Exhibit 10.34
EST DISTRIBUTOR AGREEMENT
This Agreement is entered into this 18th day of September 1998 between
Embedded Support Tools Corp., a corporation duly organized under the laws of the
Commonwealth of Massachusetts, and having its principal place of business at 000
Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, XXX ("EST"), and Microtek
International Inc., a corporation duly organized under the laws of Taiwan, with
its principal place of business at 6 Industry East Road 111, Science-Based
Industrial Park, Hsinchu, Taiwan, R.O.C. ("Distributor"). IN CONSIDERATION OF
THE MUTUAL COVENANTS AND PROMISES HEREIN CONTAINED, THE PARTIES HERETO AGREE AS
FOLLOWS:
1. APPOINTMENT AND ACCEPTANCE
EST hereby appoints Distributor and Distributor hereby accepts appointment
as an exclusive (except Taiwan) distributor for the sale of EST hardware
products, and for the sale of licenses and support services for the EST software
products, in executable form, specified in the attached Schedule B ("Products")
to end-users located within and for installation only within the geographical
area specified in the attached Schedule A ("Territory"). Additional EST products
(including new versions of the Products) may be included under this Agreement by
the mutual written consent of the parties in the form of an amendment to this
Agreement. EST reserves the right to delete any Product from this list of which
development, production, licensing or maintenance is discontinued by EST.
2. DISTRIBUTION RIGHTS
A. No Software Product shall be distributed to an end-user by
Distributor, if the Product is designated a shrink-wrapped product by EST, until
(i) the end-user executes an EST Software License Agreement which identifies EST
as the licensor and the end-user as the licensee, or (ii) the Product is
packaged with an EST Software License Agreement, the terms and conditions of
which the end-user agrees to comply with by opening the shrink-wrap package
containing this same Agreement.
B. The EST Software License Agreement is attached to, and made part of
this Agreement as Schedule D. Any modification, deletion or change Distributor
desires to make in any particular licensing transaction shall require the prior
written approval of EST. EST reserves the right to change any of the terms and
conditions of the attached EST Software License Agreement, or its licensing
procedures, provided Distributor is given thirty (30) calendar days prior
written notice of any such changes.
C. All orders submitted to EST by Distributor are subject to approval and
acceptance by EST in its sole discretion. Such approval shall not be
unreasonably withheld.
D. All shipments shall be made F.O.B. origin to Distributor at 0,
Xxxxxxxx Xxxx Xxxx III, Science-Based Industrial Park, Hsinchu, Taiwan, R.O.C.
or to a forwarding agent
as may be specified on orders received from Distributor. It is the
responsibility of Distributor to ship the Product to the applicable end-user.
E. Nothing in this Agreement shall be construed as a grant to Distributor
of any right, title or interest in and to copyrights, patents or trade secrets
of the Products, all rights related thereto being reserved by EST.
F. Except for copying as may be specifically provided by Schedule E,
Distributor will not copy, in whole or in part, or modify, alter, reverse
engineer, decompile or disassemble any Product furnished Distributor, without
prior written consent of EST. Such consent shall not be unreasonably withheld.
G. In the event that copying is authorized by Schedule E for the purpose
of making deliveries to Distributor's customers, Distributor shall reproduce and
include EST copyright notice both in and on every copy made, in any form,
including partial copies. Distributor agrees to keep a record of every copy made
and to furnish such record to EST upon its request.
H. Distributor is hereby granted an exclusive, non-transferable right to
use as selling aids in the Territory, during the life of this Agreement, the
trademarks identifying the Products. Distributor shall not sublicense or
otherwise permit the use of said trademarks by other parties. All fights in said
trademarks shall, at all times during the life of this Agreement and thereafter,
be and remain the sole property of EST and good will and other benefits
associated therewith are hereby assigned and shall inure to the benefit of EST.
Distributor shall not use said trademarks in any manner which would injure or
destroy their value or diminish EST's property rights therein. Distributor shall
promptly notify EST of any infringement or suspected infringement of said
trademarks that may come to Distributor's attention and assist EST, at EST's
expense, in taking action against such infringement as EST, in its sole
discretion, may decide.
I. Distributor is hereby granted the right to translate into Chinese and
publish any of the technical or sales promotional materials for use in promoting
EST products in Taiwan. Distributor will retain sole rights to such material.
3. OBLIGATIONS OF DISTRIBUTOR
Distributor shall:
A. Submit to EST, if requested by EST, a marketing plan for the Products
to be distributed, including a twelve (12) month forecast of sales revenue
anticipated for these products.
