DISTRIBUTORSHIP AGREEMENT
THIS AGREEMENT made and entered into this 1st day of May, 1993 by and between
SAMSUNG ELECTRONICS CO., LTD., a corporation duly organized and existing under
the laws of the Republic of Korea with its place of business at Xxxxx-Xxx Xxxxx
Xxxx Xxxxxxxx, 0 Xxxxxxx-Xxxx, Xxxxx-xx, Xxxxx, Xxxxx (hereinafter referred to
as "SAMSUNG") and ATLANTIC COMPONENTS LIMITED a corporation duly organized and
existing under the laws of Hong Kong with its principal place of business at
Xxxx 0000, 00/X., Xxxxx 0, Xxxxx Xxxxx Xxxxxx, 123 Hoi Bun Road, Xxxx Xxxx,
Kowloon, Hong Kong (hereinafter referred to as "DISTRIBUTOR").
WITNESSETH
WHEREAS, SAMSUNG is engaged in the business of manufacturing and selling the
semiconductor products; and
WHEREAS, DISTRIBUTOR is engaged in the business of solicitation of orders and/or
distribution of the semiconductor products; and
WHEREAS, SAMSUNG is desirous of granting DISTRIBUTOR distributorship for its
Products in the Territory and DISTRIBUTOR is willing to accept it:
NOW, THEREFORE, for and in consideration of the mutual premises, covenants and
conditions hereinafter set forth, it is agreed between the parties as follows:
Article 1. Definition
1.1. "Products" as used in this Agreement shall be expressly confined to
APPENDIX A
1.2. "Territory" as used in this Agreement shall be specified on APPENDIX B.
1.3. "Customer" or "Customers" as used in this Agreement shall mean
individual, partnership, firm, corporation, association, government or
any other organization.
1.4. "SAMSUNG Trademarks" as used in this Agreement shall mean those
trademarks, tradenames, slogans, labels, logo and other trade
identifying symbols whether registered or not in the Republic of Korea
or Territory as are developed and used worldwide by SAMSUNG and/or any
of its subsidiaries of affiliate companies in connection with any
Products to be sold by DISTRIBUTOR in the Territory pursuant to this
Agreement.
1.5. "Order" or "Orders" shall mean an order from a Customer for a definite
amount of Products at a specified price and a delivery schedule of less
than one (1) year. The term "Order" shall not include letters of
intent, memoranda of intent or understanding, volume purchase
agreements, blanket purchase agreements, orders with a delivery
schedule of greater than one (1) year, or similar documents.
Article 2. Distributorship
2.1. SAMSUNG appoints DISTRIBUTOR on a non-exclusive basis as its
DISTRIBUTOR to solicit Orders and/or distribute the Products in the
Territory and DISTRIBUTOR hereby accepts such appointment by SAMSUNG
upon the terms and conditions hereinafter set forth.
2.2. SAMSUNG may sell, transfer or otherwise dispose of the Products to any
Customer other than DISTRIBUTOR in the Territory.
2.3. DISTRIBUTOR shall have the right to market and sell the products of
other manufacturers and render service related to such products unless
such activity results in DISTRIBUTOR being unable to fulfill its
obligations under this Agreement. However, DISRIBUTOR shall not
purchase to sell any of the same product lines as SAMSUNG produces and
deals in from any other Korean manufacturer during the term of this
Agreement.
2.4. DISTRIBUTOR agrees not to sell the Products purchased from SAMSUNG in
violation of the COCOM Regulations as they may be in force from time to
time.
2.5. SAMSUNG reserves the right to make sales on its own behalf with any
customer in the Territory.
Article 3. Relationship of Parties.
It is expressly agreed that the relationship hereby established is that
of buyer and seller and/or solicitor and seller. In all its business
transactions, DISTRIBUTOR at all times shall act for its own account
and shall have no power or authority to assume, create or make any
binding obligation or to make any representation, commitment, guaranty
or warranty on behalf of SAMSUNG with respect to any Products or
otherwise, shall be in no way the agent or legal representative of
SAMSUNG for any purpose whatsoever.
