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EXHIBIT 10.5
SALES AGREEMENT
This Sales Agreement, hereinafter called "Sales Agreement," made by and
between Xxxxxx.xxx, Inc., a Delaware corporation (hereinafter called
"Purchaser"), and The Xxxxxxxx Company, an Ohio corporation (hereinafter called
"Seller"), constitutes the agreement of the parties as follows:
A) CONTRACT DOCUMENTS
In addition to the Standard Terms and Conditions set forth in Part B
below, the following documents ("Additional Contract Documents") are also part
of this Sales Agreement and are hereby incorporated by reference herein. To the
extent any such Additional Contract Document contains any term or condition
inconsistent with the Standard Terms and Conditions below, the Standard Terms
and Conditions shall govern. The Additional Contract Documents, copies of which
are appended hereto, are as follows:
1. The Standard Proposal for Xxxxxx.xxx, Inc. dated February 5, 1999,
except that Section 4 thereof is hereby deleted and replaced in its entirety
with the pages attached to this Sales Agreement as Attachment 1, and that for
purposes hereof such proposal shall apply to "Site C" yet to be determined
(including and as amended by such amendments thereto as may later be
specifically agreed in writing(s) signed by both Seller and Purchaser from time
to time, the "Proposal").
B) STANDARD TERMS AND CONDITIONS
ARTICLE 1. DEFINITIONS
When used in this Sales Agreement, the capitalized terms listed below
shall have the following meanings:
"Acceptance" shall mean the mutual agreement between the parties in
writing that (i) all Work has been completed (except for minor punch list items
or claims of non-material deficiencies in the Work), (ii) all Equipment has been
delivered to Purchaser and properly installed at the Worksite or stored at the
Worksite, as applicable, and (iii) the Equipment successfully meets all elements
of the Acceptance Test.
"Acceptance Test" shall mean the terms and conditions under which
Purchaser will accept tender of the Equipment, including the criteria concerning
the design, engineering, performance, functional, feature, and other
specifications or requirements which the Equipment must meet in order to be
accepted, all as agreed in the Proposal and/or the Specifications.
"Affiliate" shall mean, (i) with respect to Seller, any corporation,
partnership or other entity that is in or under the control of Seller, and to
the extent specified in the Proposal, any
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corporation, partnership or other entity that is under the control of Seller's
parent corporation, Pinnacle Automation Company, Inc., and (ii) with respect to
Purchaser, any corporation, partnership or other entity that controls, is
controlled by, or is in or under common control with, Purchaser. For purposes of
this definition, "control" means, with respect to a corporation, partnership or
other entity, the beneficial ownership of ownership, profits, voting or similar
interests (including any right or option to obtain such an interest)
representing at least 50% of the total interests of the pertinent entity then
outstanding, or the possession, directly or indirectly, of the power to direct
or cause the direction of the general management and policies of such
corporation, partnership or other entity, whether through the ownership of
voting securities, by contract or otherwise.
"Equipment" shall mean all the equipment, machinery, parts, vendor
components, Software, and other goods and items intended to be installed at the
Worksite pursuant to this Sales Agreement, excluding for the avoidance of doubt,
Seller's tools, equipment and other items which are not deliverables under the
Proposal.
"Maintenance or Software Support Agreement" shall mean any agreement
that may be entered into between Purchaser and Seller or any of Seller's
Affiliates pertaining to the maintenance and/or support of the Equipment.
"Proposal" shall have the meaning ascribed to it under Article A hereof.
"Purchase Price" shall mean the total compensation to be paid to the
Seller in consideration for the sale of the Equipment and the performance of the
Work (which may include, without limitation, the installation of the Equipment)
as set forth in the Proposal.
"Sales Agreement" shall have the meaning ascribed to such it in the
preamble and Article A hereof, and including, without limitation, all
Specifications.
"Seller Equipment" shall mean all Equipment which is not Third-Party
Equipment.
"Seller Software" shall mean all Software which is not Third-Party
Software.
"Seller's Plant" means any plant or facility (i) at which any Seller
Equipment is designed, developed, made, inspected or tested by or for Seller or
(ii) at which any Equipment is stored by or for Seller, as applicable.
"Software" shall mean all computer programming code or programs, in
machine readable object code form, that is developed or furnished by or on
behalf of Seller or any of Seller's Affiliates as a deliverable to Purchaser, or
caused to be developed or furnished by Seller or any of Seller's Affiliates to
Purchaser as a deliverable under this Sales Agreement, and all Upgrades thereto.
For the avoidance of doubt, "Software" shall not include any Source Code.
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"Source Code" shall mean, with respect to Seller Software, (i) the
human-readable form of computer programming code thereof as prepared and written
by the programmer(s) who developed the Seller Software, together with (ii) any
build tools (e.g. compilers, linkers and other related tools), compile/link
scripts, program comments, installation scripts and related system
documentation, including all comments and any procedural code such as job
control language, necessary for any reasonably skilled programmer to recompile
such source code into fully functioning object code of the Seller Software, to
the extent that the items listed in this clause (ii) exist.
"Specifications" shall mean the design, engineering, performance,
functional and other criteria, feature descriptions and other specifications or
requirements for any Equipment and/or Work that are contained in this Sales
Agreement, including, without limitation, the Proposal, or in any documents
contemplated hereby or thereby or other documents delivered by Seller pursuant
hereto or thereto and in each case agreed to by Purchaser.
"Third-Party Hardware" shall mean that portion of the Equipment which is
not developed, manufactured or owned by on behalf of Seller or any of Seller's
Affiliates, provided that the same is identified as "Third-Party Hardware" in
the Proposal, and provided further however that "Third-Party Hardware" shall not
include any Third-Party Software. To the greatest extent possible, Third-Party
Hardware manufacturers shall be identified in the Proposal.
"Third-Party Software" shall mean that portion of the Software which is
not developed, manufactured or owned by on behalf of Seller or any of Seller's
Affiliates, provided that the same is identified as "Third-Party Software" in
the Proposal. To the greatest extent possible, Third-Party Software
manufacturers shall be identified in the Proposal.
"Upgrade" shall mean each and every revision, enhancement, modification,
amendment, upgraded version and future release of the Software (including,
without limitation, versions and releases correcting programming errors, beta
versions as well as versions containing materially increased functionality)
delivered by Seller or any of its Affiliates to Purchaser pursuant to this Sales
Agreement or any Maintenance or Software Support Agreement.
"Work" shall mean all the Equipment and other items (including without
limitation, materials, supplies, drawings and data), and manufacturing,
installation, integration and other services, to be supplied or performed by or
on behalf of Seller hereunder.
"Worksite" shall mean the location or destination where the Equipment is
to be installed or, in the case of purchases of Equipment for storage and later
installation, stored, as applicable.
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ARTICLE 2. PERMITS; COMPLIANCE WITH LAWS
Prior to the installation of the Equipment, Purchaser shall procure and
pay for all building, erection and other licenses, permits, authorizations and
inspections required in connection with the Worksite, excepting Seller's Plant.
Seller shall be responsible for the procurement of and payment for all other
licenses, permits, authorizations and inspections associated with the Work.
Seller shall comply, and shall cause all of its consultants and subcontractors
to comply, with building, electrical or other laws, codes or regulations of
local, state or federal agencies or authorities in regard to the Work, and shall
otherwise comply with all other applicable laws, regulations, rules, orders and
other requirements of governmental authorities having jurisdiction with respect
to the Equipment or Seller's performance of the Work.
