EXHIBIT 10(iii)
DISTRIBUTOR AGREEMENT
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THIS AGREEMENT made and entered into by and between LEADER INDUSTRIES, (a
Quebec corporation, doing business in the State of New York) with its principal
place of business at 0000 Xxxxx Xx., Xxxxxxxxxxxx, Xxxxxx, Xxxxxx X0X0XX,
hereinafter referred to as "Manufacturer," and DAISY MANUFACTURING COMPANY, INC.
(a Delaware corporation), with its principal place of business at Xxx 000,
Xxxxxx, Xxxxxxxx 00000-0000 hereinafter referred to as "Distributor".
WITNESSETH:
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WHEREAS, Manufacturer is engaged in the manufacture and sale of [paintball
masks] together with spare parts and accessories used in connection therewith as
set forth on Addendum "A" attached hereto (collectively sometimes called the
"Products,"); and
WHEREAS, distributor desires to market such Products and Manufacturer wants
it to do so in the manner hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements and covenants hereinafter set forth, Manufacturer and Distributor
agree as follows:
Section 1. Purchase, Sales, and Delivery of Products.
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A. Territory. Manufacturer hereby appoints Distributor exclusive
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distributor for the sale of the Products worldwide, except Canada (the
"Territory").
B. Acceptance by Distributor. Distributor accepts the appointment made in
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Section 1.A. hereof. Distributor agrees to use its best efforts to develop the
market for the Products in the Territory, and to promote, sell, and distribute
the Products in such a way as to maintain and enhance the demand therefor within
the Territory. Except as otherwise expressly set forth in
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this Agreement, Manufacturer shall not be required to furnish Distributor with
any know-how or other proprietary information.
C. Product Marketing by Distributor. During the term of this Agreement,
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except as otherwise expressly permitted in writing, neither Distributor or its
affiliates shall market, manufacture, or cause to be manufactured, sell, import,
or take any steps designed to lead to the act of marketing, manufacturing,
selling, or importing within the Territory any items in direct competition with
the Products. Distributor agrees that it shall not sell, market, or distribute
any Products outside the Territory. Nevertheless, Distributor will be free to
extend its capabilities in the field by acquiring distributor rights and/or
manufacturing licensing rights to complementary products, or to develop such
products manufactured by Manufacturer.
D. Price and Discounts. The prices of the Products and other terms of
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purchase shall be set forth in Manufacturer's Price bulletin attached hereto as
Addendum "A".
E. Orders. Distributor agrees to submit purchase orders in writing and
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signed by Distributor for all Products ordered by it. In addition to the terms
and conditions set forth on the purchase order (Addendum "B"), the following
conditions shall apply to and become a part of each purchase order submitted by
Distributor for the Products:
1. Distributor shall have the right to select the mode of
transportation to be used in the shipment of the Products ordered by it.
2. All shipments shall be F.O.B. Plattsburg, New York. Transportation
charges shall be collect and title to all Products shall pass to Distributor and
Distributor shall assume all risk of loss upon delivery of such Products to a
carrier. Payment for all merchandise shall be made in the lawful currency of
the United States of America.
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3. a. Manufacturer hereby warrants that any Product to be delivered
pursuant to this Agreement and manufactured by Manufacturer shall (i) be free
from defects in material and workmanship which impair its functioning under
normal and proper use for the purpose for which it was intended and (ii) shall
comply with the specifications issued by Manufacturer describing such Product.
b. If Distributor notifies Manufacturer during such 90 day
warranty period of any such defect and such defect is demonstrated or
substantiated to the reasonable satisfaction of Manufacturer, then Manufacturer
shall at its expense, have the product returned, and its sole obligation,under
this warranty shall be to, either repair or replace the defective portion of the
relevant Product or credit Distributor with the price paid therefor.
c. Manufacturer extends this warranty to Distributor only with
respect to those Products (or portions thereof) manufactured by Manufacturer.
However, if Manufacturer obtains warranties from manufacturers (other than
Manufacturer) of Products (or portions thereof) sold to Distributor but not so
manufactured by Manufacturer, then Manufacturer shall, and hereby does, assign
to Distributor all of such manufacturers' warranties so obtained to the fullest
extent such assignment is permitted by such manufacturers.
d. The warranty set forth above shall be null and void and not
apply to any Product which is (i) altered, modified, damaged, or repaired by
someone other than Manufacturer, (ii) damaged due to use contrary to any package
insert, instruction manual, or other labeling furnished by Manufacturer, (iii)
damaged due to the use of equipment not manufactured, supplied, or approved by
Manufacturer, (iv) not maintained in accordance with
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any specifications or directions supplied by Manufacturer or (v) otherwise
abused, misused or subjected to an accident, whether intentional or negligent.
