DISTRIBUTION AGREEMENT
made on this 12th day of June 2001
BETWEEN
HOME ART & SALES SERVICES AG
a company incorporated under the laws of Switzerland,
whose registered office is at Xxxxxxxxxxxxxx 00, XX - 0000
Xxxxxxx, Xxxxxxxxxxx
(hereinafter referred to as "Home Art")
AND
CREATIVE PARTNERS INTERNATIONAL INC. LLC
a company incorporated under the laws of the State of Delaware,
United States of America,
whose principal place of business is at 0000 Xx Xxxxxxx Xxxxx,
Xxxxxxxx Xxxx, Xxxxxxxxxx
00000, Xxxxxx Xxxxxx of America
(hereinafter referred to as the "Company")
WHEREAS
A. Home Art supplies (or causes to be supplied) around the World
consumer goods, including, inter alia, the Products (as
herein defined).
B. Home Art wishes to appoint the Company and the Company has
agreed to act as the exclusive distributor of the Products in
the Territory (as herein defined) on the terms and conditions
herein contained.
NOW IT IS HEREBY AGREED as follows:
1 DEFINITIONS
In this Agreement the following words shall have the following meanings:
i) the "Products" shall mean the products (and spare parts therefor)
contained in the patented vacuum system, limited however for the
preservation of foodstuffs, such products bearing the VacSy", the
"Zepter" and/or the "Zepter International" trademarks. All other vacuum
applications used for (cigars, etc.) shall be excluded from this
Agreement. A list of the Products as currently defined and the prices
thereof is annexed hereto as Schedule A.
ii) "Quarter" shall mean the period of three months ending on 31st March,
30th June, 30th September and 31st December of each year.
iii)the "Territory" shall mean the United States of America.
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iv) the "Trademarks" shall mean the VacSy", the "Zepter" and/or the "Zepter
International" trademarks together with any other trademarks used on the
Products supplied by Home Art to the Company during the Term.
2.APPOINTMENT
Subject to the conditions set forth in this Agreement, Home Art
hereby appoints the Company, which accepts such appointment as
its exclusive distributor for the Products to import, sell and
distribute all such Products in the Territory.
3. UNDERTAKINGS OF THE COMPANY
The Company undertakes:
i) to use all reasonable means to ensure that the Products are imported into
the Territory with a minimum of delay and to attend to and complete in a
proper and efficient manner all necessary documents and formalities in
connection therewith. In this respect, all permits, certificates and
licenses required for-the importation, sale and use of the Products in the
Territory are to be obtained by the Company if possible in the name of and
to the benefit of Home Art (or its nominee);
ii) to use its best endeavours to initiate, extend and develop the sale of the
Products in the Territory and not to do anything which may hinder or
interfere with such sales. The Company will take Home Art's existing
marketing policies into consideration;
iii)to pay or ensure payment, pursuant to clause 6 hereof, to Home Art of all
sums due to Home Art in respect of sales of the Products (or spare
parts) in the Territory;
iv) not to make contracts on behalf of Home Art nor, without Home Art's prior
written consent,to make any promises, representations, warranties or
guarantees with reference to the Products on behalf of Home Art or
otherwise incur any liability on behalf of Home Art;
V) to inform Home Art immediately of any changes in the Company's
organisation or method of doing business which might affect the
performance of the Company's duties hereunder. Furthermore, the Company
shall designate a contact person, who must be able to communicate in
English, to act as the liaison between the Company and Home Art in all
matters relating to this Agreement;
vi) to observe all directions and instructions given to it by Home Art in
relation to the promotion, sale, distribution and exploitation of the
Products;
vii)to supply to Home Art on request market reports which shall include
information on demand and competitive activity in relation to the
Products. Furthermore, the Company shall inform Home Art of all
information relevant to the sales of the
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Products in the Territory including the Company's sales prices and
applicable rebates and any further information that may be of interest
to Home Art;
viii)to advise Home Art of all respective current statutory, official and
private regulations, directives, safety standards and other requirements,
including all amendments thereof, that are relevant to the Products in
the Territory and shall provide Home Art with the respective
documentation and regulations;
ix) except with the prior express written consent of Home Art not to assign,
transfer, charge or make over this Agreement or its rights hereunder or
any part thereof nor to appoint sub-distributors hereunder;
X) except with Home Art's prior written consent to purchase the Products and
spare parts therefor only from Home Art;
xi) not to manufacture or distribute during the Term of this Agreement goods
of the same description as the Products or goods in competition with the
Products in the Territory;
xii) to refrain outside the Territory from seeking customers for the Products;
