Software Development Contract - Beijing Regard Technology Co. Ltd. and Beijing Ninetowns Ports Software and Technology Co. Ltd.
SOFTWARE DEVELOPMENT CONTRACT
CONTRACT NO.: EGRID20030301
PROJECT NAME: ITOWNET PLATFORM TENDERING AND OPTIMIZATION PROJECT
PARTY A: BEIJING REGARD TECHNOLOGY CO., LTD.
PARTY B: BEIJING NINETOWNS PORTS SOFTWARE AND TECHNOLOGY CO., LTD.
SIGNING LOCATION: BEIJING MUNICIPALITY
SIGNING DATE: AUGUST 1, 2003
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TABLE OF CONTENTS
Section 1 Definitions..................................................... 3
Section 2 Project Contents and Requirements............................... 4
Section 3 Contents of Construction Project................................ 5
Section 4 System Design Proposal.......................................... 5
Section 5 Training........................................................ 6
Section 6 Documentation................................................... 6
Section 7 System Acceptance Inspection.................................... 6
Section 8 Contract Amount and Payment Method.............................. 7
Section 9 Quality Assurance............................................... 9
Section 10 Service and Maintenance......................................... 9
Section 11 Construction Period and Construction Project Progress........... 10
Section 12 Force Majeure................................................... 10
Section 13 Breach of Contract.............................................. 11
Section 14 Confidentiality................................................. 11
Section 15 Patents and Intellectual Property Rights........................ 12
Section 16 Software Copyrights and Licenses................................ 12
Section 17 Dispute Resolution Method....................................... 13
Section 18 Contract Modification........................................... 13
Section 19 Contract Validity, Cancellation and Termination................. 14
Section 20 Miscellaneous................................................... 14
Section 21 Signing......................................................... 16
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SOFTWARE DEVELOPMENT CONTRACT
SECTION 1 DEFINITIONS
Beijing Regard Technology Co., Ltd. (hereinafter referred to as "Regard")
hereby authorizes Beijing Ninetowns Ports Software and Technology Co., Ltd.
(hereinafter referred to as "Ninetowns") to undertake the technology development
and implementation for the "iTowNet Platform Tendering and Optimization
Project." Based on Party A's requirements, Party B will be responsible for the
system proposal design, system installation, system tests, and technical
support, and it will provide Party A with the related services that are agreed
upon in this contract. In accordance with the relevant provisions of the
"Contract Law of the People's Republic of China" and applicable regulations, and
in order to specify the rights, obligations, and economic responsibilities of
both parties, both parties have agreed through consultation to sign this
contract. The contract terms are specified below:
The terms listed below should have the following meanings in this contract:
1.1 "Party A" refers to "Beijing Regard Technology Co., Ltd.," the client
requesting the technical development of the "iTowNet Platform Tendering
and Optimization Project."
1.2 "Party B" refers to "Beijing Ninetowns Ports Software and Technology Co.,
Ltd.," the development firm for this "iTowNet Platform Tendering and
Optimization Project."
1.3 "One contracting party" refers to either Party A or Party B.
1.4 "Both contracting parties" refers to Party A and Party B.
1.5 "The contract" refers to this contract, and to all of its inseparable
attachments that make up the contract.
1.6 "The system" refers to the set of applications consisting of the design
proposal, design software, and related hardware and software equipment to
be provided in accordance with the requirements contents that are set
forth in the "Requirements Report" on the "iTowNet Platform Tendering and
Optimization Project."
1.7 "Third party software" refers to software outsourced from third party such
as operating systems and databases that are attached to the hardware
equipment or that are essential to the proper operation of the whole
system.
1.8 "Application software" refers to application programs that are the
development responsibility of Party B and that will ultimately be turned
over to Party A to meet Party A's requirements.
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1.9 "Technical documentation" refers to all technical parameters, drawings,
designs, manuals, and other proprietary information that are specified in
the contract and to related documents on the calculation, operation,
maintenance, and testing of the system.
