EXHIBIT 16.1
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT (this "AGREEMENT") is made effective as of the
4th day of October, 2005 by and between NeoMedia Micro Paint Repair, Inc., a
Nevada corporation with its principal place of business at Jetport Commerce Park
00000 Xxxxxxx Xxxx #00-00, Xx Xxxxx, Xxxxxxx 00000 ("NMPR"), and WI-THO AS, a
Norwegian corporation with its principal place of business at Xxxxxxxxxxxxxxx 0,
0000 Xxxx, Xxxxxx (the "Distributor").
W I T N E S S E T H :
WHEREAS, Distributor is in the business of marketing and/or distributing a
variety of automotive products, tools and other automotive-related businesses
and systems.
WHEREAS, NMPR (i) manufactures and sells chemicals, paints, and related
products that are more fully described in Section 3.1 hereof and that are
described with particularity in Exhibits A and B hereof (collectively, the
"Products"), and (ii) provides certain limited Technical Support and Services as
set forth in Exhibit C hereof.
WHEREAS, Distributor desires to offer the Products for sale throughout the
Territory described in Section 1.1 hereof, on a exclusive basis, as an NMPR
Distributor, such designation entitling the Distributor to market and sell the
Products in the Territory under the Distributor's own brand name using
Distributor's proprietary labeling.
WHEREAS, NMPR desires to appoint Distributor as a distributor of the
Products throughout the Territory, and should Distributor desire to enter other
markets outside of the Territory and subsequently notify NMPR of such desire,
NMPR would consider such an appointment at such time, all in accordance with
this Agreement.
WHEREAS, concurrent with the execution of this Agreement, pursuant to
Section 8.1.4 hereof, and in any event before any technical training of the
Distributor by NMPR pursuant to this Agreement commences, Distributor has signed
a Confidentiality and Non-Competition Agreement in the form attached hereto as
Exhibit D (the "Confidentiality and Non-Competition Agreement").
WHEREAS, Distributor is being trained in the procedures and processes of
the NMPR painting system (the "System") and realizes that the System represents
a unique proprietary process.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements and upon the terms, and subject to the
conditions hereinafter set forth, the parties, intending to be legally bound,
hereby agree as follows:
ARTICLE I
APPOINTMENT
1.1 Appointment as Exclusive Distributor. Subject to the terms and
conditions of this Agreement, NMPR hereby appoints Distributor as an exclusive
distributor of the Products throughout Norway, Denmark, and Sweden (the
"Territory") and Distributor accepts this appointment.
1.2 Defintions
(a) Defintion of exclusivity. For the purposes of this Agreement,
"exclusive" means that although Distributor has the right to sell
and distribute the Products in the Territory, NMPR shall be
entitled, either directly or indirectly, to quote prices, sell
and/or deliver the Products on an unfettered and unlimited,
wholesale or retail basis throughout the world except for in the
territory specified in Section 1.1. hereof.
(b) Definitions of Affiliate and Subsidiary. For the purposes of
Section 1.2(a) hereof: (i) an entity is "affiliated" with
another entity if one of them is the subsidiary of the other,
or both are subsidiaries of the same entity, or each of them
is controlled by the same person or entity and if each entity
is affiliated with the same entity at the same time, then each
is deemed to be affiliated with the other; (ii) an entity is a
subsidiary of another entity if (a) it is controlled by that
other entity, or by that other entity and one or more
entities, each of which is controlled by that other entity, or
by two (2) or more entities, each of which is controlled by
that other entity, or (b) it is a subsidiary of a subsidiary
of that other entity; and (iii) an entity is controlled by a
person or entity if the shares or interests of the entity
carrying more than 50% of the votes for election of the
directors are held, other than by way of security, by or for
the benefit of that person or entity and the votes carried by
such shares or interests are sufficient, if exercised, to
elect a majority of the directors of the entity.
(c) Definition of distributor
Distributor is defined as the parent company WI-THO AS located
in Norway and the wholly owned subsidiaries WI-THO AB (Sweden)
and WI-THO A/S (Denmark). Direct sales from these three units
are not defined as sales to sub-distributors.
1.3 Sub-Distributors. Distributor may appoint, license or contract with
Affiliates and franchisees or with other non-affiliated
distributors, dealers, wholesalers, retailers, jobbers and other
businesses (collectively, "Dealers") to sell, market and distribute
the Products as long as any such Dealer executes the Confidentiality
and Non-Competition Agreement. Affiliates of Distributor and Dealers
are collectively referred to in this Agreement as
"Sub-Distributors." No appointment, license or contract by
Distributor with a Dealer or Sub-Distributor shall absolve
Distributor of its duties and obligations pursuant to this
Agreement, however, and Distributor shall remain principally and
wholly liable for any transactions involving NMPR, the Products and
any such Dealer or Sub-Distributor.
1.4 Minimum purchases/Royalty payments Distributor agrees to pay a
total of $500,000 US dollars for the exclusive distribution
rights, such sum to include Distributor's product orders equal
to the purchase price of $500,000 US dollars.. The product
orders and Products will be delivered upon request from
Distributor during the initial term of the Master Distribution
Agreement. NMPR will train a maximum of 4 of Distributor's
trainers during a 5 year period from date of signature of this
agreement without cost to the distributor other than air fare,
hotel and meals. Distributor will also commit to the following
minimum yearly purchases after the first year of the agreement
as follows:
Year 2: $100,000
Year 3: $150,000
Year 4: $250,000
Year 5: $250,000
If distributor fails to meet the yearly minimum purchase the exclusive
appointment becomes non- exclusive.
While this and all amounts in this Agreement are expressed in United
States Dollars, this and all subsequent dollar amounts are intended by the
parties to be payable to NMPR by Distributor in the official and legal
currency of Norway at the applicable exchange rate relative to the United
States Dollar posted in the Wall Street Journal on the business day
immediately before such payment. Such payment shall be made by check or in
cash by wire transfer of immediately available funds to an account
specified by NMPR. In addition to the initial payment contemplated by this
Section 1.4, the following fees and royalties shall be remitted to NMPR by
Distributor from time to time as follows:
(i) 3% of any Product sales
(ii) 25% of any royalties or technical fees that Distributor
or Sub-Distributors collect from franchisees or Dealers on revenues that they
earn from performing services using the Products. Such sums as are accrued for
any given year of this agreement shall be payable to NMPR within 30 days after
the anniversary date for the beginning of the subsequent year of this agreement.
Distributor shall purchase Products in accordance with pricing as set forth in
Exhibits A and B hereof. Prices are F.O.B. Ft Xxxxx, Florida, United States (or
a distribution site designated in writing by NMPR) and are subject to change.
