proposed modifications.
b. Additional Development Time. Written modifications
shall expressly include an additional amount of time for the development of
EWorldMedia's Customized System and/or creation of EWorldMedia's Templates,
and the delivery schedule shall be delayed by the same amount of time.
When such modifications are necessary for CaptureQuest to continue working
on the project, and when no other coding can be done during the interim,
the delivery schedule shall also be delayed by the amount of time between
when such modifications are first proposed until the time when they are
signed by both parties.
2.3 Delivery Engine Services. CaptureQuest shall provide continuing
services in connection with the delivery of the email campaigns for
EWorldMedia and its subscribers as set forth in Exhibit 2.3, attached
hereto and incorporated herein, and including, but not limited to, the
following procedures:
2.3.1 Deliver the Templates up to the amount allocated for
each user per month;
2.3.2 Bandwidth for the delivery of the Templates;
2.3.3 Storage of Template files;
2.3.4 Extensive tracking functionality; and
2.3.5 Reporting pages.
5
2.4 Schedule
2.4.1 Work Completed. Prior to execution of this Agreement,
CaptureQuest has performed the following services in connection with the
development of the Customized System and/or the Templates: 50% of creative
requirements completed, 75% of the front end completed, and 25% of the back
end completed.
2.4.2 Final Version. CaptureQuest shall deliver
EWorldMedia's completed Customized System on or before April 25, 2002,
pursuant to the following schedule:
a. On or before April 25, 2002, CaptureQuest shall start
the initial programming, structure the database layout, and commence the
development of the interface and template.
b. On or before April 25, 2002, CaptureQuest shall
complete the interface, develop the front, complete the structure, and
start the front-end interface programming.
c. On or before April 25, 2002, CaptureQuest shall program
the front and backend.
d. On or before April 25, 2002, CaptureQuest shall
complete the front and backend programming, check the system for bugs or
errors, finalize and rollout the final version.
2.4.3 Final Acceptance. EWorldMedia shall indicate its
acceptance or rejection of the final version of the Customized System or a
Template in writing within five (5) business days following delivery of the
completed Customized System or Template to EWorldMedia. Any rejection
shall itemize each and every deficiency. In the case of a rejection,
CaptureQuest shall have a reasonable time to correct any such deficiencies.
EWorldMedia shall indicate its acceptance or rejection of the corrected
work within five (5) business days following its delivery to EWorldMedia.
The failure to timely accept or reject any portion of the work shall
constitute an acceptance of that portion of the work.
2.4.4 Templates. Creation of the Templates shall be
completed on a schedule mutually agreed in writing by the parties and shall
include a reasonable number of Template modifications.
2.5 Deliverables. CaptureQuest's delivery of EWorldMedia's final
version of the Customized System or a Template shall consist of
CaptureQuest's posting of the Customized System or the template on
EWorldMedia's Web site.
2.6 Modifications Subsequent to Final Acceptance
2.6.1 Method. After final acceptance pursuant to subsection
2.4.3, above, EWorldMedia may desire to modify the Customized System or a
Template to enhance its appeal. EWorldMedia shall submit its desired
modifications in writing to CaptureQuest, and the parties
6
shall sign the written modification prior to performance of any modification
work by CaptureQuest.
2.6.2 Time. For a period of 12 months following final
acceptance, and thereafter so long as fees are required to be paid pursuant
to subsection 3.2, below, CaptureQuest shall make all necessary and
reasonable modifications to the Customized System or a Template created by
CaptureQuest.
2.6.3 Fees.
a. Maintenance. Where EWorldMedia's desired post-final
acceptance modifications are to fix Bugs in the Customized System or the
Templates, CaptureQuest shall provide the development services necessary to
fix such Bugs at no additional charge.
b. Conformance with Final Specification Sheets. Where
EWorldMedia's desired post-final acceptance modifications are to cause the
Customized System or the Templates to conform to the final specification
sheets, Capture Quest shall provide development services necessary to
conform to the respective final specification sheet at no additional charge
so long as the necessary modifications are noted prior to final acceptance
or are of a manner which notice prior to final acceptance would not be
reasonable.
c. Deviations from Final Specification Sheets. Where
EWorldMedia's desired post-final acceptance modifications are to cause the
Customized System or one or more Templates to deviate from the applicable
final specification sheet ("Improvements"), CaptureQuest shall be paid by
EWorldMedia at the rate of $125.00 per hour for development time.