4. a. In the event Distributor determines that any unit of the
Product does not conform to Manufacturer's product specifications or is actually
otherwise defective, Distributor may reject such specific unit of the Product in
accordance with the provisions of the Arkansas Uniform Commercial Code, but such
rejection must be made by written notice mailed within ten (10) days after the
date of delivery by Manufacturer to Distributor of such nonconforming or
defective Product. Failure to notify Manufacturer shall constitute acceptance
but shall not constitute a waiver of any warranty-related claims.
b. Manufacturer shall have the right to replace the nonconforming
or defective Product or otherwise cure the nonconformance or defect within
thirty (30) days after the date of Distributor's written notice. If the
nonconformance or defect is not remedied within such thirty (30) day period,
Manufacturer shall refund to Distributor the purchase price paid by Distributor
for such nonconformance or defective Product by credit to Distributors account.
c. Upon Manufacturer's specific request in each instance,
Distributor shall promptly return any nonconforming Products to Manufacturer at
Manufacturer's expense.
5. The Distributor agrees to purchase a minimum of 10,000 units of the
Product the first year of the contract and 15,000 units of the Product in the
second year of the contract.
F. Withdrawal of Products and New Products. From time to time,
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Manufacturer, in its reasonable and sole discretion, may elect to withdraw
worldwide any Product.
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Manufacturer agrees to give Distributor not less than six months prior written
notice as to any such withdrawal except in the case of emergency or recall.
Section 2. Operation Requirements.
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A. Dealers. Distributor has the responsibility to provide adequate sales
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coverage in all areas of the Territory and may appoint dealers ("Dealers") for
that purpose. Distributor shall be responsible for negotiating and effecting
appointment arrangements with his respective Dealers. Dealers must agree to
comply with the policies and practices of Manufacturer, as well as Distributor.
B. Obligations of Distributor. From and after the date hereof
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Distributor, at its sole cost and expense, with sole responsibility in its
capacity as exclusive distributor and in full compliance with all applicable
laws and regulations in that capacity, including but not limited to those of
appropriate regulatory authorities, shall:
1. Store the Products under their respective labeled conditions using
appropriate facilities and equipment which comply with current good
manufacturing procedures and practices;
2. Distribute the Products and their labeling as received from
Manufacturer without any modifications unless such modifications are mutually
agreed upon prior to distribution;
3. Promptly forward, in writing, to Manufacturer all charges,
complaints or claims which Distributor receives or which otherwise come to
Distributor's attention covering any Product, and, at Manufacturer's request,
cooperate with Manufacturer in investigating any such charges, complaints or
claims;
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4. Submit for Manufacturer's review and approval, prior to
distribution and usage, all written trademark, labeling, and instructional
materials, and other items subject to regulatory control to be used in
connection with any Products and following approval and printing, provide
Manufacturer with ten (10) copies of each such item, and submit, for
informational purposes only, all other written promotional materials not
requiring regulatory approval for major promotions prior to distribution and
usage;
5. Obtain and maintain in full force and effect such federal, state,
and local records, authorizations, permits, and licenses as may be required by
law, including any appropriate regulatory authority, and fully comply with and
observe all applicable laws, ordinances, rules and regulations;
6. Maintain adequate sales and warehouse facilities for the Products;
7. Maintain a sufficient inventory of Products and replacement parts
reasonably to fulfill the requirements of Dealers and other customers located in
the Territory;
8. Maintain a training program for sales personnel in connection with
the demonstration, use, and sale of the Products;
9. Not make any warranty, representation, or claim concerning any
Product which violates applicable laws or regulations, including those of
appropriate regulatory authorities, or, without the express prior written
approval of Manufacturer, which is inconsistent or contrary to such Product's
specifications.
C. Name of Product.
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1. Manufacturer agrees that it will place the name BRASS EAGLE on all
packaging of the Product manufactured for Daisy unless instructed to do
otherwise in writing.
