CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS
([**]), HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED.
DISTRIBUTORSHIP AGREEMENT
THIS agreement (the "Agreement") is made as of the date set forth in the
schedule to this Agreement ("Schedule") by and between, Vitronic Machine Vision
Ltd., a Georgia limited partnership, having a place of business at 000 Xxxx Xxxx
Xxxxx, Xxxxxxxxxx, Xxxxxxxx, 00000 ("Vitronic"), and Xxxxxx Traffic Systems,
Inc., a Delaware corporation, having a place of business at 000 Xxxxxxxxx
Xxxxxx, Xxxxx 000, Xxxx Xxxxxxxxxx, XX 00000 ("Distributor" and together with
Vitronic, the "Parties" and each singularly a "Party") and relates to the
Vitronic products which are listed in the Schedule to this Agreement (the
"Products"). Whereas Distributor wishes to be appointed an exclusive distributor
for the Products in the Territory (as described in the Schedule), Distributor
and Vitronic intending to be legally bound agree as follows:
I. APPOINTMENT AND DUTIES OF DISTRIBUTOR.
A. Vitronic hereby appoints Distributor as an exclusive (as further set
forth in paragraph I.C.) distributor for the Products in the Territory and
Distributor hereby accepts such appointment.
B. The appointment of Distributor (i) is subject to the provisions of, and
except as provided in Paragraph VIII.F.; only for the term of, this Agreement,
(ii) is personal to Distributor and (iii) may not be assigned or transferred in
any way, in whole or in part except as provided in Paragraph IX.A. Each Party
agrees that it will at all times conduct itself in all material respects in
accordance with its warranties, duties and obligations set forth in this
Agreement (including the Schedule). All rights relating to the Products not
expressly granted by this Agreement to Distributor are reserved by Vitronic.
C. Except as set forth in Section I.D. hereof, Vitronic agrees that during
the term of this Agreement it will not appoint other distributors or sale
representatives or itself sell directly for or to any entities located in the
Territory.
D. Immediately upon written notice from Vitronic, the appointment of
Distributor shall become non-exclusive if Distributor within any twelve (12)
month period ending on December 31 during the term of this Agreement fails to
generate a turnover, defined as Products purchased and paid for, to Vitronic of
at least [**] USD in 2005, [**] USD in 2006, [**] USD in each 2007 and 2008 and
[**] USD in 2009.
E. Distributor agrees to perform the duties and obligations as further set
forth in the Schedule.
F. Vitronic will reasonably assist Distributor in obtaining such approval
and/or certification as required to market and sell the Products in the
Territory.
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II. PURCHASE OF PRODUCTS BY DISTRIBUTOR; PAYMENT AND RELATED MATTERS; THE
PRODUCTS.
A. All orders ("Orders") for, or purchases of, Products by Distributor
shall in all respects be governed by the procedures therefore set forth in the
Schedule. Upon reasonable request, Vitronic shall promptly provide to
Distributor a demonstration unit of each Product (the "Demonstration Unit").
Delivery of the Demonstration Unit to Distributor shall be paid for by Vitronic,
but all additional costs in connection with providing of the Demonstration Unit
including, but not limited to, installation, maintenance, service, etc. shall be
paid for by Distributor. Any Demonstration Unit may be used by Distributor for
demonstration purposes only and Distributor shall not acquire any rights or
interest whatsoever in any Demonstration Unit but such Demonstration Unit shall
at all times remain the sole property of Vitronic.
B. Except for any Demonstration Units as set forth in Paragraph II.A,
Distributor shall pay to Vitronic for each Product used or distributed by
Distributor the price as set forth in the Schedule. Said prices shall be
exclusive of all applicable sales, use, excise and other taxes (except those
which are solely measured by Distributor's income), insurance, shipping and
other charges of a similar nature whether currently imposed or applicable in the
future, all of which Distributor shall be liable for and all of which
Distributor shall be responsible for reporting and paying. Vitronic may, in its
sole discretion pay any such tax or other charge it reasonably believes is owing
and, in such case, Distributor shall reimburse, indemnify and hold Vitronic
harmless therefore. For all payments under any Order, a down payment of 30%
shall be due and payable upon Order acceptance. The remainder shall be due and
payable as may be agreed by the Parties at the time of Order acceptance or, in
the absence of such agreement, thirty (30) days after the date of the mailing of
the invoice therefore from Vitronic to Distributor, which invoice may not be
mailed prior to the shipment of all the Products to which it relates. If
Vitronic reasonably at any time deems itself insecure with regard to
Distributor's ability to the payment for any Orders, Vitronic may cancel the
Order upon written notice to Distributor or, at Vitronic's sole discretion, stop
shipment under the Order until payment is sufficiently secured to Vitronic.
Vitronic reserves the right to require further securities for payment if the
amount of outstanding invoices exceeds $200,000.00 in the aggregate at any time.
