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EXHIBIT 10.45
EXCLUSIVE DISTRIBUTORSHIP AGREEMENT
This Agreement (the "Agreement") is made and entered into as of the 28th
day of August, 1998 by and between Emhiser Research, Inc. ("ERI") and Microdyne
Communication Technologies, Inc. ("Microdyne" or the "Distributor").
BACKGROUND
ERI and the Distributor wish to provide for the promotion and sale in the
area specified in Appendix A hereto (hereinafter referred to as the
"Territory"), the products listed in Appendix B hereto (hereinafter referred to
as the "Products"). The Distributor represents that it is familiar with the
market for the Products in the Territory and that it is adequately qualified and
equipped to promote and sell the Products in the Territory to the mutual benefit
of both parties.
TERMS
ARTICLE 1. - SUBJECT MATTER
1.1 Subject to the provisions of Article 11 herein, ERI hereby grants to
the Distributor and the Distributor hereby accepts the exclusive
right to purchase for re-sale the Products in the Territory subject
to the terms and conditions contained in this Agreement.
1.2 ERI reserves the right, after this Agreement has been in effect for 6
months, to withdraw, modify or replace the Products according to the
needs of its production and sales policy if ERI provides the
Distributor with 90 days prior written notice of XXX's intention to
withdraw, modify or replace such Products. ERI may not grant to any
other party the right to sell such Products in the Territory for the
term of this Agreement.
ARTICLE 2. - LEGAL STATUS OF THE PARTIES
2.1 ERI is a corporation organized and existing under the laws of the
state of Nevada with its registered office at 0000 Xxx Xxxxxxx 00
Xxxx, Xxxxx, Xxxxxx 00000-0189, acting on behalf of Emhiser Research
Limited, 000 Xxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxx, Xxxxxx X0X 0X0, duly
represented by Xxxxx Xxxxxxxxxxxx and Emhiser Manufacturing Limited,
RR #0, Xxxxxxx 00 Xxxxx, X. X. Box 31, Nobel, Ontario, Canada POG
1G0, duly represented by Xxxxxx Xxxxxxxxxxxx.
2.2 Microdyne is a corporation organized and existing under the laws of
Maryland with its registered office at 0000 Xxxxxxxxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, XXX and division headquarters at 000 Xxx
Xxxx, Xxxxx, XX 00000-0000, XXX, duly represented by Xxx Xxxxxxx.
2.3 Both parties are duly organized, validly existing, and with an active
status or in good standing under the laws of their respective
jurisdiction of incorporation and both parties have the power and
authority to enter into and perform their obligations under this
Agreement.
2.4 ERI and the Distributor shall act as independent contracting parties.
The Distributor shall purchase the Products from ERI for re-sale to
its customers in its own name and for its own account; it will not
represent itself as an employee or agent of ERI and shall be deemed
to have no authorization, express or implied, to undertake any
commitments on behalf of ERI, nor to bind the latter in any manner
whatsoever.
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ARTICLE 3. - SALES PROMOTION
3.1 Throughout the term of this Agreement, the Distributor undertakes to
use its reasonable best efforts to promote and sell the Products in
the Territory and in general to act with reasonable diligence in
carrying out its obligations as a distributor.
3.2 Without prejudice to the generality of the above, the Distributor
shall, without charge to ERI, undertake:
(a) To visit existing and potential customers regularly,
(b) To arrange for adequate and effective publicity for the
Products,
(c) To use its reasonable best efforts to take advantage of any
relevant commercial techniques to promote the sales of the
Products in the Territory,
(d) To exhibit the Products at certain trade fairs and/or
exhibitions in the Territory as the Distributor deems
appropriate (for that purpose, ERI may provide the
Distributor with such demonstration Products as may be
available on terms and conditions to be agreed upon on a
case-by-case basis),
3.3 The promotion, the publicity, and the sale of the Products shall be
made exclusively under the trademark, logotype or trade name chosen
or used by the Distributor and specified by the Distributor in
writing to ERI. The Distributor shall have the right to represent
itself in the Territory as the Exclusive Distributor for the Products
of Emhiser Research, Inc., on its company letterhead, publicity
documents and the like.
3.4 The Distributor warrants that, at the time of entry into force of
this Agreement, it maintains a trained sales force and appropriate
support and service personnel to adequately assist customers in
ordering the Products.
3.5 When placing an order with ERI, the Distributor will include a copy
of the Product's technical bulletin signed by the end user as proof
that they have approved all of the specifications as written. ERI
shall offer training to the Distributor's sales personnel so that the
Distributor may properly represent the Products. All training shall
take place at ERI's facility in Verdi, Nevada. In the event that the
Distributor wishes that training occur at another location, the
Distributor shall pay the expenses incurred by ERI to send the
appropriate personnel and equipment. XXX also agrees that it will
offer training to the Distributor's engineering personnel under the
same terms and conditions as that offered to the Distributor's sales
personnel. The purpose of the training for the engineering personnel
is to ensure that the Distributor can integrate the Products into the
Distributor's systems and will be able to perform any necessary
troubleshooting.