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Section 3. Term and Termination of the Agreement.
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A. Term. This Agreement shall be for a period of two (2) years with an
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option to renew for another two year period under the terms and conditions
agreed to by the parties. If either party decides that it does not wish to
renew the Agreement at the end of two years, it shall give the other party sixty
(60) days written notice of its intent.
B. Termination Without Advance Notice. This Agreement shall terminate
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automatically and immediately by its own force without notice to or from either
party in the event of:
1. An attempted assignment of this Agreement by either party without
the written consent of the other.
2. An assignment by either party for the benefit of creditors.
3. The admitted insolvency of the either party.
4. The institution of voluntary or involuntary proceedings by or
against either party in bankruptcy, or under any of the provisions of the United
States federal or any state bankruptcy act or any comparable bankruptcy laws, or
the corporate reorganization or for a receivership, or for the dissolution or
merger of either party.
5. If Distributor does not purchase the minimums as set forth in
paragraph 5.
6. If Distributor does not pay for the Product as set forth in the
Addendum A.
C. Termination With Notice. Certain other conditions may arise under
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which either party may wish to terminate this Agreement by giving notice to the
other party. It is therefore
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agreed that this Agreement may be terminated at any time by either party, with
or without cause, upon six (6) months written notice to the other party, but
such period of notice may be changed by mutual written consent. No other
provision herein contained shall be interpreted to limit or qualify the methods
of termination set forth in this Section 3.B.
D. Transactions After Termination.
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1. Upon termination of this Agreement, Distributor will immediately
account for and pay over to Manufacturer all sums due Manufacturer. Upon
compliance with and performance of the termination procedures and obligations by
Distributor as herein set forth, Manufacturer will account for and pay over to
Distributor all sums due Distributor.
2. Because Distributor has spent a great deal of time and money over
the years cultivating its market and will continue to do so under this
Agreement, upon termination by Manufacturer of this Agreement for any reason
other than for cause, Manufacturer agrees that it will not for a period of three
(3) months after the effective date of termination, solicit orders from any
business entity to which Distributor has sold any of the Products during the
term of this Agreement, unless otherwise compensated.
3. Compensation shall be calculated as the operating profit of the
previous three months (Operating profit equals gross profit less operating
expenses).
Section 4. Indemnification.
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Manufacturer shall defend, indemnify, and hold Distributor and its
affiliates harmless from, against, for and in respect of any and all damages,
losses, costs, and expenses (including, without limitation, reasonable
attorneys' fees) resulting or arising out of any suit, action or proceeding for
bodily injury, death, or property damage or other suit, action, or proceeding if
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and to the extent such injury or damage is caused by the acts, omission, or
negligence of Manufacturer, its affiliates or their respective agents during the
term of this Agreement except upon Distributor's breach of its warranties,
obligations, representations or required performance under this Agreement.
Both Manufacturer and Distributor agree to name each as an additional
insured on their respective general liability insurance policies and provide
proof thereof within thirty (30) days of the execution of the Agreement.
Section 5. General Terms and Conditions.
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A. Distributor Not An Agent. This Agreement does not appoint Distributor
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as an agent or legal representative of Manufacturer for any purpose whatsoever.
Distributor is not granted any express or implied right or authority to assume
or to create any obligation or responsibility in behalf of or in the name of
Manufacturer or to bind Manufacturer in any manner or thing whatsoever.
B. Confidential Information. During the term of this Agreement and for
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three (3) years thereafter, each party shall use the same degree of care as it
uses with regard to its own confidential information to prevent the disclosure,
use or publication of confidential information relating to the other coming to
its knowledge as a result of this Agreement unless such use, disclosure or
publication is permitted by this Agreement or authorized by the other in
writing. However, neither party shall be obligated to treat information or data
as confidential which without breach of confidentiality, (i) is, or becomes
available to the public, (ii) is already possessed by such party or (iii) is
independently developed by such party.
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C. Arbitration. Any controversy or claim arising out of or relating to
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this Agreement, or any breach thereof, shall be settled by arbitration conducted
at the American Arbitration Association in State of New York, in accordance with
the rules of the American Arbitration Association, and judgment upon the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
thereof. All submissions and proceedings, including arguments and briefs, shall
be in English.
D. English Language. All communications relating to the subject matter of
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this Agreement whether spoken or written, including, but without prejudice to
the generality of the foregoing, literature, manuals, price lists and training,
shall be in English.
