Exhibit (10.4)
QWAI ZHOU NORMAL UNIVERSITY ATTACHED HIGH SCHOOL
THOUSAND MEGA CAMPUS NETWORK SYSTEM CONTRACT
Party A : Qwai Zhou Normal University Attached High School
Party B : Qwai Zhou Qin Hwa Yuen Information Technology Development Co. Ltd.
Party C : Tengtu Culture & Education Electronics Development Co. Ltd.
Contract Number : 200009-001
Date of signing of Contract : July 28, 2000
1. Responsibilities of Parties A, B, and C
1.1 Responsibilities of Party A
(1) Make payments to Parties B and C in time according to
the payment methods stipulated in this contract ;
(2) Provide equipment installation and testing site ;
(3) Responsible for taking delivery and inventory of goods
while Party B will take care their custody ;
(4) Coordinate with Parties B and C, and relevant companies
and departments.
1.2 Responsibilities of Party B
(1) Comprehensive PDS cable installation ( including cable
conduits );
(2) Installation and testing of equipment for the Network
Administration Center;
(3) Project implementation and system testing ( hardware ) ;
(4) Guarantees the time frame for the overall progress of
the project ;
(5) Provides complete technical documentation to Party A ;
(6) Coordinates commissioning.
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1.3 Responsibilities of Party C
(1) Installation and testing of Server System Platform
Software ;
(2) Installation and testing of Information-Based Education
Application Platform Software ;
(3) Setting up of technical enquiry telephone line for
resolving problems encountered by Party A and submit an
overview of the problems to the same Party ;
(4) To provide Party A with the latest technical materials,
upgrading schemes for the Tengtu Campus Network
Application Platform, etc. through post, e- mail or
website ;
(5) To provide 1-year free service for Tengtu Campus
Application Platform products, and 3-month free service
for the Tengtu Campus Network System Platform (
Microsoft products ) ;
(6) Responsible for liaison for Party A to undertake
training at the training base jointly established by
Part A and Microsoft.
2. Project Cost
2.1 Total payment to Parties B and C : RMB 1,320,000
2.2 Hardware cost : RMB 1,150,000
2.3 Software cost : RMB 170,000
3. Methods of Payment
3.1 Upon delivery of network cables to the work site, Party A will
pay 30% of the hardware contract price to Party B, i.e., RMB
345,000 ;
3.2 Upon delivery of software products to the School, Party A will
pay 30% of the software contract price to Party C, i.e., RMB
51,000 ;
3.3 After the hardware for this contract has passed the initial
inspection performed by Party A, Party A will pay 30% of the
hardware contract price to Party B within 15 days, i.e., RMB
345,000 ;
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3.4 After the contract items undertaken by Party B have passed the
commissioning performed by Party A, party A will pay Party B
30 % of the contract price, i.e., RMB 345,000 ;
3.5 After the System and application software provided by Party C
have passed the commissioning, Party A will pay 70 % of the
software contract price to Party C, i.e., RMB 119,000 ;
3.6 After the contract items undertaken by Party B have performed
normally in the System for 12 months, Party A will pay 10 % of
the hardware contract price to Party B, i.e., RMB 115,000.
4. Project Period
The entire project is to be completed within 60 working days from the
date the contract is signed. On completion of the project, the System will be
put into operation for 1 month. Party B shall produce a "Project Cycle Plan"
based on their own relevant project tasks and inform Party A formally within 7
days after the contract has been signed.
5. Quality Assurance
Party B shall guarantee that the quality of this project must fully
satisfy the requirements specified in the written suggestions provided to Party
A. Party B guarantees that all the equipment and hardware as provided are brand
new and OEM products, without any used or refurbished items.
Party C will guarantee that all software products as provided are authentic
copies from the software manufacturer(s), with complete information and quality
assurance certificate(s).
