EXHIBIT 10.5
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS EXHIBIT. THE
COPY FILED HEREWITH OMITS THE INFORMATION SUBJECT TO THE CONFIDENTIALITY
REQUEST. OMISSIONS ARE DESIGNATED AS [*****]. A COMPLETE VERSION OF THIS
EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
DISTRIBUTION AGREEMENT
----------------------
THIS AGREEMENT is made as of this 24th day of November, 1999 (the
"Effective Date"), by and between Proton Energy Systems, Inc., a corporation
duly organized and existing under the laws of Delaware, U.S.A., having its
principal place of business at 00 Xxxxxx Xxxx, Xxxxx Xxxx, Xxxxxxxxxxx 00000,
U.S.A., ("Proton") and Diamond Lite Limited, a corporation duly organized and
existing under the laws of Switzerland, having its principal place of business
at Xxxxxxxxx Xxxx, 0000 Xxxx, Xxxxxxxxxxx (the "Distributor").
RECITALS
--------
Proton is engaged in the business of manufacturing hydrogen generators,
including the Products (as hereinafter defined); and
Distributor is engaged in the business of selling and marketing goods
manufactured by others in the Territory (as hereinafter defined), including
products similar or related to the Products; and
Distributor agrees to be appointed a distributor of the Products in the
Territory, on the terms and subject to the conditions and limitations set forth
herein.
In consideration of the mutual covenants and agreements herein contained,
Proton and Distributor hereby agree as follows:
1. CERTAIN DEFINITIONS.
-------------------
1.1 Products. The term "Products" shall mean the items of equipment
--------
produced by Proton identified or described on Exhibit A attached hereto. Proton
shall have the right to modify, alter, improve, change, add to or discontinue
any or all of the Products at any time. Proton will use best efforts to provide
Distributor with reasonable advance notice of any change or addition to or
discontinuation of any of the Products, and will offer Distributor the
opportunity to add any new hydrogen generator products having a flow rate
capacity of greater than 10 standard cubic feet per hour which Proton may make
commercially available during the term of this Agreement to the list of Products
Distributor is authorized to distribute and sell hereunder.
1.2 Territory. The term "Territory" shall mean the geographic areas
---------
listed on Exhibit B attached hereto; provided, however, that Proton shall have
-------- -------
the right, at any
time and from time to time upon written notice to the Distributor, to eliminate
portions of the Territory in the event that (a) a government or governmental
agency in any jurisdiction constituting part of the Territory imposes conditions
or restrictions on the sale of the Products in such jurisdiction that either
prevent Proton or the Distributor from marketing, selling or delivering the
Products in that part of the Territory, or materially affect the commercial
feasibility of the transactions contemplated by this Agreement, or (b) the
Distributor is unable or otherwise fails or neglects to obtain any license,
permit or approval required under applicable law for the purchase, resale or
delivery of Products to customers in that part of the Territory.
1.3 House Accounts. The term "House Account" shall mean the existing or
--------------
prospective customers of Proton identified on Exhibit C hereto, as amended from
time to time. Proton shall have the right to add customers to the list of House
Accounts at any time and from time to time upon written notice to Distributor.
2. DISTRIBUTORSHIP.
---------------
2.1 Grant of Distributorship. Proton hereby grants to Distributor the
------------------------
right, during the Term (as hereinafter defined), to sell the Products to
customers (with the exception of House Accounts) located within the Territory
for delivery in the Territory, all in accordance with the terms and conditions
set forth herein. Distributor is not authorized to market or sell the Products
to customers who or which are (a) House Accounts, or (b) located outside the
Territory, unless in each instance Distributor has received the prior written
consent of Proton.
2.2 Direct Sales, Etc. Proton agrees that it shall not, at any time
------------------
during the Term of this Agreement, sell Products directly to customers located
within the Territory for delivery in the Territory; provided, however, that
-------- -------
Proton shall not be restricted from selling Products directly to House Accounts.