xiii)to refrain outside the Territory from establishing any branch or
maintaining any distribution depot for the sale of the Products;
xiv) to provide for customers of the Products in the Territory an efficient
maintenance after sales service and to maintain at the cost and risk of
the Company a stock of spare parts, accessories and ancillary equipment
adequate therefor;
xv) to sell the Products under the Trademarks and only in those packages and
with those labels and packaging design supplied by Home Art, and to cease
using the Trademarks after any termination of this Agreement;
xvi) not to use the Trademarks otherwise than in accordance with this
Agreement;
xvii) not to give to any purchaser of the Products or to anyone, any guarantee
or warranty with respect to the Products or any instructions for use or
care of the Products, except those previously approved in writing by
Home Art;
xviii)to notify Home Art promptly after becoming aware of any of the following
in the Territory:
(a)any claim of infringement and of the commencement against it
of any action for infringement of patents, trademarks or
other intellectual property rights made or brought against
the Company and relating to the Products;
(b)any unfair competition relating to the Products;
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(c)any infringement or suspected or threatened infringement by a
third party of the intellectual property rights relating to
the Products;
xix) to furnish Home Art (or its nominee) whatever reasonable assistance may
be required, at Home Art's request and expense, to enable Home Art (or
its nominee) to defend any claims or actions referred to in clause
3(xviii)a above made by a third party that may be threatened or filed
against the Company; and
xx) to take such steps as the parties may agree, including the institution
of legal proceedings where necessary, in the name of one of the parties
or in the joint names of Home Art (or its nominee) and the Company in the
event of any infringement or alleged infringement referred to in clause
3(xviii)c above by a third party.
4. UNDERTAKINGS OF HOME ART
Home Art undertakes:
i) to use its reasonable endeavours to comply with any delivery schedule
submitted by the Company and agreed by Home Art. In the event of late
delivery, the Company shall have no claim whatsoever against Home Art
for damages;
ii) to provide such information and support as may reasonably be requested by
the Company to enable it properly and efficiently to discharge its duties
hereunder;
iii)to advise the Company in writing sixty (60) days prior to its withdrawing
or adding any item to the Products available for distribution hereunder;
iv) to provide the Company with such advertising and publicity materials
relating to the Products, in the English and/or the local language, as the
Company may reasonably require. However said materials shall be at the
expense of the Company.
5.TERM
Subject to clauses 9 and 11 below, this Agreement shall remain
in force for an initial term of five years commencing on June 1,
2001 and terminating on May 31, 2006. However, subject always
to the Company satisfying the minimum quantity requirements, set
forth at clause 9 below, this Agreement shall continue
automatically for an indefinite period thereafter unless
terminated by either party giving to the other not less than
three (3) months' written notice of termination expiring at the
end of the initial 5-year term or at any time thereafter.
6. PRICES AND PAYMENTS
6.1. The Prices to be paid by the Company to Home Art for the
Products shall be those prices referred to in the Price
List attached hereto at Schedule A.
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6.2.The prices referred to in the Price Lists shall be fixed on a semi-annual
basis (i.e., from January 1 to June 30 and from July 1 to December 31 of
each year of the Term). In the event that the prices change from one
period to the next, Home Art shall give the Company at least two (2)
months' prior written notice of such change (i.e., notification shall be
given on or prior to April 30 and October 30 for the following
semi-annual period).
6.3.The Company shall have the following payment options with respect to the
Products:
(a) Either payment shall be made in advance by the Company to Home Art.
Payment in advance shall mean prior to delivery of the Products by
Home Art to the Company. For advance payments, the Company will
receive a discount of 2% on the corresponding final invoiced amount;
or
(b) The Company shall pay Home Art the amount provided in each invoice
within thirty (30) days of the date of the invoice, which may be
issued by Home Art on or at any time after delivery of the Products.
In such case, payments to be made hereunder shall be supported by an
irrevocable Letter of Credit, issued by a first class international
bank acceptable to Home Art, to be opened five (5) working days prior
to delivery of the Products and in the full amount representing the
exact value of the Products, in a form and on terms and conditions
acceptable to Home Art.
7. EXPENSES
No claims for or deductions in respect of expenses incurred by
the Company in the performance of its functions and duties under
this Agreement shall be made or allowed except where expressly
agreed to beforehand in writing by Home Art.
