EXHIBIT 10.2
WEBIX INC.
▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
As of January 15, 2002
WebIAm, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Gentlemen:
This Agreement sets forth the legally binding agreement among
WEBiX Inc., a Florida corporation ("WEBiX"), WebIAm, Inc., a New Jersey
corporation ("WebIAm") and The X-Change Corporation, a Nevada corporation
("X-Change") as to the following items. The parties agree to use their
reasonable efforts to prepare and execute more formal agreements to document the
agreed items in the near future if they shall mutually so determine. The parties
understand and acknowledge that WEBiX shall be merged into a wholly-owned
subsidiary of X-Change, and that this Agreement shall be binding on and inure to
the benefit of X-Change as the successor to WEBiX after the completion of the
merger transaction. All references to WEBiX contained herein shall mean and
include X-Change from and after the date of the merger.
1. WEBiX and WebIAm are currently parties to a certain License
Agreement dated as of June 20, 2001 (the "Original License Agreement"). This
letter is intended to amend and supersede the Original License Agreement to the
extent set forth herein. Except as otherwise set forth herein, the Original
License Agreement shall remain in full force and effect.
2. WebIAm hereby grants to WEBiX an exclusive, royalty free
(subject to any early termination or royalty provisions specified herein),
license (the "Master License") for a period commencing on the date hereof and
ending on the date which is three months after the second anniversary of the
date hereof (such period shall be referred to herein as the "Term") to use for
any and all purposes (including the right to sublicense software to others) the
following:
(a) all computer software (including both source and object code),
owned hardware, leased hardware, databases, computer programs and other media
used in WebIAm's Software Development and Licensing Business, including, without
limitation, the following software development related projects and
opportunities: the WEBiX exchange; the ABS exchange; the eBond exchange; the
High Grade software; the New Issue software; the Parts exchange; and the
jsBuilder software;
(b) all currently existing customer lists and other information, data,
statistics and other compilations of information relating to customers or
potential customers of the Software Development and Licensing Business, in each
case whether in hard copy or machine-readable form, including all records,
manuals, know-how and expertise relating thereto;
(c) all of WebIAm's items of equipment, furniture and personal
property;
(d) all rights and interests in and to any pending or executory
contracts, agreements, licenses, leases and arrangements of any nature
whatsoever, including, without limitation, customer and supplier agreements and
those contracts, agreements, licenses, leases and arrangements, except for
contracts and rights relating to the WebIAm's relationship with GDS CBeX and
excluding WebIAm's ownership of equity in GDS CBeX;
(e) all rights and interests in and to any and all trade names, assumed
names, corporate names, brands and slogans other than the continued use of the
corporate name "WebIAm";
(f) all rights and interests in and to any and all inventions, patents,
patent rights, patent applications, copyrights, trademarks, service marks and
registrations and registration applications, including extensions and renewals
thereof and licenses therefor (and all future income therefrom);
(g) all books, records, files and papers of the Software Development
and Licensing Business, including, without limitation, drawings, engineering
information, computer programs, manuals and data, sales and advertising
materials and sales and purchases correspondence; and
3. (a) In consideration for the grant of the license as
provided in Section 2 above, WEBiX hereby agrees to pay to or for the benefit of
WebIAm (and in some cases its principals) or to assume the following obligations
of WebIAm:
1. the balance of the account payable to Globix through
December 31, 2001 in the amount of $17,187;
2. the Globix web hosting contract, a copy of which has been
previously delivered to WEBiX and which involves the payment of $5,700
per month in fees;
3. the account payable to BEA for software licenses used in
the WEBiX software platform in the approximate amount of $38,723;
4. the account payable to Tsunami Computing for
sub-contracting services in the amount of $12,201; and
5. two (2) hardware leases with Summit Quick Lease with total
monthly payments of $700.00 (the "Assumed Trade Debt").
WEBIX IS ASSUMING NO LIABILITIES, CLAIMS OR OBLIGATIONS OF WEBIAM OR THE
SOFTWARE DEVELOPMENT AND LICENSING BUSINESS OTHER THAN THOSE SPECIFIED ABOVE.
THERE SHALL BE NO IMPLIED ASSUMPTION BY WEBIX OF ANY OTHER LIABILITY OR
OBLIGATION OF WEBIAM OR THE SOFTWARE DEVELOPMENT AND LICENSING BUSINESS,
INCLUDING, WITHOUT LIMITATION, ANY EMPLOYEE BENEFIT PLAN OR AGREEMENT WITH ANY
EMPLOYEE OR SHAREHOLDER IN EXISTENCE AT ANY TIME, WHETHER OR NOT DISCLOSED TO
WEBIX, OR KNOWN OR UNKNOWN, FIXED OR CONTINGENT.