2.3 Sub-Distributors. Distributor may appoint sub-distributors and sales
----------------
representatives to market, sell and distribute the Products in the Territory
subject to and on terms and conditions consistent with the provisions of this
Agreement; provided, however, that Distributor shall at all times remain
-------- -------
responsible for the performance of such persons and for their compliance with
the terms and conditions hereof.
2.4 Competing Products. Distributor shall not, at any time during the
------------------
Term of this Agreement, directly or indirectly manufacture, distribute, sell,
act as a sales
-2-
representative for or with respect to or otherwise deal in any products which
are competitive with any of the Products.
3. ORDERS AND SHIPMENT.
-------------------
3.1 Orders. Distributor shall place written orders for the Products with
------
Proton setting forth the model(s), quantity of the Products ordered and the
delivery date based on the applicable quotation from Proton. Each order shall
incorporate the terms of this Agreement, whether or not specific reference is
made in such order to this Agreement. No order shall be binding on Proton
unless acknowledged and accepted in writing by Proton. Proton reserves the
right to reject any order or to cancel any order previously accepted if Proton
determines that Distributor is in breach of any term or condition of this
Agreement.
3.2 Shipment. Products sold to Distributor by Proton shall be shipped "Ex
--------
Works, packed" from Proton's manufacturing facility in Rocky Hill, Connecticut
(according to INCOTERMS), unless otherwise agreed in writing by the parties.
Title to the Products will pass to the Distributor upon delivery of the Products
to the carrier, and upon such delivery Distributor shall be responsible for and
bear the entire risk of loss or damage to the goods. Distributor shall pay all
packing, freight, insurance, duty and customs, and any other charge associated
with shipment, export, import or delivery of the Products.
3.3 Compliance with Laws. Distributor shall be responsible, at its sole
--------------------
cost and expense, for obtaining and maintaining all licenses, permits and
approvals required under applicable law for, and for otherwise complying with
all laws, rules and regulations applicable to, the purchase, resale and delivery
of the Products in the Territory. Distributor shall indemnify and hold Proton
harmless from and against any damages, losses, liabilities and expenses,
including reasonable attorney's fees, arising out of any breach of the
provisions of this Section.
4. PRICES AND PAYMENT TERMS.
------------------------
4.1 Prices. Prices for the Products shall be as quoted by the Proton to
------
Distributor from time to time or for specific projects. All prices are
exclusive of all governmental excise, sales, use, occupational or similar taxes.
The prices at which the Products are resold in the Territory shall be determined
in the sole discretion of Distributor.
-3-
4.2 Terms of Payment. Unless otherwise agreed by the parties in writing,
----------------
payment for Products purchased hereunder shall be made by Distributor in
accordance with the quotation from Proton with respect to the sale of the
subject Products. All payments due hereunder shall be made in United States
dollars. In the event such remittance is not made in full within said period,
interest shall accrue on moneys outstanding from the due date to the date of
payment at the rate of one and one-half percent (1 1/2%) per month (or the
maximum legal rate allowed, whichever is less).
5. MARKETING, ADVERTISING AND TRAINING.
-----------------------------------
5.1 Distributor's Undertaking. Distributor shall exert its best efforts
-------------------------
to promote the sale of the Products in the Territory and to develop a market
demand for the same in the Territory. Distributor shall maintain professional
sales and office facilities and personnel, and trained field service personnel
adequate to provide effective, reliable and complete service, support and
installation to its customers and potential customers. Distributor shall
generally conduct its business in a professional and ethical manner in all
dealings with Proton and Distributor's customers and potential customers, abide
by the highest standards of honesty, integrity and fair dealing, comply with all
applicable laws, rules and regulations and refrain from any conduct which would
reflect adversely upon or in any manner injure the reputation or goodwill of
Proton or the Products.
