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EXHIBIT 10.41
SMARTSOURCES DISTRIBUTION AGREEMENT
THIS AGREEMENT made as of the 16th day of February, 2000.
BETWEEN:
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ TECHNOLOGIES INC., (British Columbia Incorporation
Number: 0394358), with an office at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
(hereinafter called "SMARTSOURCES")
OF THE FIRST PART
AND:
kTRAVEL SOLUTIONS INC., with an office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇.
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ 98227-5008
(hereinafter called "kTRAVEL SOLUTIONS")
OF THE SECOND PART
WHEREAS:
A. SmartSources specializes in the development of software technology for
Internet-based content and knowledge management;
B. SmartSources has developed a certain Internet application and
technology for deployment of website and portal services;
C. SmartSources and kTravel Solutions wish to enter into a distribution
relationship whereby SmartSources shall license the use of the Product within a
specified field of use to kTravel Solutions for the purpose of sublicensing the
Product to the End User Customers under the terms of the kServer License
Agreement and forming subdistribution relationships with third parties; and
D. The parties wish to set forth the terms and conditions for the mutual
responsibilities of the parties upon the terms and conditions herein contained.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the
premises and of the mutual covenants herein set forth, the parties hereto have
covenanted and agreed as follows:
1.0 DEFINITIONS
1.1 In this Agreement:
(a) "ACCOUNTING": an accounting statement setting out in detail how the
amount of Revenue was determined;
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(b) "AFFILIATED COMPANY" or "AFFILIATED COMPANIES": two or more
corporations where the relationship between them is one in which one
of them is a subsidiary of the other, or both are subsidiaries of the
same corporation, or fifty percent (50%) or more of the voting shares
of each of them is owned by the same person, corporation or other
legal entity;
(c) "BETA TEST": means the initial website and Travel Portals produced by
the Technology;
(d) "BUSINESS RULINGS": information regarding the day to day operations,
practices, procedures and processes of the End User Customers;
(e) "COMMENCEMENT DATE": this Agreement will be deemed to have come into
force on the date of execution of this Agreement by the parties, and
shall be read and construed accordingly;
(f) "CONFIDENTIAL INFORMATION": any information designated by either party
as confidential, whether orally or in writing but excluding any
information that is:
(i) possessed by the party to which the information is disclosed
(the "Recipient") prior to receipt from the party disclosing the
information (the "Discloser"), other than through prior
disclosure by Discloser, as evidenced by the Recipient's
business records;
(ii) published or available to the general public otherwise than
through a breach of this Agreement;
(iii) obtained by the Recipient from a third party with a valid right
to disclose it, provided that said third party is not under a
confidentiality obligation to the Discloser; or
(iv) independently developed by employees, agents or consultants of
the Recipient who had no knowledge of, or access to, the
Discloser's information as evidenced by the Recipient's business
records.
(g) "CONTENT PARTNERSHIPS": refers to a set of present and future content
and web application partnerships to which the End User Customer is
granted access to as part of the Product;
(h) "DEPLOYMENT DATE": means the physical deployment date for the Product
mutually agreed upon by SmartSources, kTravel Solutions, and the End
User Customer;
(i) "END-USER CUSTOMER" shall mean a customer of kTravel Solutions which
sublicenses the use of the Product, and
(j) "FIELD OF USE" shall mean to promote, market, sell, or distribute to
any entities that sell or utilize or wish to sell or utilize, in a
retail or wholesale capacity, as a travel agent or otherwise,
travel-related products or services over the Internet;
(k) "FIRST DEPLOYMENT DATE" means the date when a Product is first
physically deployed for an End User Customer, which, for greater
certainty, does not include the Beta Test;
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(l) "DOCUMENTATION": includes all functional specifications, operating
instructions, user guides, manuals, reference materials, papers or
other materials of any nature whatsoever that are supplied by
SmartSources in conjunction with the Product,
(m) "ENHANCEMENTS": improvements, variations, updates, modifications, and
enhancements made by SmartSources relating to the Product at any time
after the Commencement Date;
(n) "HOSTING": means the physical location of servers and facilities from
where the Product and applications are delivered and serviced to the
Internet on behalf of the End User Customers;
(o) "HYPERLINK": means an element in an electronic document that links to
another place in the same document or to an entirely different
document;
(p) "INITIAL TRAINING": means the initial training provided by
SmartSources to kTravel Solutions as set out in Section 7.2;
(q) "INTERNET TRAVEL RESERVATION ENGINE": means any third party web
application designed to deliver electronic booking and related
functionalities for travel-related reservations;
(r) "kSERVER LICENSE AGREEMENT": means the kServer License Agreement
between an End-User Customer and kTravel Solutions as required under
Section 5.4 of this Agreement and attached as Schedule "C" hereto;
(s) "kSITE": means a website produced by the Product that is licensed to
an End User Customer under the terms and conditions of the License
Agreement;
(t) "PERSONNEL": means all employees, officers, directors and agents of
SmartSources, and any of them;
(u) "PRODUCT" means the product that is offered to each End User Customer
under the terms of the kServer License Agreement by kTravel Solutions
that includes the Technology, Travel Portals, Content Partnerships,
and the Documentation;
(v) "NET REVENUE": all revenues, receipts, monies, and the fair market
value of all other consideration directly or indirectly collected or
received whether by way of cash or credit or any barter, benefit,
advantage, or concession received by either party from activities
which include but are not limited to the license fees, set-up and
installations fees, fees for Supplementary Services and Special
Requirements and other support fees, advertising and electronic
commerce activities related to the Product and any associated third
party technologies and Content Partnerships, less the following
deductions to the extent included in the amounts invoiced and
thereafter actually allowed and taken:
(i) credit, allowances or refunds; and
(ii) transportation charges invoiced separately and actually charged
to third parties; and
(iii) taxes, duties and customs on all sales of Products.
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Net Revenue includes any bona fide special rebates provided by either
party to third parties.
Where any Net Revenue is derived from a country other than the Canada,
it shall be either:
(i) converted to the equivalent in Canadian dollars on the date the
applicable party is deemed to have received such Net Revenue
pursuant to the terms hereof at the rate of exchange set on such
date by the Royal Bank of Canada for buying such currency. The
amount of Canadian dollars pursuant to such conversion shall be
included in the Net Revenue; or
(ii) dealt with in accordance with such other mutual agreement of the
parties.