Notwithstanding the provisions of subsection 2.6.2, above, EWorldMedia is
not obligated to engage the services of CaptureQuest for Improvements.
3. Fees and Payment
3.1 Customized System and Templates. EWorldMedia agrees to pay to
CaptureQuest a flat nonrefundable fee of $39,000 for the Customized System
and Templates, of which $27,100 has been paid, and the balance of $11,900
is payable upon execution of this Agreement by CaptureQuest.
3.2 Delivery System
3.2.1 Percentage of Sales. Commencing April 25, 2002, and
during the term of this Agreement, EWorldMedia shall pay to CaptureQuest a
fee based upon a percentage of the sales generated directly from the
worldwide sale of all Subscriptions. For such Subscriptions sold by
EWorldMedia for which CaptureQuest furnishes the email database, the fee to
CaptureQuest shall be twenty percent (20%), and for all such Subscriptions
sold by EWorldMedia for which CaptureQuest does not furnish the email
database, the fee to CaptureQuest shall be ten percent (10%) of the base
Subscription price. Nothing contained in this Agreement shall prevent
EWorldMedia from marketing and/or selling subscription rights for
7
other products which do not use the Customized System. No fee would be due
and payable to CaptureQuest for sales of subscription rights or products
which do not include the Customized System as a part of the subscription
right or product.
3.2.2 Email Database Furnished by CaptureQuest. For the 20%
fee to be paid to CaptureQuest as set forth in subsection 3.2.1 above,
CaptureQuest shall furnish access to one or more databases with a minimum
of one filter which shall permit the user to select email addresses based
upon the postal zip code of the recipient of the email campaign. The
database shall be sufficient to permit the user to select the maximum
number of email addresses based upon the level of package purchased.
3.2.3 Credits for Refunds. Should E provide a refund on
Subscriptions in accordance with E's business policies, E shall be entitled
to offset the commission actually paid to C on the refunded subscription on
the next payment due to C. Any such credits shall be accompanied with
documentation appropriate to establish the amount, timing and validity of
the refund.
3.2.4 Fee Statements. EWorldMedia shall deliver to
CaptureQuest, at its offices in Provo, Utah, or to such other address as
CaptureQuest may direct, on or before the two (2) weeks following the end
of each week during the term of this Agreement and on the fifth (5th)
business day following termination or expiration of this Agreement, a
complete and accurate statement (the "Fee Statement") of gross revenues
generated by CaptureQuest from sales of Subscriptions, for such week, or
portion thereof, during the term of this Agreement (the "Weekly Period").
The Fee Statement shall be certified as accurate by an officer of
EWorldMedia and shall include information as to the package description,
quantity sold, and gross selling price of the Subscriptions sold by
EWorldMedia during the Weekly Period, computation of gross sales,
allocation of the Subscription fee based upon whether or not the email
database is furnished by CaptureQuest for such Subscription, the amount of
fee due, and any other information CaptureQuest may from time to time
reasonably request. The Fee Statement shall be furnished to CaptureQuest
whether or not revenues from any Subscriptions have been received, and
whether or not royalties have been earned by CaptureQuest, during the
Weekly Period. Fee Statements shall be in a form reasonably acceptable to
CaptureQuest.
3.2.5 Payment of Percentage Fees. The amount shown in each
Fee Statement as being due CaptureQuest shall be paid simultaneously with
the submission of the Fee Statement. EWorldMedia's Fee Statements and all
amounts payable to CaptureQuest by EWorldMedia shall be submitted to:
0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxx, XX 00000
or such other address as CaptureQuest may direct.
3.2.6 Corrections to Fee Statements. The receipt and/or
acceptance by CaptureQuest of any of the Fee Statements furnished or
royalties paid hereunder to CaptureQuest
8
shall not preclude CaptureQuest from questioning the correctness of the
statement or the amounts paid; provided that EWorldMedia is notified in
writing within ten (10) days following the giving of the Fee Statement by
EWorldMedia or receipt of the percentage fee payment by EWorldMedia,
whichever shall be later. In the event that any inconsistencies or mistakes
are discovered in the Fee Statements or payments, and EWorldMedia is duly
notified, they shall immediately be rectified by EWorldMedia and the
appropriate payment shall be made by EWorldMedia. In the event EWorldMedia
or CaptureQuest shall discover a mistake resulting in an overpayment in any
Fee Statement, EWorldMedia shall be allowed to offset such amount in the next
Fee Statement and payment made to CaptureQuest.