ARTICLE 3. INTELLECTUAL PROPERTY INDEMNIFICATION
Seller shall defend, indemnify and hold Purchaser and its Affiliates
harmless from and against any and all expenses, costs, claims, demands, causes
of action and damages of whatever kind which Purchaser may incur in connection
with any suit or claim of infringement of any patent, copyright or trademark, or
misappropriation of any trade secret or other intellectual property right
resulting from (i) Purchaser's or its Affiliates' use of any portion of the
Equipment as contemplated in the Proposal and otherwise in accordance with this
Sales Agreement or applicable Equipment documentation delivered by Purchaser by
Seller hereunder, or (ii) performance of the Work, except, in each case with
respect to each of the foregoing clauses (i) and (ii), to the extent directly
attributable to Third-Party Hardware or Third-Party Software. Seller shall
receive written notice from Purchaser within ten (10) days after proper legal
service is received by Purchaser of any such suit or claim, provided that
failure to receive such notice shall not relieve Seller of its obligations under
this Article 3 except to the extent that Seller's ability to defend such suit or
claim is materially impaired due to such failure. Seller is hereby authorized by
Purchaser to, at Seller's expense, appear in and assume the defense of, and be
given the complete control of the settlement of, any such suit or claim;
provided that (a) if Purchaser or any of its Affiliates wishes to participate in
the defense and settlement of the claim, Purchaser or any of its Affiliates may
do at its own cost, (b) Purchaser is kept timely informed of all material
actions taken by Seller in connection with any such settlement, suit or claim
(including, without limitation, of settlement offers and responses (to the
extent the delivery of such information does not require Seller to waive work
product immunity or attorney/client privilege or otherwise violate the terms of
any protective order between Seller and any third party plaintiff or
defendant)); and (c) Seller shall not enter into or acquiesce to any settlement
admitting to or stipulating to any guilt, fault, liability or wrongdoing on the
part of Purchaser or any of its Affiliates without Purchaser's prior written
consent. In the event that Purchaser's right or ability to use the Equipment is
threatened or impaired as a result of any such suit or claim, Seller shall, at
its own expense, do one of the following, (1) diligently procure for Purchaser
the right to continue using the Equipment, or (2) modify the Equipment or, if
necessary and
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by mutual agreement, substitute functionally equivalent Equipment, to the extent
necessary to avoid infringement or misappropriation; provided in each case that
if such modified or substituted equipment fails to comply with all
Specifications applicable to the original, unmodified Equipment, Purchaser shall
be entitled to equitable compensation with respect to such noncompliance. Seller
hereby assigns to or otherwise transfers to the benefit of Purchaser all of its
right, title and interest in and to any intellectual property right infringement
or misappropriation indemnification or defense rights Seller may have with
respect to Third Party Software and Third Party Hardware, and will, at its
expense, take any actions as may be necessary to enable Purchaser to exercise
such rights and realize such benefit to the fullest extent possible. It is
mutually agreed that the provisions set forth herein are Seller's only
obligations with respect to infringement of any patent, copyright or trademark,
or misappropriation of any trade secret or other intellectual property right.
ARTICLE 4. LABOR AND PERSONNEL
Seller shall furnish all labor and personnel required for the
installation of the Equipment at the Worksite. All Work (including without
limitation all labor and other services) will be performed in a timely,
first-class and professional manner. All labor and personnel performing Work at
the Worksite (excluding Seller's Plant) shall comply with Purchaser's or its
Affiliates then-applicable policies, rules and regulations with respect to such
Worksite. If labor or personnel performing Work hereunder fail to so comply with
such policies, rules and regulations, or otherwise fail to perform Work in a
timely, first-class and professional manner, Purchaser in its discretion may
request removal of any such labor or personnel, and Seller shall remove such
labor or personnel from the applicable Worksite in accordance with each such
request. Seller will manage the transition of replacement personnel to minimize
impact on the project. Seller will be responsible for all acts, omissions,
negligence and misconduct of labor or personnel performing Work. For the
avoidance of doubt, Seller's subcontractors, as more fully discussed in Article
5 hereof, are labor and personnel for purposes of this Article 4.
ARTICLE 5. SUBCONTRACTORS AND ASSIGNMENTS
(a) Seller may assign or subcontract any of its obligations under this
Sales Agreement to any supplier, builder or other contractor which Seller, in
its good faith discretion, reasonably considers qualified; provided, however,
that (i) Seller may not so assign or subcontract any of its obligations under
this Sales Agreement to any contractor which will perform Work or supply
Equipment hereunder representing in excess of twenty percent (20%) of the
Purchase Price without the Purchaser's prior written consent (which consent may
be evidenced by Purchaser's written acceptance of Seller's Proposal to the
extent such Proposal clearly identifies such potential subcontractor and the
scope of Work it will perform), and (ii) in any event Seller remains primarily
liable for the performance of all of Seller's obligations under the terms and
conditions of this Sales Agreement. The restriction set forth in clause (i) of
the proviso of the preceding sentence does not apply to Seller's procurement of
raw materials or purchases of goods or other Equipment components from
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Seller's routine vendors and subcontractors from whom Seller routinely procures
the same as part of its standard manufacture of Equipment.
(b) Except as provided in Article 5(a), neither Seller nor Purchaser may
assign their respective rights to or delegate their duties arising from this
Sales Agreement without the prior written consent of the nonassigning or
nondelegating party, which consent shall not be unreasonably withheld; provided,
however, that, if Seller or Purchaser consents to any assignment or delegation,
the assignee or delegatee shall, as a condition to such assignment or
delegation, agree to be subject to the terms and conditions of this Sales
Agreement. Notwithstanding the foregoing, Purchaser may assign this Sales
Agreement to any of its Affiliates or in connection with any merger,
consolidation, reorganization, sale of all or substantially all of its assets or
similar transaction without the prior written consent of Seller; provided that
the assignee or delegatee is financially capable of performing its obligations
hereunder and/or Purchaser remains primarily liable for the performance of all
of Purchaser's obligations under the terms and conditions of this Sales
Agreement.
ARTICLE 6. TAXES
Unless otherwise indicated, the Purchase Price contains no provision for
sales, use, excise, or other similar taxes. It is Purchaser's responsibility to
pay any such taxes should they be levied upon Seller. If such taxes are included
as part of the Purchase Price and the rate or base of the tax is increased or
decreased, or if Seller receives any tax credits related to the Work, Purchaser
will pay any such increased taxes and Seller will give credit for any tax
decrease or credit. Seller will pay any taxes specified in this paragraph and be
reimbursed by Purchaser within thirty (30) days after receipt at the address
specified in Article 11(e) of a separate invoice therefor from Seller. Purchaser
shall be solely responsible for the prompt payment of any and all personal
property taxes of any kind that may become due or payable with respect to the
Equipment at any time following delivery thereof to the Worksite. For the
avoidance of doubt and notwithstanding any other provision of this Sales
Agreement, (a) in no event shall Purchaser have any liability or obligation to
(i) pay taxes in respect of Seller's income or gross revenues, or (ii) reimburse
Seller for or otherwise pay any taxes with respect to which Purchaser is exempt
and Purchaser provides Seller a certificate of exemption, and (b) should
Purchaser challenge any taxes specified in this paragraph, Seller will at its
expense provide Purchaser with reasonable assistance in so challenging the same
and, if Seller receives funds or credits in connection with any such contest,
promptly refund the amount of such refund or credit to Purchaser.
ARTICLE 7. INSPECTION; SHIPMENT; REJECTION
Seller will furnish Purchaser, upon its request, with safe and
sufficient access to Seller's Plant for the purposes of conducting in process
inspections and tests to determine Seller's and the Equipment's compliance with
this Sales Agreement, including without limitation the Specifications. No
inspection or test, delay or failure to inspect or test, or failure to discover
any defect or noncompliance will (i) relieve Seller of any of its obligations
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under this Sales Agreement, or (ii) impair Purchaser's rights under Article 7(c)
or any other right or remedy afforded to Purchaser. Purchaser shall conduct such
in process inspections and tests in a manner as to not interfere with Seller's
planned performance.
Seller shall ship Equipment in accordance with the delivery terms
specified in the Proposal. If Seller has manufactured Equipment to meet
Purchaser's schedule and Purchaser requests delay in shipment, Seller shall have
the right to store such Equipment at Purchaser's expense. Seller shall obtain
approval from Purchaser's Project Manager for each shipment release to ensure
the readiness of the Worksite to accept such shipment.
Notwithstanding any other provision of this Sales Agreement, Seller
acknowledges and agrees that Purchaser may reject, refuse acceptance of or
revoke acceptance of any Equipment, or any tender thereof, which does not
strictly comply with the requirements of this Sales Agreement including without
limitation all applicable Specifications. Purchaser shall notify Seller of any
such rejection, refusal or revocation. In any such event, Purchaser may, with
respect to such noncompliance, elect to: (a) retain any or all of such Equipment
for repair, replacement or other correction by Seller, or (b) retain any or all
of such Equipment without correction by Seller. Seller shall promptly comply
with any direction by Purchaser for correction. Purchaser shall be entitled, in
addition to all other remedies available to Purchaser at law or in equity, to
recover from Seller, by price reduction, credit, offset, invoice or otherwise,
an equitable amount for the diminished value of any uncorrected Equipment and
all reasonable costs and expenses incurred by Purchaser in connection with
Equipment which is rightfully rejected or with respect to which acceptance is
refused or revoked by Purchaser (including, but not limited to, reasonable costs
and expenses to return Equipment to Seller for correction to the extent not
otherwise disclaimed or limited under this Sales Agreement).
