Exhibit 10.8
Collaboration Agreement
Section 1: General Intention
China Netcom of GuangXi Province ("Party A") and Beijing Candidsoft Technology
Co. Ltd. ("Party B"), in accordance with People's Republic of China's Agreement
Law and other regulations pertaining to this agreement, taking into
consideration mutual cooperation, long term and mutual benefits, after mutual
discussion, agree, within the GuangXi Province to collaborate in developing
businesses based on telecommunication infrastructure and integrated office
automation, henceinafter referred to as ICT business.
Section 2: Intent and content
i) Principles of collaboration:
Both parties acknowledge their individual strength and the
ability to complement each other in their business, and in
order to increase the level of utilization of ICT technology
by local government and corporate customers, agrees to
cooperate to their mutual benefits.
ii) Collaboration content:
Integrate telephone exchange network, broadband Internet
network, NGN voice phone network, telecom value added services
into Office Automation Platform as a complete ICT product,
with extended and related application development, equipment
maintenance, engineering design and consultation.
iii) Agrees to:
Both parties will use their best endeavor to open up new
market and customer resources, expand the service network and
in general, grow the business.
Section 3: Conditions of collaboration
iv) Both parties will invest the following:
a. Party A: Telco class broadband Internet network,
telephone exchange network, NGN voice phone network,
customer verification/charging/management capability,
and telecom value added services with all necessary
resources to maintain and manage the above investment
b. Party B: Knowledge and capability to utilize
integrated Office Automation Platform and the ability
to assure technical service quality, management and
maintenance of the above investment, application
development ability and a complete after-sales
service system
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c. Party A will authorize the use of CNC's branding, its
basic infrastructure and value-added licenses,
broadband Internet network, telephone exchange
network, NGN voice phone network and telecom value
added services covering the entire political region
of GuangXi
d. Party B will deploy a complete integrated Office
Automation Platform, with associated application
development, system support and after-sales service
v) Ownership of both parties' respective investments will remain
unchanged regardless of new or modified development of
existing assets after this agreement comes into effect. The
investment of the parties' respective asset shall be
interpreted as necessary to open up new market while
increasing the competitiveness of each asset
vi) Other than business created as a result of this agreement,
neither party shall use the invested asset of the other party
for gain or charitable uses
vii) This venture will only undertake ICT contracts and projects
based on telecommunications technology and office automation
platform, and they will be undertaken under the name of CNC in
GuangXi. Party A has the right to name the contracts and
projects after itself, while Party B will be responsible for
the deployment of the platform, application development and
system support. All customer resources will be collectively
shared between both parties
viii) With each new customer industry, both parties will discuss on
a unique approach for maximum penetration
ix) Both parties will appoint their staff to form project teams,
which will then be in charge of coordinating, communicating
and deploying each contract or project
x) Both parties will be responsible for their own invested asset
to each project, including the maintenance and replacement:
for Party A, sustaining its invested broadband Internet
network, telephone exchange network, NGN, customer
verification/charging/management capability, telecom value
added services and "10069" Large Corporate Service Hotline;
for Party B, sustaining its invested integrated Office
Automated platform, including upgrades to the system software
interconnects based on customer requirements. Party B will
also attempt to make best use of Party A's exist
infrastructure for the deployment and future development of
its platform
xi) Party B will be solely responsible for providing the
"Integrated Collaborative Platform"
Section 5: Profit sharing
xii) Both party agrees to price this service differently for each
vertical market and group of customer
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xiii) Based on the pricing agreed in point (xii), both party agrees
also to share their profit based on different ratio, to be
signed before work begins on each new vertical market and
group of customer
xiv) It is agreed that Party A shall, by the last working day of
each month, provide Party B with profit sharing statement of
the last month, and make payable, Party B's share of profit as
an agent's commission by the last day of the following month.
In case of special circumstances, this payment must not be
delayed any more than 15 days, and Party B must issue an
official receipt within 4 working days of receiving the
payment. Taxes incurred from the above profit will be each
parties' responsibility based on their share
Section 6: Roles and responsibilities
xv) Party A's role and responsibilities
a. Fulfill collaboration requirements according to
Section 4
b. Guarantee the smooth operations of broadband Internet
network, ...
