EXHIBIT 4.8
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT (this "Agreement") is made and entered into
as of December 17, 1998, by and between HUNGAROFEK, a Hungarian corporation
("Distributor"), and AMERICAN TECHNOLOGIES GROUP, INC., a Nevada corporation
("Supplier").
R E C I T A L S:
WHEREAS, Supplier desires to develop demand for and sell its The
Force-Registered Trademark- airborne fuel treatment line of products (the
"products") in Hungary and to appoint Distributor to act as the distributor
of the Products in Hungary, subject to the terms and conditions of this
Agreement; and
WHEREAS, Distributor possesses unique skills and adequate resources to
distribute the Products in Hungary;
WHEREAS, Distributor desires to engage in the sale and distribution of
the Products in Hungary and to be designated as a distributor of the Products
in Hungary, subject to the terms and conditions of this Agreement;
NOW, THEREFORE, in consideration of the foregoing recitals and the
mutual covenants contained herein, Supplier and Distributor hereby agree as
follows:
1. DISTRIBUTORSHIP.
1.1 APPOINTMENT. Upon the terms, and subject to the terms and
conditions, contained herein, Supplier hereby appoints Distributor as its
exclusive distributor of the Products in Hungary. By said appointment,
Supplier grants Distributor the right to purchase Products from Supplier for
resale and distribution in Hungary. Notwithstanding anything set forth in
this Section 1.1, Distributor may lose its exclusive right to distribute as
provided in Section 2.1, and the Agreement may be terminated as provided in
Section 7.
1.2 ACCEPTANCE OF APPOINTMENT. Distributor hereby accepts appointment
as Supplier's distributor of Products in the Territory, as provided in
Section 1.1 above, and hereby agrees fully and faithfully to perform and
discharge all of its duties, obligations and responsibilities as set forth in
this Agreement. Distributor hereby accepts the proprietary and intellectual
property rights of Supplier in the Products.
2. PURCHASES AND SALES OF PRODUCTS.
2.1 MINIMUM SALES REQUIREMENTS.
(a) Distributor shall purchase (place a purchase order and make
the payment required by Section 4.1) the minimum value of Products set forth
below (the "Sales Requirements"). In the event Distributor fails to meet the
Sales Requirements (each such failure, a "Triggering Event"), Supplier shall
have the option to give Distributor notice ("Forfeiture Notice"), within
thirty (30) days of the Triggering Event, of Distributor's forfeiture of its
right to exclusively sell the Products in the Territory. After Supplier
gives Distributor a Forfeiture Notice, Supplier may appoint one or more other
distributors for the Products in the Territory.
(b) The Sales Requirement is the purchase of one container load of
Products constituting a minimum purchase order of at least US$100,000 per
month commencing December, 1998 and ending November, 1999.
(c) Supplier shall not be liable for any delay in the manufacture
or delivery of the Products pursuant to the terms and provisions of this
Agreement, or for any damages suffered by Distributor by reason of such
delay, when such delay is, directly or indirectly, caused by, or in any
manner arises from, earthquakes, fires, floods, accidents, riots, acts of
God, war, governmental interference or restrictions, mechanical breakdowns,
strikes, labor difficulties, or any other cause beyond the reasonable control
of Supplier, whether similar or dissimilar to the foregoing.
2.2 ORDERING PROCEDURE. Purchase of the Products shall be made by
Distributor by means of purchase orders submitted to Supplier. Each such
purchase order shall specify, INTER ALIA, the number of units of each Product
ordered by Distributor, the desired date and location of delivery.
2.3 TITLE AND RISK OF LOSS. Title to the Products and all risk of loss
shall pass from Supplier to Distributor at the time and place of Supplier's
delivery of the Products to a common carrier for delivery to Distributor in
accordance with the delivery terms prescribed in each purchase order,
notwithstanding that Supplier may retain rights of possession or repossession
to ensure collection of the purchase price thereof. Distributor shall be
solely responsible for insuring the Products after delivery to a common
carrier for delivery to Distributor. Distributor shall designate the common
carrier used for transportation of the Products. Supplier shall not be
responsible for any delay caused by the carrier.
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2.4 INSPECTION AND REJECTION. Distributor shall have the obligation to
inspect the Products delivered to it within fifteen (15) business days after
its receipt thereof at Distributor's delivery point, and unless any claim is
made within said fifteen (15) business day period, Distributor shall have
conclusively deemed to have accepted in good and marketable condition all the
Products delivered to it.
3. PRODUCT PRICES. The prices at which Supplier shall supply Distributor
with Products (the "Supply Price") are:
Fleet Formula $4.39 per unit, 48 individual units to a case
Auto Formula 1 & 2 $2.37 per unit, 75 individual units to a case
Auto Formula 1 $7.67 per box of 3 individual units, 24 boxes per case
Auto Formula 2 $10.03 per box of 4 individual units, 24 boxes per case
All prices are delivered F.O.B. place of manufacturing.
