Document:

ex10_5.htm

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT Dated For Reference the 1st day of April, 2002

 

BETWEEN:

 

ABLEAUCTIONS.COM, INC., of 2042 - 112th Street Tacoma, Washington  98444-1537

(“Ableauctions”)

 

AND:

 

ABDUL LADHA, of 7797 Jensen Place, Burnaby, British Columbia, V5A 2A7

(the “Executive”)

 

WHEREAS:

 

A.           The Executive desires to enter into employment with Ableauctions and Ableauctions desires to employ the Executive.

 

IN CONSIDERATION of the mutual agreements in this Agreement and subject to the terms and conditions specified in this Agreement, the parties agree as follows:

 

ARTICLE 1

 

DEFINITIONS

 

	
1.1

	
Definitions

 

In this Agreement, including the recitals and the schedules, the following words and expressions have the following meanings unless the context otherwise requires:

 

“Affiliate of Ableauctions” means any person or entity controlled by, controlling or under common control with Ableauctions.  For the purposes of this definition, the term “control” when used with respect to any person or entity means the power to direct the management and policies of such person or entity, directly or indirectly, whether as an officer or director, through the ownership of voting securities, by contract or otherwise.  The term Affiliate of Ableauctions specifically includes (i) Able Auctions (1991) Ltd., (ii) any corporate subsidiary or parent of Ableauctions or of Able Auctions (1991) Ltd., and (iii) any company or enterprise in which Ableauctions, Able Auctions (1991) Ltd. or any corporate subsidiary or parent of either of them owns, directly or indirectly, more than 10% of the voting securities or any similar indicia of ownership.

 

“Business of Ableauctions” means the business carried on by Ableauctions, consisting of (i) auctioning and liquidating office equipment, furniture and industrial equipment, and (ii) developing and marketing computer software that enables users to conduct or participate in live auctions over the internet.

 

“Competitive Business” means any business or enterprise that competes with the Business of Ableauctions.

 

“Permanent Disability” means (i) the total inability of the Executive to perform the duties of the Executive under this Agreement for a period of 60 consecutive days as certified by a physician chosen by Ableauctions and reasonably acceptable to the Executive, or (ii) the Executive becomes entitled to (A) disability retirement benefits under the Canada Pension Plan (Canada) or the Social Security Act (USA), or (B) recover benefits under any long term disability plan or policy maintained by Ableauctions.

  

  

  

 

“Proprietary Information” means information related to Ableauctions or an Affiliate of Ableauctions (i) that derives economic value, actual or potential, from not being generally known to or readily ascertainable by other persons who can obtain economic value from its disclosure or use; and (ii) that is the subject of efforts that are reasonable under the circumstances to maintain its secrecy; and all tangible reproductions or embodiments of such information.  Assuming the criteria in (i) and (ii) above are satisfied, Proprietary Information includes technical and non-technical data related to technical and business information, including, but not being limited to, trade secrets, computer hardware and software, procedures, manuals, methods, compositions, machines, computer programs, research projects, processes, formulae, data, algorithms, source codes, object codes, documentation, flow-charts, drawings, correspondence, know-how, improvements, inventions, techniques, personnel records, pricing information, sales or marketing plans and strategies, supply sources, production or merchandising plans, and information concerning the clients, customers, accounts, employees, contractors or affiliates of Ableauctions or any Affiliate of Ableauctions.  Proprietary Information does not include any information to the extent that it (i) is or becomes part of the public domain through no act or omission attributable to the Executive, (ii) is released after prior written authorization of Ableauctions, or (iii) is required to be disclosed by applicable law, regulation or court order; provided that if disclosure is so required, the Executive will, if permitted by law, provide Ableauctions with prompt notice of such requirement so that Ableauctions may seek an appropriate protective order.

 

“Proprietary Technology” means Proprietary Information relating specifically to the hardware, software, services, products and other technology of Ableauctions that may be developed, owned or licensed by Ableauctions or any Affiliate of Ableauctions or otherwise relating to the Business of Ableauctions or any other core line of business in which Ableauctions or any Affiliate of Ableauctions may become engaged.

 

“Third Party Information” means Proprietary Information that has been disclosed to Ableauctions or an Affiliate of Ableauctions by a third party and that Ableauctions or such Affiliate of Ableauctions is obligated to treat as confidential.

 

“Works” means copyrightable works of authorship including, without limitation, any technical descriptions for products, user guides, illustrations, advertising materials, computer programs (including the contents of read only memories) and any contribution to such materials and “Work” means any of them.

 

ARTICLE 2

 

DUTIES OF THE EXECUTIVE

 

	
2.1

	
Engagement

 

Ableauctions hereby offers to employ the Executive, and the Executive hereby accepts such employment with Ableauctions, on and subject to the terms and conditions of this Agreement.

 

	
2.2

	
Duties and Responsibilities of the Executive

 

The Executive will be employed as the President of Ableauctions, will do and perform all services and acts necessary or advisable to fulfil the duties of that position.  During the term of this Agreement, the Executive agrees to devote such of his time, energy and skill to the Business of Ableauctions and to the promotion of Ableauctions’s interests as may be necessary to fulfil his duties.  The Executive agrees that the Executive has a duty of loyalty to Ableauctions and will not engage in, or otherwise be interested in, directly or indirectly, any other business or activity that would materially and adversely affect the Business of Ableauctions or the Executive’s ability to perform the Executive’s duties under this Agreement.  Except as may be disclosed to and specifically approved by the Board of Directors of Ableauctions, the Executive will not receive or accept for his own benefit, directly or indirectly, any commission, rebate, discount, gratuity, fee or profit from any person having or proposing to have one or more business transactions with Ableauctions or any Affiliate of Ableauctions.

  

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2.3             Working Facilities

 

Ableauctions, at its expense, will furnish the Executive with such office space, office equipment, secretarial help and such other facilities, equipment and services as are needed or would be reasonably beneficial for the performance by the Executive of the duties contemplated under this Agreement.  The Executive will provide services to Ableauctions in the greater Vancouver area of British Columbia, and shall not be required to involuntarily relocate.

 

ARTICLE 3

 

COMPENSATION

 

	
3.1

	
Cash Compensation

 

For all services to be rendered by the Executive under this Agreement, Ableauctions will pay to the Executive the following amounts, which payments will be subject to withholdings for federal, provincial, state and local taxes, CPP, UIC, social security and other deductions required by law from time to time in effect:

 

	
  

	
(a)

	
Base Salary:  Ableauctions will pay the Executive an annual gross salary equal to $156,000 US, payable on a semi-monthly basis, consisting of one payment of $6,500 on the last business day preceding the sixteenth day of each month, and $6,500 on the last business day of each month.  Such salary will be reviewed by Ableauctions annually.  The Board of Directors of Ableauctions shall have the right to increase the salary of the Executive at any time and any such increase shall not operate as a cancellation of this Agreement but merely as an amendment of this clause and all of the other terms, provisions and conditions of this Agreement shall continue in force and effect.

 

	
  

	
(b)

	
Automobile Allowance:  Ableauctions will pay the Executive not more than $500 per month, payable at the beginning of each month, as an allowance applicable by the Executive to the operation and maintenance of an automobile to be used by the Executive from time to time at the request and direction and for the benefit of Ableauctions.

 

	
3.2

	
Stock Options

 

Upon execution of this Agreement, Ableauctions will grant to the Executive an option to purchase up to 1,000,000 common shares of Ableauctions, at the times and on the terms and conditions described in the form of the Stock Option Agreement attached hereto as Schedule A.

 

	
3.3

	
Business Expenses

 

The Executive will be reimbursed by Ableauctions for all reasonable and necessary expenses incurred by the Executive in connection with the performance of the Executive’s duties of employment under this Agreement in accordance with the policies of Ableauctions.  The Executive will, as a condition of any such reimbursement, submit verification of the nature and amount of such expenses in accordance with the reimbursement policies from time to time adopted by Ableauctions.