8. ORDERS / FORECASTS DELIVERY
8.1.All orders shall be on an Ex-Works (Switzerland) basis or on
an Ex-Works (Italy) basis (Incoterms 2000), depending on the
availability of the Products. All duties, import and/or export
duties and such other taxes, tariffs and surcharges of any
nature whatsoever now or hereafter levied or imposed in any
country or territory either directly or indirectly in respect
of the transfer of the Products to the Company's warehouse or
payments for them and all freight costs and insurance costs
from the place of delivery to the Company's warehouse will
be paid for by the Company. Placing the Products at the disposal
of the Company in Home Art's warehouse in Switzerland or in Italy
shall constitute delivery thereof to the Company and from the
point in time when the Products have been placed at the
disposal of the Company, the Products shall be at the Company's
risk.
8.2.The Company shall provide the three month rolling forecast to
Home Art (or its nominee) by the fifteenth (15 ) day of every
month. This forecast will concern the
Page 5 of 10
request for goods for the three months in the following quarter.
By way of illustration therefore the Company will, on 15th
January, provide a forecast in respect of goods required for
April, May and June.
8.3.The quantities required for the first (V) month of each forecast
shall be regarded as a definitive order to Home Art.
0.0.Xx soon as practicable after receipt of the forecast Home Art
will send to the Company a confirmation of the order for the
deliveries scheduled for the first (1st) month referred to in
the forecast.
8.5.The quantities provided in the forecast for the second (2nd)
and third (3rd) month of each forecast may be revised (upwards
or downwards) by a maximum of ten percent (10%).
8.6.The forecast is binding on the parties except in the case of
"Force Majeure".
9. MINIMUM QUANTITY REQUIREMENTS
9.1.Subject to clause 9.2 below, from September 1, 2001 to May 31,
2006, the Company hereby undertakes to purchase from Home Art
a minimum quantity of Products, the total value of which shall
not be less than US$44,000,000 (excluding VAT, or the equivalent
thereof). The purchase schedule for the Term shall be as follows:
Minimum
Purchase Amount
From September 1, 2001 to November 30, 2001 US$ 500,000
From December 1, 2001 to May 31, 2002 US$ 4,000,000
From June 1, 2002 to November 30, 2002 US$ 3,250,000
From December 1, 2002 to May 31, 2003 US$ 3,250,000
From June 1, 2003 to November 30, 2003 US$ 4,000,000
From December 1, 2003 to May 31, 2004 US$ 4,000,000
From December 1, 2004 to May 31, 2005 US$ 5,500,000
From June 1, 2005 to November 30, 2005 US$ 7,000,000
From December 1, 2005 to May 31, 2006 US$ 7,000,000
TOTAL US$ 44,000,000
9.2.The Company acknowledges that the UL approval for certain Products,
namely VG-017, VG-017-P and VG - 010 as described in Schedule A
hereto, has been requested and should be granted by September 1, 2001.
However, in the event that such approval is not granted by September
1, 2001, then the parties shall negotiate the revision of the purchase
schedule set forth above in order to reflect the actual date at which
the approval is granted.
0.0.Xx the event that the Company fails to respect the purchase schedule
set forth at clause 9.1 above, as may be amended in accordance with
clause 9.2 above, or in
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any subsequent six-month period of the Term as may be extended,
then Home Art shall have the right to either revoke the
exclusive right of the Company to distribute the Products (such
that the right becomes non-exclusive), or to terminate this
Agreement, with immediate effect, by advising the Company by
written notice of its wish to do so.
0.0.Xx the event that the Company satisfies the minimum quantity
requirements contained in the purchase schedule at clause 9.1
above, as may be amended pursuant to clause 9.2 above, then
the parties shall negotiate, in good faith, at the beginning
of each subsequent year of the Term the six-monthly minimum
quantity requirements to be achieved by the Company during
each additional year of the Term.
10. GUARANTEE BONUS
In consideration of the Company agreeing not to accept any
express warranties by Home Art in respect of the design,
material and workmanship of the Products, Home Art hereby agrees
to deduct 2% (excluding VAT, if applicable) from each invoiced
amount by way of a "Guarantee Bonus". Consequently, to the
extent permitted by law, any defective Products shall not be
returned by the Company to Home Art, nor shall they be replaced
"one-to-one" by Home Art. The Company hereby accepts
responsibility for the after-sales service and for the
replacement of any defective Products towards its customers.
11. LIMITATION OF DAMAGES
00.0.Xx consideration of Home Art providing the Company with the
Guarantee Bonus referred to at clause 10, above, the
Company hereby acknowledges and accepts that Home Art makes
no express warranties concerning the design, material or
workmanship of the Products and that, to the extent
permitted by law, Home Art shall therefore be under no
liability to the Company for any damages or losses, direct
or indirect, resulting from defects in design, materials or
workmanship in respect of the Products.