ARTICLE 4. - DOCUMENTATION
4.1 ERI undertakes to supply the Distributor, free of charge, with a
reasonable number of copies of such technical and commercial
documentation in the English language as may be or may become
available during the term of this Agreement for the promotion and
sale of the Products.
4.2 If deemed necessary by the Distributor, the Distributor may, at its
own expense, translate the said documentation into another language.
4.3 Should the Distributor wish to undertake any modification or
translation of such technical and commercial documentation supplied
by ERI or add to the said documentation, the Distributor shall first
submit the text thereof to ERI for its prior written approval (which
shall not be unreasonably withheld) and shall not print or use such
modified or translated documentation before having obtained the said
approval.
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4.4 It is agreed that all such technical and commercial documentation
printed by ERI shall remain the property of ERI, subject to the right
of the Distributor to make full commercial use of such documentation
for the purpose of this Agreement and throughout its duration.
ARTICLE 5. - MINIMUM PURCHASE QUOTA
In consideration of the exclusive rights of distribution granted
herein to the Distributor by XXX, the Distributor undertakes to use
its reasonable best efforts in the marketing, promotion and sales of
the Products to increase each year the sales of the Products. No
minimum purchase is in effect for the term of this Agreement.
ARTICLE 6. - NON-COMPETITION
ERI recognizes that the Distributor already manufactures and sells
individual Telemetry products. The Distributor shall not develop new
products that directly or indirectly compete with the Products
covered by this Agreement without first offering ERI the opportunity
of terminating this Agreement, and without first giving ERI at least
90 days prior written notice.
ARTICLE 7. - OBLIGATION OF DELIVERY
7.1 ERI undertakes to deliver to the Distributor the Products or spare
parts, which have been regularly ordered by the Distributor within
the delivery dates and upon the conditions specified by ERI in its
order acknowledgement.
7.2 However, XXX reserves the right to refuse any order and shall not be
obliged to make delivery of the Products in the event the Distributor
is in material breach of any of the terms and conditions of this
Agreement.
ARTICLE 8. - SALES CONDITIONS BETWEEN ERI AND THE
DISTRIBUTOR
8.1 Except as may otherwise be agreed upon between the parties for a
specific order, the sales of all Products from ERI to the Distributor
shall be governed by the prices, terms and conditions defined in
Appendix D hereto and by ERI's General Terms and Conditions of Sale
attached hereto as Appendix E. In the event of any conflict between
the two documents, the terms and conditions found in Appendix D shall
prevail.
ERI reserves the right to change the prices, terms and conditions of
Appendix D upon giving the Distributor not less than 90 days prior
written notice.
8.2 Notwithstanding anything to the contrary contained in this Agreement
or documents made a part hereof, it is expressly agreed that the
Products shall remain the sole and absolute property of ERI until
such time as the Distributor shall have paid ERI the full price for
the Products. Consequently, until such payment, the Distributor shall
be in possession of the Products solely as bailee for ERI and ERI
reserves the right to repossess such Products by whatever means it
will deem appropriate including but not limited to the right of ERI
or its agent to enter the Distributor's premises during normal
business hours to remove the Products.
8.3 Neither ERI nor the Distributor shall be liable for any incidental or
consequential damages, unless those damages are attributable to their
own acts or omissions.
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ARTICLE 9. - DISTRIBUTOR PRICES
The Distributor shall be at liberty to determine its own resale
prices. However, it undertakes to keep such prices reasonably
competitive.
ARTICLE 10. - PROMOTION OUTSIDE THE TERRITORY
The Distributor may sell the Products to any person or government,
whether in the Territory or outside of the Territory; provided,
however, that the Distributor may only represent itself as XXX's
Exclusive Distributor in the Territory.
ARTICLE 11. - DIRECT ORDERS TO XXX
11.1 In consideration of the exclusive nature of the rights granted to the
Distributor in this Agreement, ERI undertakes that it shall not,
throughout the term of this Agreement, offer the right to distribute
or sell the Products in the Territory to any party other than the
Distributor. ERI, however, retains the right to sell its Products to
any person or government, whether in the Territory or outside the
Territory.
11.2 If a customer (whether end user or sub-distributor) resident in the
Territory submits an order directly to ERI, XXX must notify the
Distributor in writing of such order and the Distributor has the
option of accepting and filling the order. The Distributor must
notify ERI within 10 business days whether the Distributor intends to
accept and fill such order. If the Distributor chooses not to fill
such order, XXX has the right to fill such order.
