EX-10
EXCLUSIVE PRODUCT LICENSE
AND
DISTRIBUTION AGREEMENT
This Agreement is entered into by and between Pelham Associates, Inc.,
with an address of ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ("Licensor"), and ▇▇▇▇▇▇▇▇▇.▇▇▇, Inc., with an
address of ▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
("Licensee").
Recitals:
Whereas, Licensor is the sole owner of an Exclusive License to
software and documentation known as Domain Name Registration SDK and
Branding Kit (collectively the "Product"); and
Whereas, Licensor desires to grant an Exclusive License to the Product
to Licensee, thereby transferring all of Licensor's rights to
manufacture, distribute or otherwise utilize the Product.
Now, therefore, the parties, intending to be bound hereby, agree as
follows:
▇.
▇▇▇▇▇ of License. Licensor hereby grants to Licensee a license to copy
the Product in object code as licensed hereunder, and to copy, sell,
license, distribute, utilize or otherwise transfer the Product on an
exclusive basis. Said License shall include the right to use the name
Domain Name Registration SDK and Branding Kit in connection with
licensing the Product, as it currently exists and as Licensee may
modify it, to third parties. Said License shall be from the date of
execution of this Agreement to January 4, 2005. In consideration for
the granting of this License to the Licensee, the Licensee will pay to
the Licensor five million (5,000,000) shares of restricted common
stock of Licensee, as defined in Paragraph IX of this Agreement.
II.
Product Description: Domain Name Registration SDK and Branding Kit.
This Domain Name Registration SDK allows for custom vertical market
offerings to provide the most user-friendly, intuitive places and ways
to buy domain names. This SDK will enable the mixing of end user
applications, and a backend registration suite.
This SDK will allow backend credit management and account integration
to enable custom offerings like domain search and purchase
applications, vertical applications like gift certificate domain
registrations and other similar related applications.
III.
Source Code. Where the source code is made available to Licensee to
Licensor, and as a condition of such release, all changes and
modifications to the source code must be sent to the Licensor and
become the exclusive property and copyright of the Licensor.
Any third party technology required in compiling, assembling and
distributing the Product or Products must be purchased or licensed by
the Licensee at the Licensee's request.
Changes made by the Licensor at the request of the Licensee become the
exclusive property and copyright of the Licensor, subject to the use
by Licensee during the term of this Agreement, regardless of
compensation to the Licensor for said changes, modifications and features.
IV.
Term. The initial term of this Agreement shall commence on the date of
the execution of this Agreement and shall end on January 4, 2005.
Licensor shall promptly advise Licensee of all modifications made to
the Product.
V.
Disclosure of Technology. Within ten (10) days after the effective
date of this Agreement, Licensor shall deliver to Licensee the following:
(A) Master diskettes containing the latest shipping version of
the Product, help files and all of Licensor's technology
necessary to distribute the latest version of the Product.
(B) A current list of the known features and "bugs", if any, of
the Product.
(C) If available, a list of proposed enhancements, improvements
and fixes.
VI.
Ownership. Subject to the license granted hereunder, all right, title
and interest in the Product licensed hereunder shall belong to the
Licensor and Licensee shall not have any rights, title and/or interest
other than that provided in this License Agreement. Licensor shall
retain copyright and ownership of any changes, maintenance, upgrades,
customization, marketing and promotional materials relating to the
Licensed Product not completed by Licensor or undertaken by Licensee.
Such tasks shall include but not be limited to special drivers, add-
ons, extensions, language porting, operating system development, text
revision, messages, help files, manuals, packaging and other related
work product.
VII.
Bundling and OEM Licensing. Licensee may publish, OEM, site-license or
market Product as a component of a bundled or multi-product package.
VIII.
Version Upgrades. For the term of this Agreement, Licensor shall
furnish Licensee with all version upgrades upon completion; however
the parties acknowledge that the Licensor is under no obligation to
upgrade the Product beyond the version provided to Licensee at the
commencement of this Agreement.
IX.