Distributor will remit the amounts described in this Section 1.4 on a monthly
basis as Distributor or its Sub-Distributors collect these fees or royalties
from franchisees. Distributor will make all payments 30 days after collection.
1.5 Distributor Right to Use or Resell. Distributor may use or resell the
Products purchased from NMPR under this Agreement.
1.6 No Trademark License Conferred. Distributor acknowledges and agrees
that no rights are granted to it by NMPR herein or hereby for the use of
any of NMPR's proprietary marks and that no goods or services, including,
but not limited to, the Products, will be sold pursuant to any such
license or in connection with the license to Distributor of any of NMPR's
proprietary marks nor will any Affiliate of Distributor, Dealer,
Sub-Distributor or franchisee be licensed to use any of NMPR's proprietary
marks unless NMPR enters into a separate licensing agreement with
Distributor or such Affiliate, Sub-Distributor, Dealer or franchisee. NMPR
will provide Distributor, licenses to operate NMPR facilities under its
own signage; these licenses can only be used at locations owned by Wi-THO
AS and cannot be assigned.
1.7 Relationship of Parties. NMPR and Distributor are each independent
contractors and nothing in this Agreement will be construed or interpreted as
creating an employer/employee, agency, joint venture or any similar relationship
between the parties. Consequently, (a) Distributor is and will remain an
independent purchaser and seller of the Products, (b) neither party will have or
exercise any right or authority to assume or create any obligations or
responsibilities, including without limitation contractual obligations, on
behalf of or in the name of the other party, and (c) each party hereto will be
exclusively responsible for paying all income and other taxes and costs and all
expenses relating to its respective business.
(a) No Less-Favorable Terms. NMPR covenants and agrees that NMPR
will treat Distributor no less favorably than any other distributor of NMPR with
respect to training and distribution of the Products. Wherever possible, NMPR
agrees to utilize Distributor to provide training and/or distribute the Products
if NMPR determines there is such a need. Without prejudice to the foregoing
generality, NMPR covenants and agrees that it will not provide training or other
services to any distributor other than Distributor for a lesser price than it
sells and provides Products and services to Distributor, nor offer benefits to
other distributors if the same are not offered to Distributor. NMPR may grant
reasonable volume discounts to other distributors provided the same or better
terms and conditions are offered to Distributor.
(b) Equal Access to Products. Distributor shall have reasonably
equal access with NMPR and any other customers to all new Products for the
purpose of sale and distribution. Distributor shall have the right to
participate in prior testing of new Products before sale and distribution. NMPR
shall take reasonable steps to keep Distributor informed as to new Products
being developed. NMPR and Distributor acknowledge and agree that any material
change in the chemistry, performance or other essential characteristics of the
Products shall constitute a new Product for the purposes of this provision.
1.8 Distributor Not To Bind NMPR. Distributor agrees that it will at no
time represent to any other party that it is an agent of NMPR or is acting on
behalf of NMPR and not undertake any agreements with any other parties
(including, but limited to, with Dealers, Sub-Distributors, Affiliates and
franchisees) that state, imply, infer or leave open the possibility or prospect
that it has the right to bind NMPR to any sort of undertaking or instrument and
Distributor agrees to indemnify NMPR against any and all actions that could
arise or be brought against NMPR due to a breach of this Section 1.8.
ARTICLE 2
DUTIES OF DISTRIBUTOR
Distributor shall, subject to the terms and conditions of this Agreement:
1. Use its reasonable efforts to promote the sale of the Products
throughout the Territory using appropriate marketing and advertising programs
and campaigns;
2. Maintain a sufficient stock of the Products in inventory to allow
prompt filling of all orders placed by Distributor's Sub-Distributors,
Affiliates and franchisees;
3. Furnish NMPR with such forecasts of anticipated Product sales and
shipment schedules as NMPR may reasonably request from time to time;
4. Refrain from tampering with the Products as set forth in detail in
Section 8.2;
5. Keep confidential and treat as trade secrets, and cause employees,
agents and consultants to keep confidential and treat as trade secrets, all
information disclosed to Distributor by NMPR concerning the composition of the
Products and the methods, procedures, specifications and techniques used in
conjunction with the Products or the application of the Products, all as
described in detail in Section 8.1 hereof;
6. Purchase, use and sell for use with the Products only those products,
materials, equipment and supplies that are compatible with the Products as set
forth in more detail in Section 3.2; and
7. Submit the Product packaging labels to NMPR for its review and approval
as set forth in Section 9.2.
ARTICLE 3
PRODUCTS, PRICES AND PURCHASES
3.1 Products. For the purposes of this Agreement, "Products" mean those
chemicals, paints, software, Toll Free Technical Support and Service and related
products described in the exhibits to this Agreement. If NMPR adds new paints,
chemicals or related products to its line of Products, enhances or improves the
Products, or substitutes different Products during the Term of this Agreement,
then these additional, enhanced, improved, or substitute Products will be deemed
to be added to the exhibits to this Agreement together with the pricing for
those Products and Distributor will be entitled to buy and distribute them on
the same terms as those Products originally included in the exhibits to this
Agreement.
3.2 Non-Proprietary Products. The parties agree that anyone using the
Products in the exhibits to this Agreement will also need to or may wish to
obtain and use various other products, materials, equipment and supplies that
are associated with use of the Products. The non-proprietary products currently
offered for sale by NMPR are described in the exhibits to this Agreement (the
"Non-Proprietary Products"). Distributor will have the right, but not the
obligation, to purchase the Non-Proprietary Products from NMPR at the prices
shown in the exhibits to this Agreement. NMPR will have the unfettered right to
alter these prices for the Non-Proprietary Products at any time during the Term
of this Agreement. Distributor, its franchisees and Sub-Distributors and Dealers
will be entitled to purchase, use and sell the Non-Proprietary Products obtained
from sources other than NMPR. If Distributor desires to purchase any
Non-Proprietary Products from such other supplier, then Distributor will submit
samples and/or specifications to NMPR for review and/or testing to determine
whether such Non-Proprietary Products are compatible with the Products. If NMPR
does not present Distributor with proof that the Non-Proprietary Products are
incompatible with the Products within thirty (30) days of submission of the
samples or specifications, Distributor, franchisees, Sub-Distributors and
Dealers will be entitled to purchase, use and sell such Non-Proprietary Products
for use with the Products.
3.3 Prices for Proprietary Products. Distributor shall pay the prices for
the Products for sale in the Territory that are set forth in Exhibit A hereto.