All payments shall be in U.S. Dollars and shall be in a form reasonably
acceptable to Vitronic. To the extent any amount to be determined under this
Agreement is to be initially calculated in any currency other than U.S. Dollars,
such amount shall be converted to U.S. Dollars using the applicable currency
conversion rate as published in the Wall Street Journal on the last business day
of the month immediately preceding the due date of the payment to be determined
from such amount. Any payment not paid when due shall bear interest at the rate
of one percent (1%) per month, compounded monthly or the maximum interest rate
permitted by law, whichever is lower.
C. Notwithstanding any language in this Agreement that could be interpreted
otherwise, any part of a Product which is software of a third party (the "Third
Party Software") is supplied by Vitronic only under the license of such third
party licensor. Any part of a Product which is software of Vitronic (the
"Vitronic Software") is supplied by Vitronic only under license for use by the
user thereof. (Third Party Software and Vitronic Software hereinafter
collectively referred to as "Software".) Distributor and Distributor's customers
are prohibited from using or duplicating any Software except as expressly
permitted in the applicable license(s) (the "Licenses") therefore which
accompany the Products and to which Distributor hereby agrees.
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D. All Products and all Product literature, manuals and other documents
relating to the use of the Products provided by Vitronic to Distributor shall be
in English. Samples of marketing documents may be in the manufacturer's
language. If and to the extent any customer in the Territories requires that any
Product or Product documents be in any language other than English, Distributor
shall be responsible and liable for the translation therefore; provided that any
such translation shall be subject to the advance written approval of Vitronic,
which approval may not be unreasonably withheld.
III. CONFIDENTIALITY.
A. Each Party acknowledges that the other Party (the "Disclosing Party")
may disclose to the other Party (the "Receiving Party") certain information,
data, software, and other material containing valuable trade secrets and other
proprietary information of the Disclosing Party. All such information, which (i)
if in writing or machine readable form, is marked confidential or (ii) if oral,
is summarized in a memorandum marked confidential and delivered by the
Disclosing Party to the Receiving Party within thirty (30) days of its initial
disclosure, is collectively referred to in this Agreement as the "Confidential
Material"; provided, however, for any Confidential Material to be subject to
this Paragraph III, the Disclosing Party shall have advised the Receiving Party
thereof in writing and the Receiving Party shall have agreed in writing to
receive it prior to its disclosure to the Receiving Party (this proviso shall
not apply to any Confidential Information listed in the Schedule). The Receiving
Party further acknowledges that unauthorized use or disclosure of the
Confidential Material could irreparably injure the Disclosing Party, which
injury may not be remedied solely by the payment of money damages, and agrees
that it will take commercially reasonable steps (which steps shall be no less
than those it uses with respect to its own information of like importance) to
hold in confidence and not to use or reproduce for any purpose whatsoever (other
than those contemplated by this Agreement), or to disclose any Confidential
Material with the exception of information: (i) which is already at the time of
disclosure or development in the public domain or thereafter becomes a part of
the public domain other than by action of the Receiving Party in violation of
this Agreement or (ii) which is received without restriction by the Receiving
Party from a third-party who had the right to disseminate it to the Receiving
Party or (iii) is independently developed by those of the Receiving Party's
employees who have not had access to the Confidential Material or (iv) the
disclosure or use of which is agreed to in writing by the Disclosing Party, but
then only to the extent so permitted or (v) which is (1) either non-technical
business information or technical information which is also applicable to the
Receiving Party's own products and (2) contained as "residuals" in the minds of
the Receiving Party's consultants, employees and officers after all written or
machine readable Confidential Material has been returned to the Disclosing Party
or irretrievably destroyed as provided in Paragraph IX. The Receiving Party may
disclose the Confidential Material only to those of its employees and
consultants who have a need to know the same as contemplated by this Agreement
and who are bound by confidentially agreements with the Receiving Party. The
Receiving Party agrees, at its expense, to take such steps as the Disclosing
Party may reasonably require to enforce those confidentiality agreements against
such employees and consultants (whether or not they are then an employee or
consultant of the Receiving Party) with respect to the Confidential Material.
B. Notwithstanding the foregoing, the Receiving Party may disclose
Confidential Material pursuant to governmental or judicial mandate, provided
that the Receiving Party (i) shall give reasonably prompt notice to the
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Disclosing Party of the receipt of such mandate prior to any disclosure thereof,
(ii) shall cooperate (at the Disclosing Party's cost and expense) with any
effort the Disclosing Party may take to limit or otherwise prevent such
disclosure and (iii) shall disclose only such Confidential Material as is
necessary to comply with such governmental or judicial mandate as the Receiving
Party is advised in writing by counsel. Any Confidential Material disclosed in
accordance with this Paragraph IIIB shall remain Confidential Material
notwithstanding any disclosure of it pursuant to this Paragraph.