Payment for License. In consideration of the rights and licenses
granted to Licensee herein, Licensee shall pay to Licensor five
million (5,000,000) shares of restricted common stock of Licensee
immediately upon the execution of this Agreement, provided that all
terms of this Agreement that are to be completed concurrently with the
execution of this Agreement must have been fulfilled by Licensor and
Licensee. The stock to be issued to Licensor under this Agreement
will be restricted under Section 144 of the Securities Act of 1933
("Restricted Securities"). Licensor understands that as Restricted
Securities under the federal securities laws, the shares are not being
issued under a public offering and that under such laws and applicable
regulations, such securities may not be resold without registration
under the Securities Act of 1933, except in certain limited
circumstances. Licensor represents that it is familiar with
Restricted Securities and understands the resale limitations imposed
thereby and by the Act. It is understood that the certificates
evidencing the stock may bear the following legends: 1) The securities
evidenced by this certificate have not been registered under the
Securities Act of 1933, as amended (the "Act"), or the securities laws
of any state of the United States ("State Acts"). The securities
evidenced by this certificate may not be offered, sold or transferred
for value, directly or indirectly, in the absence of such registration
under the Act and qualification under applicable State Acts, or
pursuant to an exemption from registration under the Act and/or
qualification under applicable State Acts, the availability of which
is to be established to the reasonable satisfaction of the Licensee.
X.
Licensee's Obligations. Licensee shall be obligated to use its best
efforts to perform hereunder as follows:
(A) To announce, copy, package and actively market the Product
under the name Domain Registration SDK and Branding Kit or such
other name or names as Licensee deems desirable.
(B) Acquire distribution for the Product through any reasonable,
economically viable and available marketing and distribution
vehicles.
(C) Provide ongoing support and maintenance to current and future
licensees of the Product.
(D) Provide all relevant ownership notices on the Product,
packaging and other supporting documentation or materials
indicating that the copyright of the Product is in the name of
Licensor, and that Licensor retains sole ownership of any and all
trademarks.
(E) Provide to Licensor, upon written request, a comprehensive
list of all sub-licensees of the product within thirty (30) days
of the request, but in no event shall the Licensee be required to
do so more than four times per year.
XI.
Licensor's Obligations. Licensor shall be obligated to perform
hereunder as follows:
(A) To the extent available, provide Licensee with a
comprehensive customer list within thirty (30) days of the
effective date of this Agreement.
(B) To the extent necessary or required by Licensee, provide
technical advice to Licensee to enable Licensee to improve
Product, create ancillary components or provide support and
maintenance to customers.
XII.
Representations and Warranties. Licensor represents and warrants to
Licensee the following:
(A). Organization. Licensor is a corporation duly organized,
validly existing, and in good standing under the laws of
Wyoming, and has all necessary corporate powers to own
properties and carry on a business, and is duly qualified to do
business and is in good standing in Wyoming. All actions taken
herein by the Incorporators, directors and shareholders of
Licensor have been valid and in accordance with the laws of the
State of Wyoming.
(B) Liabilities. The Product is not encumbered by any debt,
liability, or obligation of any nature, whether accrued,
absolute, contingent, or otherwise, and whether due or to become
due, that is not reflected in this Agreement. Licensor is not
aware of any pending, threatened or asserted claims, lawsuits or
contingencies involving the Product.
(C) Ability to Carry Out Obligations. Licensor has the right,
power, and authority to enter into and perform its obligations
under this Agreement. The execution and delivery of this
Agreement by Licensor and the performance by Licensor of its
obligations hereunder will not cause, constitute, or conflict
with or result in any breach or violation or any of the
provisions of or constitute a default under any license,
indenture, mortgage, charter, instrument, articles of
incorporation, bylaw, or other agreement or instrument to which
Licensor or its shareholders are a party, or by which they may
be bound, nor will any consents or authorizations of any party
other than those hereto be required.
(D) Full Disclosure. None of representations and warranties
made by the Licensor, or in any certificate or memorandum
furnished or to be furnished by the Licensor, contains or will
contain any untrue statement of a material fact, or omit any
material fact the omission of which would be misleading.