Article 4. Individual Contract
4.1. Each individual contract under this Agreement shall be subject to this
Agreement but such contract shall be concluded and carried out by
SAMSUNG's sales note or confirmation which shall set forth the terms,
conditions, rights and obligations of the parties hereto arising from
or in relation to or in connection with such contract except those
stipulated in this Agreement.
4.2. No orders for the Products placed by DISTRIBUTOR to SAMSUNG shall be
binding unless and until accepted by SAMSUNG.
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4.3. SAMSUNG shall use its best efforts to accept any reasonable orders for
the Products placed by DISTRIBUTOR, provided, however, that it shall
not be required to accept a DISTRIBUTOR'S order or any part thereof
when:
(a) the Products are not available sufficient enough to fill the order
placed by DISTRIBUTOR, or all the orders placed by DISTRIBUTOR and
other customers; or
(b) SAMSUNG has discontinued the manufacture or sale of the Products
ordered at the time the order is received.
Article 5. Compensation to Distributor
5.1. DISTRIBUTOR shall meet the Sales targets established by SAMSUNG.
5.2. DISTRIBUTOR's sole source of compensation shall be the commissions
payable pursuant to the express written terms of this Agreement.
DISTRIBUTOR shall have no right to any other compensation from SAMSUNG
for services rendered or any expenses incurred by DISTRIBUTOR.
5.3. SAMSUNG shall pay DISTRIBUTOR commission in US$ currency. The
commission rate is specified on APPENDIX C.
5.4. The payee is as follows:
Attention : Atlantic Components Limited
Account Number : 18-200-0121-3
Bank Name : Overseas Trust Bank Limited, Incorporated in H.K.
Address : 000-000 Xxxx'x Xxxx, Xxxxx Xxxxx, Xxxx Xxxx
5.5. If any amount owed to SAMSUNG by a customer on a sale becomes
uncollectible (as determined by SAMSUNG), or is credited to Customer
because of a Product return or other reason (at the sole discretion of
SAMSUNG), commissions already paid to DISTRIBUTOR on such amounts, if
any, shall be returned to SAMSUNG by DISTRIBUTOR, SAMSUNG may charge
back such commissions against any monies which SAMSUNG shall then or
thereafter owe to DISTRIBUTOR.
Article 6. Prices
6.1. SAMSUNG will supply DISTRIBUTOR with the price list from time to time.
All price list is to be considered as guidelines only.
6.2. The price list is subject to change without notice. The amount and
timing of such change shall be exclusively at SAMSUNG's discretion.
6.3. The prices for orders received and acknowledged by SAMSUNG prior to a
change in price and shipped after the effective date of such change
shall be the prices in effect at the time of the order.
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Article 7. Payment
7.1. Unless otherwise agreed, DISTRIBUTOR shall cause an irrevocable Letter
of Credit, without recourse, available against SAMSUNG's draft at
sight, to be opened for each individual contract through a prime bank
satisfactory to SAMSUNG at least 30 days prior to the dates of shipment
stipulated therein. If DISTRIBUTOR fails to provide such Letter of
Credit, SAMSUNG shall have the option of reselling the contracted
Products in any country, holding the Products for DISTRIBUTOR's account
and risk, and/or canceling the contract and claiming for damages caused
by DISTRIBUTOR's default.
7.2. Payments for the Products shall be made in US$ Currency.
Article 8. Credit Worthiness.
SAMSUNG reserves the right, among other remedies, either to terminate
this Agreement or to suspend further deliveries under it in the event
DISTRIBUTOR fails to pay for any shipment when the same becomes due.
Should DISTRIBUTOR's financial situation become unsatisfactory to
SAMSUNG, cash payment or satisfactory security may be required by
SAMSUNG for future deliveries and for Products already delivered.
Article 9. Promotion and Advertising.
DISTRIBUTOR shall exert its best efforts in advertising, publicizing,
participating in trade shows and exhibition and otherwise promoting the
Products within the Territory by investing at least 5 percent of annual
net sales amount each year. SAMSUNG shall provide DISTRIBUTOR free of
charge with a reasonable quantity of advertising or sales promotion
materials such as advertising literatures, catalogues, leaflets,
holders and the like. DISTRIBUTOR shall also exert with diligence its
best efforts to develop and promote the sales of products in the
Territory.
Article 10. Report.