C. Any Confidential Material delivered to the Receiving Party is and shall
remain the property of the Disclosing Party. Any documents containing or
reflecting the Confidential Material, and all copies thereof shall be promptly
returned to the Disclosing Party upon the termination of this Agreement, or
destroyed at the Disclosing Party's option, except to the extent such material
is necessary for the Receiving Party to exercise its post-termination rights
under Paragraph VIII.E., in which case it shall be returned or destroyed upon
the termination of such rights. It is understood that no license under any
patent, copyright, trademark or other proprietary right is granted or conveyed
by this Agreement. The disclosure of Confidential Material and related documents
shall not result in any obligation to grant the Receiving Party rights therein.
IV. TRADEMARKS, TRADE NAMES, PACKAGING AND ADVERTISING.
A. Distributor shall identify itself as an authorized Distributor of
Vitronic Products in connection with all its activities which are contemplated
by this Agreement. Vitronic hereby grants to Distributor during the term of this
Agreement a limited, non-transferable, exclusive and personal license (without
the right to sublicense) to use the trademarks, service marks and trade names
identified in the Schedule (the "Marks"), but only in connection with
Distributor's marketing and resale of the Products under this Agreement.
Distributor shall not use, directly or indirectly, in whole or in any part
thereof, Vitronic's name, or any trade name, trademark or service xxxx used or
owned by Vitronic prior to or subsequent to the term of this Agreement or as
part of Distributor's corporate or business name, domain name or in any other
manner not specified by this Agreement. Upon the expiration or termination of
this Agreement, Distributor shall have no further rights to use the Marks; and
at no time shall Distributor make any claim thereto or against the use thereof
by Vitronic or other duly authorized Distributors of the Products. Distributor
shall permit Vitronic to make reasonable quality control inspections, but
Vitronic shall not be liable to Distributor, Distributor's customers or others
for its failure to do so or for any defects which it discovers or could or would
have discovered by so doing.
B. Distributor agrees to prominently display the Marks on the Product, to
use the Marks in all promotional efforts of Distributor of the Products and not
to sell or market the Products under any trademark, service xxxx or trade name
other than the Marks.
C. Distributor shall not remove, deface or change, or cause to be removed,
defaced or changed, as the case may be, any Product literature supplied by
Vitronic or any labels, tags, packaging, serial numbers, notices, model numbers,
designations or other information or material of any kind affixed to or
incorporated in the Products by Vitronic. Distributor shall be responsible for
all advertising of the Products in the Territory, and all advertising copy,
ideas, campaigns, programs, in whatever form and in any media, including
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websites, undertaken by or on behalf of Distributor in the Territory and related
in any way or referring, in whole or in part, to the Products must be
specifically approved by Vitronic, in writing, prior to dissemination to the
public or any potential customer of Distributor. Notwithstanding the foregoing,
Vitronic may conduct such advertising and other publicity activities anywhere in
the world as it deems appropriate but at its own expense.
V. WARRANTIES AND REMEDIES.
A. Limited Warranty. Vitronic warrants that each Product, if properly used,
shall be free from defects in material or workmanship for a period of one (1)
year from the date of its shipment by Vitronic (the "Warranty Period").
Vitronic's sole and exclusive liability under this warranty (the "Limited
Warranty") will be, at Vitronic's option, to provide to Distributor the parts to
repair or replace, or credit Distributor with the price paid for, any Product
which fails during the Warranty Period provided (i) Distributor has in writing
reported same to Vitronic with an description of the deficiency, (ii) Vitronic
has reasonably determined such component to be defective and under warranty and
(iii) if applicable, such Product, or component, is returned to Vitronic under
the procedures set forth in the Schedule. This warranty does not cover Products
or parts of Products (i) which have been subjected to unusual physical or
electrical stress, (ii) on which the original identification marks have been
removed or altered, or (iii) which are damaged due to accident, misuse, neglect,
alteration, repair, improper installation or testing or unauthorized
modification unless caused or approved by Vitronic.
THE RIGHTS CONTAINED IN PARAGRAPHS V(A) and V(B) EXTEND ONLY TO
DISTRIBUTOR. THESE RIGHTS ARE DISTRIBUTOR'S SOLE AND EXCLUSIVE REMEDY, WHETHER
IN TORT, CONTRACT, OR OTHERWISE, AND THEY ARE IN LIEU OF, AND VITRONIC HEREBY
DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN,
WITH RESPECT TO THE PRODUCTS, INCLUDING, WITHOUT LIMITATION, ALL IMPLIED
WARRANTIES OF TITLE, NON-INFRINGEMENT, NON-INTERFERENCE WITH ENJOYMENT,
ACCURACY, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE AND ALL
WARRANTIES IMPLIED FROM ANY COURSE OF DEALING OR USAGE OF TRADE. DISTRIBUTOR
ACKNOWLEDGES THAT EXCEPT AS EXPRESSLY PROVIDED HEREIN NO OTHER WARRANTIES HAVE
BEEN MADE TO DISTRIBUTOR BY OR ON BEHALF OF VITRONIC OR OTHERWISE FORM THE BASIS
FOR THE BARGAIN BETWEEN THE PARTIES.
