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EXHIBIT 10.20
AGREEMENT
DATED Twenty-fourth day of January, 1994
BETWEEN RADIO SYSTEMS CORP
0000 Xxxxxxxx Xxxxx
Xxxxxxxxx
Xxxxxxxxx
XX 00000
("RSC") (1)
-and-
PETSAFE LIMITED
(Company No. 2820961)
Xxxxxx Xxxx
Xxxxxxx
Xxxxxxxxxxx
XX00 0XX
("Petsafe") (2)
IT IS HEREBY AGREED AND DECLARED as follows:
1. DEFINITIONS
In this Agreement the expressions set out in Column 1 have the
respective meanings set opposite in Column 2:
1. 2.
"Associate" As defined in clause 7
"Commencement Date" 1st January 1994
"Products" The range of products listed in
Schedule 1 to this Agreement and
components as manufactured and/or
supplied by RSC or any associate
of RSC or any successor in
business from time to time
"Territory" The area specified in Schedule 2
to this Agreement
2. RIGHTS AND PRINCIPAL RESTRICTIONS
2.1 RSC grants to Petsafe the exclusive right for the duration of this
Agreement to purchase from RSC the Products for resale in the Territory
and RSC undertakes that it will not confer like rights in respect of
the Products on any other party for the duration of this Agreement save
as provided below.
2.2 RSC shall refer all inquiries for the Products in the Territory to
Petsafe.
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2.3.1 Petsafe and RSC shall agree upon an amount of transmitters as a minimum
number to be purchased in the year prior to the commencement of each
calendar year. If Petsafe and RSC shall fail to reach agreement, then
the provisions of clause 2.3.2 shall apply.
2.3.2 If Petsafe shall fail to purchase cumulative minimum of
480 transmitters by 31st December 1994
1740 transmitters by 31st December 1995
3420 transmitters by 31st December 1996.
RSC may review the matter on a country by country basis and require
that Petsafe's rights become non-exclusive as regards certain countries
in the Territory provided that:
(a) RSC shall first show proof to Petsafe that another customer
not connected with RSC has signed a purchase order to RSC for
more than the minimum figure set out above for the relevant
period
(b) any shortfall shall not be due to the act or omission of RSC
including failure to deliver good quality products on schedule
or a breach of this Agreement
(c) any shortfall shall not be due to matters beyond the
reasonable control of Petsafe as specified in clause 10 below.
2.4 RSC will supply Petsafe with up to date brochures specifications and
information concerning the Products and their marketing and sale as
reasonably required. RSC will give due warning of any specification
changes to the Products and will not accept orders from Petsafe for
products that RSC knows will shortly become obsolete without warning
Petsafe.
2.5 Petsafe undertakes that it will not, while this Agreement is in force
as regards any part of the Territory where it has exclusive rights
without the Territory where it has exclusive rights without the
agreement of RSC sell any pet containment system similar to the
Products unless RSC shall have failed to deliver good quality Products
on a reasonable schedule.
3. TERMS OF SUPPLY
3.1 RSC will use its best endeavors to supply and ship such of the Products
as Petsafe shall order from time to time according to a reasonable
delivery schedule at competitive prices.
3.2 The price will not be higher than the lowest price available to any
other customer for the Products in any part of the world.
3.3 At least 4 weeks prior notice shall be given of any increase in prices
and RSC will honor any outstanding quotations issued by Petsafe prior
to such notice being given.
3.4 Delivery will be F.O.B. any US port or airport nominated by Petsafe.
3.5 Title to and risk in the Products will pass on delivery.
3.6 The Products will be safe in good condition properly packaged of sound
manufacture and design reasonably fit for their purpose free of defects
and will comply with any claims made for them or warranties given by
RSC and with all legal requirements specified by Petsafe
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applicable in the Territory. Without prejudice to the above the
warranty of RSC set out in Schedule 3 and the other terms of that
Schedule shall apply as if set forth therein.
3.7 The price shall be due and payable on shipment but it is envisaged that
after the first year from the Commencement Date credit terms will be
agreed.
4. POSITIVE OBLIGATIONS OF PETSAFE
Petsafe will at all times while this Agreement is in force use all
reasonable endeavors to promote the sale and use of the Products in the
Territory and will:
(a) spend at least $100,000 in starting and developing such
business
(b) use all reasonable endeavors to sell an increasing volume year
by year of Products in accordance with forecasts made by
Petsafe or any quotas agreed with RSC
(c) prior to each anniversary of the Commencement Date supply RSC
with copies of its sales forecasts for the following year
together with its stigmata of market penetration such
forecasts will show projected maximum minimum and most
probable sales.
5. BRAND NAMES ETC.
The parties will provide proper management and personnel to
professionally manufacture supply represent and sell the Products and
each shall conduct itself at all times (including after the termination
of this Agreement) to reflect well on the other party and the brand
names used in respect of the Products end shall not act in a manner
detrimental to the other's good name and reputation. This clause shall
be without prejudice to the free exercise and enforcement of either
party's rights against the other.
Either party may use the other's brand names provided a current written
approval from the other is in force and subject to any reasonable
requirements as to trade xxxx licensing and the like.
6. PERIOD AND TERMINATION
6.2.1 Period
This Agreement shall remain in force for an initial period of five
years from the Commencement Date and thereafter shall be automatically
renewed for further terms of five years unless and until terminated on
the expiry of not less than 6 months' notice in writing given by either
party to the other so as to expire at the end of any five-year period.