1.10 "Technical services" refers to services that are provided in accordance
with the contractual provisions, such as system design, installation
supervision, installation, testing, debugging, inspection, system
operation, maintenance, support, and others.
1.11 "Software upgrades" refer to program modifications and corrections that
are performed by Party B, including code changes and alterations of
end-user documentation that do not materially change program indices or
involve version upgrades.
1.12 "Version upgrades" refer to major improvements of application programs
which are certified by Party B to be new versions. Such improvements
expand, alter, and enhance programs by increasing functions and
performance while retaining the design purposes of the original programs.
1.13 "The construction site" refers to the system's specific installation and
debugging location as designated by Party A.
1.14 "Training" refers to the installation, debugging, startup, and operating
maintenance principles and the actual operation of the system that are
taught to Party A by Party B, as well as to other related knowledge.
1.15 "The final test" refers to the last test before the system goes into
regular operation. The test contents include all of the system's hardware,
the operating stability of the third party software, the application
software and the operating stability of the specially developed software.
They also include completeness of documentation and training progress.
After the system passes the final test, it goes into regular operation.
SECTION 2 PROJECT CONTENTS AND REQUIREMENTS
2.1 Party A intends to invest in building three new iTowNet information
platform switching systems, and upgrading the original iTowNet platform
system.
2.2 Based on Party A's requirements, Party B will perform such work as writing
the requirements analysis report, design the system proposal, installation
of the testing system, and providing technical support.
2.3 Party B will provide three licenses for the Ninetowns Ports Information
Exchange System, and upgrade the original iTowNet platform.
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SOFTWARE DEVELOPMENT CONTRACT
2.4 For the detailed requirements, see the "Requirements Analysis Report".
SECTION 3 CONTENTS OF CONSTRUCTION PROJECT
3.1 The construction project contents that are referred to in this contract
should include but are not limited to the ones listed below:
- System design proposal
- Hardware equipment test installation, debugging, and acceptance
inspection
- Ninetowns Ports Information Exchange System installation, debugging,
and acceptance inspection
- System testing and acceptance inspection
- Training of Party A's staff
- Provision of technical documentation
- Service and maintenance
SECTION 4 SYSTEM DESIGN PROPOSAL
4.1 Party B promises to draw up a design proposal that meets the project
development requirements based on Party A's needs. After obtaining Party
A's consent, this design proposal will be regarded as the basis for the
development of the said project.
4.2 After the project design proposal is approved by Party A, Party B is not
entitled to unilaterally revise this proposal. If this proposal needs to
be revised upon Party B's initiative, Party A's consent must be obtained.
Moreover, the new design proposal will be valid only after the revised
design proposal is presented to Party A.
4.3 If this proposal needs to be revised upon Party A's initiative, Party A
should notify Party B in writing, and Party B should draw up a new design
proposal as soon as possible based on Party A's needs and submit it for
Party A's consent. If Party B devotes more than eight hours of staff work
because the revision scope is too large, both parties should determine
through consultation the additional costs that Party A is required to pay.
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SECTION 5 TRAINING
5.1 Party B promises to draw up a training program based on the project
requirements (for details, see the "Training Program"). After obtaining
Party A's consent, such trading program will be regarded as the basis for
the training.
5.2 Party B promises to provide technical training to Party A's technicians,
and the time schedule for training will be jointly agreed upon by both
parties.
SECTION 6 DOCUMENTATION
6.1 Party B promises to provide all related documentation (for details, see
the "Provided Documentation List") during the system development process
until the acceptance inspection work is completed and pass the acceptance
inspection.
6.2 Party B promises to cooperate with Party A at the time of system
modifications or updates and upgrades, and to promptly provide updated or
corresponding documentation.
