Exclusive Agency Agreement
Exhibit
10.G.02
This
Exclusive Agency Agreement is made this 10th. day of
February, 2009, by and between OptiCon Systems, Inc., a Nevada corporation
with its principal place of business at 000 Xxxxxxx Xxx, Xxxxx 000, Xx.
Xxxxxxxxxx, XX 00000 (the “Company"), and Mfumo Networking Solutions cc, a South
Africa closed corporation, CC Reg. No. 99/18835/23, with its principal place of
business at 00 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxx Xxxxxx 0000 (“Mfumo” or
"Agent").
WHEREAS,
the Company offers a network management solution for physical and logical layer
and fault detection, including on fiber-optic systems, via software,
professional services, and integrated systems for Telecom, Communications and
Alternative Energy companies (“Services”) using the Company’s unique Opticon
Fiber Optic Network Management System; and
WHEREAS,
Mfumo Networking Solutions is a leading telecommunications integrator company in
South Africa focusing within the Information Technology and Telecommunications
environment, with personal and business relationships in within the governmental
and municipal agencies as well as private enterprises in South Africa and the
marketing expertise and infrastructure to promote and develop the Company’s
products and services to a wide range of customers.
WHEREAS,
the Parties are interested in establishing a mutually beneficial business
relationship in order to further the mutual interests of both Parties;
and
WHEREAS,
the Parties wish to enter into an agreement whereby the Company would appoint
Mfumo Networking Solutions to be the Exclusive Agent for the Company in the
Republic of South Africa and future appointments for other countries in Africa
in order to install the OptiCon Network Manager™ software for the
Company’s customers, to provide Data Services, including mapping and monitoring
the Customers’ network systems, train Customer personnel, troubleshoot network
problems, and assist the Customers in all matters relating to the operation of
the Company’s Products and Services; and
NOW
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and in further consideration of the mutual
covenants set forth herein, the Parties hereto agree as follows:
1.0
Definitions.
1.01 "Products" shall mean
Company products, software, accessories and services offered by the Company for
sale in the Territory which are listed in Exhibit A attached hereto, as the
same may be amended or modified from time to time by the Company in its sole
discretion.
1.02 "Territory" shall mean
the geographical area, specified prospects/customers or areas described in
Exhibit B attached hereto, as the same may be amended or modified from time
to time by duly authorized representatives of the parties hereto in
writing.
1.03
"Net Xxxxxxxx"
shall mean all amounts invoiced in respect to the services provided by the Agent
to the Customers relating to the installation, mapping, monitoring, and
professional services provided to customers of the Company’s products and
services under this Agency Agreement (other than the actual sale of the OptiCon
software, and sales of the software maintenance, which are the object of a
separate agreement) less actual discounts, credits, refunds and allowances made,
freight, transportation, C.O.D., insurance and similar charges, and any
applicable Value Added Tax or other similar taxes.
1.04 "Bookings" shall mean
orders from customers that have been received, acknowledged and accepted by the
Agent. A copy of such order shall be remitted to the Company upon
approval by the Agent.
1.05 "Agency
and Royalty
Fees" shall mean the Company's compensation for performance of its
duties hereunder at the rates set forth in Article 9.0 of this Agreement, as the
same may be amended or modified from time to time by the mutual consent of the
Company and the Agent.
1.06 “Customers” shall
mean companies, enterprises, organizations, and other entities, whether private
or public who have purchased the OptiCon Network Manager™ (“Software”), either
from the Agent or directly from the Company, and who require professional
services, similar to those provided by the Agent, in order to install, map and
monitor the network system, troubleshooting, training, and other professional
services relating to the use of the Software. Customers
shall include Regular Account customers or Industrial Distributors customers
recruited by the Company through its own Sales Representatives.
1.07 "House Accounts" shall
mean those customers for or purchasers of the Company Products which are located
within the Territory and which are designated from time to time in writing by
the Company as House Accounts. House Accounts designated by the
Company at the time of execution of this Agreement are set forth in
Exhibit B attached hereto. The Company may in its sole discretion designate
other customers as House Accounts by giving Agent at least ten (10) days prior
written notice of such designation before such designation becomes
effective.
1.08 "Regular Accounts"
shall mean those customers for or purchasers of the Company Products which are
not defined in Article 1.07 above and shall be serviced by the
Agent.
