Exhibit 10.65
SALES AND MARKETING SERVICES AGREEMENT
AMONG
ECO FUEL CELLS, LLC, ENERGY CO-OPPORTUNITY, INC.
AND
H POWER CORP.
This Sales and Marketing Services Agreement ("Agreement") is entered into this
10 day of April, 2002 (the "Effective Date"), among H Power Corp., 0000 Xxxxx
Xxxxxx, Xxxxxxx, XX 00000; H Power Enterprises of Canada, Inc. (together "H
Power"); and ECO Fuel Cells, LLC ("EFC") and Energy Co-Opportunity, Inc. ("ECO")
both of 0000 Xxxxxxxxxxx Xxx, Xxxxxxx, XX 00000. These parties are referred to
herein singularly as "Party" and collectively as "Parties." Defined terms used,
but not otherwise defined herein, shall have the respective meanings set forth
in the Second Amended and Restated Fuel Cell Product Operating Agreement, dated
April 10, 2002, among the Parties (the "Operating Agreement").
RECITALS
WHEREAS: On the date hereof, the Parties have entered into the Operating
Agreement to, among other things, further encourage the marketing of H Power's
Fuel Cell Products, to provide the Parties with additional marketing and
distribution opportunities, and to explore other products and services offered
by H Power including new fuel cell products and applications; and
WHEREAS: the Parties desire to mutually encourage the development, marketing and
selling of H Power's Fuel Cell Products to electric Cooperatives and others,
and;
WHEREAS: EFC has specific sales and marketing expertise in Distributed
Generation (DG) equipment and related applications that is transferable to Fuel
Cell Products sales and marketing, and;
WHEREAS: H Power desires to secure EFC's expertise in sales, marketing and other
areas to help enhance the commercialization of its Fuel Cell Products.
NOW, THEREFORE, in consideration of the promises herein and other valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Parties hereby agree as follows:
1. FUEL CELL SALES AND MARKETING SUPPORT.
a. EFC will work with H Power to identify and create sales
opportunities for Fuel Cell Products, including H Power's EPAC
series. This will include identification of potential markets
and applications, channels of distribution, and similar
activities.
b. EFC will continue to actively promote the Fuel Cell Power
System for residential markets and will participate in
evaluation studies and placement of test units to finalize the
development of the Cooperative design and to enter other
markets.
c. EFC's Services shall include:
----------
Certain portions of this exhibit have been omitted pursuant to a request for
confidential treatment. The omitted materials have been filed separately with
the Securities and Exchange Commission.
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i. EFC, in collaboration with others, will provide H Power
with a report on "typical" electric utility approaches
for engineering review of customer requested DG grid
interconnection to help H Power better understand
interconnection requirements. The report will include
the typical utility steps that must be taken to properly
account for site-specific concerns and will address the
typical technical and procedural requirements of
interconnection standards.
ii. EFC shall work with H Power, and both Parties will use
reasonable commercial efforts to jointly identify and
secure $3.0 million in grants and/or other funds in the
eighteen month period following the Effective Date to
support the Fuel Cell Product test and development
programs, which may include potential funding for
related technologies.
iii. EFC shall organize and sponsor a national distributed
generation seminar in April 2002 that will include
invitations to a broad spectrum of non-Cooperative and
Cooperative utilities and customers. H Power will be a
featured presenter at the seminar.
iv. EFC shall create new marketing and distribution channels
for Fuel Cell Products through the electric Cooperatives
and others by encouraging customers to actively seek new
applications for Fuel Cell Products that will expand
future sales opportunities.
v. EFC shall staff and display H Power products and
services at two electric Cooperative industry or related
trade shows in 2002 and 2003, one of which shall include
the NRECA Annual Meeting in both years. H Power will
provide all Fuel Cell equipment for the displays, and
EFC shall provide the display space, personnel and
display platforms for H Power for a cost not to exceed
$50,000 per show.
vi. EFC shall identify, assess and evaluate future and
existing Fuel Cell Product markets, fuel cell customer
needs, additional product development opportunities and
applications and similar items as follows. EFC shall be
responsible for developing and managing a structured
focus group program consisting of two different
participant interview sessions for the purpose of
establishing new sales opportunities for $15 million of
new revenue from "Other Fuel Cells". EFC shall be
responsible for securing participants for the program.
vii. EFC shall develop marketing and promotion materials for
H Power, identify marketing issues for H Power and
develop market penetration and market share strategies
for H Power.
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viii. EFC's Project Manager for this agreement will work with
national Cooperative organizations to secure display and
educational opportunities for H Power, and will
coordinate any display set ups or material hand-outs
needed for these opportunities with H Power.