ARTICLE 8. SITE CONDITIONS AND PROVISIONS BY PURCHASER
Seller shall not be liable to Purchaser for any failure to deliver and
install any Equipment in accordance with this Sales Agreement, to the extent
that such failure results solely from Purchaser's failure to provide at the
Worksite reasonable means of access to a minimum of dock doors, the availability
of a dock leveler, and a completely enclosed building to protect Seller's
Equipment from the elements, with a water-tight roof and such electric current,
water, heat, ventilation, light and other utilities and facilities as may
reasonably be required for the installation of the Equipment. Purchaser shall
allow Seller reasonable access to the Worksite for inspection of compliance with
these requirements, prior to commencement of the installation. Seller shall
promptly notify Purchaser in writing of any failure by Purchaser to provide any
of the access, availability, items or conditions set forth above or any other
failure by Purchaser to provide access, availability, items, materials,
conditions or assistance as otherwise may be required under this Sales
Agreement.
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ARTICLE 9. INSURANCE AND RISK OF LOSS
Upon delivery of the Equipment at the Worksite, and until Acceptance of
the Equipment, Purchaser shall, at its expense, take out and maintain
"installation floater" insurance in an amount at least equal to the Purchase
Price covering all risks of loss of the Equipment and any and all associated
expenses. Such installation floater insurance shall name Seller as an insured
party and shall provide for an insurer's waiver of subrogation in favor of all
insured parties. Upon Acceptance of the Equipment, Purchaser shall be
responsible for and shall bear any and all risk of loss or damage to the
Equipment except as may otherwise be provided for in this Sales Agreement.
Notwithstanding the foregoing, this Article 9 does not apply when Worksite is
Seller's Plant.
ARTICLE 10. COMPLETION, CHANGES, DELAYS, ERRORS
At any time prior to final payment, Purchaser may request in writing any
substitutions, deviations, additions, or deletions in the Equipment, Work and/or
Specifications (hereinafter referred to as "Changes") and Seller must comply
with the same. If any Change results in an increase or decrease in the time or
expense required for the Work not then performed in accordance with the Sales
Agreement, the parties will equitably adjust schedules for performance of such
Work and/or the Purchaser Price to reflect the increase or decrease. All the
terms and conditions of this Sales Agreement shall apply to such Changes. If by
any such Changes or by other causes within control of Purchaser Seller's
performance is delayed or prevented by Purchaser, Purchaser agrees to reimburse
Seller for its reasonable, documented, out-of-pocket expenses incident to such
delay which may include, without limitation, the costs of storing, maintaining,
repairing, and refurbishing Equipment, demurrage, labor and material escalation
and pull out charges. In such event, Purchaser also agrees to excuse the delay
and accept Seller's performance at an appropriately deferred completion date.
Where Seller's performance under this Sales Agreement is delayed as above, the
Purchase Price shall be revised to reflect any changes in labor wage rates,
material costs and other costs caused by such delay and actually incurred by
Seller in its performance.
ARTICLE 11. PURCHASE AND SALE; PURCHASE PRICE; PAYMENT
The Purchaser shall purchase the Equipment and Work from Seller, and
Seller shall sell and provide the Equipment and Work to Purchaser, as provided
below:
(a) Consideration: Seller shall sell and provide the Equipment and/or
Work, as applicable, to Purchaser as provided in and in accordance with this
Sales Agreement. In full consideration of Seller's sale and provision of the
Equipment and Work to Purchaser, Purchaser shall pay Seller the Purchase Price
as set forth in, and subject to, this Article 11.
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(b) Payment Terms: Unless otherwise specified in the Proposal, Seller
shall submit to the Purchaser [*] invoices for [*] payments for labor and
material expended or purchased for that month. The amounts constituting (or as
applicable, the method(s) for determining the amounts constituting) the [*]
payments, retention, or other payments applicable to this Sales Agreement, or
the amounts constituting (or as applicable, the method(s) for determining the
amounts constituting) such other payment structure as may be reflected in the
Proposal, will be as set forth in the Proposal. Seller's monthly invoices shall
contain a certification regarding the accuracy and completeness of the amounts
invoiced and that such amounts are consistent with the procedures agreed to in
the Proposal.
(c) Retention Rights: Notwithstanding Article 11(b), payment of the
amounts referred to therein shall be subject to a retention amount as specified
in the Proposal. The retention amount specified in the Proposal shall not become
due until (1) Acceptance has occurred, and (2) Seller submits to Purchaser, for
both monthly and final invoices, receipts, releases and waivers of liens arising
out of this Sales Agreement, to the extent and in such form as may be designated
by the Purchaser; provided that payment of such retention amount is subject to
reduction as set forth in Article 11(d). If any subcontractor or supplier
refuses to furnish a release or waiver required by the Purchaser, the Seller may
in lieu thereof furnish at the Seller's expense a bond satisfactory to the
Purchaser to indemnify the Purchaser against any such lien. If any such lien
remains unsatisfied after all payments are made, the Seller shall refund to the
Purchaser all monies that the latter may be compelled to pay in discharging such
lien, including all costs and reasonable attorney's fees.
(d) Retention Reduction: If all the conditions of payment set forth in
Article 11(c) have been met (except for minor punch list items or claims of
non-material deficiencies in the Work, the value of which items or claims will
be mutually determined in good faith by Purchaser and Seller), Seller will
invoice Purchaser for the retention amount less twice the determined value of
such items or claims. Upon the correction or elimination of such items or
claims, Seller will invoice Purchaser for the balance of the retention amount.
(e) Invoicing: Purchaser shall make payment of properly invoiced amounts
within thirty (30) days from receipt of invoice at the following address:
Xxxxxx.xxx, Inc.
Attn: Xxxxx Xxxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
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[*] = omitted, confidential material, which material has been filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.
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(f) Subcontractor Liens or Releases: Upon receipt of funds from the
Purchaser, Seller will sign and furnish a lien waiver to the Purchaser covering
the Work, Equipment and payment described in the applicable invoice and will
send the same to the Purchaser with the next invoice. The Seller will either
obtain lien waivers and releases from suppliers and subcontractors on behalf of
whom such payment was sought by the Seller or furnish Purchaser with a bond
satisfactory to Purchaser to indemnify Purchaser against any claim by lien or
otherwise by Seller's suppliers or subcontractors. The Purchaser is authorized
to withhold from any invoice, without interest, monies due the Seller equal to
the amount of monies previously disbursed to the Seller with respect to which
Seller fails to furnish Purchaser with supplier or subcontractor lien waivers
and releases or a bond as provided in this Sales Agreement.
(g) Purchaser Right of Invoice Rejection or Revocation: The Purchaser
may (1) decline to approve the Seller's invoice in whole or in part or (2)
nullify the whole or any part of any invoice previously approved, in each case
to such extent as may be necessary to protect the Purchaser from loss because
of:
o Defective Work not remedied;
o Failure of the Seller to make payments properly to subcontractor or
suppliers for labor, materials or Equipment;
o Reasonable evidence that the Work cannot be completed for the unpaid
balance of the Purchase Price; or
o Damage to the Purchaser's or its Affiliate's property or another
contractor's work.
ARTICLE 12. SOFTWARE
License Grant: Title to the Seller Software remains at all times with
Seller. Seller hereby grants Purchaser a nonexclusive right and license to use
Seller Software and documentation associated with it on the Equipment in the
manner contemplated by the Proposal or as otherwise permitted under this Sales
Agreement. Additionally, Purchaser may make backup and archival copies as
reasonably deemed necessary by Purchaser, provided that Seller's copyright
notice and other proprietary markings are reproduced in such copies.
Restricted Use: Each copy of Seller Software provided under this license
may be used only on the Equipment on which the Seller Software is delivered and
installed or on other equipment approved by Seller in writing. Use of the Seller
Software in a network environment is authorized under the license only to the
extent reasonably necessary for the Purchaser's or its Affiliates internal
purposes with respect to the Equipment or as otherwise specified in this Sales
Agreement. No other use of the Seller software is authorized unless specifically
agreed to in a writing signed by Seller.
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Copies and Modifications: Purchaser shall not use, copy, rent, lease,
sell, modify, prepare derivative works of, decompile, disassemble, otherwise
reverse engineer, or transfer Seller Software except with Seller's prior written
consent or otherwise as permitted under this Sales Agreement.