6. Commissioning Standards
6.1 The quality of the project items undertaken by Party B must
comply with the requirements as stipulated in the proposed
schemes agreed by Party A ;
6.2 The project items undertaken by Party B shall be commissioned
according to the following standards : (a) The technical
standards of OEM ;
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(b) The schemes provided by Party B abd agreed by Party A ; 6.3
Commissioning of the project items undertaken by Party B shall
be performed according to the following methods :
a) Visually inspect the external appearance, packaging, product
names, models and quantity of the products ;
b) Running and testing of the whole system.
6.4 Commissioning shall be divided into Initial Commissioning and
System Running Commissioning : Party A shall perform initial
commissioning according to item 6.3.a above before the System
is installed. Running commissioning will proceed upon
completion of System installation . When System Running is
successful, Parties B and C will provide complete installation
and testing documentation to Party A.
6.3 Commissioning tasks shall be organized by Part A, and parties
B and C shall coordinate.
7. Infringement of Contract and Compensation
7.1 Infringement Responsibilities of Party B
a) If Party B cannot complete the project according to
the contract, there will be a penalty for every 10
days of delay, which will be equivalent to 1% of the
total contract amount.
b) If Party B implements the project not according to
Party A's requirements, or uses substitution-products
without consulting Party A, Party A has the right to
terminate the contract and refuse to make any
payment.
7.2 Infringement Responsibilities of Party A
If Party A does not make payments for the loan according to
the methods of payment and timescale stipulated in the
contract, Party A shall pay Party B an "infringement fund",
which is 5% of the overdue payment, for each day delayed;
starting from the expiration of the 7-day period after the
date when the payment shall be made.
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7.3 If any Party is unable to implement the contract after it is
in effect due to incidents caused by fire, flooding,
earthquake, war, other mutually agreed irresistible events,
etc., the deadline for the implementation of this contract can
be extended. Depending on the actual situation, infringement
responsibilities can partially or fully be exempted.
8. Warranty Period
Party B shall provide a 36-month warranty for the project items
undertaken by itself, commencing from the date when installation of all
equipment is completed. The manufacturer shall directly issue a quality
assurance certificate, valid for 15 years, for the comprehensive cable
installation to the user.
8.1 Party B shall provide a 36-month quality warranty for the
projects it supplies, commencing from the date when the
equipment has passed the commissioning ;
8.2 During the warranty period, Party A shall allocate qualified
personnel to operate and service the equipment according to
the maintenance handbooks;
8.3 During the maintenance period, Party B will not be responsible
to maintain any faulty hardware or software if they are
changed by Party A. Party B will replace or repair any damaged
equipment or subassemblies caused by improper maintenance by
Party A and all costs incurred shall be born by Party A. If
the System's performance cannot meet the technical
specifications stipulated in the contract due to deficiencies
in the hardware, software or materials supplied by Party B; or
faults committed by Party B's technicians, Party B shall
repair or replace all the faulty equipment or materials free
of charge;
8.4 During the warranty period, Party A shall inform Party B in
time if there is any equipment fault and the latter Party
shall perform the necessary repair or replacement as soon as
possible. All costs incurred shall be born by the responsible
party;
8.5 During the warranty period, Party B guarantees to provide
Party A with continuous maintenance and replacement. Party A
will be responsible for all costs incurred;
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8.6 During the warranty period, Party B will be responsible to
repair any damaged equipment caused by fire, flooding,
electromagnetism, thunder, etc.. All costs incurred will be
born by Party A.
9. Other Matters
Any subsequent arising matters not identified in this contract shall be
resolved by Parties A, B and C. If consensus cannot be reached after
consultation, they can be resolved by relevant arbitration authorities.
Party A : Qwai Zhou Normal University Attached High School
Authorized Representative Signature :
July 28, 2000
Party B : Qwai Zhou Qin Hwa Yuen Information Technology Development Co. Ltd.
Authorized Representative Signature :
July 28, 2000
Party C : Tengtu Culture & Education Electronics Development Co. Ltd.
Authorized Representative Signature :
July 28, 2000
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