DISTRIBUTOR shall present a report by 10th of every month, including,
resales report monthly operation, market trend research, order forecast
and other important things, and shall present the annual sales plan for
following year by the end of SEP of each year.
Article 11. Limitation of Liability.
DISTRIBUTOR shall examine each Products shipped to DISTRIBUTOR for any
damage, defects or shortage. All claims, including for the alleged
damage, defect or shortage. All claims, including for the alleged
damage, defect, shortage, negligence or any other cause whatsoever,
shall be deemed waived by DISTRIBUTOR unless made in writing to and
received by SAMSUNG within sixty (60) days after DISTRIBUTOR's receipt
of the Products or within thirty (30) days after DISTRIBUTOR learns of
the facts
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giving rise to the claim, whichever occurs first. DISTRIBUTOR's
exclusive remedy and SAMSUNG's sole and exclusive liability shall be
the repair or replacement of such Products or (at SAMSUNG's sole
option) the issuing of credit therefore. IN NO EVENT SHALL SAMSUNG BE
LIABLE FOR ANY SPECIAL INCIDENTAL OR CONSEQUESTIAL DAMAGES, WHETHER
DISTRIBUTOR'S CLAIM IS FOR BREACH OF CONTRACT, BREACH OF WARRANTY,
NEGLIGENCE OR OTHERWISE.
Article 12. Trademark
12.1. SAMSUNG authorizes DISTRIBUTOR to use SAMSUNG Trademarks in the
Territory during the term of this Agreement for the sole purpose of
solicitation and distribution of the Products. DISTRIBUTOR accepts and
agrees not to use SAMSUNG Trademarks for any other purpose and to use
them only in such manner as to preserve at all times all rights of
SAMSUNG. DISTRIBUTOR agrees that it will not alter or remove any
SAMSUNG Trademarks on the Products sold under this Agreement.
DISTRIBUTOR shall not authorize third parties except its dealers to use
SAMSUNG Trademarks and any such attempted authorization shall be void.
12.2. In case DISTRIBUTOR have found that SAMSUNG'S Trademarks, patents
copyrights or other industrial property rights are infringed upon by
the third party(s), DISTRIBUTOR shall promptly inform SAMSUNG of such
infringement which comes to its notice and assist SAMSUNG in taking
steps necessary to protect SAMSUNG's right effectively.
12.3. Whether in SAMSUNG's country or in any other places, SAMSUNG shall not
be responsible for any infringement with regards to patents,
utility-models, trademarks, designs or copyrights. In case any dispute
and/or claim arise in connection with the above right or rights,
SAMSUNG shall reserve every and all rights to cancel, make this
agreement null and void at its discretion and hold itself free from any
liability arising therefrom.
Article 13. Force Majeure.
Neither SAMSUNG nor DISTRIBUTOR shall be responsible for any failure to
comply with the terms of this Agreement, or for any delay in
performance of or failure to perform under any sales transaction
between the parties contemplated in this Agreement, where such failure
or delay is directly or indirectly caused by or in any manner arises or
results from events of FORCE MAJEURE beyond the control of the party
sought to be charged. These events shall include, but not be restricted
to, fire, flood, earthquake, accident, civil disturbances, war,
inability to secure necessary materials, parts or components, delay or
failure in performance by any supplier or subcontractor, acts of God,
acts of any government or any branch or agency thereof.
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Article 14. Term of Agreement.
This Agreement is effective as of the 1st day of May, 1993 and shall
continue until expiration on the last day of APRIL, 1994 unless
terminated earlier pursuant to this Agreement.
Article 15. Termination
15.1. Either party may forthwith terminate this Agreement by giving a written
notice of termination to the other party;
(a) if the other party becomes insolvent or a petition in bankruptcy,
for corporate reorganization or for any similar relief is filed
by or against the other party, or a receiver is appointed with
respect to any of the assets of the other party, or liquidation
proceeding is commenced by or against the other party; or
(b) if the whole or an important part of the business of the other
party is transferred to a third party by agreement, order of
court or otherwise; or
(c) if the other party defaults in payment for the Products or
otherwise defaults in any of the provisions of this Agreement and
does not make the payment or remedy the default within sixty (60)
days after a written notice is given by requesting party to make
the payment or remedy the default.