Source Code; Escrow Agreement: Seller shall at all times keep and
maintain a complete master, reproducible copy of all Source Code of all Seller
Software installed at the Worksite in escrow in accordance with the terms and
conditions of the Escrow Agreement attached hereto as Exhibit A (the "Escrow
Agreement") and which agreement is hereby made part of this Sales Agreement,
being incorporated herein by this reference. Seller will promptly update the
Source Code in escrow to reflect all Upgrades installed at the Worksite.
In the event that (i) a Major Failure occurs (as defined under Article
17 b)) related to Seller Software and Seller fails to respond to and perform its
warranty or maintenance obligations under this Sales Agreement, or Seller (or
any Seller Affiliate, if applicable) fails to respond to and perform its
obligations under any Maintenance or Software Support Agreement, in each case in
connection with the occurrence of such Major Failure, and Seller does not cure
such failure to respond and perform within five (5) business days after written
notice thereof from Purchaser, (ii) Seller fails to offer maintenance or
software support services to Purchaser as reasonably required by Purchaser for
it to continue its use of the Equipment as contemplated by this Sales Agreement
and on terms no less favorable than those offered to Seller's similarly situated
customers for similar services, (iii) this Sales Agreement is terminated by
Purchaser pursuant to Article 16(a)(1), or (iv) Seller (1) becomes insolvent or
bankrupt or makes an assignment for the benefit of creditors, (2) has a receiver
or trustee in bankruptcy is appointed for it, or (3) has any proceeding in
bankruptcy, receivership or liquidation instituted against it which is not
dismissed within thirty (30) days following the commencement thereof, Purchaser
shall be entitled to the Source Code as provided for in the Escrow Agreement.
Seller hereby grants to Purchaser, effective upon the occurrence of any
of the events set forth in any of the clauses (i) through (iv) of the
immediately preceding paragraph, a perpetual, non-exclusive, right and license
to (a) use, copy, modify, adapt and create derivative works of the Source Code,
and (b) decompile, reverse engineer or disassemble any Seller Software or
modify, adapt or create derivative works of Seller Software or its
documentation, in each case solely in connection with Purchaser's and its
Affiliates' and their respective contractors' use, maintenance and support of
the Software in accordance with their respective rights under this Sales
Agreement. Notwithstanding each of the clauses (a) and (b) above, the Source
Code referred to above is hereby deemed to be Seller Software for purposes of
Purchaser's continued compliance with the terms of Articles 12 b) (except that
Purchaser's rights under clauses (a) and (b) above may be performed in its test
and development areas and equipment for the purposes set forth in this
paragraph), 12 f) and 12 i) hereof.
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Any Source Code delivered under this Article will be provided on an "as
is" basis, without any representation, warranty or liability of Seller
whatsoever, except that Seller hereby represents and warrants to Purchaser that
the Source Code in Escrow at all times is the Source Code of the latest version
of the Seller Software (including all Upgrades) installed at the Worksite.
Further, Seller disclaims any representations, warranties or liabilities
relating to modifications to, or adaptations or derivative works of, the Source
Code, Software or its documentation created by or for Purchaser and/or its
Affiliates pursuant to the immediately preceding paragraph; provided, however,
that nothing in this paragraph will limit any of Seller's representations or
warranties under this Sales Agreement with respect to the unmodified Software or
its documentation.
Term: The term of the licenses granted pursuant to this Article 12 shall
be perpetual, subject to termination only in accordance with Article 16d). Upon
any such termination of this license, Purchaser shall return the Seller Software
and all copies of it and all documentation to Seller.
Trade Secret Protection: Purchaser understands and agrees that Seller
Software and all documentation related thereto constitutes the valuable
technology, know-how and trade secrets of Seller. Purchaser agrees during the
term of this Agreement and thereafter to hold the Seller Software, including any
copies of it and any documentation related to it, in confidence and to not
permit any person or entity to obtain access to it except as required for
Purchaser's and its Affiliates' own internal use and provided such person or
entity has agreed in writing to hold such in confidence.
Software Upgrades: Except as may be otherwise agreed to in a Maintenance
or Software Support Agreement, or otherwise required under this Sales Agreement,
Seller shall have no obligation to provide Upgrades to Purchaser due to later
versions or revisions introduced into the marketplace. Materials, installation,
and customization to implement such Upgrades will be made available to Purchaser
at prices normally offered to Seller's preferred customers. Notwithstanding the
foregoing, Seller will provide and Purchaser will not be charged for, any
Upgrades required in order to correct Software to meet applicable Specifications
pursuant to Seller's obligations under the Sales Agreement or any Maintenance or
Software Support Agreement.
Seller Software Warranty Performance: As part of Seller's warranty of
the Equipment, but not in limitation of Purchaser's rights under this Sales
Agreement, Purchaser agrees that Seller may perform Seller Software warranty
service remotely via a modem in addition to other reasonable means. The Seller
Software warranty is void if the Seller Software has been altered, modified or
changed in any way from the original delivery configuration, without the written
authorization of Seller, unless so altered, modified or changed by or on behalf
of Seller or as may otherwise be permitted hereunder.
Software Markings: The Seller Software and users manuals, logos, product
names and other support materials, if any, are either patented, copyrighted,
trademarked, or
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otherwise proprietary to Seller. Purchaser agrees never to remove any such
notices and product identification.
Third Party Software: Software delivered to Purchaser pursuant to this
Sales Agreement may contain Third Party Software. Seller hereby assigns to or
otherwise transfers to the benefit of Purchaser all of Seller's right, title and
interest in and to all warranties, indemnities, product guaranties and other
representations made by third party manufacturers which Seller may have with
respect to Third Party Software, and will at its expense take any and all
actions as may be necessary to enable Purchaser to exercise rights thereunder
and realize the benefit thereof to the fullest extent possible; provided that
nothing in this Sales Agreement shall have the effect of extending or otherwise
expanding upon any of such third party warranties, indemnities, product
guarantees or representations assigned or otherwise transferred by Seller to
Purchaser. Seller hereby represents and warrants to Purchaser that Purchaser and
its Affiliates will have all rights necessary to use Third Party Software
delivered under the Sales Agreement as contemplated in this Sales Agreement
(including, without limitation, the Specifications).
Purchaser's Affiliates. All rights and obligations of Purchaser under
this Article 12 shall extend to each of Purchaser's Affiliates, and Purchaser
shall ensure that each of Purchaser's Affiliates complies with the provisions of
this Article 12 in connection with its exercise of its rights hereunder.
ARTICLE 13. DELAYED PAYMENTS
In the event that Purchaser fails to make due and punctual payments for
the Equipment and/or Work as provided herein, interest shall accrue on the
amount due and unpaid at the rate of one percent (1%) per month for each full
calendar month or part thereof during which such amount shall be outstanding,
such interest to commence to accrue on the thirtieth (30th) day after such
amount is due and payable hereunder. If the interest rate provided herein
exceeds the maximum interest rate permitted by law, then the interest payable
shall be at such maximum permissible rate.
ARTICLE 14. CONTINGENCIES
In the event of any condition or contingency, existing or future, which
is beyond the reasonable control and without the fault or negligence of either
party which prevents or delays the performance by such party of this Sales
Agreement ("Event of Force Majeure"), such party shall be entitled to an
appropriate extension of time for performance of this Sales Agreement. Events of
Force Majeure shall include, without limitation, acts of God, fire, floods,
transport delays, strikes, labor disputes and interference by civil or military
authorities. If an Event of Force Majeure occurs, the affected party shall take
measures to mitigate and minimize the effect of such event in order to continue
with the performance of its obligations under this Sales Agreement. If the
period of such an event extends beyond six
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(6) months, then either party may terminate this Sales Agreement under Article
16(a)(3) below.
ARTICLE 15. MAINTENANCE OR SOFTWARE SUPPORT
Seller will throughout the warranty period and for a period of five (5)
years thereafter offer maintenance services to Purchaser as reasonably required
by Purchaser for it to continue its use of the Equipment as contemplated by this
Sales Agreement and on terms no less favorable than those offered to Seller's
similarly situated customers for similar services. To the extent maintenance
services are not provided for in the Proposal or elsewhere as part of this Sales
Agreement, Seller and Purchaser will subsequent to the date hereof, at
Purchaser's option, negotiate in good faith as to Seller's provision of the same
to Purchaser.