(w) "SPECIAL REQUIREMENTS": means any additional requirements related to
the Product, including but not limited to all modifications, extra
capabilities and/or customization requested by the End User Customer
and which SmartSources agrees in writing to develop;
(x) "STANDARD SMARTSOURCES DOCUMENTS": includes all standard forms and
documentation produced and supplied by SmartSources for purposes which
include but are not limited to requests for Special Requirements,
Supplementary Services, enhancements, feedback, problems, procedural
matters, Business Rulings, and otherwise, for the use of the End User
Customers;
(y) "SUPPLEMENTARY SERVICES": means those training and consulting services
offered by SmartSources to the End User Customer;
(z) "TECHNOLOGY": means any and all knowledge, know-how and/or technique
or techniques invented, developed and/or acquired, prior to the Date
of Commencement by SmartSources relating to the Product, as described
in Schedule "B" hereto, as amended from time to time; and
(aa) "TRAVEL PORTALS": means the personalized travel portals produced with
the Product that are licensed to a user and described in Schedule "B"
hereto.
2.0 PRODUCT AND TERRITORY
2.1 SmartSources hereby appoints kTravel Solutions on an exclusive basis
(subject to the obligations under Section 2.3 being fulfilled by kTravel
Solutions) as its distributor to promote, market, sell, distribute the Product
within the Field of Use during the term of this Agreement to any potential
customer whose principal place of business is located anywhere in the world (the
"Territory").
2.2 kTravel Solutions shall not, without the prior written consent of
SmartSources, sell, market or distribute any version of any Product other than
the version SmartSources shall designate from time to time as its most current
version.
2.3 kTravel Solutions shall use its commercially reasonable efforts to
promote, market and sell the Product and to meet or cause to be met the market
demand for the Products within the Territory. Without limiting the generality of
the foregoing, kTravel Solutions shall cause there to be:
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(a) not less than Cdn $250,000.00 of Net Revenue generated on or before
the first anniversary of the First Deployment Date;
(b) not less than Cdn $1,200,000.00 of Net Revenue generated on or before
the second anniversary of the First Deployment Date;
(c) not less than Cdn $2,600,000.00 of Net Revenue generated on or before
the third anniversary of the First Deployment Date; and
(d) not less than Cdn $4,000,000.00 of Net Revenue generated on or before
the fourth anniversary of the First Deployment Date.
(collectively, the "Net Revenue Targets")
For greater certainty, the Net Revenue Targets stated above are not
cumulative amounts. If in any year the Net Revenue for that year exceeds
the Net Revenue Target for that year, such excess shall be applied to the
following year's Net Revenue Target. If kTravel Solutions is more than 20%
below any of the Net Revenue Targets, subject to Section 2.4, it shall
become a non-exclusive distributor under Section 2.1 above without
affecting the other terms and conditions of this Agreement.
2.4 SmartSources shall make reasonable efforts to fulfill its
installation, support and technical obligations under the kServer License
Agreement and this Agreement to meet or cause to be met the market demand for
the End User Customers secured by kTravel Solutions within the Territory. If
SmartSources is unable to fulfil these obligations within a reasonable period of
time consistent with market demand, the Net Revenue Targets under Section 2.3
shall be re-negotiated in good faith by the parties and amended by mutual
agreement of the parties. If the parties are unable to reach mutually agreeable
amended Net Revenue Target after good faith negotiations, the Net Revenue
Targets shall not apply.
2.5 If SmartSources is unable to comply with Section 2.4, kTravel
Solutions may, at its option terminate this Agreement and/or enter into new
licenses with other entities which are competitive with the Product.
3.0 SUB-DISTRIBUTION
3.1 kTravel Solutions may enter into sub-distribution agreements with
third parties for specified territories within the Territory ("THIRD PARTY
DISTRIBUTOR") with the prior written approval of SmartSources, which shall not
be unreasonably withheld. kTravel Solutions shall ensure that SmartSources
approves the form of sub-distribution agreement before such agreement is
executed. kTravel Solutions shall provide a copy of the sub-distribution
agreement to SmartSources within 10 business days of its execution, as well as
the contact person and business address for the Third Party Distributor.
4.0 REVENUE AND FEES
4.1 All Net Revenue received by either party, net of bona fide special
rebates provided by either party to the End User Customer or a Third Party
Distributor shall be shared between SmartSources and kTravel Solutions as
follows:
(a) 50% to SmartSources; and
(b) 50% to kTravel Solutions.
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4.2 kTravel Solutions and SmartSources shall agree upon the Monthly
License Fees for the Product to be quoted to prospective End User Customers
under Schedule "A" of the kServer License Agreement. SmartSources and kTravel
Solutions agree that the Monthly License Fees may, through negotiations with a
potential End User Customer, become modified or adjusted provided always that in
the event kTravel Solutions sublicences the Product at an amount less than the
agreed upon Monthly License Fees, SmartSources shall still be entitled to
receive its proportionate share of such Monthly License Fees.
5.0 PRICES AND PAYMENT.
5.1 kTravel Solutions shall execute a Direction to Pay in the form
attached as Schedule "G" hereto and deliver the same to each End User Customer.
Upon a breach by SmartSources of Section 5.4 of this Agreement, kTravel
Solutions Inc. may, at its option:
(a) revoke the Direction to Pay, which shall no longer be of force and
effect; and
(b) notify the End User Customer to make payments under the kServer
License Agreement to kTravel Solutions directly.
5.2 If kTravel Solutions exercises its option under Section 5.1 in the
event of a breach of Section 5.4 by SmartSources, the obligations of
SmartSources under Sections 5.4, 5.5 and 5.6, mutatis mutandis, shall apply to
kTravel Solutions as the remitting party and the other terms of this Agreement,
including but not limited to Section 4.1, shall still continue to apply.
5.3 kTravel Solutions' entitled share of Net Revenue pursuant to Section
4.1 that is received by SmartSources under this Agreement shall be deemed to be
held in trust for kTravel Solutions.
5.4 SmartSources shall remit to kTravel Solutions its entitled share of
Net Revenue pursuant to Section 4.1 on the 15th and last business day of each
month, with respect to the Revenue received by SmartSources in the 15 day period
immediately preceding the applicable remittance date.
5.5 SmartSources shall provide an Accounting to kTravel Solutions on the
last day of each month during the term of this Agreement setting out in detail
how kTravel Solutions' entitled share of Net Revenue was determined.
5.6 In the event of any discrepancy between any purchase order, or other
documents and this Agreement, the terms of this Agreement including but not
limited to the definition of Net Revenue under this Agreement, shall govern.
5.7 The Product shall be licensed to the End User Customers using the
kServer License Agreement, a copy of which is attached hereto as Schedule "C".
kTravel Solutions acknowledges and agrees that it may be necessary to modify the
kServer License Agreement including modifications to conform to the laws of the
applicable jurisdiction, or modifications required by the End User Customers.
6.0 BUSINESS DEVELOPMENT.
6.1 kTravel Solutions shall, at its expense, use its commercially
reasonable efforts in relation to all business development within the Field of
Use in the Territory, including but not limited to the following:
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(a) to negotiate and secure future Content Partnerships to be integrated
into the Product;
(b) negotiate and secure advertising in connection with the Product for
the effective marketing of the Product; and
(c) negotiate and secure electronic commerce relationships in connection
with the Product.