SECTION 7 SYSTEM ACCEPTANCE INSPECTION
7.1 Acceptance Inspection Criteria
7.1.1 Party B promises to be responsible for drawing up the technical
specifications, criteria, and progress plans for the final test of
the system. In order to ensure that the said project is completed in
accordance with the predetermined schedule and quality, Party A is
entitled to conduct regular phased inspections and acceptance
inspections of the project, and the acceptance inspection criteria
will be in the "Requirements Analysis Report" that is jointly signed
by both parties. In the inspection process, if Party A discovers
inappropriate issues in the original requirements, after obtaining
the consent of Party B, it may suitably revise the requirements; if
the revision of the requirements is too large and increases Party
B's development difficulties, Party B is entitled to claim for
increased expenses.
7.1.2 Party B consents to the organization by Party A of the relevant team
of experts to conduct the final test of the system, and it promises
to send a representative to cooperate with Party A in the completion
of the project acceptance inspection work. For the system's final
test criteria, see the "System Acceptance Inspection Proposal".
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7.1.3 Party A agrees to sign the initial test and final test reports with
Party B after the work is completed and the system has passed the
final test.
7.2 The Final Test of the System
7.2.1 If, after the installation and debugging of the application software
is completed and the system enters the test operation stage, the
system operates smoothly for 15 consecutive days, the application
software programs are stable, the documentation is complete, and
appropriate progress has been made in training, then the system is
ready for the final test. After the end of its test operation stage,
the system can undergo its final test, and Party B will present a
written final test request.
7.2.2 Party A must organize the final test of the system within one week
after receipt of Party B's final test request.
7.2.3 Before the final test, Party B should provide all of the
construction project documentation and the installation test report,
and it should also provide the final test documentation. The final
test may proceed after Party A's consent is obtained.
7.2.4 The final test of the system should be carried out with the
participation of Party A's technicians and in accordance with the
provisions of the "System Final Test Report", and Party B's
technicians will conduct the specific test work. The test results
should be recorded in detail, and the participating staff of both
parties should sign and certify each item. The entire test results
must be signed by the representatives of both parties.
7.2.5 After the system passes the final test, the System Final Test Report
should be signed by the representatives of both parties within two
days after the completion of the test.
7.3 The System's Official Operations Warranty Period
7.3.1 Starting on the day that the final test is passed, the system
automatically enters the official operations warranty period, which
lasts for one year.
7.3.2 During the warranty operations period, if upon Party A's request,
Party B's technicians should provide full onsite technical support.
SECTION 8 CONTRACT AMOUNT AND PAYMENT METHOD
8.1 Contract Amount
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CONFIDENTIAL TREATMENT HAS BEEN REQUESTED AND CONFIDENTIAL TERMS HAVE BEEN
OMITTED
Quantity Unit: RMB
Project (Set) Unit Price Amount
------- ----- ---------- ------
Ninetowns Ports Information 3 RMB2,200,000.00 RMB6,600,000.00
Exchange System
Ninetowns Ports Information 1 RMB900,000.00 RMB900,000.00
Exchange System (Upgraded Version)
Total RMB7,500,000.00
Total contract price:
RMB in words: seven million five hundred thousand;
in figures: [RMB]7,500,000.00
8.2 Payment Method
8.2.1 Within one week after the contract takes effect, Party A will pay to
Party B 30 percent of the total contract amount:
RMB in words: two million two hundred fifty thousand;
in figures: [RMB]2,250,000.00
8.2.2 Within one week after the system passes the final test, Party A will
pay to Party B 60 percent of the total contract amount:
RMB in words: four million five hundred thousand;
in figures: [RMB]4,500,000.00
8.2.3 If the system passes the final test, operates smoothly for three
months, and experiences no major quality problems or technical
problems during the three months, then Party A will pay the
remaining balance to Party B, or 10 percent of the total contract
amount.
RMB in words: seven hundred fifty thousand;
in figures [RMB]750,000.00
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SECTION 9 QUALITY ASSURANCE
9.1 Party B is responsible for providing Party A with technical training and
technical advisory services in order to ensure that the system can operate
in accordance with the stipulated criteria under the conditions of correct
configuration, a good environment, and proper maintenance.