Distributor shall pay the prices for the Products that are set forth in Exhibit
B for products and equipment for sale outside of the Territory. Distributor
shall pay the prices for the Products that are set forth in Exhibits A and B in
the official and legal currency of the United States. Commencing one (1) year
from the date of this Agreement and each year thereafter, NMPR may increase the
price of any of the Products by no more than ten percent (10%) of the prior
year's price for that Product, unless the latest available value of the Producer
Price Index published by the U.S. Bureau of Labor Statistics for the commodity
grouping "Refined Petroleum Products" (Code 05-7) (the "Index") has risen more
than ten percent (10%) from its one year prior value, in which case NMPR may
raise the price of any of the Products by no more than the one year percentage
increase in the Index. (This price increase does not apply to Exhibit C). If any
Products are added to the exhibits to this agreement after the date of execution
of this Agreement, then the parties will negotiate the price of such additional
Products in good faith and will determine a period of time for which such
negotiated price will be effective. After such period, NMPR may increase the
price of any additional Product on the same basis as the Products originally
listed on the exhibits hereto.
3.4 Payment Terms. NMPR will invoice Distributor for each purchase order
received by NMPR upon the complete shipment of the Products specified in the
purchase order. NMPR will simultaneously provide an advance shipping notice to
Distributor by either fax or electronic mail. Unless otherwise agreed to in
writing by the parties, Distributor will pay all invoices net 30 days. All
payments by Distributor under this Agreement shall be payable to NMPR by
Distributor in the official and legal currency of Norway at the applicable
exchange rate relative to the United States Dollar posted in the Wall Street
Journal on the business day immediately before such payment. Such payment shall
be made by check or in cash by wire transfer of immediately available funds to
an account specified by NMPR. Payments under this Article may be combined with
payments to NMPR under Section 1.4. Without prejudice to the other provisions of
this Section or any other right or remedy of NMPR, if Distributor is in arrears
with respect to any payment due to NMPR, or in the reasonable opinion of NMPR,
Distributor is or will be unable to pay its debts as they fall due, then: (a)
NMPR may elect not to deliver the Products except against contemporaneous
payment by Distributor in cash in full of all amounts due and owing to NMPR; and
(b) all amounts owed to NMPR by Distributor shall become immediately due and
payable.
3.5 Resale Prices. Distributor will have the absolute right to resell the
Products at any price determined by Distributor in its sole discretion.
ARTICLE 4
TERM
4.1 Initial Term. Unless terminated as provided herein, the initial term
of this Agreement will be 5 years (the "Initial Term") and will commence on the
date of this Agreement.
4.2 Renewal Terms. Distributor will have the unilateral right to renew
this Agreement for an indefinite number of successive additional one (1) year
terms (each, a "Renewal Term," collectively, the "Renewal Terms.") This
Agreement will automatically renew for the next Renewal Term unless Distributor
gives NMPR written notice that it is terminating the Agreement 90 days before
the last day of the Initial Term or applicable Renewal Term. The Initial Term
and any Renewal Terms shall collectively be referred to in this Agreement as the
"Term" of this Agreement.
4.3 Specific Performance. Each additional year after the initial three
years will require a minimum yearly purchase of Products and training of
Distributor's trainers at a total of $ 250,000 US dollars per annum to maintain
this agreement for a five (5) year period. After the five (5) year renewal
conditions have been met, both NMPR and the Distributor will mutually agree to
the terms and conditions for a further renewal. If the appointment is converted
from exclusive distribution to non-exclusive distribution during the Initial
Term, both NMPR and the Distributor will mutually agree to specific performance
terms related to non exclusivity.
ARTICLE 5
OBLIGATIONS OF NMPR
5.1 General Obligations. NMPR will (a) supply the Products ordered by
Distributor on a timely basis and promptly notify Distributor of any changes in
projected manufacturing or delivery dates regarding same, (b) promptly notify
Distributor in writing of any changes to the specifications of the Products, (c)
promptly provide Distributor with all documentation and information as may be
necessary to allow Distributor to arrange for the transportation of the Products
at the time and to the destinations specified by Distributor, and (d) promptly
notify Distributor in writing of all new Products that Distributor will have the
right to sell and distribute.
5.2 Training.
5.2.1 Initial Technical Training
NMPR will, within sixty (60) days after the date of this Agreement,
make available qualified instructors experienced in the use and application of
all Products ("NMPR Instructors") and provide written teaching materials for
initial technical training of up to two (2) of Distributor's trainers
(collectively, the "Distributor Trainers") as part of NMPR's Train The
TrainersTM Program. The Distributor Trainers shall be employees of Distributor.
Distributor will be responsible for selecting Distributor Trainers who are both
technically qualified to benefit from the training and capable of training
others. The initial technical training will consist of five (5) days of classes
for two Distributor Trainers at NMPR's facilities in Ft Xxxxx, Florida. The
initial technical training will provide Distributor Trainers with all necessary
technical information required for training others to market, sell, use and
apply the Products. The training will also be designed to provide Distributor's
Trainers with sufficient information for them to train others in how to deal
with any hazards related to the use of the Products or the application of the
Products, as such training is or may later be required to comply with laws,
rules and regulations pertaining to workplace safety and health, including, but
not limited to 29 CFR ss. 1910.1200 of the United States Code of Federal
Regulations. To compensate NMPR for this initial technical training, Distributor
will pay NMPR a flat fee of US$0.00 for each training program taught by NMPR.
Distributor will be responsible for the costs and expenses incurred by
Distributor Trainers in traveling to and attending all training classes in
NMPR's facilities in Ft Xxxxx, Florida. Distributor will pay an additional fee
to be negotiated on an ad hoc basis for any trips Distributor requires NMPR
Instructors to make outside of Canada or Florida and all travel costs of NMPR
Instructors for such trips will be paid for by Distributor. At any time during
the Term of this Agreement, Distributor may request that NMPR provide one or
more additional classes of initial technical training for additional Distributor
Trainers. The fee for such additional initial technical training will be US
$3,000 for a class of up to two (2) Distributor Trainers for each training
center location.
(a) Update Training. At the request of Distributor, NMPR will
provide technical update training to Distributor Trainers concerning any new
information known about the use and application of the Products or hazards
related to the use or application of the Products, as well as information about
any new Products developed by NMPR. The timing of any technical update training
will be agreed upon by mutual consent of Distributor and NMPR and will be at the
sole cost and expense of Distributor.
(b) Refresher Training. Distributor will pay NMPR's then current
daily training fee (presently US$600 per day) for any training to refresh the
training of Distributor Trainers that Distributor may request NMPR to conduct
and Distributor will reimburse NMPR for the cost of travel, meals and lodging
for the NMPR Instructors who provide such refresher instruction if the training
is not conducted in Fort Xxxxx, Florida, USA.