6.2 The parties agree that both kTravel Solutions and SmartSources shall
become parties to any agreement, present or future, with any Content
Partnerships that are part of the Product.
6.3 SmartSources shall furnish kTravel Solutions with reproducible copies
of all written information which SmartSources deems necessary for kTravel
Solutions to use in the marketing, distributing, sublicensing and support of the
Product.
6.4 SmartSources shall keep kTravel Solutions informed of any changes,
additions or modifications to such information referred to in Section 6.3 that
have an effect on the operation, cost or performance of the Product.
6.5 If the End User Customer requires an advisory committee to be formed,
each of SmartSources and kTravel Solutions shall have one representative as part
of such advisory committee.
7.0 INSTALLATION, TRAINING AND SUPPORT.
7.1 SmartSources shall provide the following installation, training and
support:
(a) set-up and installation procedures for the Product on or before the
Deployment Date;
(b) providing Initial Training to kTravel Solutions, as set out in
Schedule "A", subject to the use and operation of the Product
pre-supposing a minimum level of computer and internet knowledge.
SmartSources shall not be responsible for providing extra training to
employees of kTravel Solutions that do not possess such minimum
knowledge as is required to use and operate the Product;
(c) providing Standard SmartSources Documentation to the End User
Customers, as required;
(d) modification of the Product to support the Special Requirements upon
the written request of the End User Customers;
(e) providing Supplementary Services to the End User Customers upon the
written request of the End User Customers;
(f) providing procedural and technical advice and support regarding the
Technology, as reasonably requested by kTravel Solutions and/or the
End User Customer from time to time; and
(g) assign a project manager and account executive, if necessary, to
resolve any problems and issues regarding the Technology.
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7.2 During the term of this Agreement, it is intended that kTravel
Solutions will provide the first line of support to its customers with respect
to the Product, as set out under Schedule "E" to this Agreement. kTravel
Solutions is granted an exclusive first line support right, as set out under
Schedule "E" to this Agreement, for the Territory, except in the case where an
End User Customer dictates otherwise.
7.3 kTravel Solutions shall provide to the End User Customers, the
following services:
(a) after the provision of Initial Training to kTravel Solutions by
SmartSources, training for the End User Customers in the use of the
Product;
(b) prompt receipt, analysis and reporting to SmartSources any reported
faults in the operation of the Product;
(c) the Documentation and advice on the use of the Product;
(d) the Supplementary Services for End User Customers as may be requested
from time to time, at the rates set out on Schedule "F" hereto; and
(e) facilitating any requests received from the End User Customers for
Special Requirements and/or Supplementary Services, and invoicing the
End User Customer for services provided by SmartSources and/or kTravel
Solutions.
7.4 SmartSources agrees to provide such secondary technical support, as
set out under Schedule "E" to this Agreement, as may be requested, from time to
time by the End User Customer and/or kTravel Solutions.
7.5 kTravel Solutions shall employ competent and experienced personnel,
and provide appropriate facilities, so as to render prompt and adequate service
to the End User Customers in the Territory.
8.0 SMARTSOURCES'S OTHER TECHNICAL OBLIGATIONS
8.1 SmartSources covenants that it shall make reasonable efforts to
develop, modify, expand and enhance the Product on an ongoing basis in a manner
that is reasonably competitive with market demand for the Product and not less
than twice a year during the term of this Agreement. kTravel Solutions shall
cooperate fully with, and allow, Personnel to effect such changes to the
Product. If SmartSources is unable to fulfil these obligations in a manner that
is reasonably competitive with market demand for the Product, the Net Revenue
Targets under Section 2.3 shall be re-negotiated in good faith by the parties
and amended by mutual agreement of the parties. If the parties are unable to
reach mutually agreeable amended Net Revenue Target after good faith
negotiations, the Net Revenue Targets shall not apply.
8.2 SmartSources shall be responsible for the following:
(a) providing Hosting for the End User Customers commencing from the
Deployment Date, subject to SmartSources reserving the right to obtain
such Hosting from an outside source;
(b) providing a layout for the kSites that is consistent with the graphic
standards, logos, colours, look and feel of the Beta Test (the
"Layout");
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(c) alter, modify or design the Layout as reasonably required by the
technical requirements of the Product and/or Enhancements; and
(d) facilitate the incorporation of the Internet Travel Reservation Engine
into the Product by the use of a Hyperlink.
8.3 SmartSources reserves the right to fulfil its contractual and/or legal
obligations to third parties associated with the Product, subject to such
obligations not interfering with the core functionalities of the Product, as
described in Schedule "B".
9.0 TECHNOLOGY LICENCE.
10.0 IN CONSIDERATION OF THE COVENANTS ON THE PART OF kTRAVEL SOLUTIONS
CONTAINED HEREIN, SMARTSOURCES HEREBY GRANTS TO kTRAVEL SOLUTIONS AN
EXCLUSIVE, (SUBJECT TO SECTION 2.3) NON-TRANSFERABLE LIMITED LICENCE
(THE "LICENCE") TO USE AND SUBLICENSE THE PRODUCT SOLELY FOR THE
PURPOSES SET OUT UNDER SECTION 2.1 UPON THE TERMS AND CONDITIONS
HEREIN CONTAINED.
10.1 kTravel Solutions shall have the exclusive right (subject to Section
2.3) to grant sublicenses to use the Product or any part thereof solely to
End-User Customers within the Field of Use. Prior to delivery of the Product or
any part thereof to an End-User Customer, such End-User Customer shall execute
SmartSources's then current kServer License Agreement, the current version of
which is attached hereto as Schedule "C". Any attempt to transfer or assign the
Product, any copies thereof or any part thereof shall be null and void.
10.2 The Licence does not grant to kTravel Solutions the following rights
(without limiting the generality of the foregoing):
(a) to distribute, sell, lease, transfer, assign, trade, rent, publish or
sub-license the Product, or any part thereof including copies thereof,
to any other entity other than an End User Customer, subject to
Article 3.0;
(b) to use the Product, or any part thereof for any other purpose other
than as set out under Articles 2.0 and 9.0;
(c) to modify, adapt, translate, reverse engineer, decompile, disassemble,
create derivative work or develop any system or program based on the
Product, except as specifically permitted in writing by SmartSources;
and
(d) to include or bring in other technology, applications, or
functionalities in relation to the Product except as specifically
permitted in writing by SmartSources through the negotiation and
execution of a separate customization agreement with respect to the
same.
