Distributorship Agreement
This
Distributorship Agreement (the “Agreement”) is entered into as of January 24,
2006 (1-24-2006) by and between ShieldZone Corporation, a Utah corporation
(“ShieldZone”) and ENVIOUS (“Distributor”).
RECITALS
WHEREAS,
ShieldZone manufactures and sells invisibleSHIELDTM
branded
protective films for protecting screens of electronic devices including, but
not
limited to, cellular telephones, portable music/video players and other portable
electronic devices and/or for protecting casings or housings of said electronic
devices in the United Staes of America; and
WHEREAS,
Distributor is in the business of distributing such protective films;
and
WHEREAS,
the parties desire that Distributor shall have the right to sell
invisibleSHIELDTM
branded
protective films in the United Kingdom (“Territory”) (including Great Britain,
Scotland, Ireland, Wales, Isle of Wight, Isle of Man and Jersey) (Any future
addition of Territories must be agreed to in writing before Distributor engages
in selling invisibleSHIELDTM
products
in potential new territories.)
NOW,
THEREFORE, in consideration of the mutual covenants set forth in this Agreement,
the parties agree as follows:
SECTION
ONE—PROMOTION OF SALE
Distributor
will use its best efforts, and make available the use of its sales force, for
the purpose of promoting the sale of ShieldZone invisibleSHIELDTM
branded
protective films within the Territory. Distributor may also promote the sale
of
ShieldZone accessories, as mutually agreed upon by the parties.
SECTION
TWO—COVENANTS OF DISTRIBUTOR
Distributor
shall perform, at Distributor’s expense, the following duties to ShieldZone’s
satisfaction:
2.1 Promotions
and Marketing.
Distributor shall engage in sales promotion activities in the Territory,
including, but not limited to, the distribution of marketing materials to
current and potential customers. Distributor shall pay for printing of any
marketing materials to be used in the Territory, and all such marketing
materials are subject to approval by ShieldZone. ShieldZone shall provide
samples to Distributor at no charge. ShieldZone invisibleSHIELDTM
branded
films and accessories are collectively referred to as “ShieldZone Products”.
2.2 Sales
Organization.
Distributor will maintain a qualified sales organization which will call on
customers and potential customers in the Territory as may be reasonably likely
to purchase any of the ShieldZone products. Distributor shall adhere to
ShieldZone sales and marketing programs as provided to Distributor by ShieldZone
from time to time.
2.3 Places
of Business; Inventory.
Distributor shall establish, staff, and maintain a place or places of business
in the Territory as may be necessary to provide good customer support and
marketing coverage in the Territory. Distributor will purchase and maintain
an
inventory of ShieldZone Products as necessary to adequately service customer
requirements in the Territory.
2.4 Coordination.
Distributor shall coordinate its sales efforts with ShieldZone. In addition,
Distributor shall establish and maintain records of its sales in sufficient
detail to permit identification and destination of each of the ShieldZone
Products sold by Distributor and Distributor shall make these records available
for inspection and copying by ShieldZone. Distributor shall retain these records
until ShieldZone either (a) accepts custody of the records, or (b) consents
in
writing to their destruction or other disposal.
2.5 General
Conduct and Non-Competition.
Distributor shall at all times conduct its business in a manner as will reflect
favorably on ShieldZone and the ShieldZone Products and shall not engage in
any
deceptive, misleading, illegal, or unethical business practice. Distributor
shall not design, manufacture, or market, nor will it act as a representative
or
distributor for, any products that compete with the ShieldZone Products during
the term of this Agreement and for two (2) years following termination of this
Agreement.
2.6 Sales
Only in Territory.
Distributor shall not offer or sell ShieldZone Products outside of the Territory
and shall refer all inquiries regarding potential customers outside of the
Territory to ShieldZone. In addition, Distributor shall not offer or sell
ShieldZone Products to anyone who has the intent to offer or sell the ShieldZone
Products outside of the Territory. Distributor shall not offer or sell
ShieldZone Products on the Internet. ShieldZone may sell ShieldZone Products
to
customers from the Territory who place orders over the Internet.