ARTICLE 16. TERMINATION
(a) This Sales Agreement may be terminated upon the occurrence of any of
the following events:
(1) Other than as provided for in Article 16(a)(2), in the event
that either party shall breach or fail to comply with any provisions of this
Sales Agreement and such breach or failure shall continue for a period of thirty
(30) days after the giving of written notice thereof by the other party, the
other party may terminate this Sales Agreement immediately upon the giving of
written notice thereof to the defaulting party.
(2) Notwithstanding the foregoing, if Purchaser shall have failed to
make any payment due under this Sales Agreement within forty-five (45) days
after having been so notified by Seller, Seller may terminate this Sales
Agreement immediately after the expiration of the forty-five (45) day period by
giving notice of such termination to Purchaser.
(3) If an Event of Force Majeure occurs and continues for a period
greater than six (6) months, either party may terminate this Sales Agreement
upon giving written notice thereof to the other party. In such event, the amount
to which Seller shall be entitled shall be determined as per Article 16(b).
(b) In addition to the foregoing, Purchaser may terminate this Sales
Agreement or any portion thereof without cause effective thirty (30) days after
written notice thereof is received by Seller. If Purchaser terminates this Sales
Agreement pursuant to this Article 16(b), then Seller shall be reimbursed by
Purchaser for Seller's reasonable, documented costs incurred through the
termination date in its performance and/or termination of the terminated portion
of this Sales Agreement, plus Seller's expected profit with respect to the
terminated portion as contemplated in the Proposal, less any progress or other
payments received by Seller before termination. Seller's Chief Financial Officer
shall certify as to the accuracy and completeness of such costs incurred and
expected profit invoiced to Purchaser. Purchaser shall pay Seller net thirty
(30) days after receipt of invoice and certificate from Seller. Seller
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will keep its regularly maintained corporate books and records related to this
Sales Agreement for five (5) years following a termination hereunder. During
such period, and only to the extent necessary to support Seller's reimbursement
under this Article 16 b), Seller will make its books and records as necessary to
support Seller's reimbursement available for audit to an independent public
accountant, selected by Purchaser and at Purchaser's sole cost and expense,
under terms of confidentiality applicable to this Sales Agreement; provided that
if any such audit reveals a discrepancy in favor of Seller in excess of five
percent (5%), then Seller will reimburse Purchaser for the costs of such audit.
Any such audit will be conducted in a manner which will not unreasonably
interfere with Seller's operations.
Upon receipt or delivery (as applicable) of a termination notice under
paragraph 16(a), or upon receipt of Purchaser's termination notice under Article
16(b) above, Seller shall take the following actions:
Stop work to the extent relating to the terminated portion of this Sales
Agreement;
Take all commercially reasonable actions to limit amounts for which
Purchaser may be responsible in connection with this Article, including
terminating all subcontracts to the extent they relate to the terminated portion
of this Sales Agreement;
Assign to Purchaser all of Seller's right, title and interest to all
Third Party Software and Third Party Hardware and deliver the Equipment or
components thereof (regardless of status of completion) consistent with Seller's
progress or other payments received by Seller before and pursuant to
termination; and
Deliver, assign and otherwise transfer, in the manner contemplated by
this Sales Agreement, title to any Work and other drawings, plans and documents
(regardless of status of completion) that, if this Sales Agreement had been
completed, would have been furnished to Purchaser.
d) Notwithstanding anything to the contrary contained in this Sales
Agreement, the licenses granted under Article 12 may not be terminated except
upon the occurrence of a substantial, material breach of this Sales Agreement by
Purchaser that (i) is not cured within twenty (20) days after Purchaser receives
written notice from Seller of the breach, and (ii) is of such a nature that
Seller cannot reasonably be made whole through an award of monetary damages.
Following any termination of this Sales Agreement that does not involve a
termination of the licenses granted under Article 12, Purchaser's and its
Affiliates' and contractors' use of the Seller Software will remain subject to
the restrictions contained in Article 12.
ARTICLE 17. WARRANTY
a) Standard Warranty: Seller hereby warrants that the Equipment shall
(i) be free from all liens, charges or encumbrances, except any lien of the
Seller in respect of any unpaid
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portion of the Purchase Price; (ii) be free from defects in materials and
workmanship and shall conform to the provisions and specifications of this Sales
Agreement (including without limitation the Specifications); (iii) be new and,
if no quality is specified, of a quality consistent with the Seller's usual and
normal production; and (iv) conform with OSHA regulations in force at the time
of Acceptance of the Equipment. Seller shall use its reasonable best efforts to
as soon as practicable obtain for Seller's own benefit Third-Party Hardware and
Third-Party Software warranties that are at least co-extensive with Seller's
warranty obligations to Purchaser under clause (ii) of the immediately preceding
sentence with respect to the Equipment. Notwithstanding the foregoing, if
Seller, after so using its reasonable best efforts, fails to obtain for Seller's
own benefit such warranties, then Seller shall immediately notify Purchaser in
writing of the nature and extent of such failure, and the parties shall
negotiate in good faith as to (a) adjustment of schedules for performance of the
Work in order for Seller to secure such warranties, (b) Seller's limited release
from its warranty obligations under clause (ii) of the immediately preceding
sentence with respect to such Third-Party Hardware or Third-Party Software,
and/or (c) a reduction or increase in the Purchaser Price to reflect the changed
schedule and/or lessened warranty obligations, as applicable. Any agreement
between the parties resulting from such negotiations must be in writing.
Seller's failure to notify Purchaser as required above shall constitute Seller's
waiver of its renegotiation rights in the preceding sentence, and the provisions
of this Article 17 shall remain in full force and effect. Seller shall, at its
option, repair or replace (replacement parts to be shipped F.O.B. Worksite) any
defective Equipment or component thereof; provided, however, that Seller is
given written notice of any defect during the Warranty Period (as defined
below). For purposes of Articles 17a) and b), the warranty period shall commence
on the earlier of the date of first commercial use of the Equipment by Purchaser
or the date of Acceptance of the Equipment, and the warranty period shall end
one year after such commencement date ("Warranty Period"). Purchaser shall give
Seller prompt reasonable written notice of any claim under the foregoing
warranty within the Warranty Period and permit Seller to inspect the Equipment
in order to verify the defect or nonconformity. Seller shall promptly and
reasonably respond to verify and correct the defect. Purchaser's remedies and
Seller's obligations in connection with any claim made under this warranty shall
be limited to repair or replacement at Seller's expense of the Equipment or part
thereof which is defective. Labor performed at the Worksite with regard to such
claims is not included in this warranty. Purchaser shall be responsible for the
normal maintenance and repair of the Equipment and shall perform the same in
accordance with generally accepted maintenance procedures or such other
reasonable procedures as are set forth in maintenance and repair manuals
provided by Seller to Purchaser. Seller shall not, under this Article 17, be
responsible for or obligated to pay or to reimburse Purchaser for (a) any work
or repairs performed on the Equipment by third parties (other than on behalf of
Seller and except for mutually agreed subcontractors), (b) any materials
furnished by third parties (other than on behalf of Seller) for use in
connection with the Equipment if the same was undertaken or furnished without
mutual prior written consent or (c) any loss or damage arising from improper
operation or maintenance of the Equipment by Purchaser or from ordinary wear and
tear.
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b) Major Failure Warranty: Notwithstanding other provisions of this
Article 17, in instances of a Major Failure during the Warranty Period, Seller
will provide all necessary parts and labor to correct the defect. A "Major
Failure" is defined as failure of the Equipment or portion of the Equipment to
operate as described in the Proposal or the applicable Specifications, which
significantly impacts Purchaser's ability to use the affected Equipment or
portion thereof, and which Purchaser's maintenance personnel or available
contractors cannot remedy without significant expense or effort. Seller will
respond to a Major Failure by immediately dispatching such servicemen by
commercial air carrier, or by responding as otherwise agreed between the
parties, upon request and notification of a Major Failure by Purchaser as may be
necessary to promptly correct the defect, and such servicemen shall thereafter
diligently and continuously perform such services as may be necessary to
promptly correct such defect until corrected. Should it later be reasonably and
mutually determined in good faith by Seller and Purchaser that the necessary
corrective services rendered by Seller were within the capabilities of the
Purchaser's maintenance personnel or available contractors without the
expenditure of significant expense or effort, the Purchaser will reimburse
Seller for the labor and expenses of the service trip.