5.2 Sales Materials. Proton agrees to provide Distributor free of charge
---------------
with such catalogs and other sales and promotional materials with respect to
Products as Proton generally makes available to its distributors, and
Distributor may reproduce such materials as reasonably required, provided that
all copyright, trademark and other proprietary markings are reproduced. Such
materials shall remain the property of Proton and, except insofar as they are
distributed by Distributor in the course of his performance of his duties under
this Agreement, must be promptly returned to Proton upon the expiration or
termination of this Agreement. Distributor will arrange, at its sole cost and
expense, for sales and marketing materials and product manuals to be translated
into the respective languages within the Territory, and has therefore the right
(subject to the provisions of Section 9 hereof) to use Proton's "Trademarks" (as
hereinafter defined) in such documents. Distributor shall be solely responsible
for verifying the accuracy of all such translations.
5.3 Additional Support. Proton will provide a link on its website to
------------------
Distributor's website to facilitate referrals to Distributor. Proton will also
identify Distributor as a distributor of the Products in its advertising and
promotional materials as, when and to the extent it deems appropriate to do so.
-4-
5.4 Training for Distributor Personnel. At such time or times as are
----------------------------------
mutually agreeable and convenient for the parties, Proton shall provide free of
charge technical/technical sales training for qualified personnel of Distributor
at Proton's facility in Rocky Hill, Connecticut, provided that Distributor shall
be responsible for all expenses for its personnel attending such training.
6. LIMITED WARRANTY.
----------------
6.1 Limited Warranty. Proton's sole warranty with respect to Products
----------------
sold to Distributor shall be as set forth in Proton's standard written warranty
with respect to the subject Product, as modified and in effect from time to time
and subject to the conditions and limitations set forth therein. A copy of
Proton's current standard written warranty with respect to the Products is
attached hereto as Exhibit D.
6.2 Limitation of Liability. PROTON MAKES NO REPRESENTATION OR WARRANTY
-----------------------
WITH RESPECT TO THE PRODUCTS OTHER THAN THOSE EXPRESSLY SET FORTH IN THIS
SECTION. THE WARRANTIES STATED IN THIS SECTION ARE EXPRESSLY IN LIEU OF ALL
OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, ANY EXPRESS
OR IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR
AGAINST INFRINGEMENT. PROTON SHALL NOT BE LIABLE FOR ANY INCIDENTAL, SPECIAL,
INDIRECT OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO LOSS OF
ANTICIPATED PROFITS OR BENEFITS, DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE SUPPLY OF PRODUCTS, HEREUNDER. PROTON'S TOTAL
LIABILITY (WHETHER IN CONTRACT, TORT, PRODUCT LIABILITY OR OTHERWISE) ARISING
OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY BREACH HEREOF SHALL NOT,
UNDER ANY CIRCUMSTANCES, EXCEED THE AGGREGATE AMOUNT PAID TO PROTON BY
DISTRIBUTOR HEREUNDER.
7. INSURANCE.
---------
7.1 Distributor's Insurance. Distributor shall secure and maintain during
-----------------------
the Term an insurance policy or policies protecting the Distributor and Proton
against any loss, liability or expense whatsoever, including product liability,
workmen's compensation, personal injury, fire, theft, death, property damage or
otherwise, arising from the Distributor's business. Such policy or policies
shall include general liability coverage of not less than US$500,000 per person
and US$1,000,000 combined single
-5-
limit per accident for bodily injury and property damage coverage of US
$100,000. Distributor shall furnish Proton with certificates evidencing all such
insurance.
7.2 Proton's Insurance. Proton represents that it has and will maintain
------------------
in effect during the Term of this Agreement products liability insurance with
limits of not less than US$5,000,000. Proton will furnish Distributor with
certificates evidencing such insurance.