3.2.7 Accurate Books and Records; Audit Rights. EWorldMedia
agrees to keep accurate books of account and records at its principal place
of business covering all transactions relating to sales of Subscriptions
and pertaining to the items required to be shown in EWorldMedia's Fee
Statements to be submitted pursuant hereto, including without limitation,
invoices, correspondence, banking, financial, and other records.
CaptureQuest and its duly authorized representatives shall have the right,
upon five (5) days' written notice, during normal business hours, to audit
EWorldMedia's books of account and records, and all other documents and
material in the possession or under the control of EWorldMedia, with
respect to sales of the Customized System and to make copies and extracts
thereof. In the event that any such audit reveals an underpayment by
EWorldMedia, EWorldMedia shall within thirty (30) days written notice remit
payment to CaptureQuest in the amount of such underpayment, plus interest
calculated at the rate of five percent (5%) per annum, from the date such
payment(s) were actually due until the date such payment is actually made.
In the event that any such underpayment is greater than Twenty-five
Thousand Dollars ($25,000), EWorldMedia shall reimburse CaptureQuest for
the costs and expenses of such audit. In the event such audit shall reveal
a mistake resulting in an overpayment in any percentage fee payment,
EWorldMedia shall be allowed to offset such amount in the next Fee
Statement(s) and payment(s) made to CaptureQuest.
4. Copyright and Intellectual Property
4.1 CaptureQuest's Retained Rights. EWorldMedia expressly recognizes
that it is not the author or owner of any of CaptureQuest's Technology or
Software, including but not limited to CGI, HTML Code, graphics, or data
provided to EWorldMedia by CaptureQuest, nor their attendant Intellectual
Property Rights, where such Technology and Software, including but not
limited to CGI, HTML Code, graphics, or data was created or acquired by
CaptureQuest prior to the commencement of this project for EWorldMedia, or
acquired after the commencement of but not in conjunction with this project
for EWorldMedia ("CaptureQuest's Toolset"). The parties expressly
recognize that CaptureQuest's work on the items designed for the Customized
System and Templates, except for CaptureQuest's Toolset, have been
specially ordered and commissioned by EWorldMedia as a contribution to a
collective work, supplemental work, or such other category of work as may
be eligible, to the greatest extent available under the law, for treatment
as a "work made for hire." EWorldMedia shall be deemed the sole author of
the items designed for the Customized System and the Templates, their
contents, , and their attendant Intellectual Property Rights, except for
CaptureQuest's Toolset. To the extent that either the Customized System or
any Template is not properly characterized as a "work made for hire,"
9
then CaptureQuest hereby irrevocably grants, assigns, and otherwise transfers
exclusively and in perpetuity to EWorldMedia, its successors and its
assigns, all rights of CaptureQuest in the items designed for the
Customized System and the Templates whatsoever, except for CaptureQuest's
Toolset now existing or hereafter discovered, in all media and forms of
expression.
4.2 EWorldMedia's Retained Rights
4.2.1 Works Created by EWorldMedia. EWorldMedia shall be
deemed the author and owner of: EWorldMedia's Domain Name and its
attendant Intellectual Property Rights; EWorldMedia's uniform resource
locator, if any, and its attendant Intellectual Property Rights; and any
graphics or data provided by EWorldMedia that are incorporated into the
Customized System or the Templates or any work embodying or derived from
any portion of the items designed for the Customized System or the
Templates.
4.2.2 Reproduction, Derivation, Performance and Display
Rights of CaptureQuest's Works. CaptureQuest expressly grants, assigns,
and otherwise transfers non-exclusively and in perpetuity to EWorldMedia,
its successors and its assigns, the right to reproduce, make derivative
works, publicly perform or publicly display the portions of the Customized
System or Templates deemed to be EWorldMedia's intellectual property as per
subsection 4.1, above. CaptureQuest further grants to EWorldMedia the
right to sublicense the portions of the Customized System or Templates
deemed to be EWorldMedia's intellectual property.
5. Corporate Representations and Warranties.
5.1 CaptureQuest's Representations and Warranties. CaptureQuest
represents and warrants to EWorldMedia as follows:
5.1.1 The Agreement has been duly authorized, executed and
delivered by CaptureQuest and constitutes a valid and binding obligation of
CaptureQuest, enforceable in accordance with its terms.