SECTION
THREE—PURCHASE OF PRODUCTS
3.1 Purchase
Orders.
Purchase of ShieldZone Products under this Agreement shall be made by delivery
to ShieldZone of Distributor’s written purchase orders specifying in reasonable
detail the types and quantities of ShieldZone Products being ordered. No
purchase order is binding upon ShieldZone until accepted in writing by
ShieldZone. Nothing in this Agreement is intended to create any duty on the
part
of ShieldZone to accept any order, it being expressly understood that the
acceptance or rejection of any order is at the sole discretion of
ShieldZone.
3.2 Prices.
Prices
and minimum order quantities shall be provided by ShieldZone to Distributor
upon
receipt of each purchase order from Distributor and are subject to change at
any
time by ShieldZone until each order is finalized. Prices and minimum order
quantities shall be determined separately for each purchase order.
SECTION
FOUR—TERM AND CONDITIONS
4.1 Shipment.
All
shipments under this Agreement shall be made in ShieldZone’ standard shipping
packages to Distributor’s address in Territory. Unless otherwise instructed in
writing by Distributor, ShieldZone shall select the carrier.
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4.2 Acceptance.
Distributor must inspect all ShieldZone Products promptly upon receipt at the
shipping destination and may reject any goods that fail in a significant respect
to meet ShieldZone’ acceptance specifications. ShieldZone Products not rejected
by written notice to ShieldZone within 10 days of receipt shall be deemed to
have been accepted. Rejected products shall be returned freight prepaid to
ShieldZone within 10 days of the date ShieldZone authorizes return. As promptly
as possible after receipt by ShieldZone of properly rejected goods, ShieldZone
may, at its sole option, either repair or replace the properly rejected goods,
or refund the purchase price to Distributor. ShieldZone shall prepay
transportation costs back to Distributor and shall reimburse Distributor for
any
costs of transportation incurred by Distributor in connection with the return
to
ShieldZone of properly rejected goods; otherwise, Distributor must pay
transportation costs in both directions.
4.3 Payment.
Terms
of payment shall be Net-30, except on the first order. First order Terms of
Payment are as follows: ½ of payment (via wire transfer) must be received before
shipement.
4.4 Taxes.
Distributor shall bear all applicable federal, state, municipal and other
government taxes (such as sales, use, value added, or any similar taxes); all
customs duties, levies, imports, and similar charges; and all personal property
taxes assessable on the ShieldZone Products after delivery to the carrier at
ShieldZone’ distribution center.
4.5 Resale
Prices.
Distributor may set its own resale price for the ShieldZone Products, except
that such prices must be mutually agreed to be reasonable after consultation
with ShieldZone. Notwithstanding the foregoing, retailers in the Territory
shall
be required by Distributor to sell the ShieldZone Products within the range
of
ShieldZone’ suggested retail price (MSRP) and shall require that retailer not
sell the ShieldZone Products below ShieldZone’ minimum retail price (MMRP). (See
attached Exhibit A for pricing details).
4.6 Limitation
of Liability and Indemnity Provisions.
Notwithstanding any provision in this Agreement to the contrary, in no event
is
ShieldZone liable for indirect, incidental, or consequential damages and in
no
event may the liability of ShieldZone arising in connection with any of the
ShieldZone Products sold hereunder (whether this liability arises from a claim
based on contract, warranty, tort, or otherwise) exceed the actual amount paid
by Distributor to ShieldZone for the Products. Distributor shall indemnify
ShieldZone, its directors, officers, agents, employees, and affiliates for
any
actions, claims, liability, or losses resulting or arising from Distributor’s
use, promotion, marketing, or sale of ShieldZone Products.
4.7 Use
of
Trademarks.
Distributor is granted a limited right, during the term of this Agreement,
to
use the trademarks, service marks, corporate names, trade names, trade dress,
and logos (collectively referred to herein as “Trademarks”) owned by ShieldZone
in connection with the promotion and sale of ShieldZone Products. This limited
right is expressly limited to uses approved by ShieldZone and necessary for
sale
of the ShieldZone Products and to the performance of Distributor’s obligations
under this Agreement. Any use by Distributor of any Trademark used or otherwise
owned anywhere in the world by ShieldZone (collectively referred to herein
as
the “ShieldZone Trademarks”) must first be approved in writing by ShieldZone.