10.3 kTravel Solutions acknowledges and agrees that SmartSources
exclusively owns and retains any and all right, title and interest to the
Product, including but not limited to the Technology, Travel Portals,
Documentation and all intellectual property, trade secrets, and know-how
associated with the same, and agrees to refrain from any act or omission that
derogates from or infringes upon such exclusive proprietary rights of
SmartSources in the Product. In the event that kTravel Solutions becomes aware
that a third party or third parties are improperly using the Product, or any
part thereof, or infringing upon any proprietary rights of SmartSources to the
Product, kTravel Solutions shall promptly notify SmartSources of all facts known
to it relating to such use.
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10.4 SmartSources reserves the right to protect, in any and all
jurisdictions, by copyright, patent, trade-▇▇▇▇, trade name and all other forms
of legal and equitable protection, its right, title and interest to the Product.
10.5 kTravel Solutions shall retain and shall not alter or obscure any
notices, markings or other insignia which are affixed to the Product or any part
thereof at the time of delivery of such Product by SmartSources. To the extent
that kTravel Solutions is allowed to make copies of the Product or any part
thereof under this Agreement, kTravel Solutions agrees to reproduce and include
such notices, markings and insignia on all such copies.
11.0 ACCOUNTING RECORDS:
11.1 Each party shall maintain at its principal place of business, or such
other place as may be most convenient, separate accounts and records of all Net
Revenues and kServer License Agreements, and all business done pursuant to this
Agreement, such accounts and records to be in sufficient detail to enable proper
returns to be made under this Agreement.
11.2 Each party shall deliver to other party not less than four times a
year, the Accounting. At the same time, kTravel Solutions shall also deliver a
report on all subdistribution activity, if any, including an accounting
statement setting out in detail how the amount of subdistribution Net Revenue
was determined and identifying each Third Party Distributor and the location of
the business of each Third Party Distributor.
11.3 The calculation of Net Revenue shall be carried out in accordance with
generally accepted Canadian accounting principles ("GAAP"), or the standards and
principles adopted by the U.S. Financial Accounting Standards Board ("FASB")
applied on a consistent basis.
11.4 Each party shall retain the accounts and records referred to in
Article 10.1 above for at least six years after the date upon which they were
made and shall permit any duly authorized representative of the other party to
inspect such accounts and records during their normal business hours at the
inspecting party's expense. Each party shall furnish such reasonable evidence as
such representative will deem necessary to verify the Accounting and will permit
such representative to make copies of or extracts from such accounts, records
and agreements at the inspecting party's expense. If an inspection of one
party's records shows an under-reporting or underpayment by such party of any
amount to the inspecting party in excess of 5% for any 12 month period, then
such underpaying party ("Underpaying Party") shall reimburse the inspecting
party for the cost of the inspection as well as pay to the inspecting party any
amount found due (including any late payment charges or interest) within 30 days
of notice by the inspecting party to the Underpaying Party.
12.0 RELATIONSHIP OF THE PARTIES.
12.1 kTravel Solutions shall be considered to be an independent contractor.
The relationship between SmartSources and kTravel Solutions shall not be
construed to be that of employer and employee, nor to constitute a partnership,
joint venture or agency of any kind.
12.2 kTravel Solutions shall pay all of its expenses, including without
limitation all travel, lodging and entertainment expenses incurred in connection
with its services hereunder. SmartSources shall not reimburse kTravel Solutions
for any of those expenses.
12.3 kTravel Solutions shall have no right to enter into any contracts or
commitments in the name of, or on behalf of, SmartSources, or to bind
SmartSources in any respect whatsoever.
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12.4 In addition, kTravel Solutions shall not obligate or purport to
obligate SmartSources by issuing or making any affirmations, representations,
warranties or guarantees with respect to the Product to any third party other
than the warranties contained in the terms and conditions of the kServer License
Agreement.
13.0 REPORTING.
13.1 kTravel Solutions shall, at SmartSources's reasonable request, provide
SmartSources with written quarterly reports, which shall include customer call
reports, business trends, planning of kTravel Solutions' primary customers in
the Territory, market forecasts.
14.0 TRADEMARKS, SERVICE MARKS AND TRADE NAMES.
14.1 kTravel Solutions shall use SmartSources's, trade names and service
marks and any trademarks which SmartSources may obtain in the future in
connection therewith (hereinafter referred to as the "Trademarks") on a
non-exclusive basis in the Territory only for the duration of this Agreement and
solely for display or advertising purposes in connection with selling and
distributing the Products in accordance with this Agreement. kTravel Solutions
shall not at any time do or permit any act to be done which may in any way
impair the rights of SmartSources in the Trademarks.
14.2 In order to comply with SmartSources's quality control standards,
kTravel Solutions shall: (i) use the Trademarks in compliance with all relevant
laws and regulations; (ii) accord SmartSources the right to inspect during
normal business hours, kTravel Solutions' facilities used in connection with
efforts to sell the Product in order to confirm that kTravel Solutions' use of
such Trademarks is in compliance with this Section; and (iii) not modify any of
the Trademarks in any way and not use any of the Trademarks on or in connection
with any goods or services other than the Product.
15.0 TERM
15.1 This Agreement shall terminate on the expiration of a term of 5 years
from the Date of Commencement, or the termination of the last kServer License
Agreement, whichever event shall last occur unless earlier terminated pursuant
to Article 21.0 herein.
16.0 COVENANT NOT TO COMPETE.
During the term of this Agreement, kTravel Solutions shall not market
directly or indirectly in the Territory products which are competitive with the
Product.
17.0 TRAVEL COSTS
The employees of both SmartSources and kTravel Solutions shall be
reimbursed for all travel costs incurred when required by the other party to
travel to fulfill obligations hereunder.
18.0 PUBLICITY.
Each party agrees that any publicity or advertising which shall be
released by it or the End User Customer in connection with the Product shall be:
(a) released only with the prior approval of the other party to this
Agreement, which shall not be unreasonably withheld; and
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(b) in accordance with the terms of this Agreement and with any
information or data which SmartSources has furnished in connection
with this Agreement.
Copies of all such publicity and advertising shall be forwarded
promptly to the other party after the release thereof.
19.0 CONFIDENTIALITY AND NON-DISCLOSURE
19.1 The Confidential Information shall be received used or developed by
either party solely in furtherance of the purposes set forth in this Agreement
subject to the terms and conditions set forth in this Article 18.0.
19.2 The parties shall keep and use all of the Confidential Information in
confidence and will not, without the Discloser's prior written consent, disclose
any Confidential Information to any person or entity, except those of the
Recipient's officers, employees or consultants who require the Confidential
Information in performing their obligations under this Agreement.
19.3 The parties shall not use, either directly or indirectly, any
Confidential Information for any purpose other than as set forth herein without
the Discloser's prior written consent.
19.4 If the Recipient is required by judicial or administrative process to
disclose any or all of the Confidential Information, the Recipient shall
promptly notify the Discloser and allow the Discloser reasonable time to oppose
such process before disclosing any Confidential Information.