9.2 In the course of the project, Party A should provide Party B with the
necessary operations advice and coordinate with Party A's relevant
departments so that they provide necessary support to Party B. When
necessary, Party A should convene the relevant departments to hold an
operation coordination conference, in order to ensure Party B's
development progress and development quality.
SECTION 10 SERVICE AND MAINTENANCE
10.1 Party B promises to draw up a service and maintenance program before the
signing of the contract. After it is approved by Party A, it will be
regarded as the basis for the services and maintenance work.
10.2 During the project implementation process and after the system goes into
operation, Party B promises to provide Party A with the relevant services
and maintenance in accordance with the service and maintenance program.
10.3 After the service and maintenance program is approved by Party A and
certified by both parties, neither party is entitled to revise it
unilaterally (if the maintenance contents need to be revised due to
technical needs, both parties should consult each other and approve the
revisions before the maintenance contents may be revised).
10.4 If the service and maintenance work contents need to be revised due to
Party A's operational needs, Party A should notify Party B in writing.
Party B should consult with Party A immediately, draw up a new service and
maintenance program, and submit it for approval to Party A.
10.5 In order to ensure that the said system operates smoothly and safely after
the project development is complete, Party B promises to provide three
years of maintenance service for the project. The response time for a
software maintenance problem is 12 hours, and the response time for a
database maintenance problem is two hours.
10.6 Party B will provide one year of maintenance service for the project
covered by this contract free of charge, and the maintenance period starts
after the acceptance inspection of the system; it provides three years of
preferential technical
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upgrading serving for the provided software products; and it provides free
capacity expansion and upgrading upon Party A's request.
10.7 After the warranty period, Party B promises to continue to provide Party A
with technical support, and Party A is responsible for paying Party B for
the costs and expenses that are actually incurred.
SECTION 11 CONSTRUCTION PERIOD AND CONSTRUCTION PROJECT PROGRESS
11.1 The construction period of this project is from the construction start
date until the representatives of both parties sign the final test report,
which is projected to be 60 days.
11.2 The construction start date of this project is the date on which Party A
makes the advance payment to Party B after the contract takes effect.
SECTION 12 FORCE MAJEURE
12.1 Force majeure refers to events such as wars, fires, typhoons, floods,
earthquakes, or other events that are regarded by both parties to be force
majeure factors. The confirmation of a force majeure event must be based
on legally valid supporting documents that are provided by an
authoritative body that is jointly recognized by both parties.
12.2 If either party is forced to suspend or postpone the contract performance
due to force majeure event, the contract performance will be
correspondingly delayed, and the postponement period will equal to the
time when the force majeure is in effect.
12.3 The affected party should notify the other party in writing of the
occurrence of a force majeure event as soon as possible.
12.4 After a force majeure event ends or is eliminated, the affected party
should notify the other party in writing as soon as possible that the
force majeure event is ended or eliminated.
12.5 If the force majeure event exceeds two months, either party should contact
the other party to resolve the matter of the contract performance. If the
force majeure event exceeds three consecutive months, either party is
entitled to terminate all or part of the contract, and Party B must return
to Party A the amount related to the non-performance of the contract.
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SECTION 13 BREACH OF CONTRACT
13.1 If, because of Party B, the system cannot be turned over on schedule as
provided in the contract, Party B will be responsible for paying a fine.
Starting on the scheduled date of delivery of the system, Party B will pay
a fine of 0.5 percent of the contract price of the delayed goods for every
week of late delivery. Less than one week will be counted as one week, but
the total fine may not exceed 20 percent of the value of the system that
is delivered late.
13.2 If, because of Party A, there is an overdue payment, Party A should pay a
breach penalty to Party B. After two weeks past the deadline provided in
the payment terms of this contract, Party A should pay a late penalty of
0.5 percent of the overdue amount for every week of late payment. Less
than one week is counted as one week, but the total penalty may not exceed
20 percent of the amount of the late payment.