 

	
3.4

	
Fringe Benefits

 

The Executive will have the same rights as all other executive level employees of Ableauctions to participate in all pension and other retirement plans, medical insurance, life insurance and other fringe benefit programs as are now or may hereafter be established by Ableauctions for executive level employees.

 

	
3.5

	
Vacation

 

The Executive will receive five weeks paid vacation per year, taken in accordance with Ableauctions’ vacation policy in effect from time to time.

  

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ARTICLE 4

 

TERM AND TERMINATION

 

	
4.1

	
Term

 

The term of the Executive’s employment under this Agreement commences on the date of this Agreement and continues until terminated as provided in Section 4.2.

 

	
4.2

	
Termination

 

The Executive’s employment under this Agreement may be terminated only upon the occurrence of any of the following events:

 

	
  

	
(a)

	
the death or Permanent Disability of the Executive;

 

	
  

	
(b)

	
Ableauctions’ election to terminate the Executive for cause, as defined by applicable caselaw;

 

	
  

	
(c)

	
the mutual agreement by the Executive and Ableauctions to terminate the Executive’s employment under this Agreement;

 

	
  

	
(d)

	
the Executive’s election to terminate the Executive’s employment under this Agreement, provided that the Executive gives Ableauctions at least 90 days prior written notice of the Executive’s intent to terminate; or

 

	
  

	
(e)

	
Ableauctions’ election to terminate the Executive’s employment under this Agreement without cause, provided that Ableauctions gives the Executive prior written notice, equal to the greater of one year or two months per year of completed service, of Ableauctions’s intent to terminate, or a corresponding payment of compensation in lieu of notice.

 

A decision by Ableauctions to terminate the Executive’s employment under clause (b) or clause (e) may only be taken by Ableauctions with the approval of the Board of Directors of Ableauctions.

 

	
4.3

	
Effect of Termination

 

Upon the termination of the Executive’s employment under this Agreement, Ableauctions will have no further obligation to the Executive or any personal representative of the Executive with respect to this Agreement or the Executive’s employment by Ableauctions, except for the payment of compensation, if any, accrued pursuant to Article 3 up to the date of termination of this Agreement and unpaid at the date of such termination and the payment of any severance payments that may be due under Section 4.2(c) or 4.2(e) of this Agreement.

 

	
4.4

	
Return of Property

 

On termination of this Agreement for any reason or cause, the Executive shall return to Ableauctions all property used by the Executive in the performance of the Executive’s duties and all other property belonging to Ableauctions in the Executive’s possession or control.

 

	
4.5

	
Survival

 

The obligations of the Executive pursuant to Articles 5, 6 and 7 survive any expiration or termination of this Agreement.

  

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ARTICLE 5

 

RESTRICTIONS

 

	
5.1

	
Restrictions

 

The Executive agrees to comply with all of the restrictions set forth below at all times during the term of this Agreement and for a period of one year after the expiration or termination of this Agreement:

 

	
  

	
(a)

	
The Executive will not (except with the prior written consent of Ableauctions, which consent may be withheld in Ableauctions’ sole discretion) either individually or in partnership or in conjunction with any person or persons, firm, association, syndicate, company or corporation, as principal, agent, director, officer, employee, investor or in any other manner whatsoever, directly or indirectly, carry on, be engaged in, be interested in, or be concerned with, or permit his name to be used or employed by any such person or persons, firm, association, syndicate, company or corporation, carrying on, engaged in, interested in or concerned with, a business which competes with the Business of Ableauctions within Canada or the United States of America.

 

	
  

	
(b)

	
The Executive will not (except with the prior written consent of Ableauctions, which consent may be withheld in Ableauctions’ sole discretion) either directly or indirectly, on the Executive’s own behalf or on behalf of others, solicit, divert or appropriate or attempt to solicit, divert or appropriate to any Competitive Business, any business of Ableauctions or any Affiliate of Ableauctions from any customer or actively sought prospective customer of Ableauctions or any Affiliate of Ableauctions with whom Ableauctions or any Affiliate of Ableauctions has current agreements relating to the Business of Ableauctions, or with whom the Executive has dealt, or with whom the Executive has supervised negotiations or business relations, or about whom the Executive has acquired Proprietary Information in the course of the Executive’s employment.

 

Ableauctions and the Executive agree that these covenants are fair and reasonably required to protect the interests of Ableauctions.  The Executive acknowledges that, since the Business of Ableauctions is relatively unique, the Executive’s livelihood has not been and will not be dependent on employment in the Business of Ableauctions, and that these covenants do not materially affect the Executive’s ability to obtain other employment.

 

	
5.2

	
Acknowledgement by the Executive

 

The Executive represents and warrants to Ableauctions that the Executive is not subject to any agreement with any other entity that would prevent the Executive from competing with or in any way participating in a business that competes with that other entity’s business or from soliciting any personnel or customers of that other entity on behalf of another business.

 

ARTICLE 6

 

PROPRIETARY INFORMATION

 

	
6.1

	
Non-Disclosure

 

The Executive agrees that, during the term of the Executive’s employment by Ableauctions and for the applicable time periods specified below, the Executive will receive all Proprietary Information in strictest confidence and will not disclose or make available, directly or indirectly, any Proprietary Information to any person, concern or entity, except in the proper performance of the Executive’s duties and responsibilities under this Agreement or with the prior written consent of Ableauctions.  The Executive will abide by Ableauctions’ policies and regulations, as established from time to time, for the protection of its Proprietary Information for the time period specified in this Section.  The Executive agrees that the nondisclosure prohibitions described in this Section survive the expiration or termination of this Agreement (i) with respect to Proprietary Information other than Proprietary Technology for a period of five years; (ii) with respect to Third Party Information for the later of five years or so long as Ableauctions or an Affiliate of Ableauctions is required to maintain confidentiality of such information; and (iii) with respect to

  

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Proprietary Technology for the later of five years or so long as the Proprietary Technology retains its status as such and remains confidential.

 

	
6.2

	
Ownership of Proprietary Information

 

The Executive acknowledges and agrees that all Proprietary Information, and all physical embodiments of Proprietary Information, are confidential to and will be and remain the sole and exclusive property of Ableauctions.  Upon request by Ableauctions, and in any event upon termination of the Executive’s employment with Ableauctions for any reason, the Executive will promptly deliver to Ableauctions all property belonging to Ableauctions including, without limitation, all Proprietary Information (and all embodiments of Proprietary Information) then in the custody, control or possession of the Executive.

 

	
6.3

	
Works for Hire

 

The Executive agrees that any Works created by the Executive in the course of the Executive’s duties as an employee of Ableauctions are subject to Section 13(3) of the Copyright Act (Canada) and to the “work for hire” provisions of sections 101 and 201 of the United States Copyright Law, Title 17 of the United States Code.  All right, title and interest to copyrights in all Works that have been or will be prepared by the Executive within the scope of the Executive’s employment with Ableauctions will be the property of Ableauctions.  The Executive acknowledges and agrees that, to the extent the provisions of the Copyright Act (Canada) or the copyright laws of the United States do not vest in Ableauctions the copyrights to any Works, the Executive hereby irrevocably assigns to Ableauctions all right, title and interest to copyrights which the Executive may have in any Works.  The Executive will disclose to Ableauctions all Works, will execute and deliver all applications, registrations and documents relating to the copyrights in the Works and will provide assistance to secure Ableauctions’ title to the copyrights in the Works.  Ableauctions will be responsible for all expenses incurred in connection with the registration of all copyrights.  The Executive hereby waives any moral rights that the Executive may have under the Copyright Act (Canada) or similar legislation anywhere in the world or otherwise with respect to the Works.