19.5 Notwithstanding any termination or expiration of this Agreement, the
obligations created in this Article 18.0 shall survive and be binding on both
parties, their successors and permitted assigns.
19.6 SmartSources covenants and agrees to not disclose any information it
receives concerning the business of kTravel Solutions without the Region's
specific written consent, or unless such information becomes publicly available
through no action of SmartSources. SmartSources shall take appropriate action
with its employees, by agreement or otherwise, to satisfy its obligations under
this sub-section.
20.0 LIMITATIONS OF LIABILITY
20.1 In no event shall SmartSources be liable for direct, indirect, special
or consequential damages (including damages for loss of business profits,
business interruption, loss of business information) arising from any defect,
error, fault, or failure to perform with respect to the Product even if
SmartSources has been advised of the possibility of such defect, error, fault,
or failure. kTravel Solutions acknowledges that it has been advised by
SmartSources to undertake its own due diligence with respect to the Product.
Each party's liability on any claim shall under no circumstances exceed the
amounts due or paid by the End User Customers for the use of the Product.
21.0 INDEMNIFICATION BY kTRAVEL SOLUTIONS
21.1 kTravel Solutions recognizes that the Product including but not
limited to the Technology, Travel Portals, Documentation and all intellectual
property, trade secrets, and know-how associated with the same and all
information in respect thereto constitute valuable proprietary rights and
ownership to SmartSources. kTravel Solutions hereby indemnifies, holds harmless
and defends SmartSources against any and all claims, actions, causes of action,
suits, proceedings,
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demands, assessments, judgments, costs, including reasonable legal costs and
other expenses incidental to the foregoing, damages or liability which may be
made or brought against SmartSources and its successors and assigns by any
person or entity whomsoever directly or indirectly arising out of the exercise
of any rights under this Agreement including, without limiting the generality of
the foregoing, against any damages or losses, consequential or otherwise,
arising from or out of the use of the Product by kTravel Solutions howsoever the
same may arise.
22.0 REPORTING.
22.1 kTravel Solutions shall, at SmartSources's reasonable request, provide
SmartSources with written quarterly reports, which shall include customer call
reports, business trends, planning of kTravel Solutions' primary customers in
the Territory, market forecasts.
23.0 ESCROW AGREEMENT
23.1 The parties agree to enter into a separate Software Escrow Agreement,
attached as Schedule "D" hereto, at a mutually agreeable date after the
execution of this Agreement.
24.0 TERMINATION
24.1 This Agreement may be terminated by either party immediately without
notice prior to the expiration of the term, and any extensions thereof, upon the
following:
(a) the failure or neglect of a party (the "Breaching Party") to observe,
keep, or perform any of the covenants, terms and conditions hereunder,
where such non-performance is not fully corrected by the Breaching
Party within 30 days of written notice by the non-Breaching Party to
the Breaching Party; or
(b) any proceeding under the Bankruptcy and Insolvency Act of Canada, or
any other statute of similar purport, is commenced by or against the
other party.
24.2 SmartSources may, at its option, terminate this Agreement immediately
on the happening of any one or more of the following events by delivering notice
in writing to that effect to kTravel Solutions:
(a) if kTravel Solutions becomes insolvent;
(b) if any execution, sequestration, or any other process of any court
becomes enforceable against kTravel Solutions or if any such process
is levied on the rights under this Agreement or on any of the monies
due to SmartSources and is not released or satisfied by kTravel
Solutions within 30 days thereafter;
(c) if any resolution is passed or order made or other steps taken for the
winding up, liquidation or other termination of the existence of
kTravel Solutions;
(d) if kTravel Solutions is more than 90 days in arrears of monies
exceeding $10,000.00 that are due to SmartSources under the terms of
this Agreement;
(e) if kTravel Solutions ceases or threatens to cease to carry on its
business;
(f) if a controlling interest in kTravel Solutions passes to any person or
persons other than those having a controlling interest at the Date of
Commencement, whether by
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reason of purchase of shares or otherwise, without the prior written
consent of SmartSources;
(g) if kTravel Solutions undergoes a reorganization or any part of its
business relating to this Agreement is transferred to a subsidiary or
associated company without the prior written consent of SmartSources;
(h) if kTravel Solutions makes a material misrepresentation to
SmartSources in relation to this Agreement.
24.3 The parties agree and acknowledge that any of their obligations to pay
any outstanding monies under Articles 4.0 and 5.0 that are due and payable to
the other party at the time of termination shall survive termination. For
greater certainty, if this Agreement is terminated, each party's obligations to
remit to the other party its entitled share of Revenue under sections 4.1, 5.1,
5.2, 5.3, 5.4 and 5.5 shall survive termination.
24.4 Immediately upon any termination of the Agreement for any reason,
kTravel Solutions shall have no further right of any nature whatsoever in the
Product or any Enhancements. Without limiting the generality of the foregoing,
SmartSources shall not be obligated to provide kTravel Solutions, digitally or
otherwise, with any consumer data, databases and/or customer preferences
collected by SmartSources as part of the function of the Product. SmartSources
shall not use this information for any purpose whatsoever without the prior
written consent of kTravel Solutions and shall not prevent kTravel Solutions
from using and/or recording such information for its own purposes.
25.0 ASSIGNMENT
25.1 kTravel Solutions will not assign, transfer, mortgage, charge or
otherwise dispose of any or all of its rights, duties or obligations granted to
it under this Agreement without the prior written consent of SmartSources.
25.2 SmartSources shall have the right to assign its rights, duties and
obligations under this Agreement to an Affiliated Company or Affiliated
Companies of SmartSources. In the event of such an assignment, kTravel Solutions
will release, remise and forever discharge SmartSources from any and all
obligations or covenants, provided however that such company executes a written
agreement which provides that such company shall assume all such obligations or
covenants from SmartSources and that kTravel Solutions shall retain all rights
granted to kTravel Solutions pursuant to this Agreement.
26.0 GENERAL
26.1 Any notice, request, demand, consent or other communication provided
or permitted hereunder shall be in writing and given by personal delivery,
transmitted by facsimile to the party whose address and facsimile number for the
receipt of such document is as follows:
(a) If to SmartSources:
Delivery: ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Suite 100 - ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇ ▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Senior Analyst
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
15
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(b) If to kTravel Solutions:
Delivery: kTravel Solutions Inc.
c/o ▇▇▇▇▇ & Daugert, PLLC
Attorneys at Law
▇.▇. ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address for delivery or facsimile as a party may, in writing,
direct. Any notice so given shall be deemed to have been received on the date it
was delivered or transmitted.
26.2 This Agreement shall be governed in all respects by the laws of the
Province of British Columbia, and any dispute thereunder shall be subject to the
exclusive jurisdiction of the British Columbia Courts. The parties irrevocably
attorn to the sole jurisdiction of British Columbia.