11.2.Home Art shall have no liability for any indirect or
consequential losses or expenses suffered by the Company in
respect of the Products, however caused, including but not
limited to loss of anticipated profits, goodwill,
reputation, business receipts or contracts, or losses or
expenses resulting from third party claims in relation to
the Products.
12. TERMINATION
12.1.1. If either party shall go into liquidation either
voluntary or compulsory (except for the purpose of
amalgamation or reconstruction previously approved of in
writing) or sell or dispose of its undertaking or the major
part thereof or in any manner assign this Agreement or make
any assignment for the benefit of creditors or cease or
threaten to cease to carry on business or is unable to pay
its debts as they fall due; or
Page 7 of 10
12.1.2. if a receiver or receiver and manager or judicial
manager or administrator is appointed for either party over
the whole or any part of its assets and is not withdrawn
within forty-eight (48) hours of appointment; or
12.1.3. if either party shall commit any material breach
(whether remediable or not) of its obligations under this
Agreement and (if remediable) shall fail to remedy the
breach within thirty (30) days of notice given by the other
party to the former party requiring it to do so,
then upon the happening of any one or more of such events the
other party shall have the right forthwith by notice in writing
to terminate this Agreement.
12.2.Any termination of this Agreement shall be without
prejudice to the right of Home Art to recover any monies
due to it under this Agreement and to the rights or
remedies of either party in respect of any antecedent
breach of this Agreement.
00.0.Xx the event of termination of this Agreement for any
reason, no claims or goodwill shall arise therefrom, and
the Company shall immediately cease from making any
representations regarding its status as a distributor for
Home Art and from taking any other action or doing any
other thing relating it to Home Art or to the Products,
including without limitation to the Trademarks relating to
the Products save that in the event of termination by
effluxion of time the Company shall have the right to sell
off its remaining stock of the Products within three (3)
months from the date of termination and all the obligations
(including payment obligations) of the Company herein
contained shall continue to apply until the end of that
three (3) month period.
12.4.Upon any termination of this Agreement, the Company shall
take all necessary measures in order to transfer any
permits and licenses for the Products that may be in the
Company's name to Home Art (or its nominee).
12.5.The Company hereby waives, to the extent it is able to do so
by law, any statutory rights or other rights it may have or
acquire in respect of the termination of its relationship with
Home Art arising hereunder and the Company agrees that the rights
available to it hereunder, in the event of termination of this
Agreement, are adequate and correctly reflect the Agreement of
the parties.
13. ENTIRE AGREEMENT
This Agreement is the entire and sole agreement and
understanding of the parties hereto and supersedes all other
prior agreements, understandings and communications (if any),
whether oral or written.
14. HEADINGS
The headings of the clauses and sub-clauses of this Agreement
have been added for convenience only and shall not affect the
interpretation of this Agreement.
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15. FORCE MAJEURE
15.1.The obligations of the parties hereunder (other than an
obligation to pay money) shall be suspended during the
period and to the extent that such party is prevented or
hindered from complying therewith by "Force Majeure" (as
hereinafter defined). In such circumstances such party
shall give notice of suspension as soon as reasonably
possible to the other party stating the date and extent of
such suspension and the cause thereof and the omission to
give such notice shall forfeit the rights of such party to
claim Force Majeure. Either party whose obligations have
been suspended as aforesaid shall resume the performance of
such obligations as soon as reasonably possible after the
removal of the cause and shall so notify the other party.
In the event that the circumstances of Force Majeure
continue for more than six (6) months, either party may
terminate this Agreement on thirty (30) days written
notice.
15.2."Force Majeure" means any cause beyond the reasonable
control of such party including (insofar as beyond such
control but without prejudice to the generality of the
foregoing expression) strikes, (whether official or
unofficial), lock-outs, labour disputes, act of God, war,
warlike operations, riot, civil commotion, malicious
damage, or shortage of labour, raw material or other
supplies, and compliance with any law or governmental
order, rule, regulation or direction.
16. CONFIDENTIALITY
The Company hereby undertakes to maintain the confidentiality of
any trade secrets, knowhow, customer files, financial
information, strategic planning information, or other
information relating to Home Art which is not a matter of public
knowledge at the time such information is disclosed to the
Company, both during the Term and after the expiry or earlier
termination of this Agreement, until such time as that
information becomes a matter of public knowledge through no act
or omission of the Company.
17 INVALIDITY OF PARTICULAR PROVISION
If any term of this Agreement shall, to any extent, be invalid,
illegal or unenforceable, the remainder of this Agreement shall
not be affected thereby, and each provision of this Agreement
shall be valid and enforceable to the fullest extent permitted
by law.