(b) During the Term and thereafter for so long as WEBiX or
X-Change or any of their respective successors or assigns continue to utilize
all or any part of the assets that are the subject of the Original License
Agreement or this Master License and notwithstanding the purchase by WEBiX or
X-Change pursuant to Section 4 hereof of the assets which are the subject of
this Master License or any termination in whole or in part of the Master License
pursuant to Sections 5 or 6 of this Agreement, WEBiX shall continue to be
obligated to pay to WebIAm or its designee the fee specified in Section 3.B. of
Schedule 2 of the Original License Agreement;
(c) One Hundred Thousand (100,000) shares of Common Stock of
WEBiX (the "WEBiX Shares"), which shares shall not have been registered under
the Securities Act of 1933, as amended (the "Securities Act"). WebIAm
acknowledges that upon consummation of the merger, the WEBiX Shares shall be
cancelled and WebIAm shall receive Two Million (2,000,000) shares of X-Change
Common Stock (which shall also not be registered under the Securities Act), upon
the terms and conditions set forth in the Merger Agreement (a copy of which has
been provided to the WEBIAM); and
(d) Concurrently with the execution of this Agreement, each of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇. Nissan and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ shall enter into 2 year
employment agreements with WEBiX and X-Change on the terms outlined in the
separate employment term sheets that are attached to this Agreement.
4. In the event that the Master License shall not have been
previously either partially or fully revoked for any of the reasons set forth
provided below, then, commencing on the second anniversary of the date of this
Agreement and ending three months thereafter, WEBiX shall have the right to
purchase from WebIAm, for a price of One Dollar ($1.00), outright title to all
of the assets covered in the Master License (including all enhancements and
modifications thereto from and after the date hereof), free and clear of any and
all liens, encumbrances and liabilities; provided, however, that notwithstanding
any other term set forth in this Section 4, in no event may the purchase right
set forth in this Section 4 be exercisable by WEBiX or X-Change unless and until
(i) all amounts (including any disputed amounts) due and payable to ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇, ▇▇▇▇ ▇. Nissan and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ under the employment agreements
referred to in Section 3(d) hereof have been paid in full and (ii) all fees
payable under Section 3.B. of Schedule 2 of the Original License Agreement owed
by WEBiX to WebIAm or its designee through the date on which the purchase option
is exercised have been paid in full.
5. In the event that (i) the employment of any two or more of
the individuals specified in Section 3(d) above shall be terminated by WEBiX
before the expiration of the Term, (ii) there is a material breach by WEBiX of
any of its representations and warranties set forth in Section 10 of this
Agreement or (iii) there is a material breach of the covenant set forth in
Section 7 of this Agreement or the condition set forth in Section 11 of this
Agreement then the Master License shall be revoked with the exception that it
shall remain in effect for the limited purpose of permitting the continued use
of the software in connection with the operation of the alternative exchange for
micro-cap securities (the "Micro-cap Exchange") and in connection with any other
contractual obligations with third parties that WEBiX shall have entered into
prior to the date of termination of the Master License ("Existing Third Party
Uses"). In this event, WebIAm shall be entitled to use the software (including
all enhancements and modifications thereto from and after the date hereof) on an
exclusive basis for any and all purposes except that WebIAm shall not use or
license the software for any use that is directly competitive with the Micro-cap
Exchange or with any of the Existing Third Party Uses. The shareholders of
WebIAm individually agree to honor the restrictions and the obligations imposed
on WebIAm in this Agreement.
6. In the event that (i) WEBiX shall file a petition under any
bankruptcy or insolvency law, or in the event that such a petition shall be
filed involuntarily against WEBiX (and shall not be dismissed within 60 days
from the date of filing) or (ii) WEBiX shall default in the payment of any fees
to WebIAm as referenced in Section 3(b) above (after the provision of written
notice of default by WebIAm and the opportunity for WEBiX to cure such default
for 30 days), the Master License shall be revoked in its entirety.
7. After the consummation of the X-Change merger, one (1)
representative of WebIAm shall be nominated to serve on the Board of Directors
of X-Change on the slate to be proposed by the current shareholders of WEBiX.