26.3 kTravel Solutions acknowledges and agrees that the Product constitute
valuable proprietary rights and ownership to SmartSources, including but not
limited to the Technology, Travel Portals, Documentation and all intellectual
property, trade secrets, and know-how associated with the same. kTravel
Solutions acknowledges that the unauthorized use or release of the Product or
any part of the Product, except as provided herein, would result in damages to
SmartSources which could not be adequately compensated for in damages by
monetary award. Accordingly, in the event of any such breach, in addition to all
other remedies available at law or in equity, SmartSources shall be entitled as
a matter of right to apply to a court of competent equitable jurisdiction for
relief by way of restraining order, injunction, decree or otherwise, as may be
appropriate to ensure compliance with this Agreement.
26.4 Time is hereby expressly made of the essence with respect to the
performance of the parties of their respective obligations under this Agreement.
26.5 SmartSources shall not be held responsible, nor shall SmartSources be
considered in breach of this Agreement, for the failure of SmartSources to
fulfill any terms or provisions hereof if such failure was a result of civil
disorder, war, governmental decrees or laws, acts of enemies, strikes, floods,
acts of God, or by any other cause not within the control of SmartSources and
which could not have been prevented by SmartSources exercising reasonable
diligence.
26.6 The parties hereto hereby covenant and acknowledge that the provisions
of this Agreement with respect to confidentiality under Article 18.0 of this
Agreement and other protection set forth in this Agreement shall survive the
termination of this Agreement.
26.7 No omission or delay of either party hereto in requiring due and
punctual fulfilment by the other party of the obligations of such party
hereunder shall be deemed to constitute a waiver of its right to require due and
punctual fulfilment, or a waiver of any of its remedies hereunder.
26.8 The parties hereto are independent, and neither party is the agent,
joint venture, partner or employee of the other and no party shall be able to
bind the other party.
26.9 The parties covenant and agree to make all applications, execute all
other deeds, documents, instruments and assurances, and do such further and
other acts as may be necessary
16
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or desirable to carry out the true intent and meaning of this Agreement, and to
give full effect to the transactions contemplated or intended hereby.
26.10 This Agreement shall ensure to the benefit of and be binding upon the
parties hereto and their respective successors and permitted assigns.
26.11 Headings and captions are for the purposes of convenience only, and
are not to be construed as part of this Agreement.
26.12 Terms of computer terminology which are not otherwise defined herein
shall have the meanings normally attributed thereto in the computer industry,
unless the context of the use of such terminology would suggest otherwise.
26.13 The parties hereto acknowledge and agree that ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
have acted as counsel only to SmartSources and that ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ is not
protecting the rights and interests of any other party to this Agreement, which
parties hereby represent and warrant to the SmartSources and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ that they have sought independent legal advice or waived such advice.
26.14 This Agreement constitutes the entire agreement of the parties with
respect to the subject matter hereof, into which all prior negotiation,
commitment, representations and undertakings of the parties are merged and,
except as herein specifically provided, there are no oral or written
understandings or agreements between the parties hereto relating to the subject
matter hereof.
26.15 No amendment or other modification of this Agreement shall be valid or
binding on either party hereto, unless in writing and executed by the parties
hereto.
26.16 This Agreement may be executed in counterparts, each of which when so
executed and delivered shall be deemed an original, but such counterparts
together shall constitute but one and the same instrument.
EXECUTED by the parties hereto as of the day and year first above
written.
BY ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ TECHNOLOGIES INC.:
AUTHORIZED SIGNATURE TITLE
NAME DATE
BY kTRAVEL SOLUTIONS INC.:
AUTHORIZED SIGNATURE TITLE
NAME DATE
17
SCHEDULE "A"
INITIAL TRAINING
1.1 Personnel shall spend no more than the following hours of their
time in providing the initial training for kTravel Solutions:
(a) system user level training for the purpose of sales support to a
maximum of 5 days, and
(b) system Product training for the purpose of Product support to a
maximum of 5 days.
(the "Initial Training")
1.2 kTravel Solutions shall pay all travel costs incurred by SmartSources
in connection with the Initial Training.
18
SCHEDULE "B"
DESCRIPTION OF TECHNOLOGY
The kServer technology is described generally as follows:
I. DESIGN & PRESENTATION
1. Provide kSite and Travel Portal interface design and layout in compliance
to Uniglobe trademarks and graphical standards
1. Provide all digital imaging requirements for implementation of a
template
2. Facilitate branding and labeling of each kSite.
II. kSITE FUNCTIONALITY
2. A uniquely branded website displaying licensee-specific information
3. Display licensee-specific content published via content authoring tools
4. Display regional produced content syndicated to each kSite
5. Provide self-registration and login features to subscribers
6. Facilitate a hyperlink to third party booking engine
III. CONTENT AUTHORING
7. Provides online tools to publish content to a kSite via a java-enabled
Internet browser
(a) The Content Authoring Module will enable licensee to:
(1) Create and edit new knowledge bases (Categories)
(2) Create and edit new sub-knowledge bases (Sub-Categories)
(3) Default templates with pre-established slots for uploading of content
(i.e. specials, news articles etc.);
3. Create new templates with various combinations of slot values:
(1) Text box
(2) Text area
(3) Image
(4) Static Image
(5) Hyper Link
8. Create, edit, post and delete instances (content or article consisting of a
combination of slot values) to a kSite
9. Receive and share knowledge bases and instances published by the Region
IV. TRAVEL PORTAL FUNCTIONALITY & SUBSCRIBER MANAGEMENT
4. Self-registration and creation of personal travel portal
5. Displaying unique name of traveler
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6. Destination Content provided by Lonely Planet
7. Self-selection of value-added content
8. Travel portal will include the following value-added content and
application modules:
(a) Weather by Weather Labs
(b) Stock Portfolio by Stockpoint
(c) News with modules provided by CNNfn, Washington Post, Fox News,
Information Week, Los Angeles Times, ▇▇▇▇.▇▇▇, San ▇▇▇▇ Mercury News,
Time, USA Today, Wired News, ZD Net
(d) Street Maps by Map Quest
(e) Bookmark
(f) Calculator
(g) Census Maps
(h) Discussion Boards
(i) Email
(j) Excite Top News by Reuters
(k) Excite Business News
(l) Excite Tech News by ZDNet
(m) Excite Sport News
(n) Excite Entertainment News by UPI
(o) Excite Health News
(p) Excite Auto Guide
(q) Excite TV Listings
(r) Excite MLB Scores
(s) Excite MLS Scores
(t) Excite NBA Scores
(u) Excite NCAA Football Conferences
(v) Excite NCAA Football Scores
(w) Excite NFL Scores
20
- 3 -
(x) Excite NHL Scores
(y) Excite Small Business by Quicken
(z) Excite Maps
(aa) Excite Movie Features
(bb) Horoscopes
(cc) News Tracker
(dd) News from Moreover
(ee) News from iSyndicate
(ff) Notes
(gg) Package Tracker
(hh) Search
(ii) Search with GoTo
(jj) Search with RealNames
(kk) Search with iAtlas
(ll) Yellow Pages from iAtlas
9. Subscriber management module will provide the following capabilities:
(1) Create and add new subscribers
(a) View subscriber profiles and pertinent business-specific fields (i.e.
first name, last name, company name, email address etc.)