B. To the best of Vitronic's knowledge, the Products made available to
Distributor and the Marks under which the Products are marketed in the
Territory, do not violate any patents, trade secrets, trademarks, or other
proprietary rights of any other person or party in the Territory. Vitronic will
defend, indemnify, and hold harmless at its own expense any action brought
against Distributor or its customers to the extent that it is based on a claim
that any Product infringes on a patent, Marks, copyright or other right of a
third party cognizable in the Territory or issued by a patent and trademark
office elsewhere which is enforceable in the Territory, provided that (i)
Distributor promptly notifies Vitronic in writing of such claim (but failure to
give such prompt notice shall not be a disqualification to indemnification if
Distributor can show that such failure did not result in any prejudice to the
defense of the claim), (ii) Vitronic shall have the sole control of the defense
and settlement thereof and (iii) Distributor will, upon written request by
5
Vitronic, tender its defense of any such action to Vitronic. Distributor shall
upon Vitronic's request reasonably assist Vitronic in the defense of any such
action(s). Vitronic further agrees to use reasonable commercial efforts to
provide non-infringing products to Distributor. Vitronic shall in no event be
liable for lost profits or lost opportunity Distributor might have in connection
with any such action(s), but will remain liable for direct and indirect
out-of-pocket costs associated with termination or refunds on any customer
contracts. THE FOREGOING STATES THE ENTIRE LIABILITY OF VITRONIC WITH RESPECT TO
INFRINGEMENT OF PATENTS OR TRADEMARKS, IT BEING EXPRESSLY UNDERSTOOD THAT
DISTRIBUTOR SHALL HAVE NO OTHER REMEDIES AND VITRONIC SHALL HAVE NO OTHER
LIABILITIES TO DISTRIBUTOR EXCEPT AS NOTED IN THIS SECTION HEREINABOVE.
C. Each Party does hereby warrant that this Agreement has been duly and
validly authorized and executed by it and is its valid and binding obligation.
D. REGARDLESS OF WHETHER ANY REMEDY HEREIN FAILS OF ITS ESSENTIAL PURPOSE,
IN NO EVENT WILL VITRONIC BE LIABLE FOR ANY INDIRECT, PUNITIVE, INCIDENTAL,
SPECIAL, OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR RELATING IN ANY WAY TO THIS
AGREEMENT, THE PRODUCTS OR THE USE OF THE SAME (INCLUDING, WITHOUT LIMITATION,
DAMAGES FOR LOST INFORMATION, LOST SAVINGS, LOST PROFITS OR BUSINESS
INTERRUPTION), EVEN IF VITRONIC HAS BEEN INFORMED, IS AWARE, OR SHOULD BE OR
HAVE BEEN AWARE, OF THE POSSIBILITY OF SUCH DAMAGES. EXCEPT FOR BREACHES OF
PARAGRAPH V(B), IN NO EVENT WILL VITRONIC BE LIABLE IN DAMAGES OR OTHERWISE IN
EXCESS OF THE PURCHASE PRICE RECEIVED BY VITRONIC FROM DISTRIBUTOR HEREUNDER FOR
THE PRODUCT IN QUESTION.
VI. SOFTWARE MAINTENANCE.
During the term of this Agreement, Manufacturer shall deliver to
Distributor all error corrections and bug fixes, to the Vitronic Software (or
any part thereof) of the respective Product, and all related documentation that
are created or developed by or on behalf of Vitronic (collectively "Updates")
promptly upon their commercial release and free of charge. During the term of
this Agreement, Vitronic shall at all times offer to Distributor the newest
version of Vitronic Software, including software updates, new versions, new
releases or other updates for the Vitronic Software, other than error
corrections or bug fixes, for a reasonable purchase price/license fee, all
according to the terms of this Agreement. Notwithstanding the foregoing, the
term "Updates" shall not include any code or documentation (i) which Vitronic
developed for a third party, unless such code or documentation is then or
subsequently released commercially or (ii) the delivery or disclosure of which
to Distributor or Distributor's customers violates any applicable law, rule or
regulation or any contract to which Vitronic is bound. After termination of this
Agreement, Vitronic shall provide Updates to Distributor only so long as
Distributor is obligated to provide Updates to any customers of Distributor
during the term of this Agreement under an applicable License either (i)
existing as of the termination date or (ii) which pertains to a Product
Distributor has committed in writing on or before the termination date to sell
to a customer. All such Updates, whether developed by Vitronic or on its behalf,
6
shall be owned by Vitronic and shall be deemed licensed to Distributor and
Distributor's customers under the Licenses for the Product to which the Update
pertains.
VII. CONSULTING.
During the term of this Agreement, Vitronic shall provide such consulting
services to Distributor in connection with the Products as Distributor may
reasonably request (the "Services"). All Services shall be provided to
Distributor at Vitronic's then current rates (for time and expenses) for such
Services and in accordance with Vitronic's procedures and policies for providing
such Services. After termination of this Agreement, Vitronic shall have no
further obligation to provide the Services to Distributor.