 

	
6.4

	
Acknowledgements by the Executive

 

The Executive represents to Ableauctions that the Executive has not executed any agreement with any other party that purports to require the Executive to assign any Work or any Invention created, conceived or first practiced by the Executive during a period of time that includes the date of the Executive’s commencement of employment with Ableauctions.

 

ARTICLE 7

 

DISPUTE RESOLUTION

 

	
7.1

	
Resolution of Disputes on Determination of Cause and Breach of Restrictive Covenants

 

The parties agree that any controversy or dispute regarding whether or not “cause” exists for termination of the Executive’s employment under this Agreement or any determination that the restrictive covenants and nondisclosure covenants of Articles 5 and 6 have been breached (each, a “Dispute”) that is not resolved by the parties within ten days shall be referred to and finally resolved by arbitration under the Rules of the British Columbia International Commercial Arbitration Centre.  The appointing authorities shall be the British Columbia International Commercial Arbitration Centre.  The case shall be administered by the British Columbia International Commercial Arbitration Centre in accordance with its “Procedures for Cases Under the BCICAC Rules”.  The place of arbitration shall be Vancouver, British Columbia, Canada.

  

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ARTICLE 8

 

GENERAL

 

	
8.1

	
Governing Law and Attornment

 

This Agreement will be governed by and construed in accordance with the laws of British Columbia and the federal laws of Canada applicable in British Columbia.  Subject to section 7.1 the parties irrevocably submit to and accept generally and unconditionally the exclusive jurisdiction of the courts and appellate courts of British Columbia with respect to any legal action or proceeding which may be brought at any time relating in any way to this Agreement.  Each of the parties irrevocably waives any objection it may now or in the future have to the venue of any such action or proceeding, and any claim it may now or in the future have that any such action or proceeding has been brought in an inconvenient forum.

 

	
8.2

	
Remedies not Exclusive

 

The remedies provided to the parties under this Agreement are cumulative and not exclusive to each other, and any such remedy will not be deemed or construed to affect any right which any of the parties is entitled to seek at law, in equity or by statute.

 

	
8.3

	
Notices

 

Any notice, direction, request or other communication required or contemplated by any provision of this Agreement will be given in writing and will be given by delivery to the appropriate party at the address first set out for that party above.  Any such notice, direction, request or other communication will be deemed to have been given or made on the date on which it was delivered or, in the case of delivery by fax, on the next business day after receipt of transmission.  Any party may change its fax number or address for service from time to time by written notice to the other in accordance with this Section.

 

	
8.4

	
Entire Agreement

 

This Agreement and any documents and agreements to be delivered pursuant to this Agreement supersede all previous invitations, proposals, letters, correspondence, negotiations, promises, agreements, covenants, conditions, representations and warranties with respect to the subject matter of this Agreement.  There is no representation, warranty, collateral term or condition or collateral agreement affecting this Agreement, other than as expressed in writing in this Agreement.  No trade terms or trade usages are to be incorporated by reference implicitly or otherwise into this Agreement, unless expressly referred to in this Agreement.

 

	
8.5

	
Amendments

 

No change or modification of this Agreement will be valid unless it is in writing and signed by each party to this Agreement.

 

	
8.6

	
Invalidity of Particular Provision

 

If any provision of this Agreement or any part of any provision (in this section called the “Offending Provision”) is declared or becomes unenforceable, invalid or illegal for any reason whatsoever including, without limiting the generality of the foregoing, a decision by any competent courts, legislation, statutes, bylaws or regulations or any other requirements having the force of law, then the Offending Provision shall be severed from this Agreement and the remainder of this Agreement will remain in full force and effect as if this Agreement had been executed without the Offending Provision.

 

	
8.7

	
Currency

 

Unless otherwise specified all sums of money expressed in this Agreement are in the lawful money of Canada.

  

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8.8           Number and Gender

 

Unless the context of this Agreement otherwise requires, to the extent necessary so that each clause will be given the most reasonable interpretation, the singular number will include the plural and vice versa, the verb will be construed as agreeing with the word so substituted, words importing the masculine gender will include the feminine and neuter genders, words importing persons will include firms and corporations and words importing firms and corporations will include individuals.

 

	
8.9

	
Headings and Captions

 

The headings and captions of sections and paragraphs contained in this Agreement are all inserted for convenience of reference only and are not to be considered when interpreting this Agreement.

 

	
8.10

	
Assignment

 

This Agreement is not assignable by the Executive in whole or in part without the prior written consent of Ableauctions.  Any attempt by the Executive to assign any of the rights or to delegate any of the duties or obligations of the Executive under this Agreement without such prior written consent is void.

 

	
8.11

	
Counterparts

 

This Agreement may be executed in any number of counterparts with the same effect as if all parties had signed the same document.  All of these counterparts will for all purposes constitute one agreement, binding on the parties, notwithstanding that all parties are not signatories to the same counterpart.  A fax transcribed copy or photocopy of this Agreement executed by a party in counterpart or otherwise will constitute a properly executed, delivered and binding agreement or counterpart of the executing party.

 

	
8.12

	
Waiver

 

No failure or delay on the part of any party in exercising any power or right under this Agreement will operate as a waiver of such power or right.  No single or partial exercise of any right or power under this Agreement will preclude any further or other exercise of such right or power.  No modification or waiver of any provision of this Agreement and no consent to any departure by any party from any provision of this Agreement will be effective until the same is in writing.  Any such waiver or consent will be effective only in the specific instance and for the specific purpose for which it was given.  No notice to or demand on any party in any circumstances will entitle such party to any other or further notice or demand in similar or other circumstances.

 

	
8.13

	
Further Assurances

 

Each of the parties will promptly execute and deliver to the other at the cost of the other such further documents and assurances and take such further actions as the other may from time to time request in order to more effectively carry out the intent and purpose of this Agreement and to establish and protect the rights, interests and remedies intended to be created in favour of the other.

 

	
8.14

	
Acknowledgement of Receipt

 

Each of the parties acknowledges receiving an executed copy of this Agreement.

  

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8.15           Enurement

 

Subject to the restrictions on transfer contained in this Agreement, this Agreement will enure to the benefit of and be binding on the parties and their respective heirs, executors, administrators, successors and assigns.

 

IN WITNESS WHEREOF the parties have executed this Agreement on the dates stated below.

 

ABLEAUCTIONS.COM, INC.

 

By :/s/ Abdul Ladha                                                                           By :/s/ Abdul Ladha

Name: Abdul Ladha                 ABDUL LADHA

Title:  CEO

 

 

  

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EMPLOYEE OPTION AGREEMENT

 

 

THIS AGREEMENT Dated For Reference the  Day of , .

 

 

BETWEEN:

 

ABLEAUCTIONS.COM, INC., of 1963 Lougheed Highway, Coquitlam, British Columbia, V3K 3T8

 

(“Ableauctions”)

 

AND:

 

ABDUL LADHA, of 8824 Yarrow Place, Burnaby, British Columbia, V3N 4W2

 

(the “Executive”)

 

WHEREAS:

 

Ableauctions would like to grant to the Executive an option to purchase common shares of Ableauctions on the terms and conditions hereinafter set forth.