8. NOTICES, FORECASTS, REPORTS AND RECORDS.
---------------------------------------
8.1 Notices of Claims. Distributor shall notify Proton in writing of any
-----------------
claim, action, proceeding or the like that comes to the attention of the
Distributor which is brought, asserted or threatened against the Distributor or
Proton and relates in any way to the Products or the subject matter of this
Agreement promptly upon learning thereof, and shall cooperate with Proton in the
investigation, defense and resolution of such claim, action or proceeding.
8.2 Reports. Upon request by Proton from time to time, Distributor shall
-------
submit periodic reports detailing its sales and marketing efforts and activities
in the Territory at such intervals and containing such information as Proton may
reasonably require.
8.3 Records. Distributor agrees to maintain copies of all documentation
-------
relating to its purchase and sale of Products under this Agreement.
9. TRADEMARKS AND OTHER INTELLECTUAL PROPERTY RIGHTS.
-------------------------------------------------
9.1 Trademarks and Tradenames. Distributor acknowledges that Proton is
-------------------------
the sole owner of Proton's corporate name, as well as any other tradenames,
trademarks, service marks, logos, designs or marks that Proton has adopted or
may from time to time adopt or use with respect to the Products or in connection
with its business (collectively, "Trademarks"). Distributor shall not adopt or
use any Trademark in any manner except as expressly authorized under this
Agreement, or directly or indirectly contest or aid in contesting the validity
or ownership of any Trademark or take any actions whatsoever in derogation of
Proton's rights in any Trademark. Distributor shall not alter, remove or cover
up any Trademarks appearing on or affixed to the Products or any documentation,
literature or marketing materials relating thereto.
-6-
9.2 Limited License. Proton hereby grants Distributor a license to use
---------------
the Trademarks during the Term of this Agreement, provided that (i) such
Trademarks are used solely in connection with the marketing and sale of the
Products pursuant to this Agreement and for no other purpose, and (ii)
Distributor's use of such Trademarks complies in each instance with all
Trademark use guidelines as may be promulgated by Proton and communicated to
Distributor from time to time. Upon expiration or termination of this
Agreement, Distributor shall cease use of all Trademarks.
9.3 Advertising. Distributor shall not publish broadcast, display,
-----------
distribute or otherwise use any advertising, sales brochures, promotional
literature, press releases or other items or materials which contain or
otherwise make any representations or warranties with respect to the Products
which are inconsistent with those made by Proton in any of its manuals or
product literature relating to such Products or which are untrue, deceptive or
misleading in any respect. Distributor agrees to comply with all Trademark use
guidelines as may be promulgated by Proton and communicated to Distributor from
time to time.
9.4 Unauthorized Use. Distributor agrees to promptly notify Proton of any
----------------
infringement or other unauthorized use of any Trademark promptly upon learning
thereof.
10. TERM OF AGREEMENT; TERMINATION.
------------------------------
10.1 Term. The term of this Agreement (the "Term") shall commence on the
----
Effective Date and continue until June 30, 2002, unless sooner terminated as
hereinafter provided. Thereafter, subject to the provisions hereof, the Term
shall be automatically renewed and extended for additional successive periods of
one (1) year each unless written notice is given by either party not less than
one hundred and eighty (180) days prior to the expiration of the initial Term or
the then current renewal Term that this Agreement shall not be so extended, in
which event this Agreement shall terminate effective as of the end of the
initial Term or the then current renewal Term as the case may be.
10.2 Events of Termination. Notwithstanding the foregoing, either party may
---------------------
terminate this Agreement at any time with immediate effect by written notice to
the other party, if the other party has not discharged any of its obligations
hereunder or otherwise breached this Agreement, or if the other party is or will
inevitably in the near future be dissolved, liquidated or bankrupt, or if the
management or control of the other
-7-
party has changed in such a way as to render it undesirable for the first party
in its opinion to continue this Agreement.