Distributor shall not: (i) use any ShieldZone Trademark as part of or in
combination with any Trademark not owned by ShieldZone; (ii) use any ShieldZone
Trademark on or in connection with products not purchased from ShieldZone;
or
(iii) take any action that could damage, injure,
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or
disparage ShieldZone or the ShieldZone Trademarks. Distributor shall not
use any
Trademark other than the ShieldZone Trademarks on or in connection with the
ShieldZone Products.
4.8 Ownership
of Trademarks.
Distributor acknowledges ShieldZone’ exclusive ownership of, and the renown of,
the ShieldZone Trademarks throughout the world and specifically in the
Territory. Distributor acknowledges (i) the value of the goodwill associated
with the ShieldZone Trademarks; and (ii) that the ShieldZone Trademarks have
acquired secondary meaning in the mind of the public. Distributor shall not
take
any action inconsistent with ShieldZone’ exclusive ownership of the ShieldZone
Trademarks. Distributor has not acquired and shall not acquire, whether by
operation of law, or otherwise, any right, title, or interest in or to any
ShieldZone Trademarks. Any use by Distributor of the ShieldZone Trademarks
and
any goodwill or benefit arising therefrom shall inure to the sole and exclusive
benefit of ShieldZone. Distributor shall have no right to assign or sublicense
the use of any ShieldZone Trademark. In the event any ownership rights relating
to any ShieldZone Trademark become vested in Distributor, Distributor hereby
assigns and agrees to assign any such rights to ShieldZone and shall execute
all
documents and perform all actions reasonably necessary to effectuate and record
such ownership and assignment(s) free of additional consideration. In the event
that Distributor uses any Trademark other than a ShieldZone Trademark (“Other
Trademarks”) in conjunction with a ShieldZone Trademark or on or in connection
with a ShieldZone Product, without ShieldZone’ written consent, such Other
Trademark shall be the sole and exclusive property of ShieldZone, unless
Distributor ceases such unauthorized use within 10 days following written Notice
from ShieldZone.
4.9 Ownership
of Works.
All
works that are copyrighted, copyrightable or otherwise subject to intellectual
property protection (“Works”), including, without limitation, translations,
promotional, advertising, marketing, packaging and sales materials, used by
Distributor on or in connection with the ShieldZone Products, shall be deemed
a
“work made for hire” and shall be owned exclusively by ShieldZone pursuant to
this written instrument. To the extent that any such Works are not a “work made
for hire” under applicable law, Distributor hereby assigns and agrees to assign
to ShieldZone, all right, title, and interest in all intellectual property,
such
as copyright protection, relating to such Works. Distributor shall execute
all
documents and perform all actions reasonably necessary to effectuate and record
such ownership and assignment(s) free of additional consideration.
4.10 Confidential
Information.
Distributor shall maintain the confidentiality of all information that is
received from ShieldZone, including, without limitation, information relating
to
new products, trade secrets, business plans and relationships, strategic
marketing plans, financial matters, manufacturing methods, sources of supply,
customers, and other information that is proprietary to ShieldZone (collectively
known as “Confidential Information”). Distributor shall not use Confidential
Information in any way detrimental to ShieldZone and shall not directly or
indirectly disclose Confidential Information outside of Distributor. Distributor
hereby assigns to ShieldZone, all rights, title, and interest, in and to all
work product conceived, produced, or otherwise generated by Distributor in
connection with Distributor’s receipt of Confidential Information, including,
but not limited to any ideas, inventions, copyrights, discoveries and/or
improvements generated by Distributor. Distributor shall execute all documents
and perform all actions reasonably necessary to effectuate and record such
ownership and assignment(s) free of additional consideration. Distributor shall
maintain as confidential: (i) this Agreement; and (ii) all information relating
to the terms of this Agreement. Information received from ShieldZone shall
cease
to be Confidential Information when it is: (i) in the public
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domain;
or (ii) is received by Distributor from a source other than ShieldZone, as
shown
by Distributor’s records, that does not have a confidentiality agreement with
ShieldZone.