 

IN CONSIDERATION of the premises and of the covenants and agreements herein contained the parties hereto covenant and agree as follows:

 

1.           From and including the Agreement Date through to and including the day which is specified in Section 7 (the “Termination Date”), the Executive shall have and be entitled to and Ableauctions hereby grants to the Executive an option (the “Option”) to purchase all or any portion of 1,000,000 common shares without par value in the capital stock of Ableauctions (the “Shares”) from treasury on the following terms:

 

	
  

	
(a)

	
except as provided in clause (b) and paragraph 3, the Option shall be exercisable by the Executive at a price per share equal to ; and

 

	
  

	
(b)

	
if:

 

	
  

	
(i)

	
there is a merger or amalgamation of Ableauctions with another corporation;

 

	
  

	
(ii)

	
there is any transaction whereby all of Ableauctions’s issued and outstanding shares are acquired by or become subject to a takeover bid by another corporation; or

 

	
  

	
(iii)

	
there is a sale or conveyance by Ableauctions or one or more of its shareholders, or both, to a party that is dealing with Ableauctions or such shareholder at arms-length as defined in the Income Tax Act of Canada in a single transaction or series of related transactions, of shares of Ableauctions’s capital stock representing a majority of the votes that may then be cast by all of the shareholders of Ableauctions,

 

	
  

	
then the entire Option will become exercisable by the Executive immediately prior to (and conditional upon the completion of) such merger, amalgamation, transaction, sale or conveyance and the exercise price for the Option will be a price per share equal to the cash price for common shares of Ableauctions offered on such merger, amalgamation or other transaction if a cash price per share is so offered or the fair market value of the consideration offered on such merger, amalgamation or other transaction as determined by the board of directors of Ableauctions.

  

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2.           Subject to paragraph 3 hereof, the right to take up shares pursuant to this Option shall vest with the Executive as follows:

 

	
  

	
(a)

	
the right to take up 1/8 of the Shares shall vest on the last day of the third month after the date of this Agreement, and

 

	
  

	
(b)

	
the right to take up 1/24 of the Shares shall vest on the last day of each month thereafter until all of the Shares are so vested.

 

3.           The Option shall immediately vest such that the entire Option will be immediately exercisable by the Executive if:

 

	
  

	
(a)

	
there is a merger or amalgamation of Ableauctions with another corporation;

 

	
  

	
(b)

	
there is any transaction whereby all of Ableauctions’s issued and outstanding shares are acquired by or become subject to a takeover bid by another corporation; or

 

	
  

	
(c)

	
there is a sale or conveyance by Ableauctions or one or more of its shareholders, or both, to a party that is dealing with Ableauctions or such shareholder at arms-length as defined in the Income Tax Act of Canada in a single transaction or series of related transactions, of shares of Ableauctions’s capital stock representing a majority of the votes that may then be cast by all of the shareholders of Ableauctions.

 

4.           Subject to the terms of this Agreement, the right to take up shares pursuant to the Option is exercisable by the Executive giving notice in writing to Ableauctions accompanied by a cheque, certified if so required by Ableauctions, in favour of Ableauctions for the full amount of the purchase price of the shares then being purchased.  Provided such written notice and payment are received by Ableauctions prior to 5:00 p.m. local time on the Termination Date at its address first above written, Ableauctions covenants and agrees to issue and deliver to the Executive, forthwith thereafter, a share certificate for the number of shares so purchased registered in the Executive’s name.

 

5.           This is an Option only and does not impose upon the Executive any obligation to take up and pay for any of the shares under Option.

 

6.           The Option shall not be assignable or transferable by the Executive otherwise than by Will or the law of intestacy and the Option may be exercised during the lifetime of the Executive only by the Executive himself.

 

7.           This Option shall terminate on the earlier of:

 

	
  

	
(a)

	
five years from the date of this Agreement; or

 

	
  

	
(b)

	
30 days after the Executive ceases to be an employee of Ableauctions save and except where the Executive ceases to be an employee of Ableauctions as a result of:

 

	
  

	
(i)

	
termination for cause; or

 

	
  

	
(ii)

	
by order of any securities regulatory body having jurisdiction to so order,

 

in which case the Option shall terminate on the date the Executive ceases to be an employee of Ableauctions.

  

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8.           If the Executive should die while still an employee of Ableauctions, the Option may then be exercised by the Executive’s legal heirs or personal representatives to the same extent as if the Executive were alive and an employee of Ableauctions for a period of one year after the Executive’s death but only for such shares as the Executive was entitled to purchase pursuant to the Option at the date of the Executive’s death.

 

9.           This Agreement shall be subject to the approval of the securities regulatory authorities having jurisdiction (the “Regulatory Authorities”) and, if required by applicable laws, by the members of Ableauctions.  All amendments hereto will also be subject to the approval of the Regulatory Authorities and, if required by applicable laws, the members of Ableauctions.  The Executive and Ableauctions agree to amend this Agreement in order to comply with the requirements of the Regulatory Authorities having jurisdiction to approve this Agreement and, if the terms of the amendments can not be agreed to, to submit the proposed amendments to arbitration under the Commercial Arbitration Act (British Columbia).

 

10.           In the event of any subdivision, consolidation or other change in the share capital of Ableauctions while any portion of the Option is outstanding, then the number of shares under option to the Executive and the exercise price thereof shall be correspondingly adjusted in accordance with such subdivision, consolidation or other change in the share capital of Ableauctions.

 

11.           If Ableauctions undertakes an amalgamation, merger, reorganization or other arrangement while any portion of the Option is outstanding, then the number of shares under option to the Executive and the exercise price thereof shall be correspondingly adjusted in accordance with such amalgamation, merger, reorganization or other arrangement.

 

12.           Ableauctions hereby covenants and agrees to and with the Executive that it will reserve in its treasury sufficient shares to permit the issuance and allotment of shares to the Executive in the event the Executive exercises the Option.

 

13.           Ableauctions hereby represents that as of the Agreement Date the Executive is a bona fide employee of Ableauctions.

 

IN WITNESS WHEREOF the parties have hereunto caused these presents to be executed effective as of the day and year first above written.

 

ABLEAUCTIONS.COM, INC.

 

Per:

 

DAVID VOGT                                                                           ABDUL LADHA

 

 

MICHAEL BOYLING

 

 

BARRETT SLEEMAN

 

 

Date of Execution                                                                           Date of Executionex10_13.htm

 

 

 

 

LICENSE AGREEMENT

(this “Agreement”) made as of May 21, 2009,

 

 

	
  

	
BETWEEN:

	
Ableauctions.com Inc., of 1963 Lougheed Highway, Coquitlam, British Columbia, Canada, V3K 3T8

 

 

(Hereinafter called the “Company”);

 

 

	
  

	
AND

	
iCollector Technologies Ltd., of 1963 Lougheed Highway, Coquitlam, British Columbia, Canada, V3K 3T8

 

 

(Hereinafter called “iCollector”);

 

 

	
  

	
AND

	
ABC Live Auction World Ltd., of 1963 Lougheed Highway, Coquitlam, British Columbia, Canada, V3K 3T8

 

 

(Hereinafter called “ABC”);

 

 

(Hereinafter collectively called the “Parties” and individually, a “Party”)

 

 

WHEREAS:

 

 

	
  

	
A.  The Company’s subsidiary iCollector carries on a business (the “iCollector Business”) consisting of:

 

 

	
  

	
(i)

	
Broadcasting business and industrial auctions over the Internet for auctioneers and members of the National Auctioneers Association (“NAA”), using the Company’s licensed proprietary technology (www.ableauctions.com/technology) through the website www.naalive.com and www.naaonlinesolutions.com.

 

 

	
  

	
(ii)

	
Broadcasting antique and collectible auctions over the Internet for numerous galleries and auction houses throughout the world.  Prior to December 31, 2008, these auctions were facilitated using eBay’s live auction technology.  Commencing January 1, 2009, these auctions are facilitated using the Company’s proprietary technology (www.ableauctions.com/technology) through the Company’s website, www.iCollector.com.

 

 

	
  

	
(iii)

	
Providing auction-related products and services for a fee (www.icollectorlive.com/services.aspx).

 

 

AND WHEREAS  ABC wishes to contract with iCollector to perform the iCollector Business operations, and to sublicense from iCollector certain tangible and intangible assets iCollector licenses from the Company for use in the iCollector Business (collectively, the “Licensed Assets”), and iCollector and the Company have agreed to that contracting and sublicensing on the terms and conditions of this Agreement.