1.09 "Industrial
Distributor" shall mean those persons, firms or organizations purchasing
the Company Products for resale to customers in the Territory (excluding House
Accounts) in accordance with distributorship agreements entered into from time
to time with the Company, which shall also be serviced by the
Agent.
1.10 "Confidential
Information" shall mean all information made available by the
Company to the Exclusive Agent and/or its officers and directors, agents,
employees, related companies, partnerships, trusts or other entities and their
employees, or agents in connection with this Agreement which the Company
protects against unrestricted disclosure to others and
which: (i) if in written or other tangible form, is clearly
designated as "Confidential"; or (ii) if disclosed orally, is designated as
"Confidential" in a written memorandum delivered by the Company promptly
following such oral disclosure. By way of illustration, but no
limitation, Confidential Information may include proprietary technical data and
concepts, vendor and customer information, financial information and marketing
data.
2.0 Appointment
2.1 The
Company hereby grants to Mfumo Networking Solutions cc, the Exclusive Agency to
provide Data Services to Customers, including the installation of the OptiCon
Network Manager™, including mapping and monitoring the Customers’ network
systems, and providing all relating professional services to the Company’s
customers relating to the operation of the Company’s Products and services
(other than the actual sale of the OptiCon Network Manager™ software,
and sales of the software maintenance, which are the object of a separate
agreement) in the Republic of South Africa.
2.2 Should
Agent is able to locate a qualified Customers in other countries, cities or
geographical areas other than the Territory, and subject to other relationships
the Company may have with other entities in or for that particular territory,
the Company may also appoint Mfumo as its Exclusive Agent to provide similar
services relating to the Company’s Products and services in the particular new
territory.
2.3 Should
the Company secure Customers in any other territories in the continent of
Africa, or elsewhere, it may request the Agent to provide services to those
customers similar to the services being provided to the Company’s Customers in
South Africa, without creating an exclusive agency relationship in those
countries. The term and conditions of these engagements will be
negotiated between the Company and Mfumo at the time of the
engagement.
2.4 Agent
understands that the Company shall have the absolute discretion in evaluating
and approving an extension of Territory. The Company reserves the
right to accept or reject any application of any prospective
Territory.
3.0 Duties of the
Agent.
During
the term of this Agreement, the Agent agrees as follows:
3.1. Agent
shall use best business practices in conducting itself and in presenting the
Company’s Products. Agent agrees to safeguard, protect and promote
the reputation of the Company and shall not engage in any conduct, which might
be harmful to the reputation of the Company. Agent shall not engage
in any deceptive, misleading, unethical, unlawful or immoral conduct or
practices. Agent shall defend, indemnify and hold harmless the
Company, its officers, directors and employees from any and all claims arising
from the Agent’s acts or omissions in violation of Agent’s
obligations.
3.2 During
the term of this Agreement, Agent shall maintain at least one office in the
territory which shall be continually open and adequately staffed during normal
working hours. Agent shall employ adequate number of qualified
personnel in order to adequately discharge its duties hereunder.
3.3. The
Agent shall be responsible for paying all taxes, due on Agent’s earnings and
compensation in any form including earnings under this Agreement, as well as all
other local taxes, including VAT, property taxes, license fees to
municipalities, etc.
3.4. Agent
will be solely responsible for any and all agreements with, and any and all
payments and other obligations to its own employees or affiliates, suppliers,
independent contractors and sub-contractors, etc.
3.5 The
Agent agrees to undertake, at its own expense, those administrative functions
deemed necessary for the proper management of its duties under this Agreement,
including, but not limited to:
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a. The
Agent shall provide personnel for attendance of general, sales and
training/updating conferences as the Company may establish from time to
time.
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b. The Agent
shall submit an initial and annual revenue/sales forecast, revised and
updated every 3 months.
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c. The
Agent shall submit on a regular basis, customer contact reports for new
and potential customers, containing contact details, and details of
contractual arrangement, potential uses of the Company’s
Products,
etc.
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d. The
Agent shall report to the Company Customer interest in potential new or
modified Products within the Company’s field of
operations.
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e. The
Agent shall report to the Company regarding activities of the Company’s
competitors of which the Agent becomes aware during the course of
performing the services hereunder.