B. Provide its best efforts to promote the licensing of and support
services for the Products within the Territory in accordance with terms and
conditions determined by EST, and provide evidence of such efforts if requested
to do so by EST.
C. Employ, on an on-going basis, a fully trained and competent sales and
technical support organization sufficient to meet Distributor's obligations
hereunder and to
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have such personnel complete, at Distributor's expense, any training deemed
necessary by EST to meet this requirement.
D. Maintain adequate person-power and facilities to ensure prompt
handling' of inquiries, orders, shipments and support services as described by
Section 13 below to end-users of the Products in the Territory.
E. Assign a specific contact at the office of Distributor who will handle
inquiries and correspondence pertaining to this Agreement with reasonable
promptness.
F. In the conduct of its business under this Agreement, comply with all
applicable laws, regulations and orders in the Territory and shall not take any
action which will cause EST to be in. violation of any such law, regulation or
order in the Territory or the United States including, but not limited to the US
Foreign Corrupt Practices Act, the US Export Administration Regulations and the
US Anti-Boycott Laws.
G. Not without prior written consent of EST, appoint any sub-
representatives, agents, sub-distributors or dealers to carry out any of the
activities covered by this Agreement.
H. Assume all responsibility for delivery of the Products to end-users in
the Territory, including shipping and like costs, taxes, compliance with and
expense of any import legalities and duties.
I. Bear exclusively all responsibility toward its employees imposed by
legislation within the Territory and shall hold EST harmless from and indemnify
EST against any and all claims by any such employee against EST for payment of
commissions, salaries, expenses, termination indemnities or any other amounts
payable under such legislation.
4. OBLIGATIONS OF EST
EST shall:
A. Furnish reasonable quantifies of promotional literature at no charge
to Distributor. Additional quantities shall be available at cost.
B. Promptly advise Distributor when Products are shipped.
C. Assign a specific contact at EST in Canton, MA, USA who will handle
inquiries and correspondence pertaining to this Agreement with reasonable
promptness.
5. CHARGES AND PAYMENTS
A. Fees/Prices for the Products to be supplied to Distributor for
unbundled distribution by Distributor are in accordance with the EST Price List,
for the applicable product line, then in effect at the time of receipt of the
order by EST, minus the discount set forth in Schedule C. Fees/Prices for
bundled distribution, if applicable, are set forth in Exhibit E. Discounted
fees/prices are due and payable
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within thirty (30) calendar days of shipment of the Product(s) to Distributor.
Fees under the bundled pricing arrangement are due as specified in Exhibit E.
All payments are due when specified, regardless of whether or I not Distributor
has received payment from the end-user. All payments are to be made in United
States Dollars on drafts payable at a US bank to:
Accounts Receivable
Embedded Support Tools Corp.
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
or wired directly to:
BANKBOSTON N.A.
000 XXXXXXX XXXXXX,
XXXXXX, XX 00000, XXX
ABA # 000-000-000. SWIFT # XXXXXX00
FOR XXXXXXXX SUPPORT TOOLS CORP.
ACCOUNT NUMBER: 1908 - 489 - 2
B. EST reserves the right to change any fee/price set forth in the EST
Price List, provided Distributor is given sixty (60) calendar days prior written
notice. EST reserves the right to increase fees for bundled pricing upon sixty
(60) days written notice in the event there is a material increase in EST price
list or upon renewal of this agreement.
C. Distributor shall pay or promptly reimburse EST for all property,
sales, use and other taxes or duties imposed on EST with respect to this
Agreement and payments made hereunder, including any withholding taxes withheld
on payments made to EST hereunder, but excluding taxes based on EST net income.
D. Distributor shall cause true and accurate books of account and records
relating to the Products to be kept in such detail as to enable EST to ascertain
what fees are due hereunder, and all such books and records shall be open to
inspection and audit by EST or its duly authorized representatives at all
reasonable times during regular business hours, but not more than twice in any
single calendar year. In the event such audit discloses any breach of this
Agreement, Distributor shall pay the full cost of the audit in addition to other
damages and rights available to EST as the result of such breach.
E. For each end-user under a support services agreement Distributor
agrees to pay to EST the applicable annual fee specified in EST's Support Price
List then in effect, minus the discount set forth in Schedule C. Said fees are
due and payable by Distributor within thirty (30) calendar days from the
acceptance of a support services contract from the end-user.