Year 2000: Seller hereby represents and warrants that the Equipment,
when used in accordance with its associated documentation, shall perform
properly and without change in operations related to the advent of the new
century (defined as commencing at 12:00 am, January 1, 2000), including but not
limited to, by accurately processing date data (including without limitation by
calculating, comparing and sequencing) within, from, into and between centuries
(including, but not limited to, the twentieth and twenty-first centuries), and
by properly calculating leap years, except to the extent that any failure of the
Equipment to so perform is directly attributable to (i) the failure of other
technology, systems or interfaces, Third Party Software, or Third Party Hardware
to properly exchange date data with the Equipment, (ii) a change in the
operating environment not contemplated in this Sales Agreement, including
without limitation the Specifications, or (iii) any addition to or modification
of the Equipment by or on behalf of Purchaser or any of its Affiliates that has
not been authorized in writing by Seller or made by or on behalf of Seller or
any of its Affiliates. In the event of any material failure of the Equipment to
operate as warranted above, Purchaser's sole remedy, and Seller's sole
obligation, shall be to promptly respond and diligently and continuously work to
correct until corrected (or provide a functionally equivalent work around for)
any reproducible error or failure reported by Purchaser in writing to Seller on
or before January 1, 2001. If Seller is unable to remedy such error or failure
within a reasonable time, Seller and Purchaser shall enter into good faith
discussions to agree to reductions in Purchase Price or other equitable
adjustments to account for such delay or inability to remedy said failure.
Seller agrees to use its reasonable best efforts to incorporate a statement in
all purchase orders that Seller issues under this Sales Agreement that requires
any Third Party Software delivered hereunder to be Year 2000 compliant
consistent with the minimum requirements of this Article 17c). The remedies
provided in this paragraph are exclusive remedies for failure of the Equipment
to perform as warranted hereunder.
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Third Party Software and Third Party Hardware: The foregoing warranties
in Article 17a), b) and c) specifically exclude warranties relating to Third
Party Software or Third Party Hardware to the extent specified in such Articles.
Seller hereby assigns and otherwise transfers to the benefit of Purchaser all of
Seller's right, title and interest in and to all assignable or transferable
warranties with respect to Third Party Software and Third Party Hardware and all
assignable or transferable rights of Seller against any manufacturer or supplier
thereof, including without limitation with respect to all indemnity agreements,
and will at its expense take any and all actions as may be necessary to enable
Purchaser to exercise rights thereunder and realize the benefit thereof to the
fullest extent possible. To the extent any of such warranties, indemnities or
rights are not assignable or transferable, Seller agrees to exercise for the
benefit of Purchaser any and all claims, rights, remedies, warranties,
representations and indemnities against or obtained from any such third party
manufacturers or suppliers.
Disclaimer: OTHER THAN AS SPECIFICALLY SET FORTH ABOVE, SELLER MAKES NO
OTHER WARRANTIES, WHETHER WRITTEN, ORAL OR IMPLIED, INCLUDING WITHOUT
LIMITATION, WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE OR MERCHANTABILITY.
ARTICLE 18. USE OF INSTALLED PORTIONS OF THE EQUIPMENT
Whenever, as determined by Seller, the installation of any portion of
the Equipment has been completed, Seller may make available such portion for
Purchaser's use, provided, however, that Seller and Purchaser shall mutually
agree on the terms and conditions of such use. Except as otherwise agreed by
Seller and Purchaser (including where appropriate, an adjustment in the Purchase
Price and/or schedule otherwise provided for in this Sales Agreement), such use
shall not interfere with the installation of the remainder of the Equipment.
Seller shall not be liable for the cost of repairs, rework or replacement which
may be required due to ordinary wear and tear resulting from such use.
ARTICLE 19. INSURANCE BY SELLER
Seller will maintain insurance coverage covering its operation and its
obligations pursuant to Article 20, in at least the following amounts:
Commercial General Liability - Bodily Injury and Property damage - $1,000,000
Per Occurrence.
Personal Injury Liability - $1,000,000 Limit.
Business Auto - Bodily Injury & Property Damage - $500,000 Combined Single
Limit.
Umbrella Liability - $20,000,000 Limit of Liability
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Worker's Compensation - Coverage A - Statutory
Coverage B - Employer's Liability; $100,000 each accident; $100,000 each
employee; $500,000 Policy Limit
Foreign Products Liability - $1,000,000 Per Occurrence.
Insurance shall be purchased from companies having a rating of A-VII or
better in the current BEST'S INSURANCE REPORTS published by A. M. Best Company.
Policies of insurance shall name Purchaser as an additional insured, provide for
an insurer's waiver of subrogation in favor of all insured parties, and provide
that they will not be canceled or materially changed without reasonable prior
written notice to Purchaser. Certificates of insurance evidencing coverage shall
be submitted in advance of or concurrent with the execution of the Work, and on
each insurance policy renewal thereafter. Seller shall, at Purchaser's request,
provide copies of requested insurance policies. If Seller does not provide
Purchaser with such certificates of insurance, then Purchaser will so advise
Seller. Thereafter, if Seller does not furnish evidence of acceptable coverage
within fifteen (15) days, then Purchaser shall have the right, in its sole
discretion, to (i) withhold payments from Seller until evidence of such
acceptable coverage is provided, or (ii) immediately terminate this Sales
Agreement. Failure to obtain and maintain required insurance shall not relieve
Seller of any obligation contained in this Sales Agreement. Additionally, any
approval by Purchaser of any of Seller's insurance policies shall not relieve
Seller of any obligation contained in this Sales Agreement.
ARTICLE 20. INDEMNIFICATION
Seller shall indemnify, defend and hold Purchaser harmless from and
against any and all expenses, losses, costs, claims, demands, causes of action,
and damages of whatever kind, (a) which result from injuries at the Worksite
during the installation, or testing of the Equipment, (b) which are due to the
negligence or willful misconduct of Seller or its employees or contractors, or
(c) to the extent otherwise related to any claim, action, suit or proceeding
involving the Equipment which is based upon injuries to persons (including
death) or property arising from or relating to (i) the use of the Equipment in
accordance with Seller's operation, maintenance and other related manuals and
documents delivered to Purchaser by Seller hereunder, or (ii) the design or
manufacture of the Equipment as contemplated in the Proposal (including, without
limitation, the Specifications), including without limitation, product liability
claims. Purchaser shall indemnify, defend, and hold Seller harmless from and
against any and all expenses, losses, costs, claims, demands, causes of action,
and damages of whatever kind which result from the negligent or willful use or
operation of the Equipment by any person (other than Seller or Seller's
employees or contractors) other than in its normal and intended manner, and
removal or modification of safety features unless Purchaser notifies Seller and
such removal or modification is approved by Seller or made by or on behalf of
Seller or any of its Affiliates.
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ARTICLE 21. LIMITATION OF LIABILITY
Notwithstanding any other provision of this Sales Agreement, except to
the extent constituting a third party claim (or portion thereof) subject to
indemnification under Article 3 or Article 20 (such portion of such claim
subject to indemnification under Article 20 being a "Third-Party Non-IP
Consequential Damage Indemnified Claim"), neither party shall be liable to the
other party or anyone claiming through such other party for any special,
indirect, incidental or consequential damages of any kind whatsoever, including
without limitation loss of profit or reputation incurred by either Party,
whether such damages arise out of the use, inability to use, failure of, delay
in delivery of, or nondelivery of, the Equipment, or out of any termination of
this Agreement, or otherwise. Notwithstanding any other provision of this
Agreement, each party's aggregate liability under Article 20 for Third-Party
Non-IP Consequential Damage Indemnified Claims shall not exceed the greater of
[*].
ARTICLE 22. WAIVER
Except as otherwise expressly provided in this Sales Agreement, no
failure on the part of either party to exercise, and no delay in exercising, any
right, privilege, or power under this Sales Agreement shall operate as a waiver
or relinquishment thereof; nor shall any single or partial exercise by either
party of any right, privilege or power under this Sales Agreement preclude any
other or further exercise thereof, or the exercise of any other right, privilege
or power. Waiver by any party of any breach of any provision of this Sales
Agreement shall not constitute or be construed as a continuing waiver, or as a
waiver of any other breach of any provision of this Sales Agreement.
ARTICLE 23. ENTIRE AGREEMENT
This instrument, together with any attachments specifically made a part
of this Sales Agreement and any documents incorporated in such attachments by
reference, embodies the whole agreement of the parties relating to the subject
matter of this Sales Agreement and supersedes any and all prior oral or written
specifications, communications and agreements by or on behalf of the parties.