15.2. Upon expiration or termination of this Agreement, SAMSUNG may, at its
option cancel any or all unfilled orders, and SAMSUNG reserves the
right to repurchase from DISTRIBUTOR any or all the Products unsold by
DISTRIBUTOR.
15.3. Expiration or termination of this Agreement shall not operate to
discharge or relieve any party of any obligations vested pursuant to
this Agreement prior to the effective date thereof, or modify the
effectiveness of any obligations and provisions which are intended by
the parties to survive the expiration or termination of this Agreement.
Article 16. Secrecy
During the term of this Agreement and thereafter DISTRIBUTOR shall not
disclose or divulge to any third party any information it may acquire
in connection with the Products, this Agreement or performance
thereunder.
Article 17. Notice.
Any notice made in connection with this Agreement or performance
thereunder shall be sent to the addresses first above written, or such
other addresses as the parties may notify each other from time to time,
by a registered air mail. When the letter is dispatched as provided for
above, the notice shall be deemed to be made when the letter arrives at
the addressee.
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Article 18. Arbitration.
Any and all disputes arising from or in connection with this Agreement
or a transaction conducted under this Agreement shall be settled by
mutual consultation between parties in good faith as promptly as
possible. But in the event of failure in an amicable settlement, it
shall be settled by the arbitration through the Korea Chamber of
Commerce in Seoul, Korea. The award of the arbitration shall be final
and binding upon the parties.
Article 19. Governing Law
This Agreement shall be interpreted and construed in accordance with
the laws of the Republic of Korea.
Article 20. Assignment of Agreement
Neither party shall assign, pledge or otherwise dispose of its right or
delegate its duty under this Agreement without a prior written consent
of the other party.
Article 21. Waiver
No waiver by either SAMSUNG or DISTRIBUTOR with respect to any breach
or default shall limit any right or remedy of either party unless such
waiver is expressed in a writing signed by the party to be bound.
Article 22. Amendment
This Agreement may be amended only by a written instrument signed by
duly authorized representatives of both parties and expressly stating
that it is an amendment to this Agreement.
Article 23. Complete Agreement.
This Agreement supersedes and cancels any and all previous agreements,
contracts or understandings between the parties relating to the
Products and expresses the complete and final agreement of the parties
in respect thereof.
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized representatives to execute this Agreement as of the day and
year first above written.
DISTRIBUTOR SAMSUNG
BY BY
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TITLE TITLE
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APPENDIX A
"PRODUCTS"
PRODUCTS MEAN MEMORY & PC RELATED SEMICONDUCTORS
WHICH ARE BEING MADE NOW AND BE MADE IN FUTURE
BY SAMSUNG UNDER THE SAMSUNG TRADE MARKS.
APPENDIX B
"TERRITORY"
- TERRITORY MEANS THE GEOGRAPHICAL AREA OF HONG KONG.
APPENDIX C
"COMMISSION"
1. THE AMOUNT OF COMMISSIONS SHALL BE CALCULATED ON THE BASIS OF INVOICE
AMOUNT.
2. IN CASE THAT THE BUYER ON L/C IS DISTRIBUTOR, SAMSUNG MAY UNDERSTAND THESE
PRODUCTS WILL BE RESELLED AND FOR THIS CASE THE COMMISSION RATE IS AS
FOLLOWS:
---------------------------------------------------------------------------
PRODUCT COMMISSION
----------------------------------------------------
AT SIGHT L/C USANCE L/C
---------------------------------------------------------------------------
MEMORY * 30 DAYS * 60 DAYS *
---------------------------------------------------------------------------
NON-MEMORY * 45 DAYS * 90 DAYS *
---------------------------------------------------------------------------
3. IN CASE THAT THE BUYER ON L/C IS NOT DISTRIBUTOR, SAMSUNG MAY UNDERSTAND
THAT THE DISTRIBUTOR SOLICOTATED AND FOR THIS CASE THE COMMISSION RATE IS
AS FOLLOWS:
-------------------------------------------------
PRODUCT COMMISSION
-------------------------------------------------
MEMORY *
-------------------------------------------------
NON-MEMORY *
-------------------------------------------------
* Confidential treatment requested.