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f. The
Agent shall promptly notify the Company of any complaint or claims made or
brought against Agent or the Company with respect to the Company’s
Products or Services.
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3.6 The
Agent shall be responsible for designing and documenting an operational plan
with adequate policies and procedures relating to the deployment of equipment
and staff and providing the Company of such plan for review and
approval. The Agent shall review and update the operational
plan annually, and submit such updated plan to the Company for
approval. The major section of the operational plan would include the
following items:
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a. Providing
a list of individuals involved in performing services under this
Agreement, including their qualifications, length of service,
etc.
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b. Providing
adequate customer support staff and infrastructure (computer systems,
telephone systems, etc.).
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c.. Designing
and documenting a quality control
system.
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d. Establishing
an internal staff training program for (1) the installation of the OptiCon
Management Software Systems, and (2) for the monitoring of the customers’
network systems.
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6.0 Duties of the
Company.
During
the term of this Agreement, the Company agrees as follows:
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(a) The
Company shall provide the Agent with current technical information
regarding the Products and Services;
and
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(b) The
Company shall provide the Agent’s personnel of in-depth technical training
in the installation and use of the OptiCon Network Manager™ software for
its field technicians, programmers, and sales personnel, as the Agent may
determine. The adequate training of the Agent’s staff consists
of 2-3 weeks of classroom and field
training.
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(c) The
Company shall continue to upgrade the OptiCon Network Manager™ software
and will make such software upgrades to the Agent for the installation and
upgrading the Customers systems.
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(d) The
Company shall furnish to the Agent, without charge, reasonable quantities
of promotional sales literature and brochures, catalogue sheets, price
lists and engineering data and such other information and sales aids as,
in the Company's opinion, are appropriate for use by the Agent in
performing its duties hereunder.
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5.0 Term
The
Initial Term of this Agency Agreement shall be for twenty-four (24) months
commencing upon the execution of the Agreement, and renewed automatically for
additional twelve (12) month periods under terms and conditions to be
negotiated, unless previously terminated by either party in accordance with
Article 11 and Article 12. Request by Agent for additional extension
of the Agreement shall be in writing no less than thirty (30) before expiration
of the effective term. The Company shall not arbitrarily deny such
request.
6.0 Independent
Contractor
This
Agreement shall not render the Agent or its employees as an employee, partner or
joint venture of the Company for any purpose. The Company shall not be
responsible for withholding taxes with respect to the Agent’s or its employees.
Neither Agent nor its employees shall have any claim against the Company for
vacation pay, sick leave, retirement benefits, worker’s compensation, health or
disability benefits, unemployment insurance benefits or employee benefits of any
kind.
7.0 Exclusivity
This
Agreement is an Exclusive appointment of Mfumo as the Company’s Agent, and
therefore Agent shall refrain from entering into similar agreements with third
parties in competition with the Company’s Products and services. However, Agent
is barred during the term of this Agreement and for 2 years after termination of
this Agreement from soliciting Company’s Customers for the sale of any Products
or services that compete with the Company’s Products and services.
8.0 Representations
Agent
agrees not to make false or fraudulent representations about the Company, the
Company’s products or services, the Company compensation plan, or income
potential. Any marketing materials, collateral, compensation plans to be
advertised or presented may only be used with prior written approval from the
Company. Any violation of this policy can terminate this Agreement.
9.
0 Agency and
Royalty Fees
9.1 Agency
Fee: The Agent would pay the Company an Agency Fee consisting
of the purchase ten (10) complete packages of the OptiCon Network Manager™
Licenses at the current quantity discounted price for 10 User Servers, as
published by the Company, less 15% representing the commission amount
to which the Agent would be entitled to. The Agent would be free to
re-sell the software to prospective customers. Payment shall be made
to OptiCon Systems, Inc. via wire transfer as follows: 50% upon signing this
agreement and the remaining 50% payable 30 days thereafter. All
payment to the Company shall be nominated is U.S. Dollars.
9.2 Royalty Fees: The
Agent shall pay the Company a Royalty Fee amounting to 10% of the gross Net
Xxxxxxxx directly invoiced by the Company with respect to services performed for
Customers, whether such customers are recruited by the Agent or Regular Account
customers or Industrial Distributors customers recruited by others, but
excluding in each case Net Xxxxxxxx with respect to sales of Products purchased
by the Agent as described in Article 9.1. All payments to the Company
shall be nominated in U.S. Dollars.
