SALES and MARKETING AGREEMENT
Exhibit
10.3
This
Marketing and Sales and Marketing Agreement is made effective as of March 23,
2005 by and between PC Products Inc. (“PCPI”) a wholly owned subsidiary of
Com-Guard, Inc. (“PCPI”) and Wintergreen Systems (“Wintergreen”),
a
division of Market Development Specialists, Inc., an Indiana corporation.
Com-Guard is the Parent Company and as it pertains to law, is a party to this
Agreement.
Under
the
terms of a Production
Agreement,
dated
the same date as this Marketing
and Sales Agreement,
PCPI
has contracted with Wintergreen to assemble computer hardware (“Computer
Systems”) for PCPI, using parts that PCPI either supplies to Wintergreen or
parts for which PCPI finances for purchase by Wintergreen (the “Production
Agreement”).
In
addition, Wintergreen will provide certain service, support and warranty work
for PCPI pursuant to a Service
and Support Agreement
dated
the same date as this Agreement (the “Service
and Support Agreement”).
This
Marketing
and Sales Agreement,
the
Production
Agreement and the Service and Support Agreement (collectively,
the “Transaction
Agreements”)
are
each inter-related, and the execution and the ongoing performance of each is
a
portion of the consideration for Wintergreen and
PCPI
to enter into each of the Transaction
Agreements.
PCPI
and
Wintergreen now agree as follows:
1. Recitals.
The
above recitals are incorporated into this Agreement.
2. Scope
of Work.
Wintergreen shall perform as a sales agent for the Computer Systems (as defined
in the Production
Agreement)
on
behalf of PCPI. Subject to the provisions of this Agreement, Wintergreen shall
control the time, method and delivery of Wintergreen’s sales efforts.
Wintergreen shall follow PCPI’s product, service and pricing guidelines. All
sales made by Wintergreen are subject to the acceptance or rejection by PCPI.
Wintergreen also agrees to use its best reasonable efforts to assist PCPI in
all
post-sale customer inquiries.
3. Transfer
of Certain Accounts.
Wintergreen shall transfer certain of its current customer accounts, listed
on
the attached Exhibit “A”, to PCPI as discussed in this paragraph. PCPI intends
to raise a minimum of $3,000,000 and a maximum of $10,000,000 for the funding
of
certain purchase orders involved in the transfer of certain named accounts.
Wintergreen represents only that it will attempt to transfer accounts to PCPI
but when PCPI raises a minimum of $3,000,000 and notifies Wintergreen that
the
monies are available from the designated Escrow Account, and then Wintergreen
will transfer at a minimum the purchase orders in its possession, any new
purchase orders and the account named SYX Distributing. PCPI
has the absolute right to void and nullify the Transaction Contracts if the
accounts and purchase orders have not been transferred or accepted by
PCPI.
Should
the minimum Not be raised in 60 days then Wintergreen
has the absolute right to void and nullify the Transaction Contracts.
PCPI
in
no way will assume any prior legal, contract or financial responsibilities
of
Wintergreen. Any funds raised shall be put into an escrow account that will
be
used when PCPI has established a vendor account with SYX distributing. Neither
party in this agreement will have ANY
legal
liability if Monies are NOT
raised
or
if accounts are NOT
transferred. The
date at which the accounts are transferred and the monies are raised shall
be
known as the Transfer date.
4.
Compensation.
Subject
to the terms and conditionsforth, PCPI shall pay Wintergreen a fee based on
the
Gross Profit of the products being sold, produced and serviced by Wintergreen,
according to the schedule and definition of Gross Profit as attached on Exhibit
“B” (“Sales Fee”). Payment to Wintergreen of the Sales Fee shall be made no
later than ten (10) days following the payment to PCPI for the applicable
Computer System as contemplated in the sales or purchase order for that Computer
System.
5. Termination.
Wintergreen or PCPI may terminate this Agreement, in the event:
| a. |
Insolvency
- the other party shall become insolvent or otherwise generally be
unable
to pay debts as they come due, or make a general assignment for the
benefit of creditors.
|
| b. |
Bankruptcy
- A petition under any bankruptcy act or similar statute is filed
by a
creditor of the other party or by the other party and is not vacated
within ten (10) days through court
order.
|
| c. |
Failure
to Perform - Wintergreen or PCPI fails to perform according to
the
Transaction Agreements as
previously agreed upon. There shall be a 30 day notice period in
writing
and a 30 day cure period for any
breach.
|
| d. |
Other
breach - Wintergreen or PCPI may terminate this Agreement if any
other
Transaction Agreement is terminated for any
reason.
|
6. Advertising
Materials.
Wintergreen shall not produce print, copy or issue advertising materials
relating to the Products, or Wintergreen’s status as the sales representative of
PCPI, without first securing PCPI’s approval of the form and content of such
materials, which shall not be unreasonably withheld.
7. Changes
in Products, Allocation, Scheduling.
PCPI may
change or discontinue its offerings for sale of any of the Products or the
trademarks or trade names thereon, or allocate Products among customers during
periods of shortages, or schedule production, shipments, and xxxxxxxx in
accordance with the best interests of PCPI at any time and from time to time
without prior notice to Wintergreen and without incurring any liability to
Wintergreen for fees or otherwise. If PCPI does change or discontinue any of
the
Computer Systems, Wintergreen may elect to sell such systems to accounts other
than the transferred accounts. PCPI will provide Wintergreen with Security
Software that will be provided with each system that is manufactured for
PCPI.
8. Provisions
applicable to Com-Guard.