2. PROJECT MANAGER. EFC's Project Manager for this Agreement
shall be Xxxxxx Xxxxxx. The Project Manager shall, in addition
to the other duties prescribed in this Agreement, develop a
travel budget for this Agreement, working closely with H
Power. During the term of this Agreement, Xx. Xxxxxx and other
EFC personnel shall integrate the H Power activities described
herein into their EFC workload, and shall be responsible for
establishing work priorities, schedules and completion of work
requests. Xx. Xxxxxx shall inform both EFC and H Power when
potential or real conflicts of activities or scheduling exist,
and the Parties shall mutually resolve such conflicts for Xx.
Xxxxxx. During the term of this Agreement, H Power shall not
solicit any EFC staff for employment.
H Power and EFC shall agree to prepare travel (including
transportation, lodging, meals, and entertainment) and other
budgets from time to time to carry out the purposes of this
Agreement. In addition to the payments made under Attachment A
of this Agreement, any travel to be performed at H Power's
request that exceeds $1,000 per month shall be paid for by H
Power, except for the travel expenses in conjunction with the
planned EFC meetings described in Sections 1.c. iii and 1.c.v.
above or as may otherwise be agreed to in writing by the
Parties. EFC shall provide satisfactory documentation for such
expenses in such detail as H Power may reasonably request.
3. LIMITATIONS. IN NO EVENT SHALL THE PARTIES (INCLUDING THEIR
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND ATTORNEYS) BE
LIABLE FOR ANY INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL
DAMAGES (INCLUDING BUT NOT LIMITED TO LOST PROFITS) IN THE
PERFORMANCE OF THEIR DUTIES UNDER THIS AGREEMENT, EVEN IF THEY
HAVE NOTICE OF THE POSSIBILTY OF SUCH DAMAGES, EXCEPT FOR (I)
ANY PRODUCT LIABILITY, (II) ANY INFRINGEMENT OF INTELLECTUAL
PROPERTY RIGHTS, AND (III) OTHER DAMAGES CAUSED BY NEGLIGENCE
OR WILLFUL MISCONDUCT OF THE PARTIES OR THEIR EMPLOYEE(S).
HOWEVER, NOTHING HEREIN IS TO LIMIT OR CHANGE THE PROVISIONS
OF THE EFC-H POWER OPERATING AGREEMENT (AS AMENDED FROM TIME
TO TIME).
4. PAYMENT FOR SALES AND MARKETING SERVICES. Subject to Sections
5, 6, and 7 hereof, in exchange for the above services, H
Power will pay EFC up to $1.5 million per the schedule in
Attachment A hereto. EFC may invoice H Power monthly or
quarterly for its services. Payment of invoices will be due
and payable 15 days after receipt by H Power. In addition, H
Power agrees to pay EFC per the Schedule in Attachment A of
this Agreement an amount not to
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exceed $50,000 for its participation in each trade show
referenced in Section 1.c.v.
5. AFFIRMATIVE AND NEGATIVE COVENANTS. Notwithstanding anything
contained in this Agreement to the contrary, this Agreement is
subject to certain binding Affirmative and Negative Covenants
("Covenants") contained in a "Memorandum of Agreement" entered
into by the Parties on the date of this Agreement.
6. NO MATERIAL ADVERSE CHANGE. Notwithstanding anything contained
in this Agreement to the contrary, H Power shall have no
obligation to make payments to EFC during the Term hereof, if
there has been a "Material Adverse Change." For the purposes
of this Agreement, a Material Adverse Change shall only be
defined as a material violation of Sections 2, 3, 4, or 5 of
the Memorandum of Agreement.
7. FAILURE TO COMPLY. Notwithstanding anything contained in this
Agreement to the contrary, upon ECO's and/or EFC's breach of
any of the Affirmative or Negative Covenants set forth in the
Memorandum of Agreement, H Power shall have the unilateral
right to suspend payment of any monies due to EFC hereunder
(including those set forth on Attachment A hereto) until such
time that ECO and/or EFC cures such breach to H Power's
satisfaction.
8. TERM. This Agreement shall terminate upon: i) the completion
of EFC's and ECO's duties referred to herein; or ii) the
written agreement of the Parties.