 

 

NOW THEREFORE in consideration of the premises and the covenants herein contained, and other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged by each of the Parties, the Parties hereby agree as follows:

 

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1.           DEFINITIONS

 

 

In this Agreement, the following expressions shall have the following meaning, unless there is something in the context inconsistent therewith:

 

 

	
1.1

	
“ABC’s Products & Services” means any and all products and services sold, licensed, rented, offered or performed by ABC in the course of its business.

 

 

	
1.2

	
“Agreement” means this Agreement, all schedules attached hereto and any agreement or  schedule supplementing or amending this Agreement; the words “hereto”, “herein”, “hereof”, “hereby” and “hereunder” and similar expressions refer to this  Agreement and not to any particular section or portion of it.

 

 

	
1.3

	
“Business Day” means any day, other than a Saturday, Sunday, statutory or civic holiday in the city of Vancouver, British Columbia.

 

 

	
1.4

	
“Confidential Information” means all information, regardless of its form or medium and whether or not it is identified as confidential by the Discloser that (I) relates to a Party’s past, present or future research, development, intellectual property, business activities, personnel, finances, non-public product pricing, products, services or technical knowledge, (II) relates to this Agreement or the terms and conditions thereof, or (III) has been marked as confidential or if delivered orally, confirmed to be confidential in a written notice sent within five (5) days of such oral disclosure and, in any Case, disclosed by or on behalf of either Party (the “Discloser”) to the other (the “Recipient”). Confidential Information does not include any of the following items (I) information which at the time of its disclosure is publicly available otherwise than as a result of disclosure in breach of a duty or obligation in favor of the Discloser and through no fault of the Recipient, (II) information which, after disclosure hereunder, is released to the public by the Discloser without restriction or otherwise properly becomes part of the public domain through no fault of the Recipient, (III) information which the Recipient can demonstrate was in its possession at the time of disclosure, (IV) is received in good faith by Recipient from a third party, is not subject to an obligation of confidentiality owed to the third party and provided that the information was not obtained by the third party from Discloser, or (V) is independently developed by Recipient without any use of, or reference to, the Confidential Information of the Discloser.

 

 

	
1.5

	
“Effective Date” means May 15, 2009.

 

 

	
1.6

	
“Enhancements” means any improvements, changes, modifications, derivatives from or variations or additions to any of the Licensed Assets.

 

 

	
1.7

	
“Intellectual Property” means all intellectual and industrial property rights including rights in and to copyrights, trade-marks, patents, inventions, discoveries, industrial designs, trade secrets, know-how and information of a confidential nature, registered or not, including any application for the protection of the foregoing.

 

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1.8           “Licensed Assets” means all tangible and intangible property of the Company used as of the Effective Date by iCollector in the operation of iCollector’s Business and includes, but is not limited to, the Company’s Internet live auctions bidding technology and its source code and variants; the iCollector.com website and related software, data and plugins; software, data and plugins owned by the Company and relating to the NAALive.com website; all the tools, processes and methodology of processing and conducting Internet live and silent auctions online and all domain names, technology and Intellectual Property related to broadcasting Internet live and silent auctions online; all computers and servers used in those operations; all the graphics, photographs, marketing materials, tradeshow booth materials, sales processes, client lists and agreements relating to the , as well as all the software licenses, intellectual property and business processes associated with conducting the day-to-day operations of iCollector and NAALive, not including the NAALive.com domain itself.

 

	
1.9

	
“NAA Agreement” means, collectively, the agreement between NAA and iCollector dated March 18, 2004 and the Online Auction Agreement Addendum entered into on June 1, 2005.

 

 

	
1.10

	
“Net Profit” means the revenue received from the operations of ABC after deducting expenses, as determined in accordance with Canadian generally accepted accounting principles (“GAAP”).  The term “expenses” means all monies reasonably spent on operations, marketing and wages, and other reasonable expenses associated with operating and enhancing the iCollector Business.

 

 

	
1.11

	
“Net Auction Revenue” means the revenue realized by ABC from broadcasting auctions using any iCollector.com technology or NAAlive.com technology.  Net Auction Revenue does NOT include payments received for reimbursement of Travel Expenses that are paid directly by customer further described below, nor does it include NAA fees of currently 20% on all NAA members not part of the exemption list under the NAA Agreement.

 

 

	
1.12

	
“Quarter” means a period of three (3) months of a calendar year. For the purposes of this Agreement, the calendar year is divided in the following quarters:

 

 

	
  

	
(a)

	
Quarter 1: January 1st to March 31st inclusively,

 

 

	
  

	
(b)

	
Quarter 2: April 1st to June 30th inclusively;

 

 

	
  

	
(c)

	
Quarter 3: July 1st to September 30th inclusively;

 

 

	
  

	
(d)

	
Quarter 4: October 1st to December 31st inclusively;

 

 

	
1.13

	
“Revenue” means all revenue received by ABC from any source whatsoever including but not limited to revenue from running and facilitating auctions on the platform of icollector.com or naalive.com, excluding only any amounts reimbursed or paid in advance for direct Travel Expenses.

 

 

	
1.14

	
“Term” has the meaning given in section 8.1 of this Agreement.

 

 

	
1.15

	
“Travel Expenses” means actual out-of-pocket amounts expended and reimbursed, or reasonable allowances paid, to ABC by clients of ABC operating at arm’s length from ABC, for travel-related expenses incurred by ABC in the delivery of ABC Products and Services

 

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2.           GRANT OF SUBLICENSE

 

	
2.1

	
Grant of sublicense. Subject to the terms and conditions hereof, iCollector hereby grants to ABC, and the Company hereby consents to, a non-exclusive sublicense (the “Sublicense”) for the term hereinafter provided (the “Term”), only to:

 

 

	
  

	
(a)

	
use and make Enhancements to the Licensed Assets, and implement and utilize Licensed Assets and Enhancements directly in the production and supply of ABC Products and Services; and

 

 

	
  

	
(b)

	
utilize the Licensed Assets to operate the iCollector Business.

 

 

	
2.2

	
Restrictions.  Except as expressly provided in this Agreement, ABC shall not itself or permit any other person to use, transfer, encumber, license, sublicense or otherwise dispose of, or offer or attempt to, use, transfer, encumber, license, sublicense or otherwise dispose of, any of the Licensed Assets or the Sublicense in whole or in part.

 

 

	
2.3

	
Technical Documentation.  iCollector shall promptly provide ABC with all relevant technical documentation regarding the Licensed Assets.

 

 

	
2.4

	
Marketing Documentation.  iCollector hereby sublicenses to ABC for the Term, subject always to ABC acknowledging the Company’s ownership thereof and complying with the Company’s standards and policies, any and all marketing documents, sales documents, technical documents, logos, trademarks, trade names, graphics, presentation materials, Website and or Website materials, and any and all material that ABC reasonably considers to be beneficial to assist ABC in its operation of the iCollector Business and the supply of ABC’s Products and Services.

 

 

	
3.

	
INTEGRATION SUPPORT

 

 

If ABC requires further support from iCollector regarding the integration or utilization of the Licensed Assets or any other technical or maintenance services during the Term, then ABC shall pay the cost of such services at a price mutually agreed upon by the Parties.

 

 

	
4.

	
CONSIDERATION

 

 

	
4.1.