10.3 Early Termination by Proton. In addition to Proton's right to
---------------------------
terminate this Agreement pursuant to Section 10.2 above, Proton may, upon
written notice thereof to
Distributor, terminate this Agreement at any time prior to the expiration of the
Term upon the occurrence of any of the following events:
(i) Distributor's voluntary abandonment of the distributorship to
which it has been appointed pursuant to this Agreement; or
(ii) Distributor's engaging in any practice which is, or in the
opinion of Proton's legal counsel is determined to be, an illegal, unfair or
deceptive trade practice in violation of any applicable law, rule or regulation.
10.4 Obligations Upon Termination. Upon termination of this Agreement, by
----------------------------
expiration of the Term or otherwise, Distributor shall immediately (i) cease
holding itself out, in any manner, as an authorized distributor of the Products
and cease using the Trademarks or any advertising or promotional materials
supplied by Proton or containing any Trademarks or references to the Products
for any purpose; and (ii) return to Proton any and all documentation and
materials containing confidential or proprietary information belonging to Proton
and any and all signs, stationery, sales brochures, advertising, promotional
materials and other materials supplied by Proton. Orders placed with
Distributor by any customers in the Territory within twelve months after
termination of this Agreement pursuant to a written offer made by Distributor to
such customer before termination hereof in accordance with a written quotation
from Proton shall be completed and delivered under the terms and subject to the
conditions and provisions of this Agreement and the applicable written quotation
from Proton. In no event shall Distributor be entitled to compensation for good
will or any other payment of any type upon termination of this Agreement.
10.5 Survival of Certain Obligations. Termination of this Agreement shall
-------------------------------
not relieve either party of any accrued payment obligations under this
Agreement. The rights and obligations of the parties under Sections 6.2, 9.1,
10.4 and 11 will survive the termination of expiration of this Agreement in
accordance with their terms.
11. MISCELLANEOUS.
-------------
-8-
11.1 Confidentiality. Distributor shall hold in strict confidence and
---------------
shall not disclose to others or use, either before or after termination or
expiration of this Agreement, any technical or business information,
manufacturing technique, process, experimental work, trade secret or other
confidential matter relating to the Products, except to the extent disclosure is
reasonably required in connection with Distributor's marketing activities in the
Territory. Distributor shall, upon request (and upon termination or expiration
of this Agreement without request), deliver to Proton any and all drawings,
notes, documents and materials received from Proton.
11.2 Independent Contractor Status. Nothing contained in this Agreement
-----------------------------
shall be construed to constitute Distributor as a partner, employee or agent of
Proton, nor shall Distributor hold himself out as such. Distributor has no
right or authority to incur, assume or create, in writing or otherwise, any
warranty, liability or other obligation of any kind, express or implied, in the
name of or on behalf of Proton, it being intended by both Distributor and Proton
that each shall remain an independent contractor responsible for its own
actions. Distributor agrees to indemnify and hold Proton harmless from and
against any damages, losses, liabilities and expenses, including reasonable
attorneys fees, arising out of a breach of the provisions of this Section.
11.3 Assignment. Distributor shall not assign, transfer or otherwise
----------
dispose of this Agreement or any of its rights or obligations hereunder without
Proton's prior written consent.
11.4 Force Majeure. If the performance of any obligation under this
-------------
Agreement (other than payment obligations) is prevented, restricted or
interfered with by reason of war, revolution, civil commotion, acts of public
enemies, blockade, embargo, strikes, any law, order, proclamation, regulation,
ordinance, demand, or requirement having a legal effect of any government or any
judicial authority or representative of any such government, or any other act
whatsoever, whether similar or dissimilar to those referred to in this Section,
which is beyond the reasonable control of the party affected, then the party so
affected shall, upon giving prior written notice to the other party, be excused
from such performance to the extent of such prevention, restriction, or
interference, provided that the party so affected shall use reasonable
commercial efforts to avoid or remove such causes of nonperformance, and shall
continue performance hereunder with reasonable dispatch whenever such causes are
removed.