WEBiX shall use its reasonable best efforts to cause its current shareholders to
vote in favor of the representative of WebIAm.
8. After the consummation of the X-Change merger, WEBiX shall
cause X-Change to use reasonable efforts to continue to support and promote the
business avenues included in the Software Development and Licensing Business,
including software development and licensing, managed services, technology
consulting and outsourced IT and exchange system services.
9. WebIAm represents and warrants to WEBiX as follows:
(a) Organization. WebIAm is a corporation duly organized, validly
existing and in good standing under the laws of the State of New Jersey.
(b) Corporate Authority, Etc. The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby and all
other agreements and instruments to be executed and delivered by WebIAm have
been duly and validly authorized, approved and adopted by all requisite
corporate action of WebIAm. This Agreement constitutes, and such other
agreements and instruments, when duly executed and delivered by WebIAm will
constitute, valid and binding obligations of WebIAm enforceable against WebIAm
in accordance with their respective terms except as such enforceability may be
limited by applicable laws related to bankruptcy, insolvency, fraudulent
conveyance, reorganization or affecting creditors' rights generally and except
to the extent that injunctive or other equitable relief is within the discretion
of a court.
(c) No Conflict, Etc. Neither the execution nor delivery of this
Agreement and all other agreements and documents executed in connection herewith
by WebIAm nor the consummation of the transactions contemplated hereby or
thereby nor the performance of this Agreement and all other agreements and
documents executed in connection herewith by WebIAm will (i) conflict with or
result in a breach of any provision of the Certificate of Incorporation or
By-Laws of WebIAm; (ii) violate, conflict with, or result in a breach of any
provision of, or constitute a default (or an event which, with notice or lapse
of time or both, would constitute a default) under, or result in the creation of
any lien, security interest, charge or encumbrance upon any of the assets,
properties, contracts or obligations of WebIAm; (iii) result in being declared
void, voidable or without further binding effect under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed of trust,
lease, agreement or other instrument or commitment or obligation to which WebIAm
is a party, or by which WebIAm may be bound or affected; or (iv) violate any
order, writ, injunction, decree, judgment, or ruling of any court or
governmental authority specifically applicable to WebIAm or any of its
properties.
(d) Claims, Legal Proceedings, Etc. To the best knowledge of the
shareholders of WebIAm, there are no material claims against WebIAm or the
Software Development and Licensing Business in favor of any party (including,
without limitation, any material claim for liability, in tort or otherwise, with
respect to the services performed or provided by the Software Development and
Licensing Business) and there is no legal, administrative, arbitration, or other
proceeding or investigation pending or, to the best of WebIAm's or its
shareholder's knowledge, threatened against WebIAm or the Software Development
and Licensing Business, nor does WebIAm or any of its shareholders have any
knowledge of any basis for any such claim or proceeding.
(e) Licenses, Patents, Trademarks, Etc. WebIAm has all permits,
approvals, authorizations, consents, licenses, clearances, notifications and
certificates (collectively, the "Licenses"), and owns or has adequate rights to
use, all intellectual property, technology, processes, computer programs,
know-how and formulae and other property rights, which are necessary or material
to the conduct of the Software Development and Licensing Business, all of which
Licenses are in full force and effect and shall be included in the assets
licensed hereunder. None of the Licenses are non-assignable. Neither WebIAm nor
any of its shareholders have received notice of any claim for infringement, nor
has the Software Development and Licensing Business infringed or is it
infringing or has it engaged in or is it engaging in the unauthorized use or the
misappropriation of, any patent, trademark, copyright, technology, process,
design, computer program, know-how or formula of another.
(f) Compliance With Law. WebIAm is in compliance with all laws,
regulations and orders applicable to its business. WebIAm has not received any
notification that it is in violation of any law, regulation or order and no such
violation exists.