c. Make changes to its network assets based on business
requirement arising from this agreement
d. Based on market demands, work with Party B to design
and implement a branding and promotion exercise
e. Deploy and maintain the networks required by this
agreement, in accordance to standards set in the
telecom industry
f. Appoint staff member to form project teams for joint
business development and customer acquisition
g. Within the period of agreement and within the
political boundaries of the province, not to conduct
similar businesses with any other entity other than
Party B
xvi) Party B's role and responsibilities
a. Fulfill collaboration requirements according to
Section 4
b. Ensure the smooth operations of integrated Office
Automation platform and ensure the platform operate
within quality boundaries set by MII
c. Based on market demands, assist Party A to design and
implement a branding and promotion exercise
d. Assist Party A in engineering and system testing, and
provide necessary support for business generated from
this agreement
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e. Appoint staff member to form project coordination
committee for joint business development and customer
acquisition
f. Appoint staff member to form project teams for joint
business development and customer acquisition
g. Within the period of agreement and within the
political boundaries of the province, not to conduct
similar businesses with any other entity other than
Party A
xvii) Non disclosure and confidentiality
Section 7: Contractual period and others
xviii) After this agreement is signed, other than events described in
points (xxiv), (xxv), (xxvi) and (xxvii), it will last for 10
years. 1 month before this agreement expires, parties A & B
should discuss on renewal of this agreement, and will
automatically do so unless stated otherwise
xix) A project coordination committee will be organized within 2
weeks of signing this agreement to complete the necessary
preparation and negotiation to introduce a formal schedule of
work. This service should be offered by the third month of
signing
xx) Both parties can mutually terminate this agreement, as long as
existing customers are not affected
xxi) This agreement may be automatically terminated due to changes
in the country's national policy
xxii) This agreement may also be terminated due to heavy financial
losses suffered by either party not a result of mismanagement
or the network services
xxiii) Both parties may negotiate on completely terminating, partial
terminating or put this agreement on hold for reasons due to
natural disaster, act of god or force majeure
xxiv) If one party default on its obligation under this agreement,
the other may object on the default in writing, and if after
30 days of the written objection, the defaulted obligation is
still not carried out, the complying party may,
a. Continue the agreement and seek remedy from the
defaulting party
b. Terminate the agreement in writing and negotiate with
the defaulting party on handling any effect caused by
the default
c. Demand compensation in financial losses as a direct
or indirect result of the default
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d. If the default is due to a complete departure of
support, the compensation may include the invested
amount put in by the complying party, and the one
year revenue to be generated from existing customers
xxv) Any changes to this agreement after taking effect must be
conveyed in writing and agreed by the other party to take
effect
xxvi) If this agreement was to be terminated mutually, both parties
must complete payment to the other party, or else the party
being owed may demand compensation for losses due to this
non-payment
xxvii) Even upon termination of this agreement, both parties are
still obligated to protect confidential information pertaining
to the other
Section 8: Intellectual Property Rights
xxviii) Party B should guarantee that it hold the complete IPR to the
software platform to be used for providing the ICT business
services described in this agreement. That it hold the
legitimate patent or the right of use to the technology to be
employed, and legitimate copyright or the right of use to the
software. The software stated here include those employed in
hardware equipments to be used on this platform and service,
and that which third party supplier had provided specially for
permitting the use of all system software (copyrighted by the
supplier or possess right of use from another party by
agreement). Both sides recognized that these software are
necessary for proper operation of this business and service.
xxix) If Party A, due to the use of software and equipment as
described in this agreement, infringes on the intellectual
property rights of a third party, and is demanded
compensation, Party B will be required to resolve the above
infringement suit and compensation. In addition, Party B will
also be required to compensate Party A for any losses suffered
due to this infringement
xxx) If, due to the infringement suit. described in (xxix), Party A
and the collective customer are unable to use part or whole of
the service and/or equipment supplied, Party B must provide,
at no extra cost, a substitute within 15 days, or make
revisions to or replace in part or whole of its equipment
and/or software, so Party A and the collective customers are
able to continue using the services from this agreement. At
the same time, Party B should compensate Party A and the
collective customer, any financial losses resulted from this
infringement suit
xxxi) Party A shall promptly notify Party B on related intellectual
property rights dispute related to this agreement, and assists
the Party B in handling the intellectual property rights
dispute
xxxii) If Party A infringes on a third party's intellectual property
rights by providing equipment, software and technology for
this agreement, then Party A shall be responsible for the
compensation and claim arising from any infringement suit. Any
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compensation, litigation expense, attorney expense and any
financial losses to Party B
xxxiii) Party A should guarantee that, unless it receive clear,
written communication of permission from Party B, it will not
permit any third party to use any equipment, software and
technology from Party B. Otherwise, Party A should compensates
Party B on all financial losses as a result
Section 9: Dispute and resolution
xxxiv) If any dispute arises as a result of this agreement, either
side may, in written form, inform the other of the disputed
content and its intention for resolution. Both sides shall
attempt to resolve based on the principle of long-term
friendship and mutual cooperation, and if are unable to
resolve, shall begin arbitration by the Nanning Arbitration
Committee
xxxv) In the arbitration process, other than the parts or component
that is the cause of the dispute, this agreement should
continue to be fulfilled
Section 10: Agreement effective date and others
xxxvi) Any notice or report stated in this agreement must be in the
written form
xxxvii) Any follow-up documents attached to this agreement shall
constituent a part of this agreement and shall bear the same
legal obligation
xxxviii) Six copies of this agreement shall be signed with both parties
holding three respectively. After signing and sealing, this
agreement will take effect immediately. Any incompleteness
shall be negotiated separately by both parties, and the rights
to interpreting this agreement shall remain with both parties