(2) Edit or delete subscriber profiles
(3) Search subscriber profiles by first name and/or last name and/or email
21
The technology provided for the TIER ONE kSITES is described generally as
follows:
10. Provide kSite interface design and layout in compliance to Uniglobe
trademarks and graphical standards
11. Provide all digital imaging requirements for implementation of a template
3. Facilitate branding and labelling of each kSite limited to the following
agency specific data:
(a) Name of Agency
(b) Domain Name as text
(c) Address(es) and Locations
(d) Telephone Number(s)
(e) Facsimile Number(s)
(f) Email Address
(g) Welcome message/About Us
22
SCHEDULE "C"
kSERVER LICENSE AGREEMENT
23
SCHEDULE "D"
SOFTWARE ESCROW AGREEMENT
BETWEEN:
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ TECHNOLOGIES INC., (British Columbia Incorporation
Number: 0394358), with an office at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇
(hereinafter called the "LICENSOR")
OF THE FIRST PART
AND:
kTRAVEL SOLUTIONS INC., with an office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇.▇.
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ 98227-5008
(hereinafter called the "LICENSEE")
OF THE SECOND PART
AND:
--
(hereinafter called the "Escrow Agent")
OF THE THIRD PART
WHEREAS:
A. The Licensor has developed a certain Internet application and
technology for deployment of website and portal services which it markets as
"kServer" (the "Software");
B. The Licensee and the Licensor entered into an agreement dated the
16th day of February, 2000 (the "SmartSources Distribution Agreement"), wherein
the Licensee was granted a licence to use and distribute the Software;
C. Pursuant to the SmartSources Distribution Agreement, the Licensor
agreed to provide an original copy of the source code of the Software (the
"Source Code"), XML files, and
24
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associated technical documents (the "Documents") to the Licensee to hold in
trust and to be released to the Licensee in the event of certain defaults
pursuant to the SmartSources Distribution Agreement;
D. The parties hereto have agreed that the Escrow Agent will hold the
Source Code and the Documents as provided in the SmartSources Distribution
Agreement and in addition to the aforesaid all modifications, enhancements and
customization and the parties hereto wish to enter into this agreement to
provide for the establishment of a source code (including modifications,
enhancements and customization) and documents escrow to protect the interests of
the Licensor and the Licensee, and to define the duties and obligations of the
Escrow Agent.
NOW THEREFORE THIS AGREEMENT WITNESSETH that in consideration of the
mutual covenants herein contained and for other good and valuable consideration
the parties hereto hereby agree as follows:
27.0 DEFINITIONS:
In this agreement, unless a contrary intention appears, the following
words and phrases shall mean:
(a) "Escrow Materials" means the physical materials deposited with the
Escrow Agent pursuant to clause 2.1 of this agreement and all
modifications, enhancements or customization made to the software,
(b) "Event of Insolvency" means the Licensor has:
(i) made an assignment in bankruptcy,
(ii) being adjudicated a bankrupt,
(iii) made an assignment of all its assets for the general benefit of
its creditors,
(iv) been dissolved or takes any steps in furtherance of dissolution,
or
(v) had a receiver or trustee appointed to manage or administer the
Software.
(c) "Event of Source Code Release" means:
(i) an Event of Insolvency has occurred, or
(ii) if a controlling interest in the Licensor passes to any person
or persons other than those having a controlling interest at the
Date of Commencement, whether by reason of purchase of shares or
otherwise, without the prior written consent of the Licensee;
25
- 3 -
(iii) if the Licensor undergoes a reorganization or any part of its
business relating to this Agreement is transferred to a
subsidiary or associated company without the prior written
consent of the Licensee;
(iv) if the Licensor substantially changes the nature of its business
outside the field of Internet travel-related products or
services; and
(v) the Licensor has breached its contractual obligations to the
Licensee under Section 2.4 of the SmartSources Distribution
Agreement
28.0 DELIVERY OF ESCROW MATERIALS:
28.1 Upon execution of this agreement, and thereafter upon any
additional release of the Software, the Licensor shall deliver to the Escrow
Agent a current copy of the Source Code together with all present modifications,
enhancements or customization and the Documents in magnetic or other form.
28.2 Each anniversary date during the term of this agreement, the
Licensor shall deliver to the Escrow Agent the then current copy of the Source
Code and all up-to-date modifications, enhancements or customization and/or any
Documents relating thereto which shall be accompanied by a letter addressed to
the Licensor setting out a brief description of the Software and/or Documents
being delivered to the Escrow Agent.
28.3 The Escrow Agent is under no obligation to ensure that any
changed, modified, updated, improved, customization or enhanced copy of the
Source Code or of the Documents is or are in the future delivered pursuant to
clause 2.1 or 2.2.
29.0 RECEIPT BY ESCROW AGENT:
29.1 The Escrow Agent shall receive and retain the Escrow Materials,
and shall exercise that high level of care in holding the Escrow Materials that
the Escrow Agent would use to protect other items of a similar nature which the
Escrow Agent might own.
29.2 Title remains with the Licensor under all circumstances.
29.3 The Escrow Agent agrees that it will not disclose or otherwise
make available to any party, or make any use whatsoever of the Escrow Materials,
except in accordance with this agreement.
29.4 The Escrow Agent has no obligation to inspect or verify that the
Escrow Materials are what they purport to be.
30.0 RELEASE OF ESCROW MATERIALS:
30.1 If the Licensee delivers a statutory declaration to the Escrow
Agent stating that an Event of Source Code Release has occurred, and stating the
facts upon which such conclusions are based, the Escrow Agent shall notify,
within five business days of actual receipt of the statutory declaration, the
Licensor of their receipt of such statutory declaration. Should the Escrow Agent
not receive, within ten business days of such notification a statutory
declaration from the Licensor disputing that an Event of Source Code Release has
occurred, the Escrow Agent shall provide a copy of the Escrow Materials to the
Licensee.
26
- 4 -
30.2 If the Licensor provides the Escrow Agent with a statutory
declaration in accordance with clause 4.1 herein, the Escrow Agent shall not
deal with the Escrow Materials except in accordance with:
(a) the direction of both the Licensor and the Licensee, or
(b) an Order of a British Columbia Court.