	
Consideration.  In consideration for the grant of the Sublicense by iCollector and the provision of the consents granted by the Company hereunder, ABC shall:

 

 

	
  

	
(a)

	
pay to iCollector royalty fees as described in section 4.2 below (“Royalty Fees”);

 

 

	
  

	
(b)

	
assume and maintain and not terminate on less than three months’ written notice, iCollector’s existing license to occupy a portion of the Company’s existing premises located in Coquitlam, British Columbia, or at another location if the Company moves on at least three months’ written notice and the new premises are within reasonable proximity to the current location, and pay a proportionate share of all expenses relating to the premises, based on the area of the occupied space in relation to the total area of the premises;

 

 

	
  

	
(c)

	
hire all employees of iCollector as of the Effective Date on the same terms and conditions as they are currently employed by iCollector, and obtain from each of them for the benefit of iCollector a duly signed resignation and mutual release in the form attached to this Agreement as Schedule A;

 

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(d)

	
perform as a subcontractor of iCollector all of iCollector’s obligations pursuant to the NAA Agreement including, without limitation, payment to NAA, on behalf of and in the name of iCollector, of amounts equal to 20% of Net Auction Revenue as defined in the NAA Agreement, provided that if ABC fulfills all of iCollector’s obligations pursuant to the NAA Agreement, then subject to payment of Royalty Fees hereunder ABC shall be entitled to retain remaining Net Auction Revenue; and

 

 

	
(e)

	
assume all other liabilities of iCollector outlined in Schedule B to this Agreement.

 

 

	
4.2

	
Calculation of Royalty Fees.  ABC shall pay iCollector Royalty Fees every Quarter equal to the greater of:

 

 

	
  

	
(a)

	
50% of Net Profit; or

 

 

	
  

	
(b)

	
10% of Net Auction Revenue.

 

 

	
4.3

	
Licensing report.  A report in reasonably detailed form setting forth the calculation of Royalty Fees due to iCollector and signed by a responsible officer of ABC shall be delivered by ABC to iCollector on or before the 30th day after the close of each Quarter during the Term, regardless of whether Royalty Fees are due and owing.  The report shall include, at a minimum, the following information with respect to the relevant Quarter: (I) comprehensive financial statements detailing all revenues earned and expenses incurred by ABC during the period; and (II) total Royalty Fees accrued.

 

 

	
4.4

	
Terms of payment.  Royalty Fees shall be paid by ABC to iCollector or before the 30th day after the close of the Quarter during which the Royalty Fees accrue.  If ABC fails to pay any Royalty Fee when due, then ABC shall pay iCollector interest at the rate of 1.5% per month (18% per annum) from the due date until paid in full.  ABC agrees that any failure to pay outstanding Royalty Fees sixty (60) days after the end of a Quarter will constitute a material default entitling iCollector to terminate this Agreement.

 

 

	
4.5

	
Audit rights. Upon ten (10) Business Days’ written notice to ABC, iCollector shall be entitled, at its sole cost and expense, to have an independent third party auditor attend at the offices of ABC to conduct, during normal business hours, an audit of the relevant records of ABC to verify the financial records of and reporting by ABC.  If any such review indicates a difference from the financial information reported by ABC, then ABC will be invoiced or credited for such differences as applicable.  iCollector shall be limited to only one (1) such audit per calendar year.

 

 

	
4.6

	
Sale of iCollector Business.  The Parties will continue to look for a suitable buyer or licensee for the iCollector Business.  If the Company completes a sale or license of the iCollector Business on terms acceptable to the Company, in the Company’s sole and absolute discretion, then ABC will receive a minimum of 25% of the consideration payable to the Company upon completion of the sale or license transaction.  The Company will receive no less than 50% of the consideration.  After the deduction and payment of any amount payable to NAA, any remaining proceeds shall be allocated by agreement between the Parties.  Failing such agreement, Abdul Ladha will have the final and absolute authority to determine the allocation, which shall be binding on all the Parties.

 

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5.

	
TITLE AND OWNERSHIP

 

 

	
5.1

	
Property of the Company. ABC and iCollector hereby acknowledge and agree that, except only to the extent expressly provided herein, the Company owns and shall retain all right, title and interest in and to all the Licensed Assets.

 

 

	
5.2

	
Enhancements by ABC.  The Company shall own all right, title and interest in to any Enhancements developed or created by ABC or any of ABC’s contractors, employees or consultants, and if and to the extent required ABC hereby unconditionally and irrevocably transfers all right, title and interest in and to such Enhancements to the Company and agrees to promptly execute and deliver to the Company any and all further documents and assurances as may be required to give effect to this provision.

 

 

	
5.3

	
Enhancements by iCollector or the Company.  The Company shall own all right, title and interest in to any Enhancements developed or created by iCollector or the Company or any of the contractors, employees or consultants of iCollector or the Company, and if and to the extent required iCollector hereby unconditionally and irrevocably transfers all right, title and interest in and to such Enhancements to the Company and agrees to promptly execute and deliver to the Company any and all further documents and assurances as may be required to give effect to this provision.  The Company will grant to iCollector a license, and iCollector will grant to ABC a sublicense, for such Enhancements on the same terms as set forth in section 2.1.

 

 

6.           REPRESENTATIONS, WARRANTIES AND COVENANTS

 

 

	
6.1

	
Representations, warranties and covenants of iCollector.  iCollector represents, warrants and covenants to ABC as set out in this section and acknowledges that ABC is relying upon such representations, warranties and covenants to enter into this Agreement:

 

 

	
  

	
(a)

	
Intellectual Property Rights. The Company is the owner of all and any Intellectual Property rights in the Licensed Assets and has the right to license, and has licensed, the Licensed Assets to iCollector, and iCollector has the right to grant the Sublicense in Article 2.  To the best of its knowledge, the Licensed Assets do not infringe on any Intellectual Property rights of any third party.

 

 

	
  

	
(b)

	
Infringements by the Company or iCollector. As of the Effective Date, there is no:

 

 

	
  

	
(i)

	
claim of adverse ownership or invalidity or other opposition to or conflict with iCollector’s use of the Intellectual Property included in the Licensed Assets or the manner it is used in respect of the iCollector Business nor are there any such claims with respect to any other intellectual Property forming part of the Licensed Assets;

 

 

	
  

	
(ii)

	
pending or threatened suit, proceeding, claim, demand, action or investigation of any nature or kind against the Company or iCollector relating to the Licensed Assets or the manner they are used in the iCollector Business; or

 

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(iii)

	
claim of which the Company or iCollector has received notice (formal or informal) or is otherwise aware that the Licensed Assets or any use of them, breaches, violates, infringes or interferes with any rights of any third party or requires payment for the use of any Intellectual Property rights of a third party.

 

 

	
  

	
(c)

	
Authorization. All corporate action necessary for this authorization, execution and delivery of this Agreement and the performance of all obligations of iCollector and the Company hereunder, has been duly authorized by their respective boards of directors and by the sole shareholder of iCollector, and no other corporate proceedings on the part of either Party, is necessary or advisable to authorize this Agreement and the transactions contemplated hereby.  This Agreement constitutes a valid and legally binding obligation of iCollector and the Company enforceable in accordance with its terms, subject to laws of general application relating to bankruptcy, insolvency and the relief of debtors and by general principles of equity.  No consent, approval, order or authorization of, or registration, declaration or filing with, any court, administrative agency or commission or other governmental authority or instrumentality is required by or with respect to any Party in connection with the execution and delivery of this Agreement, or the consummation of the transactions contemplated hereby, except for such consents, approvals, orders, authorizations, registrations, declarations and filings as may be required under applicable state securities laws and the securities laws of any foreign country and such other consents, authorizations, filings, approvals and registrations which, if not obtained or made, would not have a material adverse effect on iCollector or the Company and would not prevent, or materially alter or delay any of the transactions contemplated by this Agreement.

 

 

	
  

	
(d)

	
Warranty.  iCollector and the Company do not make, and ABC hereby expressly waives, any conditions, representations or warranties that the Licensed Assets sublicensed to ABC are free of any viruses or defects, or that any of them are merchantable, durable, compatible or fit for any specific application.  All Licensed Assets are sublicensed strictly “as is”.  Except as otherwise expressly stated herein, there are no other express or implied conditions, representations or warranties in relation to the Licensed Assets whatsoever, whether statutory or arising at common law or by a course of usage or trade or otherwise.