11.5 Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto and supersedes all previous negotiations, agreements
and commitments with respect thereto, and shall not be released, discharged,
changed or
-9-
modified in any manner except by instruments signed by duly authorized officers
or representatives of each of the parties hereto.
11.6 Applicable Law. Any claim or controversy relating in any way to this
--------------
Agreement shall be governed and interpreted exclusively in accordance with the
laws of the State of Connecticut and the federal laws of the United States.
Distributor hereby agrees that all controversies arising from or relating to
this Agreement shall be initiated in a state or federal court located in the
State of Connecticut and, accordingly, irrevocably consents to the jurisdiction
and to the service of process, pleadings and notices in connection with any and
all actions and processes initiated in any state or federal court in said state.
Neither the 1980 United Nations Convention on Contracts for the International
Sale of Goods nor the United Nations Convention on the Limitation Period in the
International Sale of Goods will apply to this Agreement or any transaction
under it.
11.7 Partial Illegality. If any provision of this Agreement or the
------------------
application thereof to any party or circumstances shall be declared void,
illegal or unenforceable, the remainder of this Agreement shall be valid and
enforceable to the extent permitted by applicable law. In such event, the
parties shall use their best efforts to replace the invalid or unenforceable
provision by a provision that, to the extent permitted by the applicable law,
achieves the purposes intended under the invalid or unenforceable provision.
Any deviation by either party from the terms and provisions of this Agreement in
order to comply with applicable laws, rules or regulations shall not be
considered a breach of this Agreement.
11.8 Waiver of Compliance. Any failure by any party hereto to enforce at
--------------------
any time any term or condition under this Agreement shall not be considered a
waiver of that party's right thereafter to enforce each and every term and
condition of this Agreement.
11.9 Notices. All notices and other communications in connection with
-------
this Agreement shall be in writing and shall be sent to the respective parties
at the following addresses, or to such other addresses as may be designated by
the parties in writing from time to time in accordance with this Section, by
registered or certified air mail, postage prepaid, or by express courier
service, service fee prepaid, or by telefax with a hard copy to follow via air
mail or express courier service in accordance with this Section.
-10-
To Proton: Proton Energy Systems, Inc.
00 Xxxxxx Xxxx
Xxxxx Xxxx, Xxxxxxxxxxx
Attention: President
With a copy to: Xxxx X. Xxxxxxxx Esq.
Duane, Morris & Heckscher LLP
Xxx Xxxxxxxxxxxxx Xxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
To Distributor: Diamond Lite Limited
Industrie Xxxx
9425 Thal
Switzerland
Attention: President
All notices shall be deemed received (i) if given by hand, immediately,
(ii) if given by air mail, three (3) business days after posting, (iii) if given
by express courier service, the next business day in the jurisdiction of the
recipient, or (iv) if given by telefax, upon receipt thereof by the recipient's
telefax machine as indicated either in the sender's identification line produced
by the recipient's telefax machine or in the sender's transmission confirmation
report as produced electronically by the sender's telefax machine.
11.10 Counterparts. This Agreement may be executed in counterparts, each
------------
of which shall be deemed to be an original and all of which together shall be
deemed to be one and the same instrument.
The parties have caused this Agreement to be executed by their respective
duly authorized representative as of the Effective Date.