VIII. TERM; EXPIRATION OR TERMINATION.
A. Unless previously terminated, the initial term of this Agreement shall
commence on the date hereof and expire on a date five (5) years from the date
hereof. Thereafter, the term of the Agreement shall continue from year to year,
unless terminated by either Party (i) on written notice given at least ninety
(180) days in advance of the first day of any such renewal year or (ii) as
otherwise provided in this Agreement. The initial term and all renewal terms, if
any, shall constitute the term of this Agreement.
B. This Agreement shall immediately terminate if (i) Distributor
liquidates, dissolves, or shall be adjudicated insolvent, or files a petition in
bankruptcy or for reorganization, or takes advantage of any insolvency act or
proceeding, including an assignment for the benefit of creditors, or commits any
other act of bankruptcy; or (ii) a controlling interest in or substantially all
of the assets of Distributor is transferred without the prior written consent of
Vitronic, not to be unreasonably withheld.
C. Either Party may terminate this Agreement by written notice to the other
Party, if such other Party shall default in the payment or performance of any of
its obligations under this or any other agreement between the Parties (whether
in force prior to or subsequent to the date of this Agreement) and such default
continues for at least thirty (30) days after notice thereof. Vitronic shall
have the right to suspend its performance hereunder, if Vitronic learns of any
information which, in Vitronic's sole reasonable judgment, indicates that
Distributor is unwilling or unable to comply with its obligations under this
Agreement.
D. If pursuant to Paragraph I.C the distributorship is made non-exclusive,
this Agreement may be terminated by Vitronic upon ninety (90) days advance
written notice.
E. Notwithstanding any termination or expiration of this Agreement,
Distributor shall remain liable to Vitronic for payments validly accruing with
respect to Products previously delivered to Distributor. Termination of this
Agreement by expiration or otherwise shall not release either Party from any of
its obligations or liabilities accrued or incurred hereunder, or except as
expressly provided in this Agreement, rescind or give rise to any right to
rescind any payment made or other consideration given to either hereunder. Upon
termination or expiration of this Agreement, Distributor shall immediately cease
all marketing and other activities relating to the Products and Vitronic shall
repurchase all new, undamaged and unsold Products in Distributor's possession.
However, notwithstanding any such termination or expiration and cessation, and
7
provided that Distributor is not in default of this Agreement, Distributor may
continue to (i) use, sell and/or install Products it has in inventory or for
which it has on or before the termination or expiration date entered into a
contract or accepted a quotation (in which later case such Product shall be
supplied to Distributor by Vitronic at Distributor's request and Order) and (ii)
provide spare parts and service with respect to the Products delivered prior to
termination or expiration or pursuant to the preceding clause (i).
Notwithstanding such termination or expiration, all applicable provisions of the
Agreement shall apply to such transactions by Distributor. Any repurchases of
Product by Vitronic shall be at the prices originally charged therefore and
Vitronic shall be responsible for return shipping.
F. Upon any expiration or termination of this Agreement, the following
provisions will survive: Section III, Section V, Section VIII.E. (and any other
provision of this Agreement necessary or desireable for Distributor to exercise
its rights under Section VIII.E), and Section IX.
IX. MISCELLANEOUS.
A. Neither this Agreement, nor any interest hereunder, shall be assignable
by either Party without the consent of the other Party. Subject to the
foregoing, this Agreement shall inure to the benefit of and be binding upon the
Parties' successors. The Parties are independent contractors and engage in the
operation of their own respective businesses. Neither Party is the agent or
employee of the other Party for any purpose whatsoever. Nothing in this
Agreement shall be construed to establish a relationship of co-partners or joint
ventures between the two Parties. Neither Party has the authority to enter into
any contracts or assume any obligations for the other Party or to make any
warranties or representations on behalf of the other Party.
B. The headings and captions used in this Agreement are for convenience
only and are not to be used in the interpretation of this Agreement. If any
provision of this Agreement is, or is determined to be, invalid, illegal or
unenforceable, all remaining provisions of this Agreement shall nevertheless
remain in full force and effect, and no provision of this Agreement shall be
deemed to be dependent upon any provision so determined to be invalid, illegal
or unenforceable unless otherwise expressly provided for herein. Should any
provision of this Agreement be found or held to be invalid, illegal or
unenforceable, in whole or in part, such provision shall be deemed amended to
render it enforceable in accordance with the spirit and intent of this
Agreement. This Agreement has been entered into, delivered and is to be governed
by, construed, interpreted and enforced in accordance with the laws of the State
of Delaware(without giving reference to choice-of-law provisions) from time to
time in effect. The United Nations Convention on Contracts for the International
Sale of Goods shall not apply to any of the transactions contemplated by this
Agreement. Distributor hereby acknowledges, covenants and agrees that Vitronic's
execution of this Agreement and any and/or all of Vitronic's activities
contemplated by this Agreement shall not constitute, either individually or
taken in whole or in part, submission by Vitronic to the jurisdiction of any
country or State in the Territory, as the case may be, or to any court located
therein, except as provided in Paragraph IX.D. below.
