EXHIBIT 10.4
DEVELOPMENT, LICENSE AND SERVICE
AGREEMENT
This Development License and Service Agreement ("Agreement") is made
and entered into this 15th day of April 1998 by and between Utah WebWorks, Inc.,
a closely held Utah corporation, ("UWT") and American Home Business Association,
("Customer"), a closely held Utah corporation.
WHEREAS, Utah WebWorks owns certain software known as Iquest
("Software"), a search engine used on the Internet, and
WHEREAS, Customer is desirous of obtaining a license to use the
Software, and
WHEREAS, UWI has agreed to provide (1) certain maintenance of the
Software, and (2) certain bandwidth (also known as an Internet connection), and
(3) certain enhancements for Customer for a fee, and
WHEREAS, UWI will customize the Software for Customer and help create a
Web Site and a database on the Internet as more specifically set forth herein.
NOW THEREFORE, in consideration of the covenants and promises set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties mutually agree as
follows:
1. License. UWI hereby grants to Customer an exclusive license to use the
Software for Customer's exclusive use only within the Internet Home
Business Directory Industry. Customer agrees to pay a royalty fee of
$10,000 per year, per Central Processing Unit (CPU) on which the
Software is installed, to UWI in consideration for this exclusive
license. The term of this license shall continue during the term of
this agreement. The license fees shall be paid as follows:
a. $5,000 upon the execution of this Agreement.
b. The balance of the fee shall be paid on or before May 15,
1998.
c. Annual renewal fees shall be due on or before May 15, 1999 and
on the same date of all subsequent years during the term of
this Agreement.
2. Maintenance Service. UWI shall provide maintenance service for the
Software as follows:
a. Correct system errors.
b. Make adjustments to the Software in the event it ceases to
operate.
c. Provide day to day site maintenance.
3. Maintenance Fee. In consideration for the maintenance services to be
provided by UWI as described in Paragraph 2 above, Customer agrees to
pay UWI a monthly maintenance fee of $250. The maintenance fee shall be
paid on the first day of the month preceding the date the maintenance
service is to be provided. The fee for the first month will be prorated
from the time the Web Site is completed to the end of said month. The
Web Site will be deemed completed when it is available for use on the
Internet. The maintenance fee for each month after the initial month
shall be paid on the first day of each and every month during the term
of this Agreement.
4. Bandwidth. At the present time, UWI has a bandwidth which it uses in
its business. UWI agrees to allow Customer the right to use up to 4% of
the capacity of said bandwidth (61.6 kb per second) as part of the
maintenance service. At such time as Customer's use of the bandwidth
exceeds 4% of the bandwidth's capacity, UWI, at it's election, may
either require Customer to obtain an independent bandwidth for their
own use at which time Customer shall no longer have the right to use
UWI's bandwidth, or UWI may increase the bandwidth available to
Customer for a fee. Said bandwidth will either be obtained by UWI and
charged to Customer or the cost of the bandwidth will be billed
directly to Customer by the provider of said bandwidth as UWI shall
arrange.
5. Enhancements. It is anticipated that UWI will perform certain Software
enhancements for Customer. At the time said enhancements are to be
provided, UWI will prepare a Work Order describing work to be performed
and the price to be paid by Customer. Work described in the work order
must be approved by both parties prior to the time UWI begins work on
the enhancement. UWI will be the exclusive owner of any improvements
made to the Software; provided, however, that Customer shall continue
to have a license to use said enhancement as part of the license
agreement relating to the use of the Software.
6. Advertisement Production. It is anticipated that UWI will provide
certain advertisement production services for Customer. These services
shall include graphics and other services. The charges for said
services will be based upon UWI's Standard Service List and Price
Schedule.
7. Computer System Hardware. In order to make Customer's Web Site
productive, it is necessary for Customer to provide certain computer
hardware items. UWI will specify the hardware which Customer needs to
obtain in order to operate the Web Site. Customer agreed to promptly
supply said hardware upon receiving the written specifications from
UWI.
8. Startup Costs. In addition to the maintenance services set forth above,
UWI shall also provide certain start up services for Customer. These
services consist of creating the Web Site, customizing the Software,
preparing the first version of the Web Site and putting the data base
on the Internet. At the time said start up services are to be provided,
the parties shall enter into UWI's Standard Service Agreement with
respect to said services. The exact specification for this work will be
set forth in a Work Order which shall be prepared by UWI and shall
accompany the Standard Service Agreement. The Work Order shall set
forth the costs and fees associated with providing said startup
services. The Standard Service Agreement shall set forth the payment
schedule for services described in the Work Order.
9. Term of Agreement. This agreement shall commence as of the date set
forth above and shall continue for a period of two years; provided,
however, UWI shall have the right to terminate this Agreement and/or
suspend any services described herein if Customer is in default under
any of the terms of this Agreement. Customer shall have the right to
terminate this agreement if UWI is in default under any of the terms of
this Agreement. Customer shall have the first right of refusal to renew
this Agreement after the term described herein has expired.
10. Miscellaneous. The following miscellaneous provisions shall apply:
a. Related Agreements. The parties to this Agreement may also
enter into additional agreements between them. A default or
breach under any of these agreements shall constitute a
default and breach of all of the agreements.
b. Notice. All demands and notices to be given hereunder, if any,
shall be personally delivered or sent by registered mail
addressed to the respective parties at their postal addresses
as of the date of this Agreement or to such other addresses as
each may hereafter designate in writing.
c. Entire Agreement. This Agreement constitutes the entire
agreement and understanding between the parties and supersedes
all prior agreements or understandings with respect to the
subject matter of this Agreement.
d. Amendment. This Agreement may not be altered or amended except
by a subsequent written agreement executed by all of the
parties hereto.
e. Attorney's Fees. In the event of any controversy or claim or
dispute between the parties hereto arising out of or relating
to this Agreement or any of the documents provided for herein,
or the breach thereof, the prevailing party shall be entitled
to recover reasonable attorneys' fees, expenses and costs,
whether incurred prior to, during or subsequent to trial
including appeals from the losing party.
f. Nonwaiver. The failure of any party to enforce the provisions
of this Agreement shall not constitute a waiver unless
specifically stated in writing, signed by the party whose
rights are deemed waived, regardless of a party's knowledge of
a breach hereunder.
g. Severability. The invalidity or unenforceability of any
provision hereof shall not affect nor impair any other
provision hereof.
h. Paragraph Headings. Paragraph headings in this Agreement are
for convenience only and shall not be deemed to modify,
interpret or limit the provisions hereof.
i. Interest. In the event any money obligation described herein
is not paid when due, interest shall accrue (both before and
after judgment) thereon at the greater of the Annual
Percentage Rate of eighteen percent (18%) per annum or at the
highest legal rate.
j. Authorization. The individuals who have signed this Agreement
represent and warrant that they are duly authorized to execute
this Agreement, in either their individual or representative
capacity as indicated, and that this Agreement is enforceable
according to its terms.
k. Assignment. No interests or obligations under this Agreement
are assignable without the written consent of all parties. If
such consent is given, no assignment shall relieve any party
from the performance of all of the covenants and conditions
set forth herein.
l. Limitations of Warranties. It is expressly understood and
agreed between the parties hereto that there are no
warranties, representations, covenants, or agreements between,
the parties hereto except as specifically set forth herein.
m. Right of Offset. None of the payments set forth in this
Agreement shall be subject to any right of offset or
abatement.
IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year above written.
UTAH WEBWORKS, INC.
/s/
----------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ - President
AMERICAN HOME BUSINESS ASSOCIATION, INC.
/s/
----------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ - President