DISTRIBUTORSHIP AGREEMENT
This is an Agreement dated the 2nd day of October 2004 which is entered
into by and between CTC CABLE CORPORATION, a corporation organized under the
laws of Nevada, located at 0000 XxXxx Xxxxxx., Xxxxxx, XX 00000-0000 ("CTC"),
and GENERAL CABLE INDUSTRIES, INC., a corporation organized under the laws of
Delaware, located at 0 Xxxxxxxxx Xxxxx, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000 (the
"Distributor").
BACKGROUND
CTC is engaged in the manufacture, marketing and sale of ACCC core and
related products and desires to appoint the Distributor as a non-exclusive
distributor for CTC, which requires the purchase of CTC's products by the
Distributor for resale to certain classes of customers in the specified
territory.
The Distributor is ready, willing and able to accept such appointment and
to perform its obligations set forth in this Agreement.
In consideration of the premises and the mutual promises set forth below,
the parties agree as follows:
1. APPOINTMENT OF THE DISTRIBUTOR
On the terms and conditions set forth in this Agreement, CTC appoints the
Distributor, on a non-exclusive basis, as a Distributor for the marketing and
sale of the following designated products which are manufactured or offered for
sale by CTC (the "Products"):
all ACCC cable wrapped by Distributor and conforming within acceptable
variances with all relevant and applicable ASTM standards. As used herein,
ACCC means all aluminum conductor composite core (the "Core") cable.
only within the territory designated below (the "Territory"):
U.S. and Canada
and to the following classes of customers (the "Customers"):
All classes of Customers
CTC shall have the right during the term of this Agreement to sell the Products
directly to any Customers in the Territory, and to appoint other sales agents or
distributors to sell Products in the Territory.
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The Distributor may fill orders received from Customers for Products to be
installed and operated within the Territory, but in no event may the Distributor
engage in promotional or marketing activities relating to the Products outside
the Territory or solicit customers for the Products that are located outside the
Territory.
2. DUTIES OF THE DISTRIBUTOR
The Distributor accepts the appointment and agrees to use its best efforts
to market and sell the Products in the Territory for use within the Territory.
In order to develop the full sales potential of the Territory, the Distributor
agrees that all of the following duties are essential obligations of this
Agreement and that it will perform the following duties to the satisfaction of
CTC at its own expense:
a. Promotion and Marketing. It is the intention of the parties to enter
into a Cooperative Merchandising Agreement ("COOP Agreement"). Any obligations
of the parties that arise as a result of entering into the COOP Agreement will
be as set forth therein. The Distributor will assist CTC in promotional and
marketing activities in the Territory such as distribution of printed literature
offered by CTC to current and prospective Customers. The Products will at all
times be designated by their correct corporate names and identified as the
Products of CTC being offered for sale by the Distributor in its role as
independent distributor of CTC's Products.
b. Places of Business and Inventory. The Distributor will establish, staff
and maintain such place (or places) of business in the Territory as may be
necessary to provide good Customer support and marketing coverage in the
Territory.
c. Coordination. The Distributor will coordinate its sales efforts with
CTC, and keep CTC fully informed of its activities and of all laws, rules or
codes in the Territory relating to carrying on its distribution business and
selling the Products of CTC. To these ends, the Distributor will:
(i) effectively and promptly follow up leads and referrals provided
by CTC and keep CTC informed as to the results;
(ii) arrange for calls to be made by its salesmen accompanied by
personnel of CTC when such calls are deemed appropriate by CTC;
(iii) furnish CTC with copies of such documentation relating to the
sales of the Products as CTC may request;
(iv) convey to CTC any information which may be of value or interest
to CTC that may come to the attention of the Distributor concerning market
conditions, political or legal developments, customers, and prospects.
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d. Sales Plan. Distributor shall seek the review by and obtain the written
approval of CTC for all of Distributor's sales and marketing plans for
Distributor's Territory.
e. General Conduct. The Distributor will at all times conduct its business
in a lawful and proper manner such as will reflect favorably on CTC and the
Products. The Distributor shall be responsible for complying with all laws,
regulations, codes and rules applicable to the performance of its duties
hereunder. The Distributor will not engage in any deceptive, misleading, or
illegal business practices. The Distributor will not design, manufacture, or
market, nor will it act as a representative or distributor for, any products
which compete with the Products or any other products of CTC without CTC's prior
written consent. The Distributor will disclose to CTC the identities of all wire
and cable products and manufacturers which it distributes or represents and will
notify CTC of contemplated additions prior to making new commitments. The
complete list of existing products which compete with the Products of CTC are
identified in Exhibit A.
f. Compliance with Policies. Because failure to comply with the CTC's
policies and procedures regarding sales, marketing, and the distribution of
Products could adversely and substantially affect CTC's interests, the
Distributor shall comply at all times with CTC's policies regarding sales,
marketing, and the distribution of Products.
g. Record Keeping. The Distributor shall establish and maintain records of
its sales and transactions in sufficient detail to permit identification and
destination of each of the Products sold by the Distributor. The records shall
be provided to CTC on a quarterly basis.
h. Inspection. CTC shall have the right on reasonable notice to visit the
Distributor's places of business for the purpose of verifying satisfaction by
the Distributor of all its duties under this Agreement.
3. PURCHASE OF THE PRODUCTS
a. Purchase Orders. Purchases of the Products hereunder shall be made by
delivery to CTC of the Distributor's written purchase orders specifying in
reasonable detail the types, quantities, and desired delivery dates of the
Products ordered. Orders will be placed for delivery of the Products by CTC on
an F.O.B. Distributor's dock basis with pricing in US dollars for Product
wrapped and stored at Distributor's facility. Orders will be placed for delivery
of Products by CTC on an F.O.B. CTC's dock basis with pricing in US dollars for
Products stored at CTC's facility.
The orders filled pursuant to this Agreement are governed by the
Purchase Order Terms and Conditions ("Purchase Order"), incorporated herein by
reference. Any inconsistencies between the Distributorship Agreement and the
Purchase Order(s) shall be governed by the Purchase Order. Purchase orders shall
be in the form as attached hereto as Exhibit B. The Purchase Orders may not be
changed without written agreement between the parties and shall be deemed
accepted on receipt by CTC unless CTC notifies Distributor within three (3)
business days of receipt of its refusal thereof.
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b. Prices. The prices and minimum order quantities for each of the
Products to be supplied to the Distributor will be advised to the Distributor
from time to time in the form of Price Lists or quotations with specific
validity.
c. Shipment. All shipments will be made in Distributor's standard
packaging or as otherwise agreed. Risk of loss shall be apportioned based on
possession of the Product(s).
(i) Title and risk of loss shall be on Distributor for Products
wrapped by and in Distributor's possession. The basis on which CTC will
deliver the Products will be F.O.B. the Distributor's dock until such time
as Products arrive F.O.B. receiving Customer's dock or comparable
facility. Distributor shall be solely responsible for logistics relating
to the shipping and delivery of Products to its Customers.
(ii) It is contemplated that on occasion CTC may take possession of
Products wrapped by Distributor prior to distribution. In the event that
CTC is in possession of Product, title and risk of loss shall be on CTC
while in CTC's possession. Title and risk of loss shall pass from CTC to
Distributor when the Products are F.O.B. Distributor's dock.
d. Acceptance. Distributor may reject any Products which fail to conform
within acceptable variances with all relevant and applicable ASTM standards due
to defects in the Core. Any claims for rejected Products shall be made in
writing within a reasonable time after discovery of defect, such period not to
exceed six (6) months of Distributor's receipt of Products and shall state the
reasons for rejection with supporting documentation and/or samples. Once a claim
is validated, CTC shall promptly replace the Core portions of the properly
rejected Products at its expense and will advise the Distributor to ship the
rejected Products, freight collect, to CTC or otherwise dispose of them locally
in accord with local laws and regulations at the direction of CTC.
e. Payment. The Distributor shall make payment in United States Dollars to
CTC for all Products purchased under this Agreement. Payment must be received
from Distributor within thirty (30) days after date of CTC's invoice.
f. Taxes. The Distributor shall pay for all applicable national, federal,
state, provincial, municipal and other government taxes (such as sales, use,
excise, value added, or any similar taxes of any kind); all customs, duties,
imposts and similar charges; and any other taxes assessable on the Products once
title to the Products has passed from CTC to the Distributor.
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g. Warranty. CTC warrants to the Distributor that the Core portion of the
Products sold hereunder will meet approved standard product specifications of
the government or its agencies in the Territory and will conform fully with all
specifications, standards and test results agreed upon between the parties in
writing. The Distributor warrants to CTC that the wrapped Products sold
hereunder will meet approved standard product specifications of the government
or its agencies in the Territory and will conform fully with all specifications,
standards and test results as agreed upon between the parties in writing. This
warranty shall be effective for a period of twelve (12) months after
installation of the Products by the end user, but not longer than twenty (20)
months from the date of CTC's invoice covering the Products.
The liability of CTC under this warranty is limited to replacing any
of the Products that within the warranty period are determined to be defective
due to (i) failure of the Core to meet applicable specifications or tests or
(ii) failure of the Core to perform in normal operation or use or otherwise as
part of a finished Product. This determination will be made by CTC on the basis
of allegedly defective Product returned to CTC, or on the basis of tests
performed by a qualified third party selected by CTC and the Distributor by
mutual agreement.
In the event that the Core is determined to be defective, at CTC's
option the Product shall be returned at CTC's expense to CTC, to one of its
subsidiaries, or to a third party, or to have it scrapped by the Distributor at
CTC's expense. Any value for the aluminum content of the Product realized from
such process shall be credited to CTC by the Distributor and the scrap value for
any aluminum content shall be provided to CTC.
THE FOREGOING WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES, EITHER
EXPRESSED OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, AND OF ANY OTHER OBLIGATION
ON THE PART OF CTC.
Nothing contained in this subparagraph 3(g) is intended to limit or
affect the warranty offered by CTC to the first purchaser of the Products, as
set forth in the written warranty, if any, provided with the Products.
h. Product Changes. CTC reserves the right to add, change or delete any of
the Products in such manner as it may consider necessary or advisable. CTC
agrees to notify the Distributor ninety (90) days before discontinuing a
Product. If such additions, changes or deletions result in any material adverse
impact, Distributor may exercise the right of unilateral termination in
paragraph 4.
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4. TERM AND RENEWAL; TERMINATION
a. Term and Renewal. The initial term of this Agreement shall be for a
term through 2007, and shall thereafter automatically renew from year to year
unless either party gives at least sixty (60) days prior notice of non-renewal
or unless this Agreement is terminated earlier in accordance with subparagraph
4(b) or 4(c), below.
b. Termination for Default. Any material breach of this Agreement by
either party shall constitute a default if not remedied within fifteen (15)
days' notice of such breach to the other party. In such case, the non-breaching
party may terminate this Agreement on ten (10) days' written notice thereafter.
This Agreement shall terminate automatically without notice in case there occurs
as to either party any of the following, each of which shall constitute just
cause for the termination of this Agreement: (i) the institution of voluntary or
involuntary bankruptcy, dissolution or liquidation proceedings; (ii) admission
of insolvency; (iii) assignment for the befits of creditors; (iv) appointment of
a receiver for any part of the business; (v) the taking of equivalent actions
under laws applicable to such party; or (vi) if performance by either party is
rendered impossible or commercially impracticable.
c. Unilateral Termination. Distributor may terminate this Agreement
unilaterally at any time without cause upon ninety (90) days' written notice to
the other party.
d. Effect of Termination. Upon any termination, the Distributor shall
cease being a distributor of CTC and shall cease using any and all trademarks or
trade names of CTC and shall dispose of all Products and related property and
materials in its possession, at the direction of CTC. Upon termination:
(i) CTC may direct Distributor to distribute Product in inventory in
accordance with approved purchase orders in Distributor's possession.
(ii) CTC reserves the right to buy back any Products remaining in
the Distributor's inventory at close of business on the day of
termination, at the F.O.B. CTC's dock price paid by the Distributor plus
documented transaction costs directly incurred by the Distributor in order
to place the Products in inventory. Prior to providing compensation, CTC
will credit any compensation due against Distributor's account balance.
Any compensation remaining shall be credited back to Distributor.
(iii) Neither party shall have any further rights against the other
except for amounts due and such other rights as have accrued at the time
of the termination of this Agreement.
(iv) At any time within ninety (90) days of termination, CTC shall
have the right during business hours to inspect and make copies of any or
all of the Distributor's records pertaining to the purchase or sale of the
Products, including lists of existing and potential Customers.
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5. SALES MATERIALS, TRADEMARKS AND MARKINGS
a. Sales Materials. CTC will furnish to the Distributor samples and
supplies of its standard promotional and technical literature for the Products
in reasonable quantities at CTC's cost or at prices determined by CTC. Such
literature is subject to revision at any time without prior notice.
b. Distribution and Alteration. The Distributor will not provide Customers
with any materials which are not produced or approved in writing by CTC for use
in connection with the sale of the Products. In no event will the Distributor
alter or remove any of CTC's Product packaging which provides any information
intended by CTC for the ultimate user of the Products. The Distributor shall
deliver appropriate technical materials concerning the Products when the
Products are first delivered to a Customer, and will replace any technical
literature previously distributed with revised technical literature, if
requested to do so by CTC.
c. Trademarks and Trade Names. The Distributor is hereby granted a license
to use for the term of this Agreement the trademarks and trade names used by CTC
in connection with the Products in the Territory to the extent of such rights.
All products sold herein shall bear CTC's marks in accordance with instructions
from CTC. Any use of CTC's marks in accordance with this Agreement shall inure
to the benefit of CTC and this Agreement shall not operate to transfer or convey
any proprietary interests in the marks to Distributor. Such license is also
expressly limited to uses necessary to sale of the Products and to performance
of the Distributor's obligations under this Agreement, and the Distributor
hereby admits and recognizes CTC's exclusive ownership of such marks and names
and the renown of CTC's trademarks and trade names throughout the world
generally. The Distributor agrees not to take any action inconsistent with CTC's
exclusive ownership of such trademarks and trade names, and will abide by any
guidelines of CTC for the use of such trademarks and trade names that are
communicated to Distributor. CTC has the right to examine and approve the manner
in which Distributor uses the marks to insure proper usage of the marks. CTC
will advise the Distributor of any filings or registrations that it makes in the
Territory relating to the trademarks and trade names.
6. GENERAL TERMS AND CONDITIONS
a. Limitation of Liability. Except as otherwise provided, in no event
shall CTC be liable for indirect, incidental, special, consequential or punitive
damages and in no event shall the liability of CTC arising in connection with
any of the Products, whether such liability arises from a claim based on
contract, warranty, tort or otherwise exceed the actual amount paid by the
Distributor to CTC for such Products.
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b. Force Majeure. In the event that CTC is unable or fails at any time to
supply Products from its regular source of the Distributor is unable or fails to
take and accept delivery of the Products, by reason of fire explosion,
earthquake, strike or other labor trouble, flood, drought, embargo, war, riot,
act of God or the public enemy, action of any governmental authority or agency,
delay or failure of carriers or contractors, labor shortage, unavailability of
raw materials or any contingency, delay, failure or cause beyond the control of
either party, whether or not of the kind specified above, or commercial
impracticability, CTC shall not be liable to the Distributor for failure to
supply the Products nor shall the Distributor be liable to CTC for failure to
take the Products during the period of and to the extent of such disability,
provided that failure of the Distributor to obtain and maintain export or import
licenses, permits or approvals of governments shall not be covered by force
majeure. If by reason of any such contingency, the demand for the normally
produced Products, exceeds the ability of CTC to provide such Products, CTC may
allocate its available supply of Products among its customers, divisions or
affiliates on such basis as CTC in its discretion deems practical. If either
party is prevented from performance by any of the events specified in the
foregoing provision, the party prevented from performing shall give immediate
notice to the other party of the cause and the date of commencement of any such
non-performance and shall promptly advise when shipments may be resumed. If the
force majeure condition continues for more than sixty (60) consecutive days,
either party may terminate this Agreement on ten (10) days' written notice.
c. Indemnity. Each party ("Indemnifying party") agrees to indemnify and
hold harmless the other party and its directors, officers, agents and employees
against all claims, losses, liabilities, judgments, costs and expenses
(including without limitation reasonable attorney's fees) arising out of or
occasioned by (i) any failure by the Indemnifying Party or its employees or
agents to comply with the terms of this Agreement or (ii) damage to property or
death or personal injury to persons arising out of or occasioned by any act or
omission of the Indemnifying Party or its employees or agents. In case of a
claim for infringement for which indemnification is applicable, a party
receiving a claim or notice of a claim will provide notice to the other party
within five (5) days by written notice, fax or confirmed email. The party who is
indemnifying shall have the right to control the proceedings through counsel of
its choice and to settle the case or claim provided that the indemnifying party
secures a full release of the party indemnified. The non-indemnifying party may
participate in all such proceedings at its own costs and expense. Further, the
parties will cooperate with each other in a reasonable manner at their own
expense to provide information and access to personnel related to the defense of
such matters. The parties specifically agree that their respective obligations
under this subparagraph 6(c) are essential obligations of this Agreement.
d. Independent Contractor. The Distributor is an independent contractor
and not an agent or employee of CTC, and will not hold itself out as, or give
any person reason to believe that it is, an agent or employee of CTC. As an
independent contractor, the Distributor will not make any representations or
warranties of any kind of behalf of CTC, except as authorized by CTC in writing.