(E) Compliance with Laws. Licensor has complied with, and is
not in violation of any federal, state, or local statute, law,
and/or regulation pertaining to Licensor. Licensor has complied
with all federal and state securities laws in connection with
the issuance, sale and distribution of its securities.
(F) Litigation. Licensor is not (and has not been) a party to
any suit, action, arbitration, or legal, administrative, or
other proceeding, or pending governmental investigation. To the
best knowledge of the Licensor, there is no basis for any such
action or proceeding and no such action or proceeding is
threatened against Licensor and Licensor is not subject to or in
default with respect to any order, writ, injunction, or decree
of any federal, state, local, or foreign court, department,
agency, or instrumentality.
(G) Corporate Documents. Copies of each of the following
documents, which are true complete and correct in all material
respects, will be attached to and made a part of this Agreement:
(1) Resolutions of the Board of Directors approving this
Agreement.
(H) Documents. All minutes, consents or other documents
pertaining to Licensor to be delivered at closing shall be valid
and in accordance with the laws of Wyoming.
XIII.
Representations and Warranties. Licensee represents and warrants
to Licensor the following:
(A) Organization. Licensee is a corporation duly organized,
validly existing, and in good standing under the laws of Nevada,
and has all necessary corporate powers to own properties and
carry on a business, and is duly qualified to do business and is
in good standing in Nevada. All actions taken herein by the
Incorporators, directors and shareholders of Licensee have been
valid and in accordance with the laws of the State of Nevada.
(B) Capital. The authorized capital stock of Licensee consists
of 100,000,000 shares of common stock, $ .001 par value and
15,000,000 shares of preferred stock, no par value, of which
none is currently issued and outstanding. All outstanding
shares are fully paid and non assessable, free of liens,
encumbrances, options, restrictions and legal or equitable
rights of others not a party to this Agreement. At closing,
there will be no outstanding subscriptions, options, rights,
warrants, convertible securities, or other agreements or
commitments obligating Licensee to issue or to transfer from
treasury any additional shares of its capital stock. All of the
shareholders of Licensee have valid title to such shares and
acquired their shares in a lawful transaction and in accordance
with the laws of Nevada.
(C) Absence of Changes. Since the date of the financial
statements, there has not been any change in the financial
condition or operations of Licensee, except changes in the
ordinary course of business, which changes have not in the
aggregate been materially adverse.
(D) Liabilities. Licensee does not have any debt, liability, or
obligation of any nature, whether accrued, absolute, contingent,
or otherwise, and whether due or to become due, that is not
reflected in this Agreement, except as previously disclosed to
Licensor. Licensee is not aware of any pending, threatened or
asserted claims, lawsuits or contingencies involving Licensee or
its common stock, except as previously disclosed to Licensor.
(E) Ability to Carry Out Obligations. Licensee has the right,
power, and authority to enter into and perform its obligations
under this Agreement. The execution and delivery of this
Agreement by Licensee and the performance by Licensee of its
obligations hereunder will not cause, constitute, or conflict
with or result in any breach or violation or any of the
provisions of or constitute a default under any license,
indenture, mortgage, charter, instrument, articles of
incorporation, bylaw, or other agreement or instrument to which
Licensee or its shareholders are a party, or by which they may
be bound, nor will any consents or authorizations of any party
other than those hereto be required.
(F) Full Disclosure. None of representations and warranties
made by the Licensee, or in any certificate or memorandum
furnished or to be furnished by the Licensee, contains or will
contain any untrue statement of a material fact, or omit any
material fact the omission of which would be misleading.
(G) Compliance with Laws. Licensee has complied with, and is
not in violation of any federal, state, or local statute, law,
and/or regulation pertaining to Licensee. Licensee has complied
with all federal and state securities laws in connection with
the issuance, sale and distribution of its securities.
(H) Litigation. Licensee is not (and has not been) a party to
any suit, action, arbitration, or legal, administrative, or
other proceeding, or pending governmental investigation. To the
best knowledge of the Licensee, there is no basis for any such
action or proceeding and no such action or proceeding is
threatened against Licensee and Licensee is not subject to or in
default with respect to any order, writ, injunction, or decree
of any federal, state, local, or foreign court, department,
agency, or instrumentality.