(g) Investment Representations. WebIAm understands, acknowledges and
agrees that:
(i) Neither the WEBiX Shares nor the X-Change Shares have been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
or any state securities laws, in reliance upon either Rule 506 of Regulation D
under the Securities Act ("Regulation D") or Rule 4(2) of the Securities Act and
similar exemptions under state securities laws for private offerings. The
availability of the aforesaid exemptions depend in part upon the accuracy of
certain of the representations, declarations and warranties which are made by
WebIAm herein and which are being relied upon in determining WebIAm's
suitability to invest in WEBiX and or X-Change;
(ii) The WEBiX Shares and the X-Change Shares are restricted
securities which may not be sold or otherwise transferred unless they have been
registered under the Securities Act or unless such transaction is exempt from
the registration requirements thereunder, provided, however, that in the case of
an exemption to the registration requirements thereunder, WEBiX shall have
received an opinion of counsel, reasonably acceptable to WEBiX and its counsel,
stating that the proposed transfer is exempt from registration under the
Securities Act;
(iii) Prior to any proposed transfer of the WEBiX Shares or
the X-Change Shares and as a condition thereto, if such transfer is not made
pursuant to an effective Registration Statement under the Securities Act or
pursuant to an exemption from the registration requirements thereunder and, in
the case of an exemption to the registration requirements thereunder, if an
opinion of counsel is not delivered to WEBiX as provided above, WebIAm will, if
requested by WEBiX, deliver to WEBiX an investment covenant signed by the
proposed transferee in such form as shall be required by WEBiX;
(iv) WebIAm agrees to indemnify WEBiX against any and all
losses, claims, damages, expenses or liabilities to which WEBiX may become
subject under any United States federal or state securities law, at common law
or otherwise, insofar as such losses, claims, damages, expenses or liabilities
arise out of or are based upon (A) any transfer of the WEBiX Shares or the
X-Change Shares by WebIAm in violation of the Securities Act, or under any rule
or regulation promulgated under the Securities Act, or (B) any untrue statement
of a material fact or omission to state a material fact in connection with
WebIAm's investment in WEBiX or in X-Change in connection with any transfer of
the WEBiX Shares or the X-Change Shares by WebIAm; and
(v) Any certificate representing the WEBiX Shares or the
X-Change Shares shall bear a legend setting forth the restrictions on the
transferability of such securities;
(vi) WebIAm is acquiring the WEBiX Shares or the X-Change
Shares for its own account and for investment only and not with the intention
of, or a view toward, the resale or further distribution thereof; provided,
however, that WEBiX acknowledges that WebIAm may in the future transfer all or a
portion of the WEBiX Shares or the X-Change Shares to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇.
Nissan and/or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ individually;
(vii) WebIAm has no contract, agreement or arrangement with
any person to sell, transfer or pledge the WEBiX Shares or the X-Change Shares
or any portion thereof to such person or anyone else; provided, however, that
WEBiX acknowledges that WebIAm may in the future transfer all or a portion of
the WEBiX Shares or the X-Change Shares to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇. Nissan
and/or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ individually;
(viii) WebIAm is aware that the WEBiX Shares and the X-Change
Shares are of a very speculative nature and involve a very high degree of risk;
(ix) WebIAm has received any and all information regarding
WEBiX, X-Change and their respective businesses which it has required in
connection with the investment contemplated hereby and has had the opportunity
to discuss any questions he may have with the officers of WEBiX; and
(x) WebIAm has sufficient knowledge and experience in business
matters to evaluate the merits and risks of its investment in WEBiX and in
X-Change.
10. WEBiX hereby represents and warrants to the WebIAm as follows:
(a) Organization. WEBiX is a corporation duly organized, validly
existing and in good standing under the laws of the State of Florida.
(b) Corporate Authority, Etc. The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby and all
other agreements and instruments to be executed and delivered by WEBiX have been
duly and validly authorized, approved and adopted by all requisite corporate
action of WEBiX. This Agreement constitutes, and such other agreements and
instruments, when duly executed and delivered by WEBiX will constitute, valid
and binding obligations of WEBiX enforceable in accordance with their respective
terms.
(c) No Conflict, Etc. Neither the execution nor delivery of this
Agreement and all other agreements and documents executed in connection herewith
by WEBiX nor the consummation of the transactions contemplated hereby or thereby
nor the performance of this Agreement and all other agreements and documents
executed in connection herewith by WEBiX will (i) conflict with or result in a
breach of any provision of the Certificate of Incorporation or By-Laws of WEBiX;
(ii) violate, conflict with, or result in a breach of any provision of, or
constitute a default (or an event which, with notice or lapse of time or both,
would constitute a default) under, or result in the creation of any lien,
security interest, charge or encumbrance upon any of the assets, properties,
contracts or obligations of WEBiX; (iii) result in being declared void, voidable
or without further binding effect under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, deed of trust, lease,
agreement or other instrument or commitment or obligation to which WEBiX is a
party, or by which WEBiX may be bound or affected; or (iv) violate any order,
writ, injunction, decree, judgment, or ruling of any court or governmental
authority specifically applicable to WEBiX or any of its properties.