9. DISPUTES. The Parties agree that any and all controversies or
claims arising out of or relating to this Agreement, or any
alleged breach hereof, shall be resolved by binding
arbitration as prescribed herein, upon 30 days' written notice
to the other Party. In that event, the Parties each Party
shall select one (1) arbitrator and those shall select a
third. The three (3) arbitrators will conduct the arbitration
under the then current rules of the American Arbitration
Association ("AAA"), unless otherwise provided herein. The
arbitrator(s) will be selected in accordance with AAA
procedures from a list of qualified arbitrators maintained by
AAA. The arbitration will be conducted in Washington, D.C. and
all expedited procedures prescribed under AAA rules will
apply. Unless the Parties otherwise agree, the proceedings
will be completed within forty-five (45) days of the Parties'
receipt of notice of arbitration. Each Party will bear its own
costs and attorney's fees.
10. MUTUAL COOPERATION. The Parties agree to take such other
actions and execute such other documents as shall be necessary
to carry out the provisions of this Agreement.
11. ENTIRE AGREEMENT. With the exception of the Operating
Agreement and the Memorandum of Agreement, this Agreement
(including any Schedules and Exhibits attached hereto)
constitutes the entire agreement among the Parties with
respect to the subject matter hereof and supercedes all prior
and contemporaneous agreements and undertakings, written or
oral, of any nature whatsoever of the Parties hereto with
respect to the subject matter hereof.
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12. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given when
delivered in person, by telecopy (with confirmation of
transmission), by express or overnight mail delivered by a
nationally recognized air courier (delivery charges prepaid),
or by registered or certified mail (postage prepaid, return
receipt requested) to the Parties at their respective
addresses set forth in the preamble of this Agreement or to
such other address as the Party to whom notice is given may
have previously furnished to the other Parties in writing in
the manner set forth above. Any notice or communication
delivered in person shall be deemed effective on delivery. Any
notice or communication sent by telecopy or by air courier
shall be deemed effective on the first business day at the
place at which such notice or communication is received
following the day on which such notice or communication was
sent. Any notice or communication sent by registered or
certified mail shall be deemed effective on the fifth business
day at the place from which such notice or communication was
mailed following the day on which such notice or communication
was mailed.
13. PARTY'S RELATIONSHIP. Neither Party by this Agreement makes
the other Party its legal representative or agent. Neither
Party shall assign this Agreement to any other third party
without the other Party's prior written permission, except
that ECO and ECO Fuel Cells may assign it to a Cooperative
Member.
14. NO RIGHTS IN THIRD PARTIES. Nothing contained in this
Agreement shall be construed as giving rise to any rights to
enforce its provisions to any person or entity not a Party to
this Agreement under any legal theory.
15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original
as against any Party whose signature appears thereon, and all
of which shall together constitute one and the same
instrument. This Agreement shall become binding when one or
more counterparts hereof, individually or taken together,
shall bear the signatures of all the Parties hereon as
signatories.
16. SEVERABILITY. If any provision of this Agreement for any
reason shall be held to be illegal, invalid or unenforceable,
such illegality shall not affect any other provision of this
Agreement, but this Agreement shall be construed as if such
illegal, invalid or unenforceable provision had never been
included herein.
IN WITNESS WHEREOF the undersigned Parties hereby execute this
Agreement.
H POWER CORP. H POWER ENTERPRISES OF CANADA, INC.
/s/ Xxxxxxx X. Xxxx H. Xxxxx Xxxxxxx
----------------------------- -----------------------------------
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ECO FUEL CELLS, LLC ENERGY CO-OPPORTUNITY, INC.
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxxx X. Xxxxx
------------------------------------ ---------------------------------
Xxxxxxx X. Xxxxx, President & CEO Xxxxxxx X. Xxxxx, President & CEO
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ATTACHMENT A
SALES AND MARKETING SERVICES AGREEMENT
BETWEEN
ECO FUEL CELLS, LLC, ENERGY CO-OPPORTUNITY INC.
AND
H POWER CORP.
ATTACHMENT OF H POWER'S PAYMENTS TO EFC
Subject to the terms and conditions set forth in the Agreement, H Power shall
make the following payments to EFC:
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April-2002 Qtr 2-2002 Qtr 3-2002 Qtr 4-2002 SubTotal Qtr 1-2003 Qtr 2-2003 Qtr 3-2003
==================================================================================================================================
Sales and Marketing Services [*] [*] [*] [*] [*] [*] [*] [*]
Trade Show Displays and Staffing [*] [*] [*] [*] [*] [*] [*] [*]
==================================================================================================================================
TOTAL [*] [*] [*] [*] [*] [*] [*] [*]
----------------------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------
Qtr 4-2003 Totals
=============================================================
Sales and Marketing Services [*] [*]
Trade Show Displays and Staffing [*] [*]
=============================================================
TOTAL [*] $1,700,000
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* Confidential
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