6. TERM
This Agreement shall enter into effect on the date set forth above and
shall have an initial term of one year (365 days) from such date. Said initial
term shall be
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automatically renewed for successive terms of one year (365 days) each, unless
either party notifies the other in writing at least sixty (60) calendar days
prior to the date of expiration of the term in effect, of its election that the
Agreement not be renewed. This Agreement shall be interpreted as a definite term
Agreement.
7. TERMINATION
Either party may terminate this Agreement at any time after the initial
term by giving sixty (60) calendar days prior written notice to the other party.
Either party may terminate this Agreement upon written notice if the other party
breaches any of its basic. obligations hereunder and fails to cure such breach
within thirty (30) calendar days from the date of written notice given by the
other party identifying such breach. Either party may terminate this Agreement
immediately upon written notice if the other party (i) becomes bankrupt or
insolvent, or files a petition therefor, (ii) makes an assignment for the
benefit of its creditors; (iii) enters proceedings for winding up or
dissolution; (iv) is dissolved; (V) is nationalized or is subject to the
expropriation of all or substantially all of its business or assets. EST may
terminate this Agreement upon written notice in the event that Distributor
changes .ownership either by sale, acquisition, merger or other reason.
8. CONSEQUENCES OF TERMINATION
Upon the termination of this Agreement: (i) all orders submitted by
Distributor and not accepted by EST on or before the date of termination shall
be canceled or accepted at the sole option of EST; (ii) Distributor shall return
all lists, catalogs, samples, and promotional literature and Products furnished
to it by EST and any and all copies thereof, and (iii) EST shall not be liable
to Distributor for, and Distributor hereby expressly waives any claims for,
extracontractual compensation or damages of any kind whatsoever in connection
with this agreement or its termination, expiration or modification, whether on
account of the loss by Distributor of anticipated profits or of expenditures,
investments or commitments made in connection with the establishment,
development or maintenance of Distributor's business or for any cause
whatsoever. Sections 3I, 5, 8, 10, 11, 14, 15, and 16 shall survive the
termination, expiration or cancellation of this agreement.
9. NOTICES
All communication between parties shall be made by facsimile, telex, cable,
or regular airmail. Notices concerning termination or alleged breaches hereof
shall be made by registered mail, return receipt requested. Notices are to be
addressed to:
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EST: Distributor
President Vice president Xxxx Xxxx
Embedded Support Tools Corp. Microtek International Inc.
000 Xxxxxx Xxxxxx 6, Industry Xxxx Xxxx XXX
Xxxxxx, Xxxxxxxxxxxxx 00000 Science-Based Industrial Park
USA Hsinchu, Taiwan, R.O.C.
10. CONFIDENTIALITY
Distributor understands and recognizes the confidential and proprietary
nature of the Products and related business and technical information which may
be furnished from time to time to Distributor by EST under this Agreement.
Except that Distributor may ship Products to licensed end-users as provided by
Section 3 above, Distributor shall not disclose, provide or otherwise make
available the Products or related information to any person other than
Distributor employees who have a need to know, without EST prior written
consent, and shall use the same only for purposes consistent with this
Agreement. Distributor agrees to take all the necessary steps to safeguard the
proprietary. and confidential nature of the Products and related information and
to ensure that no unauthorized., person has access to. the Products. and related
information and that no unauthorized copy, in whole or part, in any form, is
made. Distributor further agrees, at EST request, to assist EST in protecting
the same against unlawful appropriation by third parties. The obligations of
this Article do not apply to information that has become part of the public
domain through no fault of Distributor.
11. WARRANTIES
The only warranties which shall be granted by EST with respect to the
Products licensed to end-users within and for installation in the Territory,
shall be those expressly set forth in the EST Software License Agreements,
Hardware Product Users' Manual and Schedule F of this Agreement. IN NO EVENT
SHALL ANY SUCH WARRANTIES OR ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
WITHOUT LIMITATION, WARRANTIES OR MERCHANTABILITY AND FITNESS FOR A PARTICULAR
PURPOSE BE DEEMED TO HAVE BEEN EXTENDED TO DISTRIBUTOR.