C. The failure of either Party to require performance of any provision of
this Agreement shall not affect the right to subsequently require the
performance of such or any other provision of this Agreement. The waiver of
8
either Party of a breach of any provision shall not be taken or held to be a
waiver of any subsequent breach of that provision or any subsequent breach of
any other provision of this Agreement. This Agreement contains the entire and
exclusive agreement of the Parties with respect to its subject matter. This
Agreement supersedes any agreements and understandings, whether written or oral,
entered into by or between any of Xxxxxx and Vitronic prior to its effective
date and relating to its subject matter. No modification or amendment of this
Agreement shall be effective unless it is stated in writing, specifically refers
hereto and is executed on behalf of each Party.
D. Any dispute, controversy or claim arising out of or relating to this
Agreement or a breach thereof, shall be settled by arbitration before three
neutral arbitrators (selected from a panel of persons having experience with and
knowledge of computer or other electronics businesses, all of whom shall be
attorneys), and shall be in Dover, Delaware, and shall be administered by the
American Arbitration Association in accordance with its Commercial Arbitration
Rules. Any provisional or equitable remedy which would be available from a court
of law shall be available from the arbitrators to the Parties. In any such
proceeding limited civil discovery shall be permitted for the production of
documents. All issues regarding discovery requests shall be decided by the
arbitrators. Judgment upon the award of the arbitrators may be enforced in any
court having jurisdiction thereof. The Parties hereby consent to the
non-exclusive jurisdiction of the courts of the State of Delaware or to any
Federal Court located within the State of Delaware for any action (i) to compel
arbitration, (ii) to enforce the award of the arbitrators or (iii) prior to the
appointment and confirmation of the arbitrators, for temporary, interim or
provisional equitable remedies and to service of process in any such action by
registered mail, return receipt requested, or by any other means provided by
law.
E. Except as otherwise specified, all notices, payments and reports
hereunder shall be deemed given and in effect as of the date of mailing or
transmission, as the case may be, when sent by next day delivery or courier
service or, in the cases of notices and reports, by fax (with confirmation by
first class mail, postage pre-paid), addressed to the Parties or to such other
addresses as the Parties may from time to time give written notice of as herein
provided at the address shown in the Preamble to this Agreement for such entity,
Attn: President.
F. Vitronic GmbH, a German corporation, having a place of business at
Xxxxxxxxxxxxxx. 00, 00000 Xxxxxxxxx, Xxxxxxx, agrees to not appoint distributors
other than Vitronic for distribution of, nor to directly sell, the Products in
the Territory for as long as Distributor's rights under this Agreement remain
exclusive.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, the Parties hereto have set their hands by their
duly authorized representatives as of the day and year first above written.
VITRONIC, INC. as General Partner XXXXXX TRAFFIC SYSTEMS, INC.
of VITRONIC Machine Vision Ltd.
By: /s/ Xxxxxxx Xxxxx By: /s/Xxxxx X. Xxxxxxx
----------------------------- -----------------------------
Name: Xxxxxxx Xxxxx Name: Xxxxx X. Xxxxxxx
Title: President Title: President & CEO
(Authorized Signature) (Authorized Signature)
For the sole purpose of evidencing Vitronic
GmbH's agreement to Section IX.F of this
Agreement:
VITRONIC GMBH
By: /s/ Xxxxxxx Xxxxx
-----------------------------
Name: Xxxxxxx Xxxxx
Title: President
(Authorized Signature)
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SCHEDULE
A. THE DATE of this Agreement is: August 17, 2004
B. TERRITORY:
Territory is Xxxxx Xxxxxxx (Xxxxxx Xxxxxx xx Xxxxxxx, Xxxxxx and
Mexico)
C. PRODUCTS shall mean only the following products and any future products of
Vitronic which are (i) future versions of such products or (ii) the same or
substantially the same as such products, but in any such case only so long
as they are marketed by Vitronic:
VITRONIC PRODUCTS
Poliscan - speed
Other Vitronic products for traffic applications like Poliscan -
surveillance or Poliscan - digital will be offered to the distributor
for sale and use in his territory on a non - exclusive basis.