E. Force Majeure. No party shall be liable for any failure to perform or
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delay in performance of its obligation hereunder caused by circumstances beyond
its reasonable control which make performance commercially impracticable
including, without limitation, fire, storm, flood, earthquake, hurricane,
explosion, accident, acts of the public enemy, war, rebellion, insurrection,
sabotage, epidemic, quarantine, restrictions, labor shortages, transportation
embargoes or delays, inability to secure raw materials or machinery for the
manufacture of its devices, acts of God, acts of any government or any agency
thereof, judicial action and other such external circumstances.
F. No Implied Waivers. The failure of either party at any time to require
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performance by the other party of any provision hereof shall in no way affect
the full right to require such performance at any time hereafter. Nor shall the
waiver by either party of a breach of any provision hereof constitute a waiver
of any succeeding breach of the same or any other such provision, nor constitute
a waiver of the provision itself.
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G. Notices. Any notice between the parties shall be deemed duly served
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when: (i) personally delivered and receipt thereof confirmed; (ii) five (5)
days after sent by registered airmail; or (iii) when transmitted by facsimile
machine with receipt thereof confirmed, and addressed as follows, or to such
other address as notified by the recipient:
If to Manufacturer: Leader Industries
0000 Xxxxx Xx.
Xxxxxxxxxxxx Xxxxxx, Xxxxxx
X0X0XX
Attn: Xxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Distributor: Daisy Manufacturing Company, Inc.
Xxx 000
Xxxxxx, Xxxxxxxx 00000
X.X.X.
Attn: E. Xxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
H. Applicable Law. It is expressly agreed and understood that this
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Agreement is a complete Agreement and that it shall be governed by the laws of
the State of New York in all matters, including, without limitation, validity,
obligation, interpretation, construction, performance and termination
I. Amendment, Alteration or Modification. The amendment, alteration or
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modification of this Agreement shall only be valid when executed in writing and
signed personally by both an authorized officer of Manufacturer and Distributor.
J. Addenda. The Addenda, if any, attached hereto is by this express
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reference made a part of this Agreement as fully as though set out at length
herein. Notwithstanding anything
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to the contrary, such Addenda may be amended, altered or modified by
Manufacturer from time to time, and as so amended, altered or modified will be
binding upon Distributor.
K. Separability. If any provision of this Agreement is invalid or
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unenforceable, this Agreement shall be considered divisible as to such provision
and the remainder of the Agreement valid and binding as though such provision
were not included herein.
L. Gender. Wherever used herein, the masculine gender shall include both
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the feminine and neuter genders.
M. This Constitutes Sole Agreement. The sole and total Agreement of the
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Parties is as set forth in Sections 1 through 5 preceding this Paragraph M, and
the "Witnesseth" clauses preceding Section 1, and there are no oral or implied
representations, rights or obligations to be considered or construed with the
express written provisions hereinabove set forth. No alterations, changes, or
interlineations of this written document shall be effective unless the same are
initialed by an authorized officer of each of the parties.
IN WITNESS WHEREOF, the parties hereto have hereunto signed this Agreement,
this 31st day of August, 1995.
WITNESS LEADER INDUSTRIES
/s/ By: /s/ Xxxx Xxxxxxxx
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Xxxx Xxxxxxxx
Its:
WITNESS DAISY MANUFACTURING COMPANY, INC.
/s/ Xxxxx Xxxxxxx By: /s/ E. Xxxx Xxxxx
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E. Xxxx Xxxxx
Its: Vice President
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ADDENDUM "A"
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1. Manufacturer hereby designates Distributor above named as Distributor for
the sale of:
UP X (single lens) $11.00 USD
UP XX (thermal lens) $13.20 USD
UP X (replacement lens) $ 4.40 USD
UP XX (replacement lens) $ 7.25 USD
Pricing includes all duties.
Pricing regarding new UP X & UP XX with face armor to follow shortly
upon design and costing completion
Terms of payment are 2% 10/net 30 days. Prices are subject to change
with 90 days written notice and will only reflect increases in raw
materials and labor salaries. Any stated prices will not be changed
unless on an annual basis.
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ADDENDUM "B"
PURCHASE ORDER TERMS
1. Buyer shall not be charged for any costs of packing, crating, drayage or
storage without its prior written consent.