6.2 Prior Termination
6.2.1 Either party may terminate this Agreement forthwith by written notice
if:
(a) the other ceases or threatens to cease business becomes
insolvent compounds with its creditors commences to be
wound-up or suffers any distress or execution to be levied
against it or has a Receiver or Administrative Receiver of all
or any of its assets appointed or takes or suffers any similar
action in consequence of debt;
(b) the other shall persistently breach (after being given warning
of termination) or shall fail to make good any substantial
breach of its obligations under this Agreement
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(including but not limited to clauses 2.1 and 2.5) within 30
days of receiving notice in writing from the first party
requiring it to do so
6.2.2 RSC may terminate this Agreement by written notice served on Petsafe if
Petsafe shall have persistently failed over a period of 3 consecutive
years (after reasonable written warning giving notice of the need for
improvement from RSC) to meet its minimum sales targets or agreed
quotas.
7. ASSOCIATES
Any act or omission which if it were an act or omission of RSC or
Petsafe would be a breach of Clause 2.1 or clause 2.5 of this Agreement
(as the case may be) on its part shall be deemed to be such an act or
omission for which RSC or Petsafe is responsible respectively if done
or omitted by any "associate" of RSC or Petsafe (as the case may be).
For this purpose "associate" of RSC or Petsafe means any person or
persons who for the time being:
(a) directly or indirectly controls or control the RSC or Petsafe
(as the case may be);
(b) any other person or persons controlled directly or indirectly
by the person or persons who controls or control RSC or
Petsafe; and
(c) any person or persons who are directly or indirectly
controlled by RSC or Petsafe itself (as the case may be).
8. APPLICABLE LAW
This Agreement shall be governed in all respects by the law of England
and the Courts of that country shall have non-exclusive jurisdiction.
Both parties hereby submit to the jurisdiction of the English Courts.
Any dispute or difference concerning or arising out of this Agreement
shall be determined by arbitration in accordance with the Arbitration
Acts.
9. SEVERANCE
If any provision of this Agreement shall be invalid or unenforceable
under the law of England or any other part of the Territory but
provision shall continue to apply elsewhere in the Territory and the
remaining provisions of this Agreement shall remain in force.
10. FORCE MAJEURE
Neither party will be responsible for any delay or damage or
non-fulfillment of its obligations arising from force majeure including
strikes lockouts labor disputes accident to machinery shortages of
supplies or labor policies or restrictions of government war acts of
state or acts of God or any other cause beyond its reasonable control.
11. NOTICES
Any notices which are to be served under this Agreement shall be in
writing and shall be deemed served if sent by telex or facsimile
transmission or cable or if mailed by registered or recorded mail for
the relevant party at the address given above or such other address as
it may have notified to the other party in writing from time to time
for the purpose.
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Notice shall be deemed to have been served:
(a) (in the case of notice sent by letter) 7 days from the date of
posting and
(b) (in the case of telex or facsimile sent during the business
hours of the party to be served) at the time of transmission
or (if not sent during such hours) at the commencement of its
next business day.
AS WITNESS the hands of the parties hereto the day and the year first above
written.
SIGNED by
for and on behalf of )
RADIO SYSTEMS CORP ) /s/ Xxxxx Xxxx
in the presence of: ) Xxxxx Xxxx, President
SIGNED by
for and on behalf of )
PETSAFE LIMITED ) /s/ Xxxxxxx Tolleche
in the presence of: ) Chairman
/s/ Xxxxxxxx Xxxxxxx
Xxxxxxxx Xxxxxxx
Receptionist
000 X. Xxxxxx Xx. #000
Xxxxxxx Xxxxx, XX 00000
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SCHEDULE 0
Xxxxxxxxx
Xxxxxxx Xxxxxx as defined by:
Austria
Belgium
Denmark
France (including Monaco) Germany
Greece Iceland Irish Republic Italy
(including San Marino) Luxembourg
Netherlands Norway Portugal Spain
(including Andorra) Sweden
Switzerland (including
Liechtenstein) United Kingdom
(including Gibraltar and the Channel
Islands)
or any countries which may in the future evolve from the territory presently
covered by the above territory.
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SCHEDULE 3
Warranty
Full warranty to replace all faulty parts for an unlimited period,
including after the termination of this agreement, should such occur, on RSC
products sold by Petsafe during the term of this Agreement. Petsafe shall
purchase and hold an appropriate stock of parts to do repairs sufficient for a
reasonably estimated stock required for a one year period, and may return faulty
parts to RSC for credit to Petsafe account at the then current parts cost, at
times and quantities convenient to Petsafe. RSC will supply Petsafe with other
parts required for repairs on the terms of this Agreement. If any parts shall
become unavailable or obsolete and RSC cease to hold stocks, RSC will supply
appropriate substitute Products or components at a price not exceeding the price
of the relevant part on the last occasion on which it was supplied to Petsafe.
Petsafe shall be responsible for any labor cost, except in the case where faults
occur in more than 5% of the products supplied in any order which shall be
considered a significant quality problem, which RSC shall credit Petsafe with
any reasonable labor costs incurred by Petsafe in repair and servicing which it
cannot recoup from its customers. Petsafe shall be responsible for any labor
costs otherwise incurred in the repair or servicing of RSC products and for any
warranty it may extend to its customers.
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