5.1.2 The execution, delivery and performance of this
Agreement by CaptureQuest, and the consummation of the transactions
contemplated hereby, have been duly and validly authorized by all requisite
corporate action, and no further proceedings on its part are necessary to
authorize the execution, delivery or performance of this Agreement.
5.1.3 CaptureQuest has the right to license the Technology
and Software as contemplated hereby and enter into this Agreement without
the violation of the rights of others.
5.2 EWorldMedia's Representations and Warranties. EWorldMedia
represents and warrants to CaptureQuest as follows:
5.2.1 This Agreement has been duly authorized, executed and
delivered by EWorldMedia and constitutes a valid and binding obligation of
EWorldMedia, enforceable in accordance with its terms;
10
5.2.2 The execution, delivery and performance of this
Agreement by EWorldMedia, and the consummation of the transactions
contemplated hereby, have been duly and validly authorized by all requisite
corporate action, and no further proceedings on its part are necessary to
authorize the execution, delivery or performance of this Agreement; and
5.2.3 EWorldMedia's execution and delivery of this Agreement
and its performance hereunder will not violate or breach any agreement,
obligation or covenant to which it is a party.
5.3 Duration of Warranties. The representations and warranties of the
parties as set forth in this section 5 shall be true and accurate as of the
date of this Agreement and shall survive the execution of this Agreement
for one year.
6. Confidential Information. The parties recognize that each shall come
into possession of information that comprises valuable trade secrets and
other confidential information protectable under applicable law
("Confidential Information"), which is exclusively owned by the conveying
party. Both parties expressly recognize that Confidential Information is
being conveyed to them under conditions of confidentiality, and agree that
they shall not disclose Confidential Information to any third party during
the term of this Agreement, and for a period of three years following the
termination or expiration of this Agreement. The parties may, however,
disclose Confidential Information to their employees who need to know
Confidential Information in order to assure the parties' compliance with
the other terms and conditions of this Agreement and as may be required by
law.
7. Non-Competition. CaptureQuest agrees that during the term of this
Agreement and for a period of six months following the termination or
expiration of this Agreement, CaptureQuest shall not design any Web sites
or computer software products for any third parties which are engaged in
any business which is directly the same as EWorldMedia's business,
including, but not limited to, network marketing and/or multi-level
marketing. In the context of the Section, this type of network
marketing/multi-level marketing would mean sales through independent
representatives, distributors, or others who earn commissions and/or
overrides on others, and would include sales organizations, people
recruited into the business, sales teams, and other organizations which
earn money on the efforts of others selling subscriptions to the Customized
System in the network marketing/multi-level marketing industries.
8. Product Warranties
8.1 Express Warranties.
11
8.1.1 Limited Warranty. CaptureQuest warrants that the
Customized System will perform substantially in accordance with the
specification sheet set forth in subsection 2.1.1 above. This warranty
shall not apply to the Customized System if it has been modified by
EWorldMedia or any third party. This warranty is made only to EWorldMedia
and EWorldMedia shall be solely responsible for any warranty to, or claims
by, its subscribers concerning performance of the Customized System.
8.1.2 Customized System and Templates shall Function with
Many Browsers. The Customized System and the Templates shall be prepared
in a workmanlike manner, and the Customized System and the Templates will
function in conjunction with properly configured web browsers including,
but not limited to, Netscape, and Internet Explorer.
8.2 Warranty Disclaimers. EXCEPT AS SPECIFICALLY PROVIDED IN THIS
AGREEMENT, AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE SERVICES,
SOFTWARE AND TECHNOLOGY IS PROVIDED OR LICENSED ON AN "AS IS" BASIS,
WITHOUT ANY EXPRESS OR IMPLIED WARRANTY, INCLUDING WITHOUT LIMITATION ANY
IMPLIED WARRANTY OF MERCHANTABILITY, NONINFRINGEMENT, TITLE, OR FITNESS FOR
A PARTICULAR PURPOSE, ALL OF WHICH ARE SPECIFICALLY DISCLAIMED. WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, CAPTUREQUEST DOES NOT REPRESENT
THAT THE SERVICES, SOFTWARE OR TECHNOLOGY WILL BE ERROR FREE.