(c) Hot Line. Distributor agrees to purchase Toll-Free Technical
Support and Service from NMPR (the "Hot Line") as they become available, which
will allow its distributors, Dealers, franchisees, wholesalers, retailers,
jobbers, catalog companies, telemarketers and other businesses involved in
distribution of the Products to obtain technical information about the Products
by telephone or on a Web site. The Hot Line may be operated either by the
Distributor regional training centers or by Distributor on a country-wide basis.
Distributor shall make the Hot Line available during normal business hours in
all areas where the Products are sold. Distributor shall staff the Hot Line with
competent technicians. NMPR also agrees to allow Distributor access to any of
NMPR's Teleconference and Videoconference Technologies that it is developing so
as to assist Distributor with new and high tech Training and Technical Support
Services by means of these Toll-Free lines. (An example of how the Hot Line will
work is explained as Exhibit C attached hereto).
5.3 Material Safety Data Sheets. For each of the Products, NMPR will
provide Distributor with a Material Safety Data Sheet ("MSDS"), as that term is
defined in 29 CFR ss. 1910.1200(g) of the United States Code of Federal
Regulations. NMPR will supply each MSDS in English and/or Spanish (if required),
within ninety (90) days of the date of this Agreement, and will also supply a
French and/or Spanish translation (if required). NMPR will supply the MSDS to
Distributor in electronic format. In the event that Distributor determines that
the laws or regulations of any country, state or province where Distributor is
selling the Products require a MSDS document that contains different information
or formatting than that specified under 29 CFR ss. 1910.1200(g), Distributor
shall provide NMPR with the relevant law or regulation and NMPR shall prepare a
version of the MSDS for each of the Products that complies with those laws and
regulations. If the MSDS is updated or modified at any time during the Term of
this Agreement, NMPR will provide Distributor with an updated or modified MSDS
with the first shipment of the Products to Distributor after the date that the
MSDS is updated or modified. Each MSDS will be prepared at NMPR's expense, but
Distributor will bear the costs of printing and distribution of the MSDS for
each of the Products.
5.4 Advertising and Marketing Materials. NMPR will provide Distributor, at
no charge to Distributor, samples of sales and marketing literature that NMPR
has developed in connection with its marketing of the Products, such as
catalogs, brochures, flyers, advertisements and other sales literature or video
presentations concerning the qualities, properties, advantages and uses of the
Products. If available, samples of this literature will be made available in
English, French and/or Spanish. Distributor will be free to use any or all of
the content of this literature in developing and producing its own sales and
marketing literature to be used in conjunction with the sale of the Products by
Distributor. Distributor will be responsible for all expenses associated with
the creation and reproduction of its sales and marketing literature and all
labeling associated with Distributor's "brand name" for NMPR's products.
Distributor agrees to submit copies of all proposed MSDS sheets, sales and
marketing materials to NMPR's compliance department prior to use in the
marketplace.
ARTICLE 6
PRODUCTS, ORDERS, DELIVERY, LABELING AND SHIPPING
6.1 Purchase Orders. Distributor will submit purchase orders to NMPR for
all Products to be purchased by Distributor. Each purchase order will be subject
to the provisions of this Agreement. If there is a discrepancy between the
provisions of this Agreement and the terms of any purchase order, order
confirmation or other communication between the parties, whether or not such
communication is acknowledged by the other party, then the provisions of this
Agreement will govern.
6.2 Delivery Terms. Unless otherwise agreed in writing, all deliveries of
Products will be F.O.B. at NMPR's manufacturing or distribution site. Title to
the Products and all risk of loss or damage to the Products will pass to
Distributor when NMPR loads the Products onto the common carrier's vehicle at
NMPR's manufacturing or distribution site .
6.3 Labeling. NMPR will deliver all Products to Distributor's common
carrier properly packaged and labeled in shipping cases. Distributor will
instruct NMPR at the time of placing its order whether the Product containers
themselves should be labeled by NMPR. If so instructed NMPR will apply labels
supplied by Distributor to the Products. In order for Distributor to produce
these labels, NMPR agrees to supply Distributor with copies of all labels
developed by NMPR for each of the Products that meet the requirements of Section
9.2. Distributor will substitute its various brand names for the brand names
previously used by NMPR on these labels. Distributor will then print the new
labels at its sole cost. Distributor will provide a copy of each of the labels
to NMPR for its review and approval before final printing pursuant to Section
9.2, such approval not to be unreasonably withheld. Before final printing,
Distributor will make all changes to the label designated by NMPR in writing as
necessary to comply with laws or regulations. In the event that Distributor
instructs NMPR not to label containers, Distributor will be responsible for the
cost of labeling the Products at or en-route to their destination.
6.4 Shippinq. Distributor will be responsible for arranging and paying for
all transportation of the Products from NMPR's distribution center to any final
destination. NMPR will be responsible for preparing all documentation required
to export the Products from the United States or import the Products into any
other country where the Products are sold. Distributor agrees, however, to
cooperate in this process by providing all information in its possession that
may be required of NMPR by the customs services of any of these countries or any
other agency or instrumentality of any government. Distributor also agrees to
pay any tariffs, duties or other sales taxes imposed on the Products by reason
of their import or export.
ARTICLE 7
PRODUCT ACCEPTANCE AND WARRANTY
7.1 Acceptance of Products. Distributor or its agents will examine all
incoming Products as soon as possible upon arrival of the Products at the
destination specified by Distributor, but in no event later than ninety (90)
days from the date of receipt. Distributor will promptly report to NMPR in
writing all shortages, damages, defects or discrepancies in each shipment. Upon
providing supporting material that the shortage, damage, defect or discrepancy
existed at the time NMPR made the Products available for shipping, NMPR will
promptly deliver additional or substitute Products to Distributor, who will
alternately deliver additional or substitute products to its Sub-Distributor,
franchisee or Dealer in accordance with the delivery procedures set forth in
this Agreement. In the event that the loss or damage occurred during shipping,
Distributor will file an appropriate freight loss and damage claim with the
carrier and arrange for disposal of any damaged Products.
7.2 Damaged or Defective Product. In the event that any of the Products
NMPR ships are damaged or defective at the time they are made available for
shipping or received by Distributor, Distributor will store the damaged or
defective Products and combine them for shipment back to NMPR along with a
packing list that briefly describes the damage or defects. NMPR will then ship
replacement Products to Distributor, who will deliver additional or substitute
products to its Sub-Distributor, franchisee or Dealer to whom the damaged or
defective Products were shipped. Damaged or defective Products for the purposes
of this Section 7.2 do not include Products that are lost or damaged in shipping
for which Distributor shall look to the carrier for redress pursuant to Section
7.1.