13.3 After the signing of this contract, if the contract performance is
terminated because of Party B, Party B will pay Party A a breach penalty
of 5 percent of the contract amount.
13.4 After the signing of the contract, if the contract performance is
terminated because of Party A, Party A will pay Party B a breach penalty
of 5 percent of the contract amount.
13.5 Excluding force majeure events, if the construction period is delayed due
to what both parties jointly hold to be Party A's fault (such as the
failure to promptly provide the test environment), Party B assumes no
liability.
13.6 Excluding force majeure events, if, due to what both parties jointly hold
to be Party A's fault, a system malfunction occurs and causes a production
loss, Party B assumes no liability.
SECTION 14 CONFIDENTIALITY
14.1 Both parties have unanimously agreed through consultation that, while the
contract is in effect and after the contract is terminated, either party
will keep in strict confidentiality the secret information about affairs,
business, or operating methods that it holds pertaining to the other party
and the technical documentation that is provided by Party B. Both parties
will sign a confidentiality agreement. Except with the authorization of
the other party or due to the need for related parties to conduct
operations, neither party may disclose any confidential information at any
time to any person. Both parties further agree not to turn over any
confidential information to any person, unless with the written consent of
the
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other party or due to a reasonable need of one party to fulfill its
obligations. Both parties agree not to copy or transcribe confidential
information.
14.2 This clause does not apply to the contents listed below:
(1) Contents that are, when provided, already in the public domain or in
the category of common knowledge;
(2) Contents that are in the public domain through publications or other
reasons (excluding unauthorized actions or negligence), and that
have become common knowledge;
(3) Contents provided by any third party without restrictions, for which
contents the said third party has no express or implicit
confidentiality obligations;
(4) Contents that are required by law to be disclosed to any institution
or organization.
14.3 The software that is provided by Party B is not involved in any copyright
disputes. If the use of software that is provided by Party B results in a
copyright dispute, Party B will assume responsibility for all
consequential losses to Party A.
SECTION 15 PATENTS AND INTELLECTUAL PROPERTY RIGHTS
15.1 Both contracting parties should protect patents that appear in the
contract.
15.2 Party B guarantees that neither the equipment nor any part of it that
Party A uses in the contract is subject to claims or legal proceedings
filed by a third party concerning infringements of its patents,
trademarks, industrial designs, or other protected rights.
15.3 Party B holds the entire intellectual property rights to software products
that are provided to Party A, and revisions of Party B's software that are
made by Party B for Party A's current work requirements are applicable
only in this project.
SECTION 16 SOFTWARE COPYRIGHTS AND LICENSES
16.1 Copyrights
In this project, Party A purchases the use rights to Party B's software
products. Party A should use this system within the license provisions.
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16.2 Proprietary technology that is involved in the software is owned by Party
B. The ownership or naming rights to the software are not transferred to
Party A.
16.3 Scope of Permission
Proprietary technology that is involved in the software is protected by
copyright laws and international treaties. Party A may not reverse
engineer, back translate, or decompile this part of the software, except
where the law provides that Party B may not prohibit such actions.
Electronic documentation. Unless otherwise provided, Party A may, in the
reasonable exercise of its rights to use this software, print out the
electronic software documentation that is attached to the software.
SECTION 17 DISPUTE RESOLUTION METHOD
If a dispute arises in the performance of this contract, both parties will
resolve it through mutual consultation. If consultation fails, both parties
consent to its arbitration by the Beijing Arbitration Commission.
SECTION 18 CONTRACT MODIFICATION
18.1 In the event that an authoritative body that is jointly recognized by both
parties provides certification, and both parties jointly confirm that a
force majeure event has occurred and has forced the suspension or
postponement of the contract performance, the contract performance will be
correspondingly delayed, and the postponement time will equal the time
when the force majeure is in effect. If the force majeure event exceeds
two months, either party should contact the other party to resolve the
matter of the contract performance. If the force majeure event exceeds
three consecutive months, either party is entitled to terminate all or
part of the contract, and Party B must return to Party A the amount
related to the nonperformance of the contract.