8.2.1 Limitation on Liability. TO THE EXTENT PREMITTED BY
APPLICABLE LAW, IN NO EVENT SHALL CAPTUREQUEST HAVE ANY LIABILITY FOR ANY
PUNITIVE, EXEMPLARY, MULTIPLE, SPECIAL, INDIRECT, INCENDENTAL, OR
CONSEQUENTIAL DAMAGES WHATSOEVER, (INCLUDING, WITHOUT LIMITATION, DAMAGES
FOR LOST PROFITS, BUSINESS INTERRUPTION, OR LOSS OF BUSINESS INFORMATION)
ARISING UNDER THIS AGREEMENT, WHETHER IN A CONTRACT, TORT OR OTHER ACTION
FOR OR ARISING OUT OF BREACH OR WARRANTY, BREACH OF CONTRACT, DELAY,
MALPRACTICE, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE. CAPTUREQUEST'S
AGGREGATE LIABILITY UNDER THIS AGREEMENT SHALL NOT EXCEED AN AMOUNT EQUAL
TO THE AGGREGATE FEES PAID BY EWORLDMEDIA TO CAPTUREQUEST HEREUNDER. THE
LIMITATION OF LIABILITY SET FORTH IN THIS SECTION SHALL APPLY REGARDLESS OF
THE CAUSE OF ACTION UNDER WHICH SUCH DAMAES ARE SOUGHT AND WHETHER OR NOT
THE POSSIBILITY OF SUCH DAMAGES MIGHT REASONABLY BE FORESEEABLE.
8.2.2 Disclaimer of Certain Actions. CAPTUREQUEST DOES NOT
AND CANNOT CONTROL THE FLOW OF DATA OR THE DELIVERY OF EMAILS TO OR FROM
VARIOUS NETWORKS AND OTHER PORTIONS OF THE INTERNET. SUCH FLOW AND
DELIVERY DEPENDS IN LARGE PART ON THE PERFORMANCE OF
12
INTERNET SERVICE PROVIDED OR CONTROLLED BY THIRD PARTIES. AT TIMES, ACTIONS
OR INACTIONS OF SUCH THIRD PARTIES CAN IMPAIR OR DISRUPT EWORLDMEDIA'S DATA
OR DELIVERY OF EMAILS ON THE INTERNET (OR PORTIONS THEREOF). ALTHOUGH
CAPTUREQUEST WILL USE COMMERCIALLY REASONABLE EFFORTS TO TAKE ACTIONS IT
DEEMS APPROPRIATE TO REMEDY AND AVOID SUCH EVENTS, CAPTUREQUEST CANNOT
GUARANTEE THAT SUCH EVENTS WILL NOT OCCUR. ACCORDINGLY, CAPTUREQUEST
DISCLAIMS ANY AND ALL LIABILITY RESULTING FROM OR RELATED TO SUCH EVENTS.
9. Termination. This Agreement may be terminated upon the occurrence of
one or more of the following events, and the terminating party shall not be
liable to the other party solely for the rightful exercise of such right:
9.1 By either party, if the other party seeks protection under the
bankruptcy laws (other than as a creditor) or any assignment is made for
the benefit of creditors or a trustee is appointed for all or any portion
of such party's assets; or
9.2 By either party, if the other party is in default of any material
provision of this Agreement and such default is not cured within thirty
(30) days after the giving of notice thereof by such other party.
9.3 By mutual written consent of the parties.
10. Indemnification
10.1 Action by NuWays. EWorldMedia covenants and agrees to defend,
indemnify and hold harmless CaptureQuest, its officers and directors, from
and against any damages (including reasonable attorneys' fees and other
related costs and expenses) arising out of or resulting from any claim,
action, suit, or proceeding either threatened or brought by NuWays Inc.
against CaptureQuest, its officers or directors, that result from or
pertain to dealings between NuWays and EWorldMedia.
10.2 Notification and Procedure
10.2.1 If any party entitled to be indemnified pursuant to
Section 10.1 (an "Indemnified Party") receives notice of the commencement
by NuWays of any claim, action, suit, or proceeding (any such claim or
action being referred to herein as an "Indemnifiable Claim") with respect
to which EWorldMedia is or may be obligated to provide indemnification, the
Indemnified Party shall promptly notify EWorldMedia in writing (the "Claim
Notice ") of the Indemnifiable Claim; provided, that the failure to provide
such notice shall not relieve or otherwise affect the obligation of
EWorldMedia to provide indemnification hereunder, except to the extent that
any damages directly resulted or were caused by such failure.
