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Exhibit 10.38
Wednesday, July 01, 1998
Mr. Xxxxx Xxxxxxxx
President, Vemeco
0000 Xxxx Xxxxxxx Xxxxxxx
Xxxx. #000
Xxxxxx, XX
00000 XXX
Dear Xxxxx:
This letter shall serve as an Agreement between Warrantech Additive, Inc.
("WAI") and The Global Tracker Corporation ("TRACKER") whereby WAI will
distribute Tracker's personal property identification labels and global recovery
services to Automotive Dealers through WAI's warranty program per the following
terms and conditions:
1. WAI will purchase a minimum of 400,000 labels during the term of this
contract. XXX will remit to TRACKER $1.00US per label. Payment on a net 45
day basis upon shipment of labels to WAI.
2. TRACKER will bulk ship labels to WAI for distribution to the automotive
industry.
3. XXX will capture activation and label information and electronically
transfer to TRACKER.
4. TRACKER will offer 24-hour service activation call center access for WAI
customers.
5. TRACKER will provide ownership identification service to law enforcement
officials and WAI upon auto recovery.
6. WAI can purchase scanners and software from TRACKER at a cost of
$1,450.00US per unit for reselling purposes.
7. WAI will provide the call to activate service information to be included
with every warranty sold. The design and content of the activation card to
be mutually agreed upon by XXX and TRACKER.
8. TRACKER will provide three years of recovery service per label issued.
9. TRACKER will revenue share with WAI on property kit its upgrades as per the
following schedule:
If 1%-4% of activations purchase upgrades then revenue sharing is 10% If
5%-9% of activations purchase upgrades then revenue sharing is 15% If 10%
plus of activations purchase upgrades then revenue sharing is 20%
10. TRACKER will provide WAI with a monthly report of activations and upgrades
and will roll revenue sharing into a three (3) month payment schedule.
11. TRACKER will not provide any customer information to WAI, but will verify
if a specific label has been activated upon request from WAI.
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12. WAI will incorporate TRACKER information into advertising, collateral and
web site materials where applicable and at the discretion of WAI.
13. TRACKER will promote awareness of WAI products to TRACKER customers upon
recovery, renewal and from time to time through correspondence with its
membership.
14. TRACKER will provide WAI with immediate notification of every WAI customer
recovery.
15. This Agreement will commence the date of this letter, and will be for an
initial period of two (2) years. Thereafter, this Agreement shall
automatically renew on a bi-annual basis (with such amendments to this
Agreement, which may be necessary or desirable) unless terminated by either
party upon written notice at least ninety (90) days prior to commencement
of each new term. Either party to this Agreement may immediately terminate
this Agreement by giving written notice of termination to the other party
in the event such party shall, (i) elect to be wound up or dissolved; (ii)
become insolvent or admit in writing its inability to pay its debts as they
mature; (iii) make any assignment for the benefit of creditors, file a
voluntary petition in bankruptcy for reorganization or be adjudicated as
bankrupt or insolvent; or (iv) have a liquidator or trustee appointed over
its affairs and such appointment shall not have been terminated and
discharged within thirty (30) calendar days. In the event that any party to
this Agreement has been informed by a state or federal regulatory agency or
a court of competent jurisdiction that its continued performance pursuant
to this Agreement is impermissible or if applicable law or regulation makes
its continued performance impermissible, that party may terminate this
Agreement immediately upon written notice, unless this Agreement can be
amended so that the party" performance would no longer be impermissible.
This Agreement shall also terminate should either party be in breach of any
obligation, representation or warranty under this Agreement and such breach
shall remain uncured for a period of thirty (30) days after receipt of
written notice of the breach thereof from the non-breaching party. Upon
termination of this Agreement TRACKER will continue to provide TRACKER
service to existing WAI customers until a customer's membership is
terminated. In the event of early termination of this Agreement, WAI shall
be obligated to pay only for TRACKER products pending payment as per any
existing orders received by TRACKER and not for any balance of tags as
noted in the following section.
16. WAI may promote its TRACKER products using the name "TRACKER" and all logos
and other identifying names and marks which TRACKER authorizes WAI to use
in connection with any such name, provide that WAI shall do so only in
conformity with such direction as may be given from time to time by
TRACKER.
17. (a) Tracker shall indemnify WAI and hold WAI harmless from any and all
claims, suits, actions, liabilities and costs of any kind, including
reasonable legal fees and all costs of litigation, for any and all
claims by any party resulting directly or indirectly from any acts,
representations or omissions by TRACKER relating to this Agreement or
the performance of TRACKER. TRACKER shall, at the request of XXX,
assume the defense of any claims or proceedings brought against WAI by
reason thereof and pay any damages payable by XXX as a result of the
disposition of any such claims or proceedings.
