Korean Joint Venture Agreement

EXHIBIT 10.30


JOINT VENTURE AGREEMENT


by and between


PACIFIC PAY VIDEO, LIMITED


and


NAG YONG LEE


TABLE OF CONTENTS


PAGE
---- 1. Formation of the JVC.................................................... 1


2. Business Purpose........................................................ 2


3. Article of Incorporation of the JVC..................................... 2


4. Capital and Shares...................................................... 2


5. Conditions Precedent to Subscription.................................... 4


6. Preemptive Rights....................................................... 4


7. Transfer of Shares...................................................... 4


8. Shareholders............................................................ 5


9. Board of Directors...................................................... 5


10. Officers................................................................ 6


11. Statutory Auditor....................................................... 6


12. Financial Activity and Accounting....................................... 6


13. Related Agreements...................................................... 7


14. Non-competition......................................................... 8


15. Term.................................................................... 8


16. Termination............................................................. 8


17. Consequences of Termination............................................. 9


18. Miscellaneous........................................................... 10


18.1 Entire Agreement................................................. 10


18.2 Modifications.................................................... 10


18.3 Waiver........................................................... 11


18.4 Severability..................................................... 11


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TABLE OF CONTENTS
(CONTINUED)


PAGE
----


18.5 Governing Law.............................................. 11


18.6 Arbitration................................................ 11


18.7 Expenses................................................... 11


18.8 Assignment................................................. 11


18.9 Third Party Benefits....................................... 11


18.10 No Partnership or Agency................................... 11


18.11 Force Majeure.............................................. 12


18.12 Notices.................................................... 12


18.13 Compliance with Law........................................ 12


18.14 Counterparts............................................... 12


18.15 Captions................................................... 13


18.16 Confidentiality of Agreement............................... 13


18.17 Language................................................... 13


Exhibits - --------


Exhibit A - Articles of Incorporation


Exhibit B - Asset Purchase Agreement


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JOINT VENTURE AGREEMENT


This JOINT VENTURE AGREEMENT (this "Agreement") is entered into as of March 1, 1995, by and among:


I. Pacific Pay Video Limited, a corporation organized and existing under the laws of the State of California, United States of America, with its principal place of business at 405 Tasman Drive, Sunnyvale, California 94089, the United States of America ("PPV");


II. Nag Yong Lee, a Korean individual residing at 82-102, Hyundai Apartment, Apgujung-Dong, Kangnam-Gu, Seoul, Korea ("LEE").


RECITALS
--------


A. PPV is engaged in the development, manufacture, maintenance and distribution of software, data processing works, accounting and computing machinery and video distribution involving on-demand pay per view entertainment and information systems for the lodging industry (hereinafter the "Products") and has acquired and possesses valuable technical information, and experience in the installation and operation of such Products; and


B. LEE (hereinafter, the "Korean Partner") is engaged in the pre- scheduled hotel pay movie business in the Republic of Korea ("Korea") for numerous years and has thus developed expertise with respect to said business.


C. PPV and LEE (hereinafter collectively, the "Parties," and individually, the "Party") have mutually agreed to establish a joint venture company in Korea to market, distribute and service such Products in the premier hotel industry in Korea in accordance with the terms and conditions of this Agreement.


AGREEMENT
---------


NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the Parties agree as follows:


1. Formation of the JVC.
--------------------


1.1 Promptly upon the receipt of all authorizations, approvals, licenses and/or clearances from the Korean government or other authorities necessary to carry out the activities contemplated by this Agreement in form and substance satisfactory to all Parties, the Parties shall establish a joint venture company (the "JVC") as a joint stock company (chusik-hoesa) under the laws of Korea.


1.2 The name of the JVC shall be:


(a) In Korean: PPV Korea Chusik-Hoesa; and


(b) In English: Pacific Pay Video (Korea), Ltd.


1.3 The head office of the JVC shall be located at Seoul, Korea. Branches and other business offices may be established anywhere within or outside Korea, as required.


1.4 The Korean Partner shall render all possible assistance and support to PPV in the preparation and submission of an "Application for Approval of Foreign Investment" under the Foreign Capital Inducement Law and other related documents, and in securing all approvals, licenses and permits from the Korean authorities that are necessary or appropriate for the execution and performance of this Agreement under the most favorable terms and conditions possible. The Parties to this Agreement shall make best efforts to establish the JVC within 30 days after execution of this Agreement.


2. Business Purpose. The business purpose of the JVC shall be as follows:
----------------


(a) To market, distribute, and service software, data processing works; accounting and computing machinery and video distribution involving on- demand pay per view entertainment and information systems for use in the lodging industry in Korea;


(b) To engage in foreign trade within the scope necessary for carrying out the foregoing activities; and


(c) To engage in any and all acts, things, businesses and activities that are related, incidental or conducive, directly or indirectly, to the achievement of the foregoing businesses.