10.2.2 EWorldMedia shall have thirty (30) days after receipt
of the Claim Notice to undertake, conduct and control, through counsel of
its own choosing, and at its expense, the settlement or defense thereof,
and the Indemnified Party shall cooperate with EWorldMedia in
13
connection therewith; provided, that (i) EWorldMedia shall permit the
Indemnified Party to participate in such settlement or defense through counsel
chosen by the Indemnified Party (subject to the consent of EWorldMedia, which
consent shall not be unreasonably withheld), provided that the fees and
expenses of such counsel shall not be unreasonable, and (ii) EWorldMedia
shall not settle any Indemnifiable Claim without the Indemnified Party's
consent, which consent shall not be unreasonably withheld. So long as
EWorldMedia is defending or seeking to settle any such Indemnifiable Claim
in good faith, the Indemnified Party shall not pay or settle such claim
without EWorldMedia's consent, which consent shall not be unreasonably
withheld.
10.2.3 If EWorldMedia does not notify the Indemnified Party
within thirty (30) days after receipt of the Claim Notice that it elects to
undertake the defense of the Indemnifiable Claim described therein, the
Indemnified Party shall have the right to contest, settle, or compromise
the Indemnifiable Claim in the exercise of its reasonable discretion;
provided, that the Indemnified Party shall provide prior written notice to
EWorldMedia of any compromise or settlement of any such Indemnifiable
Claim.
10.3 Certain Limitations. Notwithstanding anything to contrary in
this Section 10 or elsewhere in this Agreement:
10.3.1 No claims under this Section 10 shall be first made
more than one year following the date of this Agreement.
10.3.2 The indemnification provided in this Section 10 shall
not apply unless (and then only to the extent that) the aggregate
indemnification amounts payable by EWorldMedia exceed $5,000.
10.3.3 The liability of EWorldMedia under this Section 10
shall not exceed in the aggregate $750,000.00
10.3.4 The Indemnified Party's sole and exclusive remedy for
breaches of this Section 10 and for indemnification hereunder or in
connection herewith shall be his, her, or its right to make claims for
indemnification under this Section 10.
11. Miscellaneous
11.1 Notices. All notices, requests, demands, and other
communications required to or permitted to be given under this Agreement
shall be in writing addressed to the other party at the address set forth
below and shall be conclusively deemed to have been duly given when:
(a) Hand-delivered to the other party;
(b) Received when sent by telex or facsimile at the address and
number set forth below;
14
(c) The next business day after same have been deposited with a
national overnight delivery service, shipping prepaid, addressed to the
parties as set forth below with next-business day delivery guaranteed,
provided that the sending party receives a confirmation of delivery from
the delivery service provider; or
(d) Three business days after mailing if mailed from within the
continental United States by registered or certified mail, return receipt
requested, addressed to the parties as set forth below.
EWorldMedia: 000 Xxxxxxx Xxxxxx Xx.
00xx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Facsimile Number (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxx, President
With Copy to Xxxxxx X. Xxxxx
Attorney at Law
00 Xxxx 000 Xxxxx
Xxxxx 000
Xxxx Xxxx Xxxx, XX 00000
Facsimile Number (000) 000-0000
CaptureQuest: 0000 Xxxxx Xxxxxxxx Xxxxx
Xxxxx 000
Xxxxx, XX 00000
Facsimile Number (000) 000-0000
Attention: Xxxxxx Xxxxx, President
With Copy to Xxxxx Xxxxx
Attorney at Law
00 X. 00000 X., Xxxxx #000
Xxxxx, XX 00000
Facsimile Number (000) 000-0000
11.2 Attorneys' Fees. If any legal action or any arbitration or other
proceeding is brought for the enforcement of this Agreement, or because of an
alleged dispute, breach, default, or misrepresentation in connection with any
of the provisions of this Agreement, the successful or prevailing party or
parties will be entitled to recover reasonable attorneys' fees and other
costs incurred in that action or proceeding, in addition to any other relief
to which it or they may be entitled.
11.3 Further Assurances. The parties shall each from time to time,
at the request of the other, and without further consideration, execute and
deliver such instruments, and take such actions, as may be reasonably
necessary to effect the transactions contemplated by this Agreement.