(d) Financial Statements; No Undisclosed Liabilities. WEBiX has
previously delivered to WebIAm its unaudited financial statements for the period
as of and ended September 30, 2001 (the "Financial Statements"). A copy of the
Financial Statements is attached hereto. The Financial Statements are in accord
with the books and records of WEBiX and they fairly and accurately present the
assets, liabilities and financial condition of WEBiX as of September 30, 2001
and the results of WEBiX's operations for the period ended September 30, 2001.
The Financial Statements do not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading. Since September 30, 2001,
there has been no material adverse change in the financial condition, working
capital, assets, liabilities, reserves, business operations or prospects of
WEBiX. WEBiX has no obligations or liabilities of any nature (absolute, accrued,
contingent or otherwise and whether due or to become due) except (a) liabilities
which have been fully reflected or reserved against the Financial Statements,
which reserves are appropriate and reasonable and (b) liabilities incurred in
the ordinary course of business and consistent with past practice since the date
of the Financial Statements.
(e) Compliance With Law. WEBiX is in compliance with all laws,
regulations and orders applicable to its business. WEBiX has not received any
notification that it is in violation of any law, regulation or order and no such
violation exists.
11. Condition. The obligation of WebIAm to consummate and fully perform
its obligations under this Master License shall be conditioned on there being no
material breach by X-Change of any of its representations or warranties set
forth in Sections 3.04, 3.07, 3.08, 3.09, 3.11 and 3.12 of the Merger Agreement
dated as of December 14, 2001 by and among X-Change, WEBiX and Popo Agie, Inc.,
a Delaware corporation.
12. Miscellaneous.
(a) Entire Agreement, Etc. This Agreement (and any other agreement
specifically referred to herein) contains all of the representations,
warranties, and agreements of the parties hereto with respect to the subject
matter hereof, and all prior understandings, representations, and warranties
(whether oral or written) with respect to such matters are superseded. This
Agreement may not be amended, modified, waived, discharged, or terminated except
by an instrument in writing signed by the party or an executive officer of a
corporate party against whom enforcement of the change, waiver, discharge, or
termination is sought.
(b) Governing Law and Jurisdiction. This Agreement and the legal
relations between the parties hereto will be governed by and construed in
accordance with the laws of the State of New York.
(c) Assignment. This Agreement shall inure to the benefit of and be
binding on the successors, assigns, heirs and legal representatives, as the case
may be, of each of the parties hereto. No assignment of this Agreement or any
rights hereunder shall be effective without the written consent of the remaining
parties hereto.
(d) Designations and Notices. Any notices or other communications
required or permitted hereunder, except as may otherwise be provided in this
Agreement, will be deemed given if mailed by certified mail, return receipt
requested, postage prepaid, to the address set forth in the recitals to this
Agreement.
(e) Further Assurances. Each of the parties hereto agrees to execute
such instruments and take such further action, if any, as may be reasonably
requested by any other parties hereto in order to assure such requesting party
of the rights and benefits intended by this Agreement.
(f) Severability. The invalidity or unenforceability of any particular
provision of this Agreement shall not affect the other provisions hereof, and
this Agreement shall be construed in all respects as if such invalid or
unenforceable provisions were omitted. In lieu of such illegal, invalid, or
unenforceable provision, any court shall be empowered to substitute as a part of
this Agreement a provision as similar in terms to such illegal, invalid, or
unenforceable provisions as may be legal, valid and enforceable.
(g) Construction. The provisions of this Agreement shall be deemed
prepared jointly by the parties hereto with the intent that no provision hereof
is to be strictly construed against any party by reason of the preparation or
negotiation of this Agreement.
(h) Expenses. Except as may be otherwise provided in this Agreement,
each party hereto shall pay its own expenses and costs in connection with the
preparation of this Agreement and the transactions contemplated hereby.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
(i) Counterparts. This Agreement may be executed in two or more
counterparts, each of which will be considered one and the same agreement.
If you are in agreement with the foregoing, please sign in the
place indicated below.
WEBIAM, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Principal/ Secretary
WEBIX INC.
By: /s/ K. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------------
Name: K. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
SHAREHOLDERS OF WEBIAM, INC.:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, individually
/s/ ▇▇▇▇ ▇. Nissan
----------------------------------------------
▇▇▇▇ ▇. Nissan, individually
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, individually
THE X-CHANGE CORPORATION
By: /s/ W. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------------
Name: W. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President