18. NOTICES
All notices shall be in writing and shall be served personally
or by registered or certified air mail (return receipt
requested) or courier service to either party at its address set
forth in this Agreement or at such other address as each party
may provide to the other in writing from time to time. Service
of any such notice served at such address in accordance with
this clause shall be effective upon receipt or within five (5)
working days from the date of posting (postage prepaid, properly
addressed and registered) whichever is the earlier.
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19. LIMITATION OF AUTHORITY
The Company shall act solely as an independent contractor and
shall have no legal power or authority, either expressed or
implied, to act for, bind or commit Home Art in any way
whatsoever and the parties hereby acknowledge that nothing in
this Agreement is intended to result in the appointment of the
Company as an agent of Home Art, or to create a joint venture
between the parties hereto. Furthermore, Home Art shall retain
title and ownership of all know-how for the Products and of all
information and material made available to the Company, which
are subject to copyright.
20. COMPLIANCE WITH GOVERNMENTAL REGULATIONS
The parties hereby acknowledge that the sale and delivery of the
Products are subject to the import, export and re-export laws
and other laws and regulations of the countries involved.
21. APPLICABLE LAW
21.1.This Agreement shall be governed by and construed in
accordance with the laws of Switzerland.
21.2.Any disputes arising in connection with this Agreement
shall (if an amicable settlement cannot be reached between
the parties) be finally settled under the Rules of
Conciliation and Arbitration of the International Chamber
of Commerce by three arbitrators appointed in accordance
with the said rules. The arbitration shall be held in the
English language and shall take place in London, England.
IN WITNESS whereof this Agreement has been executed by the duly
authorised representatives of the parties hereto on the day and
year first above-mentioned.
For and on behalf of For and on behalf of
HOME ART & SALES SERVICES AG CREATIVE PARTNERS INTERNATIONAL
BY BY
Duly Authorised Representative Duly Authorised Representative
tiome. Art 6 Sales swwces 041
Xxxxxxxxxxxxxx 00
0000 Xxxxxxx (XxxxxxxxxxX
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SCHEDULE A
VacSy Vacuum System
VG-011-USA VacSy Pump 20.13
VG-011-15 Glass Container 15x15x8.5cm Capacity 1.01 7.05
VG-011-19 Glass Container 19x19x9.5cm capacity 1.91 9.40
VG-011-20 Glass Container 21x13x8.5cm Capacity 1.61 8.05
VG-011-22 Glass Conatiner 22x22x10.5cm Capacity 3.21 11.07
VG-011-26 Glass Container 26x21x9.5cm Capacity 3.41 12.42
VG-012-18 Glass Container 18x9.5cm Capacity 1.51 7.72
VG-012-23 Glass Container 23x10.5 capacity 2.81 10.07
VG-013.05 Canister small 11cm h 13cm Capacity 0.51 5.03
VG-013-10 canister medium 11cm h 19.5cm Capacity 1.01 6.04
VG-013-15 Canister large 11cm h26.5cm Capacity 1.51 6.71
VG-013-20 canister extra large 11cm h33.5cm Capacity 2.01 7.72
VG-014-08 Universal Lid 4-8 cm 3.36
VG-014-16 Universal Lid 8-16cm 5.03
VG-015-19 Cheese Xxxx small/round 19x11cm 11.74
VG-015-22 Cheese Xxxx square 22x22x13cm 13.76
VG-015-28 Cheese Xxxx big/round 28x14cm 15.44
VG-015-30 Cheese Xxxx rectangular 30x22x15cm 16.44
VG-016 Bottle Caps 2 pieces 1.95
VG-017-USA vacSy Bag Sealing Unit 40.27
VG-017-P-USA vacSy Bag Sealing Unit with Pump 50.33
VG-017-N12 Single Bags, 12 pieces 28x50cm 2.50
VG-018-16T Lexi Lid 16cm transparent 6.71
VG-018-18T Lexi Lid 18cm transparent 7.72
VG-018-20T Lexi Lid 20cm transparent 8.39
VG-018-22T Lexi Lid 22cm transparent 9.06
VG-018-24T Lexi Lid 24cm transparent 9.73
VG-019 Car Cable 5.20
VG-021-1 Food Jar capacity 2.51 5.03
VG-021-2 Set of Food Jars, 2 pieces capacity 2.51 9.40
VG-150 vacSy MINI set (5 pcs) 48.73
VG-160 vacSy STANDARD Set (9 pcs) 74.40
VG-170 vacSy FAMILY Set (11 pcs) 118.21