4.11 Cooperation.
Upon
ShieldZone’ request, Distributor shall provide to ShieldZone such documents,
specimens, packaging, labels, tags, or other materials required for the
execution, filing, and prosecution of any applications or registrations relating
to ShieldZone’ intellectual property and shall perform all other actions
reasonably required for such applications or registrations or to effectuate
and
record any assignments required herein. Distributor shall also perform all
actions reasonably required to confirm this Agreement or to record Distributor
as a registered user in the Territory. All such confirmations or recordations
may be cancelled solely by ShieldZone. Distributor hereby consents to such
cancellation as requested by ShieldZone.
4.12 Infringement.
Distributor shall immediately notify ShieldZone of any infringement of any
intellectual property rights owned by ShieldZone, and shall cooperate with
and
assist ShieldZone, in connection with any action ShieldZone may elect to
undertake relating thereto. ShieldZone shall have the sole right to engage
in,
prosecute, withdraw from, or receive monetary compensation in any action
relating to any such infringement.
4.13 Export
of Products.
Any and
all obligations of ShieldZone
to
provide products shall be subject in all respects to United States laws and
regulations relating to the delivery of products abroad. Distributor shall
be
solely responsible for the payment or discharge of any fees or duties in
connection with transporting ShieldZone
Products
to or selling or using ShieldZone
Products
in the Territory.
4.14 Approval
Process.
Prior
to using any materials that incorporate a ShieldZone Trademark, such as
packaging, promotional, marketing, or sales materials, Distributor shall submit
such materials to ShieldZone for approval. In the event ShieldZone fails to
give
its written approval within 20 days from ShieldZone’ receipt of such materials,
the materials shall be deemed not to have been approved.
SECTION
FIVE—TERM AND TERMINATION
5.1 Term.
Unless
terminated earlier pursuant to this Section Five, this Agreement shall terminate
on January 24th,
2007.
5.2 Breach.
Any
material breach of this Agreement by either party constitutes a default if
not
cured within 20 days after written notice of the breach is given. Upon default
by either party, the other party may terminate this Agreement immediately upon
written notice.
5.3 Termination
without Cause.
Either
party may unilaterally terminate this Agreement at any time without cause on
60
days’ written notice to the other party.
5.4 Termination
for Insolvency.
Subject
to any applicable law to the contrary, this Agreement may be immediately
terminated by either party in the event the non-terminating party files or
becomes the subject of any action for bankruptcy, reorganization, receivership
or similar relief under any laws intended for the benefit of creditors, shall
have a receiver or manager appointed in respect to any part of the
non-terminating party’s business, shall make an
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assignment
for the benefit of a creditor or shall become insolvent, or in the event
that
the non-terminating party shall voluntarily or involuntarily dissolve,
liquidate, or terminate its existence.
5.5 Effect
of Termination.
Upon
termination, Distributor shall cease being a ShieldZone distributor, and neither
party shall have any further rights against the other except for money owed
and
other rights as by their nature must survive termination of this Agreement,
including, but not limited to, the obligations contained in Sections 2.4, 2.5,
and 4.8-4.11, which shall survive termination of this Agreement.
SECTION
SIX—MISCELLANEOUS
6.1 Independent
Contractor.
Distributor is an independent contractor and not an agent or employee of
ShieldZone, and will not hold itself out as, or give any person reason to
believe that it is, an agent or employee of ShieldZone. Distributor shall not
make any representations or warranties of any kind on behalf of ShieldZone.
Distributor shall indemnify and hold ShieldZone harmless from and against any
and all claims, liabilities, and damages arising out of breach of this provision
by, or otherwise attributable to any act or omission of, Distributor, its agents
or employees.
6.2 Assignment.
Rights
conferred on Distributor by this Agreement are personal and may not be
transferred, sublicensed, or assigned without ShieldZone’ prior, express and
written consent.
6.3 Governing
Law.
This
Agreement shall be governed by, construed, and enforced in accordance with
the
laws of the State of Utah, United States of America.