4. PAYMENT FOR PRODUCTS.
4.1 PAYMENT TERMS. Payment shall be made by bank wire, 50% at time of
order and 50% upon delivery of Products to Distributor's common carrier.
4.2 INVOICES. Supplier shall invoice Distributor for the purchase
price of the Products upon Supplier's delivery of such Products to a common
carrier for shipment to Distributor.
5. PRODUCT WARRANTY. The sole warranty given by Supplier regarding any
Product is that it shall be free from design or manufacturing defects.
6. TERM. Subject to the termination provisions of Section 7 hereof, the
term of this Agreement shall be for a one year period commencing on the date
of this Agreement (the "Initial Term"). Notwithstanding the aforesaid, in
the event Distributor meets and continues to meet the Sales Requirements and
agreement upon revised Sales Requirements for the renewal term, the term of
this Agreement shall be extended for consecutive three (3) year terms
("Renewal Term").
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7. TERMINATION. Subject to the provisions of Section 2.1 hereof, this
Agreement shall remain in full force, unless earlier terminated as follows:
(a) By mutual consent of the parties in writing at any time.
(b) By either party upon giving written notice to the other party
if such other party is in default of any term or provision hereunder, and
such default is not cured within thirty (30) days of written notice of such
default. Any such notice shall identify the nature of the claimed default and
the action or actions required to cure each claimed default.
8. NOTICES. All notices, requests, demands and other communications which
may be given or are required to be given under this Agreement shall be in
writing and in the English language. All notices shall be sent by facsimile
transmission and confirmed by overnight courier, and shall be deemed given on
the date of such facsimile transmission. All notices shall be addressed as
set forth below:
IF TO DISTRIBUTOR: HungaroFek
X-0000 Xxxxxxxxxxxxx
Xxxxxxxxx
XX00 XXXXXXX
IF TO SUPPLIER: American Technologies Group, Inc.
0000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000 XXX
Attention: Chief Executive Officer
9. GOVERNING LAW. This Agreement has been executed and delivered in, and
shall be governed by and construed in accordance with the laws of the State
of California without regard to its conflict of laws provisions.
10. RESOLUTION OF DISPUTES. Any controversy or claim relating to this
Agreement (whether contract, tort, or both) or to the breach of this
Agreement shall be arbitrated by and in accordance with the then existing
commercial arbitration rules of the American Arbitration Association, in Los
Angeles, California. The arbitrator may render a judgment awarding actual
compensatory damages only, and no consequential, incidental, or punitive
damages may be awarded by the arbitrator. Judgment on the award rendered by
such arbitrator may be entered in any court having jurisdiction. Nothing in
this Section 10 shall affect Supplier's right to bring an action or
proceeding against Distributor in the courts of any jurisdiction where the
purpose of such action or proceeding is to (i) seek injunctive relief against
Distributor,
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or (ii) collect moneys due and owing from Distributor to Supplier on account
of Distributor's failure to pay for Products or services provided by
Supplier. Service of process in any such action or proceeding brought
hereunder may be made by mailing copies of such process to the address of the
parties provided for in Section 8 hereto. In the event of any action or
proceeding to enforce this Agreement, the successful or prevailing party will
be entitled to recover its attorneys' fees actually incurred and other costs
incurred in any such action or proceeding, in addition to any other relief to
which it may be entitled. Each party hereto consents to the personal
jurisdiction of the AAA and Federal and State courts in Los Angeles County,
California.
11. WAIVER AND AMENDMENT. No waiver, amendment, modification or change of
any provision of this Agreement shall be effective unless and until made in
writing and signed by all of the parties hereto. No waiver, forbearance or
failure by any party hereto of its right to enforce any provision of this
Agreement shall constitute a waiver or estoppel of such party's right to
enforce any other provision of this Agreement or a continuing waiver by such
party of compliance with any provision.
12. ENTIRE AGREEMENT. This Agreement (including the exhibits and schedules
hereto, each of which is incorporated herein and made a part of this
Agreement) constitutes the entire agreement and understanding of the parties
hereto and terminates and supersedes any and all prior agreements,
arrangements and understandings, both oral and written, express or implied,
between the parties hereto concerning the subject matter of this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
"Distributor" "Supplier"
HUNGAROFEK AMERICAN TECHNOLOGIES GROUP INC.
By: /s/ Palatics Attila By: /s/ Xxxxxxxx X. Xxxxx
----------------------- -------------------------
Name: Palatics Attila Name: Xxxxxxxx X. Xxxxx
Its: President Its: Chief Executive Officer
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