This Sales Agreement may not be varied by any purchase order, acknowledgment,
confirmation, invoice, or shipping document issued by either party. Any
amendments or modifications of this Sales Agreement must be in writing and
signed by an officer or General Counsel of Purchaser and an officer or General
Counsel of Seller to be binding.
---------------------
[*] = omitted, confidential material, which material has been filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.
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ARTICLE 24: CONFIDENTIALITY AGREEMENT
With respect to information received by either party as a result of or
in connection with this Sales Agreement, the parties will abide by the terms and
conditions of following Mutual Nondisclosure Agreements, as applicable (but only
to the extent that the information constitutes "Confidential Information" as
defined in the Mutual Nondisclosure Agreement):
The Xxxxxxxx Company: Agreement signed with Xxxxxx.xxx dated January 14, 1999
Real Time Solutions: Agreement signed with Xxxxxx.xxx dated January 19, 1999
White Systems, Inc.: Agreement signed with Xxxxxx.xxx dated January 19, 1999
ARTICLE 25. GOVERNING LAW
This Sales Agreement shall be governed by and interpreted in accordance
with the laws of the State of Washington, without regard to its choice of law
provisions.
ARTICLE 26. PUBLICITY
Neither party shall disclose the terms of this Sales Agreement or the
existence or nature of any relationship between the parties (including, without
limitation in any press release or public communication) to any third party
without the prior written consent of the other party.
ARTICLE 27. SOLICITATION
Seller and Purchaser agree that, for the period commencing with the
commencement of Work hereunder (whether of not prior to the date hereof) until
one year following Acceptance, or any earlier termination of this Sales
Agreement, neither party will, except with the other party's written approval,
offer or seek to offer or solicit employment to the other party's employees or
staff. Notwithstanding the foregoing, the parties agree that general
solicitations or advertisements (by any means or media) shall not constitute
prohibited offers or solicitations for purposes of this Article 27.
Notwithstanding any other provision of this Sales Agreement, each party's
exclusive remedy for a violation of this Article 27 is recovery of such party's
direct damages and/or specific performance in connection therewith, as
applicable. The parties agree that under no circumstances shall a violation of
this Article 27 give rise to a right to terminate this Agreement.
ARTICLE 28. SURVIVAL
Articles 3, 12, 15, 17(c), 20, 21, 24 and 27 (together with all other
provisions that reasonably may be interpreted as surviving termination or
expiration of this Sales Agreement) will survive the Acceptance of the
Equipment, the performance of the Work and performance of Seller's warranty
obligations hereunder.
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ARTICLE 29. DISPUTES
Any controversy or claim arising out of or relating to this Agreement,
or the breach thereof, ("Claim") shall be resolved in accordance with this
Article 29.
Any Claim shall first be submitted by the claiming party to the other
party in writing within a reasonable period after the event giving rise to it,
which writing shall include a description of such Claim, the proposed remedy for
such Claim and data supporting such Claim. If the parties are unable to resolve
the Claim informally, either party may submit the Claim for joint consideration
by and between Purchaser's senior logistics officer and Seller's Chief Executive
Officer.
Arbitration. Claims that have been properly raised and considered in the
above procedures but have not been resolved shall be resolved exclusively by
arbitration before a panel of three arbitrators in Seattle, Washington or in
such other location as may be reasonable given the facts and circumstances
involved in such Claim. The arbitration shall be conducted in accordance with
the applicable rules of the American Arbitration Association currently in effect
unless the parties mutuality agree otherwise.
Notice of the demand for arbitration shall be filed in writing with the
other party to the Sales Agreement and in accordance with the applicable rules
of the American Arbitration Association and shall be made within the statutes of
limitation that are applicable to the Claim.
The parties shall apply to the arbitrators for relevant discovery
consistent with the Federal Rules of Civil Procedure, which the arbitrators
shall be authorized to order. Either party may request that the arbitrators'
award include findings of fact and conclusions of law.
The arbitrators shall not be empowered to grant exemplary or punitive
damages. The award rendered by the arbitrator or arbitrators shall be final, and
judgment may be entered upon it in accordance with applicable law in any court
having jurisdiction thereof.
Within 30 days of receipt from the of the written findings of fact and
conclusions of law, either party will have the right to file with the
arbitrators and serve on the other party a written motion to reconsider. The
arbitrators may request the nonmoving or responding party to file a written
response within 10 days after receipt of that request, and the arbitrators
thereupon will reconsider the issues raised by the motion and response (if any)
and either confirm or alter their decision, which will then be final, binding
and conclusive upon the parties. The cost of such motion for reconsideration and
written opinion of the arbitrators, including attorneys' fees, will be awarded
against the moving party if it does not substantially prevail on its motion.
Upon demand of either party, the arbitration shall include, by
consolidation, joinder or third party claim, any person or entity (a) that is
substantially involved in a common
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question of fact or law, (b) where the presence of such person or entity is
required if complete relief is to be accorded in the arbitration, or (c) who is
alleged to be liable to a party for all or part of a claim in the arbitration.
The agreement herein among the parties shall be specifically enforceable
under applicable law in any court having jurisdiction thereof.
Each party agrees that all aspects of any arbitration are "Confidential
Information" under the Mutual Non-disclosure Agreement referred to in Article
24.
Seller shall diligently carry on the Work, and Purchaser shall continue
its duties under this Agreement, during any dispute resolution proceedings,
unless otherwise agreed in writing. The requirements of this paragraph cannot be
waived with respect to any Claim except by an explicit written waiver signed the
party against whom the Claim is brought.
Notwithstanding the foregoing, nothing in this Article 29 will preclude
either party from seeking provisional remedies (including, without limitation,
temporary restraining orders and preliminary injunctions) from any court of
competent jurisdiction to protect its rights pending resolution as provided for
above. Further, unless otherwise agreed by the parties in writing, this Article
29 will not apply to disputes relating to the enforceability of, or a party's
rights under, any United States or foreign patent or other intellectual property
right.
ARTICLE 30. TRANSFER OF TITLE AND RESERVATION OF SECURITY INTEREST
Upon Acceptance, title to the Work shall transfer to Purchaser. For the
avoidance of doubt, notwithstanding the transfer of possession of the Equipment
by Seller to Purchaser, Seller shall retain legal title to, and hereby reserves
a purchase money security interest in, the Equipment until Acceptance. Seller
shall have the rights of a secured creditor under the Uniform Commercial Code
for the jurisdiction applicable during such period. Purchaser hereby authorizes
Seller to file, and to sign on behalf of Purchaser as the debtor, any financing
statements or other documents with State or local recording offices which may be
required to perfect such security interest. In circumstances where Acceptance
has occurred and the Equipment is thereafter stored at Seller's Plant, Seller
hereby authorizes Purchaser to file, and to sign on behalf of Seller any
financing statements or other documents with State or local recording offices
which may be required to perfect Purchaser's security interest in the Equipment
so stored.
ARTICLE 31. NOTICES
All notices, requests, demands, applications, services of process, and
other communications which are required to be or may be given under this Sales
Agreement shall be in writing and shall be deemed to have been duly given if
sent by telecopy or facsimile transmission, answer back requested, or delivered
by courier or mailed, certified first class
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mail, postage prepaid, return receipt requested, to the parties to this
Agreement at the following addresses:
If to Purchaser: Xxxxxx.xxx, Inc.
0000 0xx Xxxxxx
Xxxxxxx, XX 00000
Attn: General Counsel
Fax: 000-000-0000
With a copy to: Xxxxxx.xxx, Inc.
0000 0xx Xxxxxx
Xxxxxxx, XX 00000
Attn: Chief Logistics Officer
Fax: 000-000-0000
If to Seller: _______________________________
_______________________________
_______________________________
Attn: The President
Fax: __________________________
With a copy to: The Xxxxxxxx Company
00000 Xxxxxxxxxxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxxx 00000
Attn: General Counsel
Fax: 513/000-0000
or to such other address as either party shall have furnished to the other by
notice given in accordance with this Article. Such notice shall be effective (i)
if delivered in person or by courier, upon actual receipt by the intended
recipient, or (ii) if sent by telecopy or facsimile transmission, on the date of
transmission unless transmitted after normal business hours, in which case on
the following date, (iii) if mailed, upon the date of first attempted delivery.
ARTICLE 32. HEADINGS
Headings used in this Sales Agreement are for convenience and ease of
reference only, are not part of this Sales Agreement and shall not be relevant
to or affect the meaning or interpretation of this Sales Agreement.