PROTON ENERGY SYSTEMS, INC. DIAMOND LITE LIMITED
By: /s/ Xxxxxx X. Xxxxxxxxx By:
------------------------------------- ------------------------------
Xxxxxx Xxxxxxxxx President & CEO
---------------------------------------- ---------------------------------
Printed Name and Title Printed Name and Title
-11-
EXHIBIT A
PRODUCTS
--------
1. XXXXX(R) 20 Hydrogen Generator
2. XXXXX(R) 40 Hydrogen Generator
3. XXXXX(R) 380 Hydrogen Generator
4. XXXXX(R) 600 Hydrogen Generator
5. XXXXX(R) 1000 Hydrogen Generator
-12-
EXHIBIT B
TERRITORY
---------
Austria, Benelux countries, Bulgaria, Czech Republic, Denmark, France,
Germany, Greece, Hungary, Italy, Poland, Portugal, Romania, Slovak Republic,
Slowenia, Spain, Switzerland
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*****CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.*****
EXHIBIT C
HOUSE ACCOUNTS
--------------
1. [*****]
2. [*****]
3. All industrial gas companies (i.e. organizations engaged in the business of
distributing and supplying industrial gases and equipment) having gross
annual sales equivalent to [*****] or more, including but not limited to
[*****].
-00-
XXXXXXX X
XXXXXXX XXXXXXXX
HYDROGEN GAS GENERATOR SYSTEMS
PROTON ENERGY SYSTEMS, INC. ("PROTON") warrants to purchasers from Proton (each
a "Buyer") of the PROTON manufactured and designed ITEMS LISTED BELOW that such
items shall be free from defects in materials and workmanship under normal use
and service for the stated period of time commencing from date of shipment or as
stated below.
HYDROGEN GAS GENERATORS: Twelve (12) months from start-up or fifteen (15)
months from shipment, whichever occurs first.
SPARE AND REPLACEMENT PARTS (excluding electrolysis cell stack): Ninety (90) days
ELECTROLYSIS CELL STACKS: Twelve (12) months
EXCLUDED FROM THIS WARRANTY:
. Parts and items considered consumable in normal operations, including those
parts and items supplied with the unit for maintenance.
. Any Generator and its parts that are not installed, operated, and maintained
in accordance with the unit's operation and maintenance manual supplied with the
system.
. Damages due to accident, misuse or negligence of the operator
Buyer shall provide PROTON with prompt written notice and an explanation of the
circumstances of any claim hereunder. Buyer's sole and exclusive remedy in the
event of defect, and the liability of PROTON hereunder, is limited to the
adjustment, repair, or replacement (at PROTON's option) of defective item or
part. Such adjustments, repairs, or replacements will be made at PROTON's Rocky
Hill, Connecticut, plant or, for Generators only, at the site of the equipment
if BUYER so elects. All costs for shipping equipment or parts, whether to or
from the point of manufacture, and all travel and related expenses (including,
without limitation, meals and lodging) incurred by PROTON employees or agents in
connection with the performance of field services hereunder shall be the
responsibility of the BUYER. If PROTON cannot, or determines that it is not
practical to, repair or replace a defective item, the price allocable to such
item paid to PROTON by Buyer shall be refunded or, at PROTON's option, credited
against other obligations of Buyer or toward future purchases.
NOTE: DISASSEMBLY OF THE ELECTROLYSIS CELL STACK
-15-
IMMEDIATELY VOIDS ANY AND ALL WARRANTIES
THE WARRANTY PROVIDED HEREUNDER, AND THE RIGHTS AND REMEDIES OF THE BUYER
HEREUNDER, ARE IN LIEU OF ALL OTHER WARRANTIES, GUARANTEES, OBLIGATIONS,
LIABILITIES, OR REMEDIES, EXPRESSED OR IMPLIED, ARISING BY LAW OR OTHERWISE,
INCLUDING WITHOUT LIMITATION IMPLIED WARRANTIES OF MERCHANTABILITY, IMPLIED
WARRANTIES ARISING FROM COURSE OF DEALING OR USAGE OF TRADE AND IMPLIED
WARRANTIES OF SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR AGAINST
INFRINGEMENT. THE REMEDIES PROVIDED IN THIS CLAUSE ARE EXCLUSIVE AND THE SELLER
SHALL IN NO WAY BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND
WHATSOEVER, INCLUDING WITHOUT LIMITATION LOSS OF USE, REVENUE OR PROFIT, WHETHER
OR NOT PROTON HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
-16-