 

 

	
6.4

	
Intellectual Property Rights enforcement and defense. iCollector shall use reasonable efforts to prosecute and defend the Company’s Intellectual Property.  ABC shall promptly inform iCollector and the Company of any alleged infringement of the Company’s Intellectual Property which may come to its attention.  iCollector shall use commercially reasonable efforts, at its own expense, to terminate any infringement of Intellectual Property included in the Licensed Assets that affects the rights granted to ABC hereunder.  In any event, iCollector will not be required, in seeking to terminate any such infringement, to spend any amount in excess of the total Royalty Fees received from ABC in the three years immediately preceding commencement of such efforts.  ABC will cooperate with iCollector and will furnish such evidence, document and testimony as will be reasonably required in respect thereof at iCollector’s cost. iCollector shall immediately

 

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notify ABC if any of the Company’s Intellectual Property included in the Licensed Assets is challenged or declared null, invalid or void.

 

 

	
6.5.

	
Representations, warranties and covenants of ABC.  ABC represents and warrants that ABC has the full right and authority to enter into this Agreement and to fulfill its obligations hereunder.

 

 

	
6.6

	
Compliance: ABC agrees to comply with all applicable laws, regulations and orders of authorities having jurisdiction in the market in which it operates the iCollector Business or licenses, rents or sells any of ABC’s Products and Services, or utilizes the Licensed Assets.

 

 

	
6.7

	
Indemnification by ABC.  ABC  agrees to hold harmless, defend and indemnify iCollector and the Company from and against any and all claims by any third party arising from the use of the Licensed Assets, provided that:

 

 

	
  

	
(a)

	
the Party or Parties seeking indemnity promptly notifies ABC in writing of the claim;

 

 

	
  

	
(b)

	
the Party or Parties seeking indemnity cooperates with ABC in the defense of such claim;

 

 

	
  

	
(c)

	
ABC is granted the control of the defense and all related settlement negotiations provided any such settlement has no material adverse effects on iCollector or the Company and that iCollector and the Company may participate in any such defense or settlement negotiations; and

 

 

	
  

	
(d)

	
the Party or Parties seeking indemnity have no authority to settle any claim on behalf of ABC, provided ABC shall not enter into any settlement without the prior written approval of iCollector and the Company, which approval shall not be unreasonably withheld or delayed.

 

 

	
7.

	
CONFIDENTIALITY

 

 

	
7.1

	
In addition to any non-disclosure agreement executed by any of the Parties, the Parties agree as follows:

 

 

	
7.2

	
Recipient shall keep confidential the Confidential Information and shall protect the Confidential Information by using the same degree of care, but no less than a reasonable degree of care, as Recipient uses to protect its own Confidential Information.

 

 

	
7.3

	
Without limiting the foregoing, Recipient shall not copy, reproduce, disclose, circulate or publish the Confidential Information or permit such actions, except as reasonably required for the purpose of this Agreement or as permitted herein. Recipient will disclose the Confidential Information only to those of its employees, consultants and subcontractors or to those employees of any consultant or subcontractor of Recipient who have a need to know the Confidential Information for the purpose of this Agreement or as permitted herein. Recipient shall, prior to disclosing the Confidential Information to such employees, subcontractors and consultants, issue appropriate instructions to them to satisfy its obligations herein and obtain their agreement to receive and use the Confidential Information on a confidential basis on the same conditions as contained in this Agreement. Notwithstanding the disclosure of the Confidential Information to such employees, consultants or subcontractors hereunder, or the employees, consultants or

 

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subcontractors acknowledgement and agreement to be bound by the terms of this Agreement, Recipient shall remain responsible to Discloser for any disclosure or use of the Confidential Information by such employees, consultants or subcontractors contrary to the provision hereof.

 

 

	
7.4

	
Recipient shall not use the Confidential Information in any manner except as reasonably required for the purpose of this Agreement or as permitted herein. iCollector and the Company shall not use the Confidential Information of ABC to reproduce, adapt, convert, develop or manufacture any product, process or material. However, for greater certainty, ABC may use the Confidential Information to reproduce, adapt, convert, develop or manufacture any product, process or material implementing or utilizing the Licensed Assets.

 

 

	
7.5

	
The Parties agree that ABC may disclose to its customers information that is necessary to operate, use, install or test ABC’s Products & Services utilizing the Licensed Assets.

 

 

	
7.6

	
If Recipient is required by judicial or administrative process to disclose Confidential Information, then Recipient shall promptly notify the Discloser and allow the Discloser a reasonable time to oppose such process.

 

 

	
  

	
8.

	
TERM AND TERMINATION

 

 

	
8.1

	
Term:  The term of the Sublicense (the “Term”) shall commence on the Effective Date and will remain in force until terminated in accordance with section 8.2 or section 8.3.  Upon such termination, the Sublicense and all other rights and consents granted hereunder shall be deemed immediately revoked and terminated without further action or notice by any Party.

 

 

	
8.2

	
Termination for Default:  In addition to any rights or remedies hereunder, any Party may terminate this Agreement for any materia1 default by another Party (the “Defaulting Party”) under this Agreement not cured within twenty-one (21) Business Days after receipt of written notice of such default is given to the Defaulting Party.

 

 

	
8.3

	
Business Termination:  In addition to any other rights or remedies hereunder, any Party may terminate this Agreement by giving a written notice to a Party who (I) makes any general assignment for the benefit of creditors or otherwise enters into any composition or arrangement with its creditors; (II) becomes bankrupt or insolvent or takes or attempts to take advantage of any law of statute for the relief of bankruptcy or insolvent debtors; or (III) ceases to carry on business.

 

 

	
8.4

	
Obligations Upon Termination: Upon the termination of this Agreement in accordance with section 8.2 or section 8.3:

 

 

	
  

	
(a)

	
each Party in possession of any Confidential Information of another Party shall immediately return that Confidential Information to that other Party;

 

 

	
  

	
(b)

	
each Party shall refrain from further use of any Confidential Information of another Party; provided however that ABC shall have the right to continue to use the Licensed Assets in accordance with the terms and conditions of this Agreement pending the outcome of any arbitration proceeding related to such termination, provided that ABC shall continue to comply with all its obligations under this Agreement, including the payment of Royalty Fees, during the

 

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arbitration process.  As well, notwithstanding any termination of this Agreement ABC will remain entitled to utilize the Licensed Assets only to the extent necessary to provide support, maintenance or training services to customers that purchased ABC’s Products & Services prior to the termination of this Agreement.

 

 

	
  

	
9.

	
GENERAL

 

 

	
9.1

	
Force Majeure: If the performance by a Party under this Agreement is prevented by any circumstance beyond the reasonable control of the Party affected, as a result of fire, flood, earthquake, explosion, war, strike or labour dispute (even if the Party is in a position to settle such strike or labour dispute), embargo, government requirement, civil or military authority, act of God, nature, sabotage or terrorism, or act or omission of carrier, then the Party affected shall be excused from such performance on a day-for-day basis to the extent of such interference (and the other Party shall likewise be excused from performance on a day-for-day basis to the extent such Party’s obligations depend upon the performance so interfered with) provided the Party so affected shall use reasonable efforts to remove, resolve or work around such circumstances.

 

 

	
9.2

	
Notices. Unless otherwise specifically provided in this Agreement, all notices, demands, requests, consents, approvals or other communications (collectively and severally called “Notices”) required or permitted to be given hereunder, or which are given with respect to this Agreement, shall be in writing, and shall be given by: (1) personal delivery (which form of Notice shall be deemed to have been given upon delivery), (2) by courier service (which forms of Notice shall be deemed to have been given upon confirmed delivery by the delivery agency), (3) by electronic or facsimile or telephonic transmission, provided the receiving party has a compatible device or confirms receipt thereof (which forms of Notice shall be deemed delivered upon confirmed transmission or confirmation of receipt), or (4) by mailing by registered or certified mail, return receipt requested, postage prepaid (which forms of Notice shall be deemed to have been given upon the 5th business day following the date mailed).  Notices shall be addressed to the address hereinabove set forth in the introductory paragraph of this Agreement, or to such other address as the receiving Party shall have specified most recently by like Notice, with a copy to the other Parties hereto;

 

 

	
  

	
(a)

	
in the case of a notice to ABC at:

 

	
  

	
ABC Live Auction World Ltd..