3. Article of Incorporation of the JVC.
-----------------------------------


3.1 The JVC's articles of incorporation (the "Articles") and internal regulations shall be in conformity with the terms and conditions of this Agreement. If any discrepancy is found between this Agreement and the Articles and internal regulations, the Parties shall amend the Articles and internal regulations to make them consistent with this Agreement.


3.2 The Parties shall cause the JVC to adopt the Articles that are substantially in the form attached hereto as Exhibit A.


4. Capital and Shares.
------------------


4.1 The authorized capital of the JVC shall be TWO BILLION FIVE HUNDRED MILLION Korean won (2,500,000,000), divided into FIVE HUNDRED THOUSAND (500,000) shares of, common stock with a par value of FIVE THOUSAND Korean won (5,000) per share.


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4.2 The paid-in capital of the JVC at the time of incorporation shall be FIVE HUNDRED SIXTY MILLION Korean won (560,000,000), divided into ONE HUNDRED TWELVE THOUSAND (112,000) shares of common stock with a par value of FIVE THOUSAND Korean Won (5,000) per share.


4.3 The amount of subscription prices to be contributed and the number of shares to be subscribed for by each Party at the time of incorporation shall be as follows:


(a) PPV: FOUR HUNDRED SEVENTY SIX MILLION Korean won (476,000,000) (equivalent to SIX HUNDRED TWO THOUSAND FIVE HUNDRED THIRTY TWO United States dollars [US$602,532]) divided into NINETY FIVE THOUSAND TWO HUNDRED (95,200) shares at FIVE THOUSAND Korean won (5,000) per share;


(b) LEE: EIGHTY FOUR MILLION Korean won (84,000,000) (equivalent to ONE HUNDRED SIX THOUSAND THREE HUNDRED TWENTY NINE United States dollars [106,329]) divided into SIXTEEN THOUSAND EIGHT HUNDRED (16,800) shares at FIVE THOUSAND Korean won (5,000) per share.


4.4 Subject to the provision of Sections 4.5 and 4.6, the Parties shall make their respective contribution to the paid-in capital of the JVC in the following ratio:


(a) PPV: eighty five percent (85%);


(b) LEE: fifteen percent (15%);


4.5 The Parties shall make their respective initial capital contributions in cash in Korean won or equivalent U.S. dollars.


4.6 Any shares issued by the JVC shall be common stock of one (1) class, in non-bearer form evidenced by share certificates to be issued immediately after the JVC is incorporated.


4.7 CAPITAL CONTRIBUTION TABLE
--------------------------
(WOOO)


DATE PPV LEE FORM - ---------------- ------- ------- --------------------- Initial 476,000 84,000 Cash for Common Stock April 1, 1995 657,333 116,000 Cash for Common Stock June 1, 1995 266,667 47,000 Cash for Common Stock Sept. 1, 1995 283,333 50,000 Cash for Common Stock Jan. 1, 1996 680,000 120,000 Direct loan or guarantee
of third party loan
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In the event either party fails to make a cash contribution to equity in the amount and on the date specified, the other party shall have the right to make up such shortfall, and in such event the ownership percentages of the respective parties shall be adjusted accordingly.


4.8 Unless otherwise provided by Korean law or this Agreement, no additional shares of the JVC, whether common or preferred, shall be authorized or issued except upon the prior written approval of a majority of the voting shares of the JVC.


5. Conditions Precedent to Subscription. The obligations of the
------------------------------------ Parties to complete the subscription of shares, in the JVC under Section 4.3 are subject to the following conditions precedent:


(a) All authorizations, approvals, licenses and/or clearances from the Korean government or other authorities that are necessary to carry out the activities contemplated by this Agreement shall have been received in form and substance satisfactory to all Parties; and


(b) The Korean Partner shall deliver or cause to be delivered to PPV a written undertaking that he and GLOBAL ENGINEERING INC. ("GLOBAL") shall indemnify and hold harmless PPV from any damages, losses, lawsuits and claims arising out of, or in connection with, the operation of the on-demand pay video business prior to the establishment of the JVC.


6. Preemptive Rights. The shareholders of the JVC shall have preemptive
----------------- rights in proportion to the number of shares held by each shareholder with respect to any new issuance of shares of the JVC.


7. Transfer of Shares.
------------------


7.1 If, at any time after the subscription of the shares of the JVC in accordance with Section 4, either party or his successor(s) ("Transferer") wishes to transfer its shares, then such party shall firs ...