18.2 If, excluding force majeure events, certain factors arise in the course of
the implementation of this project that make one party hold that it is
necessary to modify the contract, it must notify the other party in
writing as soon as possible. After obtaining the approval of the other
party through consultation, a new contract must be signed. Otherwise,
neither party is entitled to modify the contract unilaterally.
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SECTION 19 CONTRACT VALIDITY, CANCELLATION AND TERMINATION
19.1 The date on which the authorized representatives of both parties sign and
seal this contract is the effective date of this contract.
19.2 The occurrence of any of the circumstances listed below may be cancelled
or terminated:
(1) This contract is valid, and it has been completely fulfilled.
(2) If the force majeure event exceeds two months, either party should
contact the other party, in order to resolve the matter of the
contract performance. If the force majeure event exceeds three
consecutive months, either party is entitled to terminate all or
part of the contract, and Party B must return to Party A the amount
related to the nonperformance of the contract.
(3) Excluding force majeure causes, both parties jointly agree to an
early cancellation of the contract.
(4) In accordance with the decision of the arbitration agency, the
contract is cancelled or terminated.
SECTION 20 MISCELLANEOUS
20.1 This contract is composed of all of its provided terms and the attachments
referred to below:
Attachment 1 Requirements Analysis Report
Attachment 2 System Installation and Debugging Program
Attachment 3 Provided Documentation List
Attachment 4 System Acceptance Inspection Proposal
All of the attachments to this contract are inseparable parts of this contract,
and they have a legal effect equal to this contract.
20.2 The terms of this contract constitute the entire agreement and
understanding reached by both parties on the subject matter of this
contract, and they shall replace and supersede all previous agreements,
understanding, related documents, and presentations.
20.3 Any revisions of or supplements to the terms of this contract must be made
through written documents signed by the authorized representatives of both
parties to the contract. Revisions or supplements that are jointly signed
by both parties have a legal effect equal to this contract. If they
conflict with the terms of
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this contract, the revisions or supplements will prevail. This contract
consists of four identical original copies, and each party keeps two
copies.
20.4 Neither party may disclose the contract contents to a third party, unless
the advance consent of the other party is obtained. However, if it is
required to submit this contract to a government department concerned for
approval, the consent of the other party is not required.
20.5 Matters not covered in this contract are all implemented in accordance
with the relevant existing laws of the People's Republic of China.
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SECTION 21 SIGNING
Party A Beijing Regard Technology Co., Ltd. Technology
Title (or Name) (Signature) Contract
Special Seal
or
Official Seal
Beijing
Regard
Technology
Co., Ltd.
[Seal]
Legal
Representative Tian Hongmei (Signature)
Authorized Agent (Signature)
Contact Person
(Person in Charge) Shan Pin Fang /s/ Shan Pin Fang (Signature)
#406 No. 1 Building, 3
Residence (Postal No. 2 Yard, Hengfu Zip
Address) Middle Street, Fengtai Code 100070
Science Park, Fengtai
District, Beijing
Municipality
Telephone 010-65882661 Fax 010-65882265
Bank of Deposit
Account No.
Party B Title (or Name) Beijing Ninetowns Ports Software and Technology
Technology Co., Ltd. (Signature) Contract
Special Seal
or
Official Seal
Beijing
Ninetowns
Ports
Software and
Technology
Co., Ltd.
[Seal]
Legal
Representative (Signature)
Authorized Agent /s/ Wu Bo Lin (Signature)
Contact Person
(Person in Charge) (Signature)
5th Floor, Union
Residence (Postal Plaza, 20 Chaowai Zip 100020
Address) Street, Chaoyang Code
District, Beijing
100020, The People's
Republic of China
Telephone 010-65887788 Fax 010-65882260
Bank of Deposit
Account No.
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Affix Revenue Stamps Here
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2. Registration Materials: (1)____________________________________________
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