ARTICLE 12. - REPORTING
12.1 Every three months during the term of this Agreement, the Distributor
will send to ERI a written report on its activities, which will set
forth in particular:
(a) The various actions undertaken in compliance with the
obligations set forth in Article 3 of this Agreement,
(b) The Distributor's sales results,
(c) The resale price of the Products sold,
(d) All material claims from customers concerning the Products
or the Distributor's activities in relation to the
Products,
(e) Sales forecasts for the next twelve months,
(f) Competitor's activities.
12.2 During the term of this Agreement, the Distributor will promptly
advise ERI of any material change in its senior management or
organization.
ARTICLE 13. - GUARANTEE
13.1 The Products sold to the Distributor by XXX are guaranteed for a
period of 18 months from delivery to the Distributor (unless
otherwise provided in Appendix D hereto) and are subject to ERI's
General Terms and Conditions of Sale attached hereto as Appendix E,
to the exclusion of all other rights, compensation or demands of the
Distributor or of its customers.
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13.2 The Distributor is only authorized to make representations on
performance or technical characteristics of the Products to its
customers or to provide a guarantee on the Products to its customers
strictly in accordance with ERI's instructions in writing and in
accordance with ERI's General Terms and Conditions of Sale attached
hereto as Appendix E.
ARTICLE 14. - GUARANTEE IMPLEMENTATION
The Distributor shall notify ERI promptly of all customers' written
claims, which may fall within the guarantee set forth in Article 13.
Upon receipt of such notification, ERI shall, after consultation
with the Distributor, decide whether the Distributor:
(a) Shall return, at ERI's cost, to ERI, the defective Product
or part thereof for repair or replacement. When upon
examination of the defective product or part thereof, ERI
has confirmed that it falls within the terms of ERI's
guarantee, it shall send to the Distributor free of charge
the repaired or replaced Product; or,
(b) Shall undertake the repair of the Product locally, at a
cost agreed by the two parties, and paid by XXX. The
Distributor shall send to ERI a report indicating the
nature of the fault and the cause thereof after making such
repairs.
ARTICLE 15. - AFTER SALES SERVICE
ERI shall also, at a negotiated expense, provide an after-sales
service for all Products installed in the Territory; such service
being at least equal to the service provided by ERI to its own
customers. Microdyne shall have no responsibility for providing
after-sales service.
ARTICLE 16. - PRODUCTS' APPROVAL
In the event the export or sale of the Products in the Territory is
subject to any necessary authorization from any government agency or
other authority, ERI shall provide to the Distributor, at its
request, with any necessary assistance.
ARTICLE 17. - CONFIDENTIALITY
Both ERI and the Distributor agree not to reveal any technical,
commercial or financial information which either party may have
obtained in the course of carrying out this Agreement, including, but
not limited to, all correspondence between the parties and their
customers. This obligation shall remain in effect, notwithstanding
the termination of this Agreement, until such information has fallen
into the public domain through no fault of either ERI or the
Distributor. Upon termination of this Agreement, both ERI and the
Distributor agree that they will return all material received from
the other and warrant that no other copies of the material exists.
ARTICLE 18. - DUTIES - TAXES
All export/import items (duties, taxes, fees, licenses, etc.) will be
the responsibility of the purchaser of the Products.
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ARTICLE 19. - INDUSTRIAL PROPERTY
19.1 Both ERI and the Distributor expressly acknowledge that the
trademarks "EMHISER," "EMHISER RESEARCH," "EMHISER MANUFACTURING" and
"MICRODYNE" together with other trademarks, trade names, or logotypes
associated with the business, Products or services of ERI or the
Distributor are each party's exclusive property of which the other
party has no right, title or interest during the existence of this
Agreement or thereafter. In addition, the Distributor has no right,
title or interest in any patent or other intellectual or industrial
property right in the Products (hereinafter referred to as "ERI's
industrial property") whether or not registered in the Territory.
19.2 Both XXX and the Distributor declare that they have not sought nor
obtained and shall not seek nor obtain registration in each party's
own name of any of the other party's industrial property in the
Territory or elsewhere. In addition, the Distributor undertakes to
cease use of ERI's industrial property upon termination of this
Agreement for whatever reason.
19.3 The Distributor agrees that it will not use XXX's industrial property
in the Territory, except in connection with the sale, promotion,
guarantee and after-sales service of the Products, in accordance with
this Agreement and for its duration.
19.4 ERI and the Distributor agree that any increase in the value of ERI's
industrial property in the Territory or elsewhere resulting from the
Distributor's activities shall inure to the sole benefit of the
Distributor and shall not give rise to any compensation to XXX.
19.5 The Distributor will promptly notify ERI of any counterfeit or
imitation of XXX's industrial property or trademark infringement or
alleged infringement or acts of unfair competition of which it may
have knowledge in the Territory during the term of this Agreement and
will assist XXX at XXX's request and at XXX's expense in defending or
prosecuting all such matters.