Com-Guard is the Parent Company of PCPI and as it pertains to law, is a party
to
this Agreement. In addition, Com-Guard agrees to vote the stock of PCPI such
that the directors of PCPI elect Xxxx Xxxx, or such other individual(s) as
identified by Wintergreen, to hold offices which constitute no less than
one-half of the officers of PCPI, unless Wintergreen waives this voting
requirement in writing. The officers of PCPI which are identified by Wintergreen
shall have management and other responsibilities similar to or greater than
those officers elected by PCPI which are not identified by
Wintergreen.
PCPI
anticipates that will continue to provide the financing or direct provision
of
computer components as necessary, to support the production of the computer
systems, as long as practicable.
9. Indemnification.
PCPI
shall indemnify and hold Wintergreen harmless from and against any and all
claims, obligations, liabilities, damages, losses, expenses or other costs
(including reasonable attorneys’ fees and disbursements and the costs of
investigation) asserted against or suffered by Wintergreen and resulting
directly or indirectly from any breach of any provision of this Agreement by
PCPI or any negligent or willful acts or omissions of PCPI.
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10. Force
Majeure.
Neither
PCPI nor Wintergreen shall be liable to the other for any delay in or failure
of
performance of their respective obligations hereunder if such performance is
rendered impossible or impracticable by reason of fire, explosion, earthquake,
drought, embargo, war, riot, act of God or of public enemy, an act of
governmental authority, agency or entity, or any other similar contingency,
delay, failure or cause, beyond the reasonable control of the party whose
performance is affected, irrespective of whether such contingency is specified
herein or is presently occurring or anticipated by either party. In the event
either party is prevented from fulfilling its obligations under this Agreement
because of such a force majeure as described herein, both Wintergreen and PCPI
shall make every effort to continue to maintain as much as possible the
supplier-customer relationship established under this Agreement. However, if
PCPI or Wintergreen is unable to meet its obligations hereunder because of
the
conditions described above, then this Agreement shall be extended by such time
period as such conditions exist. As an example, if a condition of force majeure
exists for 10 weeks, this Agreement shall be extended by ten weeks and all
applicable dates in this Agreement shall be extended by ten weeks. No provision
of this Section shall be construed to excuse PCPI from payment of amounts owed
Wintergreen under this Agreement.
11. Assignment.
This
Agreement is not assignable without the written consent of the other
party.
12. Entire
Agreement.
This
Agreement and the terms and conditions referenced in any purchase order issued
by PCPI in connection with this Agreement (to the extent not inconsistent in
whole or in part with this Agreement) constitute the entire agreement and
understanding between the parties with respect to the subject matters herein
and
therein, and supersede and replace any and all prior agreements and
understandings, whether oral or written, between them with respect to such
matters. Both parties agree that the terms and conditions of any Wintergreen
or
PCPI quotation, offer, acknowledgment or similar document, however designated,
shall not apply.
13. Waiver.
The
provisions of this Agreement may be waived, altered, amended, or repealed in
whole or in part only upon the written consent of PCPI and Wintergreen. The
waiver by either party of any breach of this Agreement shall not be deemed
or
construed as a waiver of any other breach, whether prior, subsequent or
contemporaneous, of this Agreement.
14. Severability.
Invalidation of any of the provisions contained herein, or the application
of
such invalidation thereof to any person, by legislation, judgment or court
order
shall in no way affect any of the other provisions hereof or the application
thereof to any other person, and the same shall remain in full force and effect,
unless enforcement as so modified would be unreasonable or grossly inequitable
under all the circumstances or would frustrate the purposes hereof.
15. Counterparts.
Section
headings contained herein are for ease of reference only and shall not be given
substantive effect. This Agreement may be signed in one or more counterparts,
each to be effective as an original.
16. Notices.
Any
notice required or permitted under this Agreement shall be sufficient if given
in writing and delivered personally or by overnight courier service or if
mailed, registered or certified mail, postage prepaid, return receipt requested,
to the address of such party first set forth above, or at such other address
as
is specified by a party by like notice
17. Arbitration.
In the
event of a dispute arising under this Agreement, such dispute shall be resolved
by binding arbitration through submission of the issue to a member of the
American Arbitration Association who is chosen by mutual agreement of the
parties. If mutual agreement cannot be reached, then each party shall select
an
arbitrator, and those arbitrators shall select another arbitrator to act as
arbitrator for the dispute. Arbitration shall be held in a mutually agreed
upon
location; if no location shall be agreed upon then arbitration shall be in
the
venue where the wronging party resides. Expenses of the Arbitration shall be
paid as decided.
18. Term.
The
initial term of this Agreement shall be five (5) years from the signing of
the
Transaction Agreements.
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Final
PC
Products Inc. and Wintergreen Systems Sales and Marketing Contract
The
parties now execute this Agreement to be effective as of the date written
above.
| PC Products, Inc. | Wintergreen Systems, by its parent, Market Development Specialists, Inc. |
| ("PCPI") | ("Wintergreen") |
| By: | By: |
| Name: | Name: |
| Title: | Title: |
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Final PC Products Inc. and Wintergreen
Systems Sales and Marketing Contract
EXHIBIT
A
(Accounts
to Transfer)
SYX
Distribution
Other
account to be identified by MDS
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EXHIBIT
B
(Fees)
Gross
Profit- for purpose of this Agreement and the Transaction Agreements, Gross
Profit will be defined as the difference between Sales Price and the Xxxx of
Material cost of the product (inclusive of freight, insurance , financing fees
and license fees) without any other cost added.
Wintergreen
shall receive 10% of the Gross profit for the Sales and Marketing portion of
the
Transaction Agreements.
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