7.3 Warranty. EXCEPT AS OTHERWISE SET FORTH HEREIN, NMPR MAKES NO WARRANTY
WHATSOEVER CONCERNING THE PRODUCTS OR THE SYSTEM. NMPR WARRANTS THAT THE
PRODUCTS AND SYSTEM CONFORM TO THE SPECIFICATIONS AND REPRESENTATONS REGARDING
THE SAME THAT NMPR HAS REPRESENTED TO DISTRIBUTOR AS BEING THOSE WHICH PERTAIN
TO THE PRODUCTS AND SYSTEM. THE PRODUCTS AND THE SYSTEM ARE SOLD WITHOUT IMPLIED
WARRANTY OF ANY KIND. NMPR FURTHER DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING
WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF TITLE, NONINFRINGEMENT,
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR ARISING FROM A COURSE OF
DEALING OR USAGE OF TRADE. DISTRIBUTOR ACKNOWLEDGES THAT THE ENTIRE RISK ARISING
OUT OF THE USE OR PERFORMANCE OF THE PRODUCTS AND THE SYSTEM REMAINS WITH
DISRIBUTOR. TO THE EXTENT THAT A PARTICULAR JURISDICTION DOES NOT ALLOW FOR THE
EXCLUSION OF IMPLIED WARRANTIES, ANY IMPLIED WARRANTIES UNDER THIS AGREEMENT ARE
LIMITED TO THIRTY (30) DAYS AFTER DELIVERY TO DISTRIBUTOR WITHOUT AFFECTING ANY
OTHER LIMITATION CONTAINED IN THIS AGREEMENT.
ARTICLE 8
CONFIDENTIALITY, TRADE SECRETS AND NON-COMPETITION
8.1 Confidentiality and Non-Competition Agreement
8.1.1. Distributor acknowledges that the System and the formula of
each of the Products in Exhibits A and B hereto are trade secrets and covenants
and agrees that it shall not, directly or indirectly, during the Term of this
Agreement, or at any time thereafter, take any steps to reproduce, reverse
engineer or otherwise ascertain the formulas for any such Product, nor shall it
attempt to manufacture or produce such Product or the System.
8.1.2 Distributor and all of its Sub-Distributors, franchisees or
Dealers are prohibited from performing any tests of the Products in Exhibits A
and B except as may be required by law or as may be necessary to determine
conformance of the Products to the specifications and representations of NMPR,
whether during the Term of this Agreement or at any time thereafter. It shall be
the responsibility of Distributor to obtain either separate Confidentiality and
Non-Competition Agreements in the form attached hereto as Exhibit D from its
Sub-Distributors, franchisees or Dealers, or to include provisions containing
all of the provisions of the Confidentiality and Non-Competition Agreement in
its agreements with Sub-Distributors, franchisees or Dealers for the benefit of
NMPR. In addition, Distributor shall require that its Sub-Distributors,
franchisees or Dealers obtain either separate Confidentiality and
Non-Competition Agreements in the form attached hereto as Exhibit D from their
employees and contractors that use or apply the Products in Exhibits A and B or
include provisions containing the provisions of the Confidentiality and
Non-Competition Agreement in its agreements with such employees and contractors.
8.1.3 Within thirty (30) business days of the execution of this
Agreement, Distributor shall require any and all of its managers, employees,
agents, directors, officers, partners, members, affiliates or independent
contractors having access to any Confidential Information of NMPR (as defined in
the Confidentiality and Non-Competition Agreement) or to the System to (a)
execute a copy of the Confidentiality and Non-Competition Agreement, and (b)
provide such Confidentiality and Non-Competition Agreement to NMPR. Failure to
comply with this Section 8.1.3 shall constitute breach of this Agreement and
shall allow NMPR to terminate this Agreement immediately with no consequences to
NMPR whatsoever.
8.1.4 On the date hereof, Distributor shall execute the
Confidentiality and Non-Competition Agreement attached hereto as Exhibit D and
provide same to NMPR contemporaneously with the execution of this Agreement.
8.2 Non-tamperinq Agreement. Distributor agrees to refrain from tampering
with, altering or modifying the Products without the express written consent of
NMPR. In order to ascertain that Distributor is complying with this obligation,
NMPR shall be entitled, at any reasonable time, to remove and test samples of
the Products from Distributor's inventory or the inventory of Distributor's
Affiliates, Sub-Distributors, franchisees or Dealers. NMPR will not be required
to pay for these samples. NMPR will promptly replace all such samples at its
cost. NMPR will take the smallest quantities reasonably necessary for testing
and will not take a quantity of the Products at any Affiliate, Sub-Distributors,
franchisees or Dealers location that will impair the ability of the Affiliate,
Sub-Distributors, franchisees or Dealers to serve its customers. An independent
certified laboratory selected by NMPR will do all testing of these samples. The
cost of such testing will be borne by NMPR unless the testing demonstrates that
the Products sampled were not supplied to Distributor by NMPR or have been
tampered with, altered or modified without the written consent of NMPR, in which
case the cost of testing will be borne by Distributor.
8.3 Affiliates of Distributor. Distributor agrees to honor (and shall
cause its Affiliates, Sub-Distributors, franchisees or Dealers to honor) the
provisions of this Article 8 while Distributor has control by way of ownership
or otherwise. Article 8 shall not apply to any publicly traded company unless it
sells or distributes the Products in the exhibits attached hereto.
ARTICLE 9
LEGAL COMPLIANCE
9.1 In General. Distributor and its Affiliates shall each comply with all
national, state or provincial, and local or municipal laws, ordinances, by-laws,
rules, regulations, orders, rulings and permits applicable to its performance
under this Agreement. Distributor and its Affiliates agree to promptly make all
reports to and filings with governmental agencies required by applicable laws,
by-laws, rules and regulations and to obtain all approvals, licenses, permits
and permissions necessary for its operations under this Agreement. Distributor
shall pay its own costs incurred in making such filings and reports and in
obtaining such approvals, licenses, permits and permissions. NMPR shall provide
Distributor with the information necessary to make such filings and reports and
to obtain such approvals, licenses, permits and permissions.
9.2 Packaqinq and Labelinq. Distributor will be responsible for developing
labeling and packaging for the Products that are in compliance with all laws,
by-laws, rules and regulations of each of the countries in which the Products
are sold by Distributor. Prior to the first shipment of Products by Distributor
into any country, Distributor and NMPR shall cooperate to do research to
determine what laws, by-laws, rules and regulations may apply to packaging and
labeling of paint and chemical products generally. NMPR will then develop any
additional or different labels and packaging pursuant to Section 6.3 that are
necessary to comply with these laws and regulations.