30.3 Notwithstanding clause 8.1 of the SmartSources Distribution
Agreement, the parties hereto agree that for greater certainty the Licensor will
be deemed to have made an assignment or have been petitioned into bankruptcy as
provided in the SmartSources Distribution Agreement if an Event of Insolvency
occurs.
30.4 Where an Event of Source Code Release has occurred, and a copy of
the Escrow Materials is delivered to the Licensee by the Escrow Agent, the
Licensee shall be free to modify the Source Code for its own personal uses, and
have it serviced by any third party to modify the Source Code as to suit the
personal needs of the Licensee. Such use and/or modification of the Source Code
shall be a royalty-free use by the Licensee.
31.0 RELEASE AND INDEMNIFICATION OF ESCROW AGENT:
31.1 Save and except for claims arising from the Escrow Agent's own
gross negligent or wilful negligence or wilful misconduct, the Licensor and the
Licensee hereby indemnify and save harmless and release the Escrow Agent from
any and all claims of any nature or kind whatsoever made by any person, firm or
corporation, arising out of or in respect of this agreement or amendments
thereto.
32.0 APPOINTMENT OF SUCCESSOR ESCROW AGENT:
32.1 The Licensor and the Licensee covenant and agree that the Escrow
Agent shall be released from all obligations hereunder upon:
(a) the Escrow Agent unilaterally designating a trust company, law firm or
chartered accountancy firm to act as successor escrow agent (the "New
Escrow Agent") in its place,
(b) the Escrow Agent obtaining from such New Escrow Agent and delivering
to the Licensor and the Licensee a true copy of an agreement pursuant
to which the New Escrow Agent assumes all obligations under this
agreement,
(c) the Escrow Agent delivering to the New Escrow Agent all Escrow
Materials, and
(d) the Escrow Agent delivering to the Licensor and the Licensee a
statutory declaration confirming the occurrence of the events set out
above.
Upon the occurrence of each of the events set out in this article 6.0, the
Escrow Agent shall be relieved of all obligations hereunder, save and except the
benefit of clause 5.1 herein.
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- 5 -
33.0 FEES AND DISBURSEMENTS OF ESCROW AGENT:
33.1 The disbursements and reasonable fees of the Escrow Agent for
performing its obligations pursuant to this agreement shall be paid, in the case
of the provision of a copy of the Escrow Materials to the Licensee in accordance
with this agreement, by the Licensee.
34.0 TERMINATION:
34.1 This agreement may be terminated only by an instrument in writing
executed by all parties hereto.
35.0 GENERAL:
35.1 This agreement shall be governed by and construed in accordance
with the laws of the Province of British Columbia and the laws of Canada in
force therein. Each party hereto irrevocably attorns to the jurisdiction of the
Courts of the Province of British Columbia.
35.2 The Escrow Agent is not in a trust or fiduciary relationship with
any third party, and no party to this agreement is an agent or such third party,
and no benefit or burden of this agreement may be assigned except in accordance
with article 6.0 of this agreement.
35.3 In the event the Escrow Agent is named in any court action in
relation to the Escrow Material or is required to seek direction from the Court
which requires legal advice and/or legal counsel the parties jointly and
severally agree to pay all such reasonable legal fees and disbursements that may
be incurred by the Escrow Agent.
35.4 No modifications hereof shall be binding upon the parties hereto
unless executed in writing by the parties hereto.
35.5 Any notice, delivery or communication required or permitted to be
given or sent or delivered hereunder shall be in writing and be sufficiently
given or sent or delivered if it is delivered by hand to the last known address
of the party and shall be deemed to have been received by such party one day
after said notice or communication is delivered. Any statutory declaration
delivered to the Escrow Agent pursuant to clause 4.1 shall be delivered to the
attention of -- .
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IN WITNESS WHEREOF the parties hereto have hereunto executed this
agreement the day and year first written below.
DATED this -- day of --, 2000.
BY ▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ TECHNOLOGIES INC.:
AUTHORIZED SIGNATURE TITLE
NAME DATE
BY kTRAVEL SOLUTIONS INC.:
AUTHORIZED SIGNATURE TITLE
NAME DATE
BY _________________________________ :
AUTHORIZED SIGNATURE TITLE
NAME DATE
29
SCHEDULE "E"
SUPPORT AND MAINTENANCE SERVICE LEVELS
1. First-Line Support Service Levels
The following describes first line support service levels to End-User
Customers of the Products by kTravel Solutions:
(a) provision of a help desk facility and telephone support service for
the purpose of supporting user queries regarding usage and
functionality of the Products, problems encountered and efficient
operation,
(b) assist and advise End User Customers in the usage of the Products,
diagnosis and correction of simple problems in usage and functionality
of the Products,
(c) communicate defects relating to the Products those to SmartSources for
correction, and
(d) track customer inquiries and provide timely responses to all queries.
2. Second-Line Support Service Levels
The following describes second line support service levels to End-User
Customers of the Products by SmartSources that shall include the following:
(a) diagnose and isolate defects relating to the Product communicated by
kTravel Solutions and/or the End User Customer;
(b) making reasonable effort in rectifying a defect, or providing a
work-around to the defect, in the Products in a reasonably timely
manner having regard to the nature, severity and business impact of
the defect,
(c) carrying out sufficient testing to ensure that no defects are
introduced by a remedy supplied by SmartSources;
(d) documenting remedies and incorporating such remedies into the next
release of the Product,
(e) maintaining the Documentation, including the incorporation of fixes
and modifications into Products releases, provision of regular
releases of such improved Product, and dissemination of Product
releases to End-User Customers, and
(1) providing any major technical advice and support associated with the
core functionality and/or defects in the Technology.
30
SCHEDULE "F"
SUPPLEMENTARY SERVICES RATES TO BE PROVIDED BY kTRAVEL SOLUTIONS
(to be attached)
31
SCHEDULE "G"
DIRECTION TO PAY
To: ___________________________________ (the "Licensee")
kTravel Solutions Inc. hereby authorizes and directs you to pay to
▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇. Technologies Inc. ("SmartSources") all fees and monies that
are payable to kTravel Solutions Inc. under the kServer License Agreement
between kTravel Solutions Inc. and the Licensee (the "kServer License
Agreement").
kTravel Solutions Inc. may revoke this Direction to Pay and redirect you to sign
another Pre-Authorization Form under the kServer License Agreement by way of
written notice to you confirming the same. This Direction to Pay shall not
affect or prejudice the rights and remedies which kTravel Solutions Inc. may
have with respect to payment of all fees and monies that are payable to kTravel
Solutions Inc. under the kServer License Agreement.
Dated this ___________ day of __________ , 20___.
BY kTRAVEL SOLUTIONS INC.:
Authorized Signature Title
Name Date