15
11.4 Assignment and Binding Effect
11.4.1 The parties recognized that EWorldMedia has retained
CaptureQuest for CaptureQuest's unique development capabilities. As such,
CaptureQuest shall not delegate any of its duties under this Agreement to any
other person, entity, or subcontractor.
11.4.2 EWorldMedia may only assign this Agreement to a parent,
or a subsidiary of which it owns not less than 80% and EWorldMedia may assign
the Agreement to any third party in connection with any merger or sale or
transfer of all or substantially all of its business assets.
11.4.3 Subject to the foregoing, the provisions of the Agreement
shall be binding upon and inure to the benefit of the parties, and their
respective heirs, successors (by merger, transfer of assets or stock,
dissolution or otherwise), permitted assigns, and legal and personal
representatives.
11.5 Independent Contractors. Except as otherwise expressly
provided herein, the relationship between the parties to this Agreement is
that of independent contractors, and neither party shall hold itself out or
have the authority to act as the agent of the other party for any purpose.
Nothing contained herein shall be deemed to create any joint venture or
partnership relationship between the parties.
11.6 Authority
11.6.1 Each party warrants to the other that the warranting
party is duly organized and in good standing under the laws of the
jurisdiction of its incorporation or existence.
11.6.2 Each party warrants to the other that it has full power
and authority to enter into this Agreement and that the signatories executing
this Agreement have actual authority to bind the warranting party to this
Agreement.
11.7 Survival of Representations and Warranties. The representations
and the warranties made in this Agreement shall survive the execution and
termination of this Agreement.
11.8 Severability. The provisions of this Agreement shall be deemed to
be severable, and if any provision of this Agreement is found to be invalid by
any body of competent jurisdiction, such invalidity shall not effect the
validity of the remaining provisions of this Agreement.
11.9 Non-Waiver. The failure of either party to enforce at any time or
for any period of time any provision of this Agreement shall in no way be
considered to be a waiver of such provision or the party's right thereafter
to enforce every provision of this Agreement. The failure of either party to
enforce any provision shall not be
16
construed as a waiver of any continuing or succeeding breach of such
provision, a waiver of the provision itself, or a waiver of any other right
under this Agreement.
11.10 Governing Law and Venue. This Agreement and the rights and
duties of the parties hereto shall be construed and determined in accordance
with the laws of the State of Utah, and any and all actions to enforce the
provisions of this Agreement shall be brought in a court of competent
jurisdiction in the State of Utah and in no other place.
11.11 Force Majeure. Neither party shall be liable hereunder by
reason of any failure or delay in performance of its obligations hereunder on
account of strikes, shortages, riots, insurrection, fires, flood, storm,
explosions, acts of God, war, acts of terrorism, governmental action, labor
conditions, earthquakes, or any other cause which is beyond the reasonable
control of such party.
11.12 Headings. The section and paragraph headings used in this
Agreement are for the purpose of convenience only and shall not be construed
to limit or extend any provision hereof.
11.13 Entire Agreement. This document sets forth the entire
agreement and understanding between the parties and supersedes the Letter of
Intent, and all prior and contemporaneous agreements and understandings
between them with respect to the subject matter of this Agreement. No
amendments, modifications, waivers or supplements to this Agreement shall be
enforceable or binding upon the parties unless executed by a written
instrument expressly referring to this Agreement and executed by the duly
authorized representatives of the parties. The acceptance of any order
inconsistent with the terms of this Agreement shall not be deemed as
acceptance or approval of any amendment, modification or supplement to this
Agreement.
11.14 Counterparts. This Agreement may be executed in any number of
counterparts and all such counterparts taken together shall be deemed to
constitute one instrument. Delivery of an executed counterpart of this
Agreement by facsimile shall be equally as effective as delivery of a
manually executed counterpart of this Agreement. Any party delivering an
executed counterpart of this Agreement by facsimile also shall deliver a
manually executed counterpart of this Agreement, but the failure to deliver a
manually executed counterpart shall not affect the validity, enforceability,
or binding effect of this Agreement.
11.15 Drafting. This Agreement was drafted with the joint
participation of the parties and/or their legal counsel. Any ambiguity
contained in this Agreement shall not be construed against any party as the
draftsman, but this Agreement shall be construed in accordance with its fair
meaning.
17
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement to be effective the day and year first written above.
eWorldMedia, Inc.
By /s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx, President
CaptureQuest, Inc.
By /s/ Xxxxxx Xxxxx
Xxxxxx Xxxxx, President
18