ARTICLE 10
TERMINATION
10.1 Termination. Unless this Agreement is terminable by NMPR in its sole
discretion pursuant to the terms of Sections 8.1.3 or 12.1(k) of this Agreement,
this Agreement may otherwise be terminated before the expiration of the Term,
including any Renewal Terms set forth in Article 3, in accordance with any of
the following provisions:
(a) Termination For Cause With Notice. Except as provided to the
contrary in this Agreement, either party may terminate this Agreement if the
other party materially breaches this Agreement and fails to cure such breach
within thirty (30) days after receipt of a written notice from the party
alleging the breach; provided, however, that if NMPR terminates this Agreement
under the terms of this paragraph, NMPR agrees that it will continue to sell
Distributor, on a C.O.D. basis, a sufficient quantity of the Products for
Distributor to meet its obligations under any agreement entered into during the
term of this Agreement.
(b) Termination without Notice. Either party may terminate this
Agreement, effective immediately upon receipt by the other party of written
notice of termination, if the other party files a petition of any type as to its
bankruptcy, is declared bankrupt, becomes insolvent, makes an assignment for the
benefit of any of its creditors, goes into liquidation or receivership or
otherwise loses legal control of its business. In the event of termination by
Distributor pursuant to this Section 10.1(b), Distributor shall comply with the
provisions of Section 10.2 hereof as they relate to termination pursuant to this
Section 10.1(b) to the extent allowable by applicable law.
(c) Termination by Distributor. Distributor shall have the right to
terminate this Agreement for any reason on giving sixty (60) days written notice
to NMPR to this effect, provided, however, that Distributor shall comply with
the provisions of Section 10.2 hereof as they relate to termination pursuant to
this Section 10.1(c).
10.2 Riqhts and Obliqations upon Termination. The expiration or
termination of this Agreement will not release or affect the obligations of
either party to timely pay all amounts then or thereafter due to the other
party. Upon termination by Distributor of this Agreement pursuant to Sections
10.1(b) or 10.1(c) hereof, NMPR will become entitled to sell the Products
directly to all Sub-Distributors, franchisees or Dealers of Distributor to which
Distributor sold Products during the Term and Distributor shall then timely
provide NMPR with any non-confidential or non-privileged information or data
needed to enable NMPR to continue to service these customers in a complete
fashion to the degree that such customers desire to be serviced by NMPR.
Distributor covenants to include language in any agreement with its Dealers,
Sub-Distributors and franchisees providing for and describing this eventuality.
This undertaking by Distributor shall be expressly subject to injunctive relief
for specific performance by NMPR against Distributor should Distributor fail to
comply with this Section 10.2. Distributor relinquishes any claim for
compensation of any type or kind for any such post-termination sales of the
Products by NMPR to these Sub-Distributors, franchisees or Dealers. If this
Agreement is terminated by NMPR pursuant to Section 10.1 hereof and such
termination occurs within five years of the date of the execution of this
Agreement, NMPR shall refund to Distributor the remaining portion of the initial
$500,000.00 paid to NMPR by Distributor pursuant to Section 1.4 above that has
not been taken out in form of Products and NMPR shall repurchase from
Distributor all Products purchased by Distributor which Distributor has been
unable to sell.
10.3 Limitation of Liability. Distributor will not be liable to NMPR or
NMPR will not be liable to Distributor due to the termination or expiration of
this Agreement in accordance with its terms except for as outlined in section
10.2 above. Neither party will be entitled to any compensation, reimbursement or
damages from the other for: (a) loss of prospective compensation, profits or
income or other consequential damages; (b) loss of anticipated sales; (c)
goodwill or loss thereof; or (d) expenditures, expenses, investments, leases or
any type of commitment made in connection with, or in reliance upon, this
Agreement.
ARTICLE 11
DISPUTE RESOLUTION
11.1 Unaided Negotiations. All disagreements, disputes and controversies
(each, a "dispute") between the parties arising from or relating to this
Agreement, including, but not limited to, allegations of fraud and
misrepresentation, shall be settled by the procedures specified in this Article.
If one party believes the other party has breached this Agreement, that party
shall promptly notify the other party in writing. The party receiving such a
notice shall respond in writing within seven (7) days after receipt. If the
dispute is not promptly resolved there shall follow, within twenty (20) days,
after written notice, a meeting of the representatives of the parties. The
purpose of the meeting shall be to discuss and negotiate in good faith, a
resolution of any outstanding dispute. The location of the meeting will be in Ft
Xxxxx, Florida. All negotiations pursuant to this Article are confidential and
shall be treated as compromise and settlement negotiations.
11.2 Mediation. If the procedure outlined in Section 11.1 fails to bring
about a prompt resolution of the dispute, then within twenty (20) days following
the meeting of the parties, the parties shall initiate a voluntary, non-binding
mediation conducted by a mediator mutually-agreed upon by the parties. If the
parties are not able to agree upon a mediator, they shall request that the
Florida (State) office of the American Arbitration Association appoint a capable
mediator for them. The parties shall bear equally the costs and expenses of this
mediation and endeavor in good faith to resolve their differences. Mediation
pursuant to this Article is confidential and shall be treated as compromise and
settlement negotiations.
11.3 Choice of Law; Litigation. This Agreement will be construed under and
subject to the laws of the State of Florida, without regard to the conflict of
laws principles thereof. The parties agree to waive any provision in the United
Nations Convention on the Law Applicable to the International Sale of Goods or
any other treaty or international convention to which Canada or the USA are or
may become signatories which might lead to a different choice of law. The
parties hereto hereby submit to the exclusive jurisdiction of the courts of
general jurisdiction of the County of Xxx, State of Florida and the federal
courts of the United States located in the Middle District of the State of
Florida for all litigation, court actions and other legal proceedings between
the parties arising under this Agreement. Distributor and NMPR and their
respective officers, directors, and employees hereby submit to personal
jurisdiction in Florida for all such litigation and waive any rights they may
have to contest personal jurisdiction or venue elsewhere and any claims that
such jurisdiction or venue is invalid.
ARTICLE 12
INDEMNIFICATION AND LIABILITY LIMITATION
12.1 Distributor Indemnification of NMPR. Distributor agrees to comply
with all municipal, city, Provincial and Federal laws, by-laws, regulations,
ordinances and any other regulations with which it must comply. Distributor
shall indemnify and hold NMPR, its officers, directors, employees, agents,
successors and assigns harmless against, and will reimburse NMPR for, all
losses, claims, damages, judgments, costs and expenses of whatever form and
nature, including, without limitation, attorneys' fees, court costs and
litigation expenses, whether direct or indirect, that NMPR, or any of is
officers, directors, employees, agents, successors or assigns, may sustain or
incur as a result of: (a) any failure by Distributor and/or its directors,
officers, employees, Dealers, Affiliates, franchisees and Sub-Distributors
(collectively, the "Distributor Parties") to comply with any municipal, city,
Provincial and Federal law, by-law, regulation, ordinance or any other
regulation, (b) any distribution, sale, use or misuse of the Products or the
System by the Distributor Parties; (c) any loss, claim or action based on the
negligence, misfeasance or nonfeasance of the Distributor Parties, including,
but not limited to, actions by each or any Distributor Party involving or
administering training concerning the Products or the System or any
environmental liability within the control of Distributor involving, relating to
or arising from the Products, or (d) any liability arising due to or as a result
of the labeling of the Products by Distributor.