6.4 Equitable
Relief.
Each
party further understands and agrees that (i) money damages would not be a
sufficient remedy for any breach of this Agreement and (ii) the non-breaching
party would be irreparably harmed if any of the provisions of this Agreement
were not performed in accordance with their respective terms or were otherwise
breached and, accordingly, that the non-breaching party shall be entitled to
specific performance and injunctive or other equitable relief as a remedy for
any such breach. Each party further agrees to waive any requirement for the
securing or posting of any bond in connection with any such remedy. Such remedy
shall not be deemed to be the exclusive remedy for the breach of this Agreement,
but shall be in addition to all of the remedies at law or in equity to the
non-breaching party.
6.5 Arbitration.
Distributor agrees that any and all controversies, claims or disputes with
ShieldZone arising out of this Agreement, including, without limitation, any
breach of this Agreement, shall be subject to binding arbitration. DISTRIBUTOR
AGREES TO ARBITRATE, AND THEREBY AGREES TO WAIVE ANY RIGHT TO A TRIAL BY JURY
WITH RESPECT TO ALL DISPUTES ARISING FROM OR RELATED TO THIS AGREEMENT.
Distributor agrees that any arbitration will be administered by the American
Arbitration Association (“AAA”), consistent with its rules, and that such
arbitration shall take place in Salt Lake City, Utah, United States of
America.
6.6 Attorney
Fees.
In the
event that any action is filed in relation to this Agreement, the unsuccessful
party in the action shall pay to the successful party, in addition to all the
sums that the unsuccessful party may be required to pay, a reasonable sum for
the successful party’s attorney fees and costs.
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6.7 Headings.
The
headings used in this Agreement are for convenience only and are not a part
of
this Agreement and do not in any way limit or amplify the terms and provisions
of this Agreement.
6.8 Impracticability.
This
Agreement may be terminated at any time without liability of one party as
against the other if the situation between nations renders the performance
of
this Agreement impracticable.
6.9 Entire
Agreement.
This
Agreement supersedes and cancels all prior agreements, if any, between the
parties, and may not be amended, altered, or changed except by a written
agreement signed by both parties. This Agreement is in the English language
only, which language in controlling in all respects.
6.10 Notices.
Any
Notice, approval, or other communication required or permitted herein shall
be
in writing and shall be considered to be given: (a) upon personal delivery
or
delivery by facsimile (with confirmation of receipt); or (b) two (2) days after
being deposited with an international courier (e.g., United Parcel Service)
via
second-day guaranteed express air mail. All such communications shall be to
the
following:
To
ShieldZone:
Xxxxxxx
Chipping
ShieldZone,
Inc.
0000
Xxxxx 000 Xxxx Xxxxx X
Xxxx
Xxxx
Xxxx, XX 00000
XXX
Facsimile
No. (000) 000-0000
with
a
courtesy copy to:
Xxxx
X.
Xxxx
Xxxxxxx
Xxxxxxxx
1000
Eagle Gate Tower
60
East
South Temple
Salt
Lake
City, Utah 8411
Facsimile
No. (000) 000-0000
To
Distributor:
ENVIOUS
Facsimile
No.
6.11 Effect
of Partial Invalidity.
The
invalidity of any part of this Agreement shall not be deemed to affect the
validity of any other part. In the event that any provision of this
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Agreement
is held to be invalid, the parties agree that the remaining provisions shall
be
deemed to be in full force and effect.
6.12 Waiver.
Failure
by either party at any time or from time to time to enforce any of the
provisions of this Agreement is not construed to be a waiver of that provision
or of the party’s right to subsequently enforce each and every provision of this
Agreement.
6.13 Counterparts.
This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed to be an original, but all of which together shall constitute but one
and
the same instrument.
IN
WITNESS HEREOF, the parties have executed this Agreement as of the date first
written above.
| ShieldZone, Inc.: | ENVIOUS |
| By: __________________ | By: ______________ |
| Name: Xxxxxx X. Xxxxxxxx XX | Name: Xxxxx Naseem__ |
| Its: President & CEO______ | Its: ______________ |