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e. Assignment. The rights and duties of the Distributor under this
Agreement may not be assigned or delegated in whole or in part by operation of
law or otherwise without the prior express written consent of CTC .
f. Enforcement of Terms. Failure by either party to this Agreement at any
time or from time to time to enforce any of the provisions of this Agreement
shall not be construed to be a waiver of such provision or of such party's right
to thereafter enforce each and every provision hereof.
g. Compliance with Laws. Each party shall be responsible for compliance
with all applicable laws, rules and regulations applicable to its performance
under this Agreement.
h. Confidential Information. The parties acknowledge and agree to maintain
the Confidentiality Agreement having an effective date of May 24, 2003. The
Distributor agrees not to disclose to any person outside of its employ, and, for
a period of five (5) years from termination of this Agreement, not to use for
any purpose other than that to fulfill its obligations under this Agreement, any
information concerning customers or markets outside the Territory, or the
composition, manufacture or development of any products of CTC or any of its
subsidiaries or affiliates that are disclosed to the Distributor by CTC in
confidence and which are not otherwise publicly available. The parties
specifically agree that the Distributor's obligations under this subparagraph
6(h) are essential obligations of this Agreement.
i. Entire Agreement. The terms and conditions of this Agreement constitute
the entire agreement of the parties with regard to the subject matter hereof and
supersede all other written or oral agreements or understandings. As such, the
provisions of this Agreement shall take precedence over any conflicting terms
set forth in the MOU agreement between the parties. All other conditions,
including those on any correspondence or forms of the Distributor, are hereby
rejected and shall be of no effect unless expressly signed by both parties. Any
amendment to, or modification of, this Agreement must be in writing and signed
by both parties to be effective.
j. Binding Agreement. This Agreement shall be binding upon and inure to
the benefit of successors, permitted assigns, heirs, executors, or
administrators of CTC and the Distributor. If more than one corporate person,
entity or formal part of the Distributor's organization executes this Agreement,
the obligations of all such parties shall be joint and several.
k. Notices. All notices and other communications hereunder shall be in
writing and shall be transmitted either by registered or certified mail (or
equivalent), postage prepaid, to the parties hereto at their respective
addresses specified herein, or by facsimile to the parties hereto at their
respective facsimile numbers, subject to the right of either party to change its
address or facsimile number by written notice.
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l. Consent to Jurisdiction and service of Process. Any proceeding arising
out of or relating to this Agreement or the transactions contemplated hereby
shall be instituted in the Courts of the State of Kentucky, or, if jurisdiction
for the matter exists solely in federal court, in the federal courts located in
Kentucky, and each party waives any objection which such party may now or
hereafter have to the laying of the venue of any such proceeding, and
irrevocably submits to the jurisdiction of any such court in any such
proceeding. Any and all service of process and any other notice in any such
proceeding shall be effective against any party if given by registered or
certified mail, return receipt requested, or by any other means of mail which
requires a signed receipt, postage prepaid, mailed to such party as herein
provided.
m. Neutral Construction. The parties have negotiated this Agreement and
all of the terms and conditions contained in this Agreement in good faith and at
arms' length, and each party has been represented by counsel during such
negotiations. No term, condition, or provision contained in this Agreement will
be construed against any party or in favor of any party (i) because such party
or such party's counsel drafted, revised, commented upon, or did not comment
upon, such term, condition, or provision; or (ii) because of any presumption as
to any inequality of bargaining power between or among the parties. Furthermore,
all terms, conditions, and provisions contained in this Agreement will be
construed and interpreted in a manner which is consistent with all other terms,
conditions, and provisions contained in this Agreement.
n. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Kentucky, without regard to its
conflict of laws principles. The parties hereby expressly exclude the
applicability of the United Nations Convention for the International Sale of
Goods if the same would otherwise apply hereto.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
GENERAL CABLE INDUSTRIES, INC. CTC CABLE CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxx X Xxxxxxxx
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Name: Xxxxxxx X. Xxxxxxx Name:Xxxxxx X Xxxxxxxx
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Title:Sr.Vice President & General Manager Title: Chief Executive Officer
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EXHIBIT A
Complete list of existing products which compete with the Products of CTC:
None
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