12. PATENT AND COPYRIGHT INDEMNIFICATIONS
EST will defend at its own expense any action brought against Distributor
to the extent it is based on a claim that an unmodified Product used by an end-
user within the scope of the EST Software License Agreement infringes a patent
or copyright. EST will pay any costs, damages and attorney fees finally awarded
against Distributor in such action which are attributable to such claim provided
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EST is given prompt written notice of the claim, information, assistance, and
authority over the control of the defense and/or settlement of the same. In the
event that the Product becomes or, in EST opinion, is likely to become the
subject of a claim of infringement, EST may, at its option, secure Distributors
and any licensed end-users' right to continue using the Product, replace or
modify the Product to make it non-infringing or remove the Product and refund
the license fee paid by Distributor thereof as depreciated or amortized over the
lifetime of the Product as established by EST in its sole discretion. EST shall
have no liability for any claim or patent copyright infringement based upon the
use of a combination of the Product with programs or data not supplied by EST
where the Product alone would not constitute an infringement. THE FOREGOING
STATES THE ENTIRE LIABILITY OF EST WITH RESPECT TO INFRINGEMENT OF ANY
COPYRIGHTS OR PATENTS OR OTHER PROPRIETARY RIGHTS BY THE PRODUCTS OR ANY PART
THEREOF.
13. SUPPORT SERVICES
A. EST shall provide Distributor support services which are equivalent to
those normally provided to EST's end-user customers for the Products as follows:
(1) EST will use its reasonable efforts to correct deviations from
the Products' published specifications current at the time of
shipment to Distributor, within reasonable time of written
notification from Distributor of the deviation, such notification
to include the specific version number and parts list number of
the Product that showed the deviation and a complete and accurate
description of the deviation.
(2) EST will provide Distributor updates, enhancements and
documentation of known deviations to the Products as generally
made available by EST to its customers under support services
agreements with EST.
(3) EST will provide Distributor with reasonable telephone
consultations regarding the use and functionality of the
Products.
B. Distributor agrees that it will provide support services for the
Products to its licensed end-users in accordance with EST's standard practices
as set forth in Section 13A above, provided that the end-user has entered into a
support services agreement with Distributor. In no event shall Distributor
distribute support services provided by EST to an end-user who is not under a
support services agreement with Distributor and for which Distributor has not
paid EST a support services fee.
C. EST will make its best effort to enable Distributor to carry out local
repairs to EST hardware products including in-warranty repairs. This will
include the supply by EST, at reasonable cost, of critical parts to enable
Distributor to maintain a local inventory. EST agrees to reimburse Distributor
for any parts used for in-warranty repairs. In the event that it is agreed that
a hardware product should be returned to EST for repair or replacement, EST will
make all reasonable effort to carry out the repair or send a
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replacement within (4) weeks of receiving the returned unit at its place of
business in the USA.
D. All communication from EST, including manuals and technical support
documents, shall be in English.
E. Distributor shall provide the first line of support to its customers
such as installation and operation assistance. For support issues requiring the
assistance of EST, Distributor shall use the standard EST procedure and forms
then in effect for documenting and communicating the support issues to EST.
F. EST shall have no obligation under this Section 13 to provide support
services for Product(s) altered or modified without EST prior written consent;
problems resulting from equipment malfunction or created by causes within
Distributor's or its owner's control; and, at EST option, Product(s) that have
been superseded by a new release for more than six (6) months.
G. Distributor shall, on a quarterly basis, provide EST with a record of
all end-users to which Distributor is providing support services.
H. Distributor will grant EST, reasonable access to any unique software,
equipment or information required by EST in carrying out its obligations under
Section 13A.
14. GOVERNING LAW
The laws of the Commonwealth of Massachusetts, United States of America
shall apply to any interpretation of the terms and conditions of this Agreement.
15. LIMITATION OF LIABILITY
DISTRIBUTOR AGREES THAT EST's LIABILITY, IF ANY, IN ANY ACTION REGARDLESS
OF FORM SHALL NOT EXCEED THE PAYMENTS MADE HEREUNDER BY DISTRIBUTOR TO EST. IN
NO EVENT SHALL EST BE LIABLE FOR ANY INDIRECT, INCIDENTAL OR CONSEQUENTIAL
DAMAGES EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR FOR
CLAIMS BY THIRD PARTIES. DISTRIBUTOR AGREES TO INDEMNIFY AND HOLD EST HARMLESS
FROM AND AGAINST ANY SUIT, CLAIM, EXPENSE, LOSS OR LIABILITY (INCLUDING BUT NOT
LIMITED TO COUNSEL FEES AND EXPENSE) ARISING FROM THE ACT, OMISSION OR
NEGLIGENCE OF DISTRIBUTOR.
16. FOREIGN RESHIPMENT LIABILITY
This Agreement is made subject to any laws, regulations, orders or other
restrictions on export from the United States of America of controlled
commodities, technical data or information about such commodities or data, which
may be imposed from time to time by the Government of the United States of
America.
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Distributor will not export, directly or indirectly, any of the Products or
information pertaining thereto to any country for which the Government of the
United States or any agency thereof requires an export license or other
government approval or written assurance at the time of export without first
obtaining such license, approval or assurance and shall indemnify EST for any
failure to do so.