(b) XXX shall indemnify TRACKER and hold TRACKER harmless from any and all
claims, suits, actions, liabilities and costs of any kind, including
reasonable legal fees and all costs of litigation, for any and all
claims by any party resulting directly or indirectly from any acts,
representation or omissions by XXX relating to their performance under
this Agreement. XXX xxxxx, at the request of TRACKER, assume the
defense of any claims or proceedings brought against TRACKER by reason
thereof and pay any damages payable by TRACKER
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as a result of the disposition of any such claims or proceedings.
(c) TRACKER hereby agrees to indemnify and hold Warrantech, its
subsidiaries and affiliates, and their respective directors, officers,
employees and agents (collectively referred to as the "Indemnified
Party") harmless from and against any and all claims, causes of action,
costs (including, but not limited to, increased costs of doing
business), expenses, losses, liabilities, damages, penalties and
demands whatsoever (collectively "Claims"), together with reasonable
counsel fees and expenses, arising, directly or indirectly, out of (i)
any act of negligence or willful misconduct on the part of TRACKER, its
employees or agents, (ii) the actual or alleged infringement of any
patent, license, copyright, trademark or trade name by TRACKER or any
entity through which TRACKER derives any of its rights, (ii) any
failure on the part of TRACKER, its employees or agents to perform its
obligations under or in connection with this Agreement or (iv) the
final adjudication of all litigation between Datastrip Ltd. And Symbol
Technologies Inc. with respect to PDF417 symbology. If any action or
proceeding in connection with any such matters is brought against the
Indemnified Party, it shall notify TRACKER and furnish TRACKER with a
copy of any papers served. TRACKER shall defend any such action or
proceeding, employing competent counsel, selected by TRACKER with the
approval of the Indemnified Party, but the Indemnified Party shall have
the right at any time, if it has reasonable grounds to believe its
interests are not being protected, at TRACKER's expense, to defend or
join the defense of any such action or proceedings through attorneys
selected by the Indemnified Party and approved by TRACKER, which
approval shall not be unreasonably withheld. The provisions of this
Section shall survive the termination of this Agreement.
(d) In consideration for TRACKER entering into this Agreement, XXX agrees
that the following items used in TRACKER's business are secret,
confidential, unique, and valuable, were developed by TRACKER at great
cost and over a long period of time and disclosure of any of the items
to anyone other than TRACKER's officers, agents, or authorized
employees will cause TRACKER irreparable injury:
- Non public financial information, accounting information, plans of
operation, possible mergers or acquisitions prior to the public
announcement;
- Customer lists, call lists, and other confidential customer data;
- Memoranda, notes, records concerning the technical process
conducted by TRACKER;
- Sketches, plans, drawings and other confidential research and
development data;
- Neither party shall disclose or otherwise reveal to any third party
without the express written consent of the other party the specific
terms or existence of this Agreement, except where required by law.
(e) In consideration for XXX entering into this Agreement, TRACKER agrees
that the following items used in WAI's business are secret,
confidential, unique and valuable, were developed by XXX at great cost
and over a long period of time, and disclosure of any of the items to
anyone other than WAI's officers, agents, or authorized employees will
cause WAI irreparable injury:
- Non public financial information, accounting information, plans of
operation, possible mergers or acquisitions prior to the public
announcement;
- Customer lists, call lists, and other confidential customer data;
- Memoranda, notes, records concerning the technical process
conducted by XXX;
- Sketches, plans, drawings and other confidential research and
development data;
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- Neither party shall disclose or otherwise reveal to any third party
without the express written consent of the other party the specific
terms or existence of this Agreement, except where required by law.
18. TRACKER agrees to obtain authorization from WAI to issue an press release
regarding the signing of this Agreement. XXX agrees that this authorization
will not be unreasonably withheld.
19. TRACKER shall maintain accurate records and accounts of all transactions
pertaining to this Agreement. If WAI requires any information concerning
such accounts and records, the previously mentioned accounts and records
shall be made available by TRACKER during its normal business hours for
examination by WAI or its representative appointed in writing.
20. This Agreement shall be governed under the laws of the province of Ontario,
Canada.
Kindly indicate your approval of this Agreement below. We look forward to a long
and mutually beneficial relationship with XXX.
Sincerely,
THE GLOBAL TRACKER CORPORATION Agreed and accepted by:
/s/ Xxxxx Xxxxxxx /s/ Xxxxx Xxxxxxxx
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Xxxxx X. Xxxxxxx Mr. Xxxxx Xxxxxxxx
Sales Executive President, Vemeco
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