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ARTICLE 33. INTERPRETATION
Except where otherwise expressly provided or unless the context
otherwise necessarily requires: (i) references to a given law or rule are
references to that law or rule as amended or modified as of the date on which
the reference is made, (ii) reference to a given agreement or instrument is a
reference to that agreement or instrument as originally executed, and as
modified, amended, supplemented and restated through the date as of which
reference is made to that agreement or instrument, and (iii) accounting terms
have the meanings given to them by U.S. generally accepted accounting principles
applied on a consistent basis by the accounting entity to which they refer.
ARTICLE 34. ATTORNEY'S FEES AND COSTS
If any suit is brought, or an attorney retained to collect any money due
under this Sales Agreement, or to collect a judgment for breach of this Sales
Agreement, the prevailing party shall be entitled to recover, in addition to any
other remedy, reimbursement for attorneys' fees, court costs, investigation
costs and other related expenses incurred in connection therewith.
ARTICLE 35. SEVERABILITY
This Sales Agreement will be enforced to the fullest extent permitted by
applicable law. If for any reason any provision of this Sales Agreement is held
to be invalid or unenforceable to any extent, then such: (i) provision will be
interpreted, construed or reformed to the extent reasonably required to render
the same valid, enforceable and consistent with the original intent underlying
such provision; (ii) provision will be void to the extent it is held to be
invalid or unenforceable; (iii) provision will remain in effect to the extent
that it is not invalid or unenforceable; and (iv) such invalidity or
unenforceability will not affect any other provision of this Sales Agreement or
any other agreement between the parties.
ARTICLE 36. REMEDIES
Except as otherwise expressly provided in this Sales Agreement, each and
all of the rights and remedies provided in this Sales Agreement, and each and
all of the remedies allowed at law and in equity, will be cumulative, and the
exercise of one right or remedy will not be exclusive of the right to exercise
or resort to any and all other rights or remedies provided in this Sales
Agreement or at law or in equity.
ARTICLE 37. RELATIONSHIP
The Parties are independent contractors under this Sales Agreement. Each
party acknowledges and agrees that it is not and will not be during the term of
this Sales Agreement, be an employee or an agent of the other party. Each party
and its employees,
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subcontractors, and agents shall not be entitled to or eligible for any of the
benefits that the other party provides for its employees. Each party shall be
solely responsible for withholding and paying its and its employees',
subcontractors' and agents' taxes and other charges, including without
limitation, federal, state and local income and social security taxes, workmen's
compensation and unemployment insurance. Nothing in this Sales Agreement will be
deemed to constitute, create, give effect to or otherwise recognize a joint
venture, partnership, franchise or business entity of any kind. Nothing in this
Sales Agreement will be construed as providing for the sharing of profits or
losses arising out of the efforts of the parties hereto.
ARTICLE 38. USE OF MARKS; PRESS RELEASES
Seller will not use any trade name, trademark, service xxxx or logo of
Purchaser (or any name, xxxx or logo confusingly similar thereto) in any
advertising, promotions or otherwise, or otherwise make any press release or
disclosure concerning this Sales Agreement or the activities contemplated
hereby, without Purchaser's prior written consent.
ARTICLE 39. PERMITTED DISCLOSURE
To the extent either party is required to disclose information that
otherwise requires the other party's prior written consent under Articles 26 or
38 of this Sales Agreement, each party hereby consents to the other party's
disclosure to the extent that such disclosure is (i) required by law (provided
that the disclosing party (a) gives the other party prior written notice
sufficient to allow the other party to seek a protective order or other
appropriate remedy, (b) discloses only such information as is so required, and
(c) and uses commercially reasonable efforts to obtain confidential treatment
for any information so disclosed), or (ii) necessary in connection with (aa)
such party's performance of this Sales Agreement, (bb) such party's standard
accounting disclosure obligations, or (cc) the proposed sale or reorganization
of such party's business or the like, provided in each of cases (aa), (bb) and
(cc) that each person to whom such information is disclosed has a need to know
the same, and is bound to keep the same confidential to at least the same extent
as required herein (including pursuant to any applicable confidentiality
agreement between the parties hereto). In both cases (i) and (ii) above, the
disclosing party shall, within the earliest possible time under the
circumstances (or, if the disclosure is to be made under case (ii)(cc) above to
a person or entity which may reasonably be deemed to be a competitor of the
non-disclosing party (or any of its affiliates), then in advance of any such
disclosure), notify or advise the other party of such disclosure, the
information disclosed or to be disclosed, and the identity of recipient of such
information.
IN WITNESS WHEREOF, the parties hereto have caused this Sales Agreement
and all annexes, exhibits and attachments thereto to come into effect on the
last date appearing below:
AUTHORIZED FOR PURCHASER BY:
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Xxxxxx.xxx, Inc.
Signature /s/ Xxxxx X. Xxxxxx
-------------------------
Name Xxxxx X. Xxxxxx
------------------------------
Title V.P./C.L.O.
-----------------------------
Date 3/11/99
------------------------------
AUTHORIZED FOR SELLER BY:
The Xxxxxxxx Company
Signature /s/ Xxxxx X. XxXxxxxx
-------------------------
Name Xxxxx X. XxXxxxxx
------------------------------
Title President
-----------------------------
Date 3/11/99
------------------------------
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ATTACHMENT 1
PRICING; PAYMENT SCHEDULE
The pricing set forth in this Proposal is fixed pricing, based on a
building configuration/layout which has been mutually developed between Xxxxxxx
and Xxxxxx.xxx, and which is assumed to be typical of buildings which may be
located and leased or purchased by Xxxxxx.xxx in the near future. The Equipment
will be engineered based on such standard configuration/layout, manufactured and
placed into storage (if required). Once a specific building has been located and
purchased by Xxxxxx.xxx, the standard configuration/layout will be modified to
suit the specific building parameters. Once this has been accomplished, a change
order to this Proposal will be developed to reflect the building-specific
configuration/layout, as well as necessary changes for travel, local labor, and
freight based on the site of the specific building.
Storage and handling costs for Equipment are not included in the
pricing. Storage and handling costs will be invoiced monthly as they are
incurred.
The Purchase Price shall be paid as follows: [*].
---------------------
[*] = omitted, confidential material, which material has been filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.
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ALLIANCE PRICING SUMMARY FORM- STANDARD
--------------------------------------------------------------------------------------------------------
DESCRIPTION HOURS LIST PRICE/COST MULTIPLE SELL PRICE
--------------------------------------------------------------------------------------------------------
[ * ]
--------------------------------------------------------------------------------------------------------
TOTAL $ 26,893,390
--------------------------------------------------------------------------------------------------------
---------------------
[*] = omitted, confidential material, which material has been filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.
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PRICE BREAKDOWN
[ * ]
TOTAL................................................ $ 26,893,390
---------------------
[*] = omitted, confidential material, which material has been filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.
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BUYOUT SUMMARY
The following is a summary of the Buyout equipment and the categories
that they have been assigned.
Major Purchases - [*].
o Tilt-tray
o Mezzanine
Major Purchases - [*].
o Belt Curves
o Shrink-Wrap Tunnels
o Carton Erectors
o Extendable Conveyors
Major Purchases - [*].
o Scales
o Tapers
o Chutes
o Printer/Applicators
o Air Compressors
o Structural Steel
o Trolley Carriers
o Packing Tables
o Platforms/Catwalks/Xxxxxx
o Pick-to-light shelving
o Reject pullers
o Netting
---------------------
[*] = omitted, confidential material, which material has been filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.
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PROVISIONS
o Prices do not include any state, local sales/use taxes and Performance
Bond costs.
o Installation services are based on using nonunion labor during regular
working hours. Xxxxxxxx uses overtime labor, as applicable, to make any
tie-ins that would affect operations.
o Electrical installation is performed under license.
o This price is a total price for the conveyor system. The equipment being
manufactured and stored, based on the blanket order, will be applied and
the price deducted as necessary.
o Other services including ongoing Operational Audits, Slotting, Labor
Standards, and Equipment Maintenance will be priced at a later date if
requested.
o The price does not include trash compactors.
o Freight estimate is based on shipping to [*]. Actual freight charges
will be determined once the job has been chosen and will then be
adjusted accordingly.
o Local labor rate will be adjusted accordingly to the city and state
selected for each site.
---------------------
[*] = omitted, confidential material, which material has been filed
separately with the Securities and Exchange Commission pursuant to a request for
confidential treatment.
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