2. Buyer shall not be liable for the payment of any federal, state or local
taxes which may be applicable to the materials, goods or services covered
by this order unless the same shall have been separately itemized and set
forth in Seller's quotation.
3. Seller warrants and represents that the prices for the goods and materials
set forth herein does not exceed the net price now charged by Seller to any
other customer purchasing the same items in like or similar quantities, and
agrees that if at any time during the pendency of this order, lower net
prices are quoted to any other person for similar goods and materials, such
lower net prices shall be from that time substituted for the prices
contained herein.
4. (a) Seller warrants and represents that the goods furnished hereunder
shall be of the quantity, quality, description and specifications set
forth herein and free of defects in design, workmanship and materials.
(b) All such goods and materials shall be received subject to Buyer's
inspection and approval. Payment for the goods and materials shall
not constitute acceptance thereof.
(c) Seller agrees to promptly repair or replace any goods and materials
found to be defective in design, workmanship or material or not in
conformity with the specification therefor. Buyer may return any non-
conforming goods or materials at Seller's expense.
(d) Goods delivered in excess of the quantity specified herein may be
refused and returned to Seller at its expense.
(e) Buyer may cancel any portion of this order if shipment is not timely
made as specified.
(f) Seller warrants that the sale or use of the articles or materials
covered by this order, either alone or in combination with any other
articles or materials with which Seller intends or has advised or
advertised that they may be used, will not constitute an infringement
or contributory infringement of any patents or trademarks or
copyrights in any country, and Seller hereby licenses Daisy
Manufacturing Company, Inc. and its customers under all of Seller's
patents or
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trademarks or copyrights to use and sell the articles or materials
covered by this order, alone or in any combination for which the
materials may be used.
5. Seller covenants and agrees to hold harmless, defend, indemnify and keep
indemnified, the Buyer, its affiliated and Subsidiary companies,
successors, and assigns, customers and users of its products of and from
any and all action or actions, loss, claims, demands, expenses, fees and
charges, costs and damages of any person whomsoever, arising out of or
caused by any breach of warranties or violation of the terms and conditions
hereof.
6. The representations and warranties of the Seller and the remedies of the
Buyer for breach thereof set forth herein shall not be construed to limit
or exclude any other warranties or remedies provided by law.
7. The warranties herein shall run to the Buyer, its affiliated and subsidiary
companies, successors, assigns and its customers and the users of the goods
and materials involved.
8. Seller shall bear the sole responsibility for any materials furnished to it
by Buyer in connection with this order.
9. Seller shall not assign any portion of this order without Buyer's written
consent. Buyer's consent shall not release Seller from its obligation and
liabilities hereunder.
10. Any terms herein to the contrary notwithstanding, neither party shall be
liable for delays or defaults due to force majeure, acts of governmental
authority or public enemy, war, strikes and labor troubles, freight
embargoes or any other causes or contingencies beyond its control,
provided, however, that Buyer may cancel any portion of this order if
shipment is not timely made as specified hereunder.
11. This order is subject to and Seller shall comply with all applicable
federal, state and local laws and regulations, including the requirements
of the Fair Labor Standards Act of 1938, as amended and including, for
orders (or contracts) not exempt under Section 204 of Executive Order
11246, as amended by Executive Order 11375, the provisions of paragraphs
(1) through (7) of Section 202 thereof, which provisions are incorporated
herein by reference. Acceptance of this order on the part of the Seller
shall constitute its certification of full compliance with such laws and
regulations.
12. The terms of this order supersede any prior dealings or negotiations of the
parties and contain the entire agreement between them, and no amendment or
modification thereof shall be valid or binding upon the Buyer unless
contained in a written instrument signed by its authorized representative,
provided, however, that where this purchase order form is used in
connection with purchase release under formal written contracts, the
contract provisions shall prevail if inconsistent with the within terms;
and provided, further, that in the event this purchase order involves a
government contract the terms thereof shall
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be superseded by attachment of form entitled "Standard Terms and Conditions
For Fixed Price Purchase Orders," which form upon attachment shall become
part of the purchase order.
13. Daisy Manufacturing Company, Inc. is a Federal Contractor subject to
Section 402 of the Vietnam Era Veterans Readjustment Assistance Act of 1974
and Section 503 of the Rehabilitation Act of 1973 and as such vendors [
]are subject to these sections.
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