17. FORCE MAJEURE
EST will incur no liability arising out of any delay in delivery or non-
delivery of any Products or Support Services due to a force majeure. A force
majeure is defined as any circumstances beyond the reasonable control of EST
including, but not limited to, fire, floods, earthquakes, fuel shortages, acts
of nature, war, or acts of any Government.
18. DISPUTES
Any controversy or claim out of or pertaining to this Agreement or breach
thereof shall be resolved by arbitration in accordance with the rules of the
American Arbitration Association, then in effect, at the office of the American
Arbitration Association located closest to ESTs corporate address, and the
decision rendered by the American Arbitration Association shall be final and
binding upon both parties and judgement upon such decision may be entered in any
court of competent jurisdiction. Neither party shall be precluded hereby from
seeking provisional remedies in the courts of any jurisdiction, including but
not limited to temporary restraining orders and preliminary injunctions to
protect its right and interest, but such shall not be sought as a means to avoid
or stay any arbitration. Neither party shall institute a proceeding hereunder
unless, at least thirty (30) calendar days prior thereto, such party shall have
provided to the other party written notice of its intent to do so and the
grounds therefor. The place of arbitration shall be at Canton, Massachusetts if
EST is defending party, or it shall be at Hsinchu, Taiwan if Distributor is
defending party.
19. ASSIGNMENT
Distributor shall not assign or transfer this Agreement or any of its
rights or obligations hereunder, including assignment or transfer to a successor
Company, without the prior written consent of EST. EST may assign, transfer or
delegate any of its rights or obligations hereunder to any affiliated or
subsidiary company of EST or any company acquiring all or substantially all of
the assets of Embedded Support Tools Corp.
20. WAIVER
A. A waiver of any breach or acceptance of any order inconsistent with
the terms of this Agreement, or the making of deliveries pursuant to such order,
shall effect no modification of this Agreement. No waiver of any provision of
this Agreement shall be
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effective unless made in writing. Any waiver of any breach of any provision of
this Agreement shall not constitute a waiver of any subsequent breach of the
same of any other provision of the Agreement.
21. SEVERABILITY
In the event that any provision of this Agreement is declared invalid or
becomes unlawful in its operation, such provision shall be deemed to be omitted
and shall not affect that validity or enforceability of any of the other
provisions.
22. RELATIONSHIP
Distributor shall perform its work as an independent contractor and not as
an employee, agent, or partner of EST. Distributor shall have no right or
authority to enter into any contracts in the name of, or for the account of EST,
nor to assume or create any obligation or liability of any kind, expressed or
implied, on behalf of EST, and shall not take any action which has the effect of
creating the appearance of its having such authority.
23. ENTIRE AGREEMENT
This Agreement, including the attached Schedules A, B, C, D and E, contains
the entire Agreement of the parties hereto. No verbal or oral statements or
representations by either party shall in any way modify, add to, delete or
otherwise amend this Agreement. This Agreement may be changed only by a writing
signed by authorized representatives of the parties hereto.
Agreed to by:
Embedded Support Tools Corp. Microtek international Inc.
Signature: /s/ Xxxxxx XxXxxxxxxxx Signature: /s/ Xxxx Xxxx
------------------------- ------------------
Name: Xxxxxx XxXxxxxxxxx Name: Xxxx Xxxx
------------------------------ -----------------------
Title: Vice President Title: Vice President
----------------------------- ----------------------
Date: 9/1/98 Date: 9/18/98
------------------------------ -----------------------
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SCHEDULE A
TERRITORY
Territory:
1. Taiwan, R.O.C.: nonexclusive distributor
2. China: exclusive distributor
3. Hong Kong: exclusive distributor
4. Australia: exclusive distributor
Initials:
EST: _______________________ Microtek __________________________
SCHEDULE B
PRODUCTS
Products: (Exclusive for Term of this Agreement)
1. ALL PRODUCTS DEVELOPED, MANUFACTURED AND THE OWNERSHIP RIGHTS TO WHICH
ARE THE PROPERTY OF EST.
2.
3.
4.
5.
6.
Initials:
EST: _______________________ Microtek __________________________
SCHEDULE C
Discount Schedule
This schedule is based on US Dollars sent to EST, net of commissions, in
any given calendar quarter.
Sales Volume US Dollars Discount Percentage
----------------------- -------------------
30%
35%
$0 and Above 40%
Initials:
EST: _____________________ Microtek ________________________