(I) Corporate Documents. Copies of each of the following
documents, which are true complete and correct in all material
respects, will be attached to and made a part of this Agreement:
(1) Resolutions of the Board of Directors approving this
Agreement.
(J) Documents. All minutes, consents or other documents
pertaining to Licensee to be delivered at closing shall be valid
and in accordance with the laws of Nevada
(K) Title. The Shares to be issued to Licensor will be, at
closing, free and clear of all liens, security interests,
pledges, charges, claims, encumbrances and restrictions of any
kind, except the restrictions noted in Paragraph IX of this
Agreement. None of such Shares are or will be subject to any
voting trust or agreement. No person holds or has the right to
receive any proxy or similar instrument with respect to such
shares, except as provided in this Agreement, the Licensor is
not a party to any agreement which offers or grants to any
person the right to purchase or acquire any of the securities to
be issued to Licensor. There is no applicable local, state or
federal law, rule, regulation, or decree which would, as a
result of the issuance of the Shares to Licensor, impair,
restrict or delay Licensor's voting rights with respect to the
Shares.
XIV.
Additional Terms and Conditions. Other terms and conditions of the
Agreement that both Parties have agreed to and have determined are
material to this Agreement are as follows:
(A) Board of Directors
Immediately upon the closing of the transaction, provided that
all terms of this Agreement that are to be completed
concurrently with the execution of this Agreement have been
fulfilled by Licensor and Licensee, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ will resign from the Board of Directors of
Licensee. The Board of Licensee will then appoint ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ to the Board of
Directors. After such appointment, the Board of Directors will
consist of these four Board members until such time as the
Company holds its next annual elections for the Board of
Directors or until such time as any Board member resigns.
(B) Proxy to Pelham Associates, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇ ▇. ▇▇▇▇▇▇, shareholders of Licensee
(who each hold their stock as Joint Tenants with Rights of
Survivorship with their spouses, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇ ▇.
▇▇▇▇▇, respectively), hereby grant to Pelham, an irrevocable
proxy to vote all of the shares currently owned by both
individuals for a period not to exceed six (6) months. Said six
(6) month period shall commence on the date of the execution of
this License Agreement.
(C) Reverse Splits
Both Parties hereby agree that an important term in the License
Agreement is that, for a period of twelve (12) months, from the
date of the execution of the License Agreement, the New Board of
Directors of Licensee will not subject the stock of Licensee to
a reverse split of any kind. It is also agreed that Licensee is
not precluded from forward splitting the common stock of
Licensee.
(D) Payment of Outstanding Debts
Before or concurrent with the execution of this License
Agreement, the existing Board of Directors will resolve to pay
off the outstanding liabilities of the Licensee, and
specifically the amounts owed to ▇▇▇ ▇. ▇▇▇▇▇▇, $149,874, and
▇▇▇ ▇. ▇▇▇▇▇▇, $110,075, by May 31, 2001. Pursuant to the terms
of this License Agreement and a Debenture Agreement, the debts
owed to both ▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇ ▇. ▇▇▇▇▇▇ will be converted
into a Convertible Debenture that provides that, at the option
of the Debenture holder, if these debts have not been satisfied
by May 31, 2001, then any amount outstanding owed to these
parties will be convertible into equity of the Licensee at
eighty (80) percent of the average of the five trading days'
closing price for the five trading days prior to the Conversion
Date, as defined in the Debenture Agreement. Newport Federal
Financial, a third party who is currently owed approximately
$280,000, has agreed to extend its period for repayment to July
2, 2001 at an interest rate of twelve (12) percent per annum.
It is understood and agreed that Newport Federal Financial will
not be included in the Convertible Debenture, and that Newport
Federal Financial must be repaid in cash and not in equity.
Furthermore, it is understood and agreed to by the Parties that
the Licensee intends to raise capital for business operations
once this transaction is consummated. It is further understood
and agreed to that, from capital that is raised by the Licensee,
until such time as the three creditors, listed above, have had
their outstanding debts satisfied by the Licensee in full, one-
half (50%) of any and all capital raised, after subtracting for
fees related to the raising of the capital, will be paid to
Newport Federal Financial first, and then to each of the Marples
equally.