(a) NMPR shall not be obligated or liable for any injury or death of
any person or damage to any property caused by the Distributor's action, failure
to act, negligence or willful conduct, nor for any liability of the Distributor,
whether or not the same be covered by insurance arranged pursuant to this
Agreement. For purposes of this Agreement, if the Distributor can control or
cause the actions or omissions of any Distributor Party, or can control or cause
any Distributor Party's to omit to take any action, NMPR shall not be obligated
or liable for any injury or death of any person or damage to any property caused
by the any Distributor Party's action, failure to act, negligence or willful
conduct, nor for any liability of the Distributor Party, whether or not the same
be covered by insurance arranged pursuant to this Agreement or otherwise.
(b) The Distributor shall indemnify and save NMPR and its affiliates
and its and their respective shareholders, directors, officers, partners,
members, employees and agents harmless from:
(i) All fines, suits, proceedings, claims, demands or actions
of any nature or kind whatsoever, directly or indirectly arising out of, or in
any manner whatsoever associated or connected with the Distributor's operations,
including without limitation, all claims made in respect of loss of or damage to
customer's vehicles or the contents thereof;
(c) The Distributor shall indemnify and hold NMPR and any of its
affiliates and its and their respective directors, shareholders, officers,
partners, members and employees harmless from and against any and all taxes that
the Distributor may be required by applicable law to pay.
(d) This Agreement, the documents incorporated by reference herein,
and the exhibits hereto constitute the entire agreement between the parties and
all prior negotiations, commitments, conditions, representations, warranties and
undertakings are merged herein. Except as herein provided, there are no oral or
written conditions, representations, warranties, undertakings or agreements made
by NMPR to the Distributor relating to the subject matter hereof. NMPR and
Distributor specifically acknowledge and agree that the Distributor has entered
into this Agreement after making an independent investigation of the operations
of NMPR and not upon any representation made by NMPR as to the profits which the
Distributor might expect to realize, nor has anyone made any other
representation which is not expressly set forth herein to induce the Distributor
to execute and deliver this Agreement. The Distributor hereby represents and
warrants to NMPR that all written statements made by the Distributor to NMPR
prior to the execution of the Agreement, including, without limitation, all
statements pertaining to the Distributor's financial standing, were true when
made and continue to be true at the time of execution of this Agreement (unless
subsequently corrected in writing), and in the event that such representation or
warranty is untrue, NMPR shall, at its option, be entitled to terminate this
Agreement without prejudice to any other remedies that it may have.
(e) Nothing in this Agreement shall be interpreted as requiring the
Distributor to sell any product or provide any service at a price stipulated by
NMPR or any other person. However, NMPR may establish, maintain and advertise a
suggested schedule of retail prices, although the Distributor shall be under no
obligation whatsoever to comply with same, and shall suffer no penalty from NMPR
for non-compliance.
(f) The Distributor acknowledges that NMPR may receive rebates from
suppliers of NMPR or the Distributor in respect of purchases made by NMPR or
Distributor and expressly acknowledges and confirms that the Distributor shall
have no rights in respect of, or entitlement to, such rebates.
(g) NMPR acknowledges that the Distributor may operate other
non-competing dealerships or sell other non-competing products or offer
non-competing services within its facility and/or at the same time as it
operates its Distributorship.
(h) This Agreement may be executed in counterparts, and each
counterpart so executed shall be deemed an original.
(i) Time is of the essence hereof.
(j) Whenever a personal pronoun is used herein, it is understood
that such usage shall include both singular and plural, masculine, feminine and
neuter, and refer in appropriate cases to corporations or other legal entities
as well as to individuals.
(k) This Agreement shall inure to the benefit of and be binding upon
the Distributor and its successors and assigns but shall be personal to and
non-assignable by the Distributor to any person or entity which is in
competition with NMPR, except with the prior written consent of NMPR, which may
not be unreasonably withheld. Any purported assignment of the rights of the
Distributor hereunder without such consent by NMPR shall permit NMPR to
immediately terminate this Agreement without notice. For the purpose of this
provision the term "assignment" shall include any sale, assignment, transfer,
pledge, hypothecation, encumbrance or other disposition of this Agreement or of
the Distributor's rights hereunder, including, but not limited to, any transfer
or assignment resulting from the death of the Distributor, bankruptcy of the
Distributor, or otherwise resulting by operation of law.
(l) Any requested assignment of this Agreement by Distributor to an
individual or entity or addition of a geographic region to the Territory shall
be subject to the following conditions:
(i) NMPR must approve the assignment, sale or addition in
writing and approve the qualifications of any new Distributor succeeding to the
rights of this Agreement.
(ii) A fee of US $3,000 (plus all applicable taxes) must be
paid to NMPR to cover training for up to two (2) members of any new Distributor.
(iii) All monthly fees shall be paid by the new Distributor to
NMPR and cannot be claimed in whole or in part by the former Distributor.
(iv) NMPR may require in its sole discretion that (a) any new
Distributor sign a new version of this Agreement, the terms of which need not be
the same as this Agreement, or (b) that the Distributor sign a new version of
this Agreement, the terms of which need not be the same as this Agreement, in
order to add any geographic region to the Territory.
ARTICLE 13
INSURANCE
13.1 General and Products Liability Insurance. NMPR and Distributor will
each procure and maintain in full force and effect general and products
liability insurance with coverage of at least two million dollars ($2,000,000)
insuring NMPR, on the one hand, and Distributor, Sub-Distributors, franchisees
or Dealers, on the other hand, and each of their respective officers, directors,
employees and agents from and against any and all losses, liability, damages,
causes of action, lawsuits, claims, and expenses of any kind whatsoever
("Claims"), including Claims for personal injury, death, property damage and all
other occurrences, arising out of, in connection with or related to the Products
or the System, the application of the Products and the System, the use of the
Products and the System, and the operation of NMPR's and Distributor's
businesses. The insurance policy procured by NMPR will specifically provide
coverage for Claims made against either Distributor or NMPR based on the failure
of the Products or the System to perform as represented and Claims for product
liability.