ARTICLE 20. - DURATION
This Agreement shall come into force at the date of signature by both
parties and shall be valid for 12 months. Thereafter, it shall
automatically be renewed for successive periods of one year each
unless terminated by either party and at any time by 90 days prior
written notice to the other, such notice to be applicable to the
first contractual period and thereafter.
ARTICLE 21. - EARLIER TERMINATION
21.1 Except as otherwise set forth in this Agreement and notwithstanding
Article 20, after this Agreement has been in effect for 6 months,
either party may terminate this Agreement for any reason at any time
by providing the other party with 90 days prior written notice.
21.2 This Agreement may also be terminated immediately by either ERI or
the Distributor by notice in writing in the event the other party
files a petition under bankruptcy or similar laws or if the other
party is liquidated or becomes insolvent, or is wound up or taken
over, or is subject to corporate changes such as, without limitation,
take over bids, mergers or change of control or ownership of assets
or shares or if the Distributor becomes nationalized or in the event
of changes in the personnel of the Distributor as referred to in
Article 3.4 and 12.2 which make the Distributor unable to perform its
obligations under this Agreement. XXX xxx also terminate this
Agreement with 60 days prior written notice in the event of the
transfer to a third party of part or all of the business concerned by
this Agreement.
21.3 Neither party shall solely by reason of the expiration or termination
of this Agreement be liable to the other for compensation,
reimbursement or damages on account of loss of prospective profits
or on account of
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expenditures, investments, leases or commitments in connection with
the business or goodwill of either party or otherwise.
ARTICLE 22. - OUTSTANDING ORDERS
In case of the expiration or termination of this Agreement for any
reason whatsoever, ERI shall honor all prior quotations and all open
purchase orders at their stated prices and terms. XXX will also honor
any order received from the Distributor within 30 days of the
termination of this Agreement.
ARTICLE 23. - ASSIGNMENT
23.1 Subject to Article 23.2, neither this Agreement in part or in whole
or the rights and obligations herein contained shall be assigned or
sublet by the Distributor or ERI without the prior written consent of
ERI or the Distributor.
23.2 ERI shall have the right to freely assign this Agreement to any
affiliate provided the affiliate is not in competition with the
Distributor in the Territory, such right being exercised by written
notice to the Distributor.
ARTICLE 24. - GOVERNING LAW - COURT
This Agreement made in two originals in the English language shall be
governed and construed in accordance with the laws of the
jurisdiction in which the defendant is located. For example, if the
Distributor commences an action against ERI, the action shall be
construed pursuant to the laws of the State of Nevada. The proper
venue for any dispute arising between the parties in connection with
the performance or the interpretation of this Agreement will be in
the defendant's jurisdiction.
ARTICLE 25. - NOTICE
All notices and other communications required or permitted to be
given hereunder shall be in writing and shall be deemed to have been
duly given and effective when (i) delivered personally, (ii) sent by
telecopy, with receipt confirmed by telephone, or (iii) two days
after being sent by DHL, Federal Express, or similar overnight
delivery service, postage prepaid, to the address set forth below (or
to such other address as a party to this Agreement shall have
furnished in writing to the others):
If to Emhiser Research, Inc.:
0000 Xxx Xxxxxxx 00 Xxxx
P. O. Box 189
Verdi, Nevada 89439-0189, USA
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Xxxxxxx X. Xxxxxxxxx, Esq.
000 Xxxxx Xxxxxx
Xxxx, Xxxxxx 00000, XXX
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If to Microdyne:
MICRODYNE COMMUNICATIONS TECHNOLOGIES, INC.
000 Xxx Xxxx
Xxxxx, Xxxxxxx 00000, XXX
Attn: Mr. Xxx Xxxxxxx
Telecopy: (000) 000-0000
With a copy to:
Holland & Knight LLP
000 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
ARTICLE 26. - APPENDICES - AMENDMENTS
26.1 Appendices A, B, C, D, E and F hereto, duly signed by both parties
form an integral part of this Agreement.
26.2 Any amendment or modification to this Agreement will become binding
only upon written agreement signed by the duly qualified
representatives of each of the two parties.
ARTICLE 27. - MISCELLANEOUS
27.1 This Agreement represents the whole agreement between the contracting
parties and supersedes any other agreement or understanding whether
written or oral between the parties. Neither party will be bound by
any condition, definition, guarantee or representation other than
those set forth in this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first above written.
EMHISER RESEARCH, INC.
By: /s/ Xxxxx X. Xxxxxxxxxxxx
Name: Xxxxx X. Xxxxxxxxxxxx
Title: President
MICRODYNE CORPORATION
By: /s/ Xxxxxx Xxxxxxx
Name: Xxxxxx Xxxxxxx
Title: President - MCTI
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