	
  

	
1963 Lougheed Highway

	
  

	
Coquitlam , BC

	
  

	
V3K 3T8

	
  

	
Canada

	
  

	
Attention: Thorsten Bonn

	
  

	
Facsimile: ++1 604-525-4759

 

	
  

	
(b)

	
in the case of a notice to iCollector at:

 

	
  

	
iCollector Technologies Ltd.

	
  

	
1963 Lougheed Highway

	
  

	
Coquitlam, British Columbia, Canada V3K3T8

	
  

	
Facsimile (604) 521-4911

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(c)

	
in the case of a notice to the Company at:

	
  

	
Ableauctions.com Inc.

	
  

	
1963 Lougheed Highway

	
  

	
Coquitlam, British Columbia, Canada V3K3T8

	
  

	
Facsimile (604) 521-4911

 

or at such other address, facsimile number or individual as may be designated by Notice by a Party to the other Parties.

 

 

	
9.3

	
Preparation of Agreement; Costs and Expenses. This Agreement was prepared by the the Company solely on behalf of the Company.  Each other Party acknowledges that:  (i) it had the advice of, or sufficient opportunity to obtain the advice of, legal counsel separate and independent of legal counsel for any other Party hereto; (ii) the terms of the transaction contemplated by this Agreement are fair and reasonable to such Party, and (iii) such Party has voluntarily entered into the transaction contemplated by this Agreement without duress or coercion.  Each Party further acknowledges such Party was not represented by the legal counsel of any other Party hereto in connection with the transaction contemplated by this Agreement, nor was it under any belief or understanding that such legal counsel was representing its interests.

 

 

	
9.4

	
Independent Contractor. This Agreement is of a contractual nature only, and does not constitute any Party the agent or legal representative of any other Party for any purpose whatsoever.  A Party shall not hold itself out as an agent or representative of any other Party under any circumstances.  This Agreement creates no relationship of joint venture, partnership, association, employment or agency between any of the Parties, and each of Parties are independent contractors of each other.  None of the Parties is granted under this Agreement any right or authority to, and shall not attempt to, assume or create any obligation, liability or responsibility for or on behalf of any other Party.

 

 

	
9.5

	
Assignment.  A Party may assign any rights or benefits under this Agreement to any person without the prior written consent of the other Parties, but shall provide written notice of such assignment to the other Parties, and notwithstanding such assignment shall remain liable for the full, proper and timely performance of all obligations hereunder.

 

 

	
9.6

	
Amended; Waiver. Except as expressly provided otherwise herein, neither this Agreement nor any of the terms, provisions, obligations or rights contained herein, may be amended, modified, supplemented, augmented, rescinded, discharged or terminated (other than by performance), except by a written instrument or instruments signed by all of the Parties to this Agreement.  No waiver of any breach of any term, provision or agreement contained herein, or of the performance of any act or obligation under this Agreement, or of any extension of time for performance of any such act or obligation, or of any right granted under this Agreement, shall be effective and binding unless such waiver shall be in a written instrument or instruments signed by each Party claimed to have given or consented to such waiver and each Party affected by such waiver.

 

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9.7

	
Entire Agreement/No Collateral Representation. Each Party expressly acknowledges and agrees that this Agreement (1) is the final, complete and exclusive statement of the agreement of the Parties with respect to the subject matter hereof; (2) supersedes any prior or contemporaneous agreements, proposals, commitments, guarantees, assurances, communications, discussions, promises, representations, understandings, conduct, acts, courses of dealing, warranties, interpretations or terms of any kind, whether oral or written (collectively and severally, the “Prior Agreements”), and that any such Prior Agreements are of no force or effect except as expressly set forth herein; and (3) may not be varied, supplemented or contradicted by evidence of Prior Agreements, or by evidence of subsequent oral agreements.  No prior drafts of this Agreement, and no words or phrases from any prior drafts, shall be admissible into evidence in any action or suit involving this Agreement.

 

 

	
9.8

	
Headings. The headings used in this Agreement are for convenience and reference purposes only, and shall not be used in construing or interpreting the scope or intent of this Agreement or any provision hereof.  References to this Agreement shall include all amendments or renewals thereof.

 

 

	
9.10

	
Currency. Except as otherwise expressly provided in this Agreement, all dollar amounts referred to in this Agreement are stated in the lawful currency of the United States of America.

 

 

	
9.11

	
Number and gender. Words in the singular include the plural and vice versa and words in one gender include all genders.

 

 

	
9.12

	
Successors and Assigns. All of the representations, warranties, covenants, conditions and provisions of this Agreement shall be binding upon and shall inure to the benefit of each Party and such Party's respective successors and permitted assigns.

 

 

	
9.13

	
Severability.  If any term or provision of this Agreement or the application thereof to any person or circumstance shall, to any extent, be determined to be invalid, illegal or unenforceable under present or future laws, then, and in that event:  (1) the performance of the offending term or provision (but only to the extent its application is invalid, illegal or unenforceable) shall be severed from the balance of this Agreement and excused as if it had never been incorporated into this Agreement, and, in lieu of such excused provision, there shall be added a provision as similar in terms and amount to such excused provision as may be possible and be legal, valid and enforceable; and (2) the remaining part of this Agreement (including the application of the offending term or provision to persons or circumstances other than those as to which it is held invalid, illegal or unenforceable) shall not be affected thereby, and shall continue in full force and effect to the fullest extent provided by law.

 

 

	
9.14

	
Applicable Law. This Agreement and the rights and remedies of each Party arising out of or relating to this Agreement (including, without limitation, equitable remedies) shall (with the exception of the United States Securities Act and the Blue Sky Laws) be solely governed by, interpreted under, and construed and enforced in accordance with the laws of British Columbia, as if this Agreement were made, and as if its obligations are to be performed, wholly within British Columbia.

 

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9.15

	
Dispute Resolution. Any dispute, controversy or claim, arising out of or relating to this Agreement, including the interpretation, execution or breach thereof, arising in the course of or following its performance, shall be finally settled by arbitration and to the exclusion of any court of law.  Such arbitration shall be held under the rules of the International Court of Arbitration in Vancouver, B.C., Canada.  Judgment on the award granted by the arbitrator may be entered in any court having jurisdiction thereon.  The number of arbitrators shall be one. The place of arbitration shall be Vancouver, British Columbia. The language of the arbitration shall be English.

 

 

	
9.16

	
Survival.  The provisions of this Agreement shall survive and remain in effect beyond any expiry of the Term.

 

 

	
9.17

	
Counterparts.   This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument, binding on all the Parties.  Any signature page of this Agreement may be detached from any counterpart of this Agreement and reattached to any other counterpart of this Agreement identical in form hereto by having attached to it one or more additional signature pages.

 

IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the date first above written:

ABLEAUCTIONS.COM INC.

Per: ________________________                                                                           Witness by:                                                      

Name and Title                                                                             Name

ICOLLECTOR TECHNOLOGIES LTD.

Per: ________________________                                                                           Witness by:                                                      

Name and Title                                                                             Name

ABC LIVE AUCTION WORLD LTD.

Per: ________________________                                                                           Witness by:                                                      

Name and Title                                                                             Name

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SCHEDULE A

RESIGNATION AND MUTUAL RELEASE

SCHEDULE B

OTHER LIABILITIES OF ICOLLECTOR ASSUMED BY ABC

 

 

 

 

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