(E) Term of Legal Representation
Subject to the terms of an agreement for legal services, parties
of this Agreement hereby agree that The Law Offices of ▇▇▇▇ ▇.
Tow will represent Licensee on a going forward nature from the
date of this Agreement for a three (3) year period. Duties in
said representation shall include all matters relating to
corporate and securities issues.
(F) Funding Agreement
It is understood by the Parties to this Agreement that the
Licensor is capable and has obtained an Equity Line of Credit,
in an amount up to 2.5 Million Dollars, that will be provided to
the Licensee upon the execution of this Agreement. It is
understood that this funding is critical to the growth and
expansion of the Licensee. The Equity Line of Credit will be
available to the Licensee for a period not to exceed two (2)
years from the first date of distribution to the Licensee.
XV.
Effective Date. The effective date of this Agreement shall be the date
of execution of this Agreement.
XVI.
Termination. Upon material default by either party, the non-defaulting
party must provide written notice to the party in default within sixty
(60) days of said event of default of its intent to terminate this
Agreement and the reason(s) therefore. The defaulting party shall have
thirty (30) days from the date of receipt of said notice of intent to
terminate to cure said default. In the event that the defaulting party
substantially cures said default, this Agreement shall remain in full
force and effect. In the event that the defaulting party fails to cure
said default within thirty (30) days, then this Agreement shall
terminate. Upon termination, neither party shall have the right to
market or distribute the other party's work product, and a final
accounting shall be conducted.
XVII.
Invalid Provision. The invalidity or unenforceability of any
particular provision of this Agreement shall not effect the other
provision hereof, and in such instance, this Agreement shall be
construed in all respects as if such invalid or unenforceable
provision were omitted.
XVIII.
Limitations of Liability between Licensor and Licensee. In no event
shall either party be liable to the other for incidental, indirect,
special or consequential damages, or for lost profits, savings or
revenues of any kind, or for lost data or downtime, regardless of
being advised of the possibility of such damages. The cumulative
liability of both parties for all claims relating to the Product or
this Agreement, regardless of the form of action, whether in contract
or in tort, including negligence, strict liability or otherwise, shall
not exceed the total of all proceeds from the Product.
XIX.
Notices. All notices required hereunder shall be forwarded as
follows:
▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.
▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
C/o ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Pelham Associates, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
c/o ▇▇▇▇ ▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
XX.
Governing Law; Resolution of Disputes. This Agreement shall be
governed by and construed in accordance with the laws of the State of
California. Any controversy or claim relating to this Agreement
(whether contract, tort, or both) or to the breach of this Agreement
shall be arbitrated by and in accordance with the then existing
commercial arbitration rules of the Judicial Arbitration and Mediation
Service ("JAMS"), in Orange County, California. The arbitrator may
render a judgment awarding actual compensatory damages only, and no
consequential, incidental, or punitive damages may be awarded by the
arbitrator. Judgment on the award rendered by such arbitrator may be
entered in any court having jurisdiction. Nothing in this Section
shall affect either parties' right to bring an action or proceeding
against the other in the courts of any jurisdiction where the purpose
of such action or proceeding is to seek injunctive relief. In the
event of any action or proceeding to enforce this Agreement, the
successful or prevailing party will be entitled to recover its
attorneys' fees actually incurred and other costs incurred in any such
action or proceeding, in addition to any other relief to which it may
be entitled.
XXI.
Entire Agreement. This Agreement shall constitute the entire agreement
between the parties. Any modifications or amendments hereto shall be
in writing and executed by the party to be charged.
LICENSEE: LICENSOR:
▇▇▇▇▇▇▇▇▇.▇▇▇, Inc. Pelham Associates, Inc.
/s/ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇ Aniz ▇▇▇▇▇
By: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, President By: ▇▇▇▇▇▇▇ Aniz ▇▇▇▇▇,
President
Date: February 16, 2001 Date: February 16, 2001