D. CONFIDENTIAL MATERIAL. The following information shall be deemed
Confidential Material subject to Paragraph III:
Belonging to Vitronic: To be Identified
Belonging to Xxxxxx: To be Identified
E. DISTRIBUTOR'S DUTIES AND OBLIGATIONS
Distributor agrees that:
1. it (i) has sufficient experience, personnel and resources, and will use
its reasonable business efforts, to promote, advertise, and market the Products
including, but not limited to, production and distribution of marketing
material, and developing and maintaining customer contacts, and (ii) will
concentrate all such marketing efforts to customers located in the Territory;
2. it (i) will include in its agreements with its customers such
disclaimers of Vitronic's warranty obligations and damages payable by Vitronic
as Vitronic may from time to time and at any time request and (ii) shall be
solely and exclusively responsible for all Product warranties or guarantees of
any kind whatsoever made by Distributor to its customers beyond Vitronic's
warranty. (Nothing in this Agreement is intended to or shall effect or restrict
the price Distributor charges to its customers for any of the Products or any of
the services set forth in paragraph 6 below);
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3. it will inform its customers that their use of the Products is
conditioned on and subject to their express agreement to the Licenses;
4. it (i) will not infringe Vitronic's or any third parties copyright or
other proprietary rights in the Vitronic Software and the Third Party Software
(collectively the "Software"), (ii) is prohibited from creating derivative works
from, or disassembling, decompiling, or otherwise "reverse engineering" any part
of any Software for any purpose, except and then only to the extent that any
such activity is expressly permitted by applicable law notwithstanding this
limitation, and (iii) will not reproduce or modify any Product except to make
one archival back-up of any copy of the Software or as is contemplated by this
Agreement or any manual or documentation relating to the Products (including but
not limited to the Program Literature as hereinafter defined);
5. it and its personnel will use reasonable commercial efforts to and its
personnel shall successfully complete such training on the marketing, use,
configuration, installation and servicing of the Products as Vitronic may, from
time to time and at any time during the term of this Agreement, reasonably
require;
6. it will (i) provide to its customers such configuration, installation,
warranty, maintenance, training and support for all Products as are commercially
reasonable and/or, at a minimum, materially as specified in Vitronic's Program
Literature on Sale, Support and Installation (the "Program Literature") for the
Product in question, all of which services shall be at Distributor's own cost,
risk and obligation and (ii) inform its customers that such services are offered
on Distributor's own account and that Distributor is solely liable for them;
7. it will use reasonable commercial efforts to comply with any Program
Literature which Vitronic may establish (which Program Literature Vitronic
reserves the right to amend from time to time and at any time);
8. it does not intend to and will not use, market, distribute, export,
re-export, sell, ship or transfer the Products in violation of any applicable
law, rule or regulation of the United States, or any State of the United States
or any foreign country of applicable jurisdiction (including without limitation
any United States law, rule or regulation relating to technology export or
transfer) and it specifically agrees that it will not market, distribute,
export, re-export, sell, ship or transfer any Product: (i) outside the
Territory; (ii) to any end-user who Distributor knows or has reason to know will
utilize the Product or portion thereof in the design, development or production
of nuclear, chemical or biological weapons; or (iii) to any end-user who has
been prohibited from participating in U.S. export transactions by any federal
agency of the U.S. government;
9. it will not accept any purchase order or contract (including without
limitation any United States or foreign government contract) that by its terms
or by the operation of law will abridge Vitronic's proprietary rights in and/or
to the Products;
10. all of the foregoing shall be at Distributor's cost.
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11. Distributor shall not, within the Territory, sell, distribute, market
or otherwise deal in any product which is substantially similar or comparable to
any Product or is considered by users to be similar to any Product in terms of
its characteristics, price and intended use or application. The term
"substantially similar or comparable" is agreed to mean a LIDAR based speed
enforcement product.
12. Distributor's failure to substantially and materially conduct its
activities at a minimum in accordance with the foregoing duties and obligations
shall constitute a material breach of this Agreement.
F. PROCEDURES FOR ORDER, PURCHASE OR WARRANTY RETURN OF PRODUCTS:
1. All orders by Distributor shall be initiated by Distributor sending to
Vitronic an executed copy of a Distributor purchase order in which Distributor
shall specify the specific quantity and type of Product ordered and the desired
delivery date(s) therefore (an "Order"). All Orders must fully comply with all,
and may not amend or supplement any, of the terms and conditions of this
Agreement. If Vitronic accepts an Order containing terms or conditions which
amend or supplement this Agreement, it is done as an accommodation only and such
acceptance is expressly conditioned on Distributor's agreement made hereby that
any such terms and conditions shall be null and void and of no effect.
2. Vitronic agrees to ship all Products as set forth in any duly and
validly executed Order. All shipments by Vitronic are F.O.B. point of shipment
which shall be a location in the United States. Vitronic shall not be required
to ship any Products to a location outside the United States, and any further
shipment to or for a customer located outside the United States shall be the
responsibility of Distributor. Title (except for Software) and risk of loss to
all Products pass to Distributor upon their delivery to the carrier at the point
of shipment. Vitronic, unless otherwise instructed in writing, will select the
carrier on behalf of Distributor, but will not thereby assume any liability in
connection with the shipment nor will the carrier be construed as Vitronic's
agent. Claims for shortages or damage caused in transit must be made to the
carrier. Other shortage or damage claims may be rejected by Vitronic unless such
claims are received by Vitronic in writing within a commercially reasonable
time, not exceeding ten (10) days, after delivery of the Products to Distributor
and Vitronic is given a reasonable opportunity to inspect the shipment in
question. Use of the Products by Distributor or the customer prior to such
inspection by Vitronic shall constitute acceptance of the Products and waiver of
all claims.