13.2 Approval of Insurance Companies; Evidence of Coverage. NMPR will
provide Distributor and Distributor will provide NMPR with a certificate
evidencing the insurance coverage set forth in Section 13.1 within sixty (60)
days after the date of this Agreement.
ARTICLE 14
GENERAL TERMS
14.1 Expenses. Each party will be solely responsible for and will pay all
expenses it incurs in fulfilling its obligations under this Agreement. Each
party has had the opportunity to seek legal counsel regarding this Agreement.
14.2 NMPR's Ownership of the Products. NMPR represents and warrants that
NMPR owns the Products and the System (defined for these purposes as the trade
secret formulae of the Products, the manufacturing processes used to produce the
Products and the System and/or any patents or patent rights associated with
either the Products, the System or the manufacture of the Products).
14.3 Notices. All notices required under this Agreement must be in writing
and by at least one of the following means; (a) personally delivered, (b)
facsimile, (c) sent by certified air mail, postage prepaid, or (d) delivered by
a recognized international delivery service (such as Federal Express, United
Parcel Service or Airborne Express), which requires the signature of the
addressee or its agent for delivery. Copies of all notices sent to NMPR by
Distributor shall be sent to the attention of each of:
NeoMedia Technologies, Inc.
0000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx, President
Facsimile: (000) 000-0000
Copies of all notices sent to Distributor by NMPR shall be sent to the
attention of:
WI_THO AS
Xxxxxxxxxxxxxxx 0
0000 Xxxx, Xxxxxx
Attention: Marten Wigst0l
Facsimile: (x00) 00000000
Any notice will be effective upon the earlier of (a) receipt by the party
to which notice is given, or (b) the fifth (5th) day following the date such
notice was sent which date shall be evidenced by an affidavit of the sender.
14.4 Entire Agreement. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof and supersedes all
previous proposals and agreements, whether oral or written, and all prior
negotiations, conversations, understandings or discussions between the parties
related to the subject matter of this Agreement.
14.5 Amendment. This Agreement may not be, and will not be deemed or
construed to be modified, amended, rescinded, canceled or waived, in whole or in
part, except by a written amendment signed by both parties. An alleged verbal
modification or amendment to this Agreement will be void and unenforceable.
14.6 Severability. If any of the terms of this Agreement are in conflict
with any law, statute, rule, ordinance, or order or otherwise unenforceable
under the laws or regulations of any government or subdivision thereof, such
terms will be deemed stricken from this Agreement, but such invalidity or
unenforceability will not invalidate any of the other terms of this Agreement,
and this Agreement will continue in force.
14.7 Force Majeure. "Force Majeure" will mean any event or condition, not
existing as of the date of this Agreement, not reasonably within the control of
either party, which prevents in whole or in material part the performance by one
of the parties of its obligations under this Agreement or which renders the
performance of such obligations so difficult or costly as to make such
performance commercially unreasonable. Without limiting the generality of the
foregoing, the following will constitute events or conditions of Force Majeure:
acts of State or governmental action, embargoes, riots, disturbance, war,
terror, strikes, lockouts, slowdowns, prolonged shortage of energy supplies,
delays in transportation, fire, flood, hurricane, typhoon, earthquake,
lightning, explosion, and problems related to the inability of computers (used
by either the parties or their vendors) to properly recognize or process data as
a result of any wide-spread computer related problems or viruses. Upon giving
written notice to the other party, the party affected by an event of Force
Majeure will be released without any liability on its part from the performance
of its obligations under this Agreement, but only to the extent and only for the
period that its performance of such obligations is prevented by the event of
Force Majeure. An event of Force Majeure will not relieve or affect in any way
either party's obligation to pay all amounts due and owing under this Agreement.
14.8 Waiver. The failure of NMPR or Distributor to exercise any of their
rights under this Agreement, or to insist on strict compliance by the other
party, and no custom or practice of the parties at variance with the terms of
this Agreement, will constitute any waiver of either party's right to demand
exact compliance with the terms of this Agreement. A waiver by either party of
any specific default will not affect or impair the right of that party with
respect to any subsequent default of the same or different nature, nor will any
delay or omission to exercise any right arising from a default affect or impair
the rights of that party with respect to such default or any subsequent default.
14.9 Headings. All titles and headings used in this Agreement are for
convenience in reference only and should not be used to interpret or construe
this Agreement.
14.10 Counterparts. This Agreement may be executed in two or more
counterparts, each of which when taken together will constitute one instrument.
14.11 Injunctive Relief. Notwithstanding any other provision of this
Agreement, the parties hereto understand and agree that the data sharing
provisions of Section 10.2, the remedy of indemnity payments provided herein and
other remedies at law would be inadequate in the case of any breach of the
provisions of the Confidentiality and Non-Competition Agreement or this
Agreement, and the parties hereto agree that the aggrieved party will be
entitled to equitable relief, including the remedy of specific performance,
without posting of bond or other security, with respect to any breach or
attempted breach of such provisions.
14.12 NMPR Right to Distributor Sales Reports; Right to Audit. From time
to time during the Term of this Agreement and for one (1) year thereafter, NMPR
may, in its sole and complete discretion, require Distributor to furnish to
NMPR, within seven (7) business days of any written request, complete
Distributor sales reports, related data and necessary information to back up any
payments made (or which should have been made) to NMPR arising hereunder based
on sales of the Products or otherwise (each, a "Distributor Report"); however,
such request may not include any information which is aged more than three (3)
years from the date of the request. Should NMPR disagree with the content of any
Distributor Report furnished to it, NMPR and its representatives shall, at any
time during business hours and without prior notice to Distributor, have the
right to inspect and audit any business books and records, bookkeeping and
accounting records and sales and income tax records of Distributor relating in
any way to this Agreement. Distributor agrees to fully cooperate with
representatives and independent accountants hired by NMPR to conduct any such
inspection or audit. If an inspection or audit discloses an understatement of
payments or nonpayment due to NMPR under this Agreement, Distributor shall pay
NMPR, within fifteen (15) days after receipt of the NMPR inspection or audit
report, the amount of the understatement, plus interest from the date originally
due until the date of payment, and Distributor shall reimburse NMPR for the cost
of the audit or inspection, including the charges of attorneys and any
independent accountants and the travel expenses, room and board and compensation
of NMPR employees. These remedies are in addition to our other remedies and
rights under this Agreement or applicable law and the right to audit will
continue for one (1) year following termination of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized officers or employees.
NEOMEDIA MICRO PAINT REPAIR INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
-----------------------------
Title: President & CEO
-----------------------------
DISTRIBUTOR:
WITHO-AS
By: /s/ Marten Wigst0l
--------------------------------
Name: Marten Wigst0l
------------------------------
Title: Chairman of the Board
-----------------------------