3. If, at any time prior to the sixty (60) days period preceding the
scheduled shipment by Vitronic of an accepted Order, Distributor may cancel said
Order without charge.
4. If any Product is to be returned to Vitronic for warranty replacement or
repair, Distributor must obtain a Vitronic Return Material Authorization prior
to returning it. All replaced Products or parts will become Vitronic's property.
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G. PRICES AND DISCOUNT: See Exhibit I attached to the Agreement.
H. TRADEMARKS, SERVICE MARKS AND TRADE NAMES:
The trademarks, service marks and trade names of Vitronic which Distributor is
licensed to use in connection with its activities as contemplated by this
Agreement are: To be Identified
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EXHIBIT I
PRICES AND DISCOUNT:
1. Except as hereinafter set forth, the prices charged to DISTRIBUTOR for
any Product shall be at the discount set forth below from the suggested list
price for that Product as set forth in VITRONIC's Price Guide as in effect at
the time of the Order in question. VITRONIC shall have the right at any time and
from time to time to revise or amend the prices in (euro) (EURO) due hereunder;
provided that (i) such revision or amendment, if an increase, applies to
VITRONIC GmbH's price guide generally and not just to DISTRIBUTOR, (ii) VITRONIC
gives DISTRIBUTOR thirty (30) days' advance written notice of the date on which
such revision or amendment will be effective with respect to DISTRIBUTOR and
(iii) no such revision or amendment shall affect any Products for which
DISTRIBUTOR has previously paid VITRONIC. If DISTRIBUTOR has previously agreed
in a binding order contract or quotation to deliver to a customer at a fixed
price in a period less than or equal to one year (which contracts or quotations
are identified by DISTRIBUTOR to VITRONIC in writing within thirty (30) days of
the date VITRONIC sent the pricing notice in question to DISTRIBUTOR). VITRONIC
shall charge the previously agreed price for the systems of this binding
contract or quotation.
2. In any such price change notice, VITRONIC shall provide to DITRIBUTOR,
the reason for price changes in question. If the maximum price increase in % is
higher than twice the U.S. inflation rate in % for the time period since the
last price change, DISTRIBUTOR may terminate this agreement without any
liability to itself. To do so, DISTRIBUTOR shall send VITRONIC thirty (30) days
advance written notice of termination, which notice shall include the US
inflation rate for that period in question. If VITRONIC within that thirty (30)
day period notifies DITRIBUTOR that it has reduced the prices in question so
that the change is no more than twice the US inflation rate, the termination
notice will be of no effect. All prices and price changes are based on EURO. US
Dollar - EURO currency fluctuations are not judged as price changes. Invoices
will be in US Dollar, based on the actual currency rate as determined in
accordance with the provisions of this Agreement.
3. DISTRIBUTOR will get a [**] discount to the prices of the official price
list of VITRONIC GmbH, Germany for end customer sales in Europe, the current
version of which is attached as Exhibit I. The discount is based on at least
five systems (a mix of Poliscanspeed products is possible) per order and
delivery, but this requirement shall not apply to the first five (5) systems
ordered. Prices do not include at site certification costs in the Territory.
These costs will be covered directly by DISTRIBUTOR.
4. In addition, shortly after signing the contract, DISTRIBUTOR will get a
Demo unit for free of charge lease. This Demo unit may have some reasonable
restrictions depending on the actual status of Soft- and Hardware. This unit
will also be used for certification purposes in the Territory.
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VITRONIC GmbH Official Price List for Europe Rev. 1. , Aug. 10. 2004
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Product Description Price per Unit Available
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Poliscan(speed) mobile, 2 Lane speed enforcement (EURO) 49,000.00 Serial units (Territorial
Including 2 Cameras and flashlight Certification may not be
For applications where no drivers photo is required completed): 2. half of
Including GUI - (Input station) -Software Q 4/2004
Excluding the GUI - Station (Notebook) Excluding
automatic Licence plate ID Excluding options
like Tripod, car installation equipment
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Poliscanspeed as an option 2 Lane speed enforcement at crossings, one approach (EURO) 34,000.00 Serial units (Territorial
to Red Light Systems, Excluding Cameras and flashlight Certification may not be
(Red light enforcement cameras can be used)
completed): Q 1/2004 For applications where no
drivers photo is required Including GUI - (Input
station) -Software
Excluding the GUI - Station (Notebook)
Excluding Cables for Road side Installation
Excluding automatic Licence plate ID
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Poliscan(speed) as an option 4 Lane speed enforcement at crossings, one approach (EURO) 49,000.00 Serial units (Territorial
to Red Light Systems, Excluding Cameras and flashlight Certification may not be
(Red light enforcement cameras can be used)
completed): Q 1/2004 For applications where no
drivers photo is required Separate housing for
each 2 lanes Including GUI - (Input station)
-Software
Excluding the GUI - Station (Notebook)
Excluding Cables for Road side Installation
Excluding automatic Licence plate ID
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Prices for NTS: [**] discount on all these prices.
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