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(a) Payments
of the Royalty Fee, as described hereunder, shall be made by direct wire
transfers to the Company on a monthly basis, by the 15th.
day of the month following the month Customer funds were received by the
Agent.
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(b) The
payment of each Royalty Fees shall be accompanied by a statement setting
forth in reasonable detail the computation of the Royalty Fee being paid,
with Customer’s name, original tender or agreement amount, addition or
deletion from contractual amount or deductions identifying invoices by
number with appropriate
explanation.
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(c) Royalty
Fees shall not accrue or be payable on orders or shipments for any
non-production items, such as experimental samples, tools or equipment,
development or experimental products, special testing equipment or any
similar equipment, unless provided by the
Company.
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(d)
If this Agreement is terminated by either party as provided in Article 12,
or if the Agreement with Agent is terminated due to an Event of Default as
provided in Article 11, the Agent shall be obligated to continue paying
the Company a Royalty Fee for a period of 5 years after the termination of
this Agreement, for Products and Services the Agent has provided to
Customers and continues to provide to Customers thereafter. The provisions
of this subsection shall survive the termination of this
Agreement.
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10.0 Use
of Service Marks including trade marks, logos, prices, plans, product
names.
The Agent
may not use any of the Company’s service marks without the express prior written
permission of the Company. The Company materials, whether printed, produced on
the internet, on film, videotape, or produced by sound recording, are
copyrighted and may not be reproduced in whole or in part by Agent or any other
person except as authorized by the Company.
11.0 Events
of Default
11.1. Any
of the following circumstances shall constitute a material breach (“Event of
Default”) of this Agreement:
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a. Agent
fails to perform its obligations hereunder, or breaches any provision of
this Agreement.
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b. Agent
participates or engages in any fraudulent, illegal or other wrongful
activity, including but not limited to the falsification or
misrepresentation of facts or circumstances regarding, or the forgery of,
any Letter of Agency.
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c. The
insolvency, bankruptcy, dissolution, or the filing by or on behalf of
Agent of any claim or proceeding for receivership, relief from creditors,
any assignment by Agent for the relief of debtors, or the appointment by
or on behalf of Agent of a trustee for its
property.
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d. Any
attempt by Agent to assign this Agreement or any part of this Agreement
without OptiCon Systems, Inc.’s prior written
consent.
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e. The
breach by Agent of any of the restrictions set forth in Paragraph 8 of
this Agreement regarding use of OptiCon Systems, Inc. service
marks.
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f. Any
violation of the prohibitions in Articles 13 or 14 this
Agreement.
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11.2 Remedies
to the Company - Upon the occurrence of any Event of default, the Company may
immediately terminate this Agreement without written notice to Agent.
Termination of this Agreement shall be in addition to, and not in lieu of, all
other rights and remedies available to the Company under this Agreement or under
applicable law and/or in equity.
11.3 Duties
upon Termination. Upon termination of this Agreement due to the occurrence of an
Event of Default, the Company shall have no further obligation to the Agent, and
Agent shall refrain from any further use of OptiCon Systems, Inc.’s name or
property, and shall return to the Company all material relating to the Company’s
Products then in Agent's possession or otherwise obtained by Agent in connection
with this Agreement.
12.0 Termination
12.1.
In event that the Agent violates any provision of this Agreement, the Company
has the right to terminate this Agreement immediately and without
notice.
12.2. This
Agreement may be terminated by either party upon ninety (90) days prior written
notice in accordance with Article 19.
13.0 Confidentiality
13.1. Parties
acknowledge that in the course of performing their obligations under this
Agreement each Party may disclose to the other or each Party may come into
possession of Confidential Information and proprietary information/data/material
relating to the other Party’s business, and therefore, agree to abide by the
terms of the Agreement.
13.2
The Parties mutually agree not to disclose to any third party any “Confidential
Information” provided to the other in the course of and as a result of their
business transactions and activities together.
14.0 Non
Circumvention
The
Parties of this Agreement, separately and individually agree that no effort
shall be made to circumvent this Agreement or the agreed terms thereof in an
effort to gain fees, commission, remuneration, or considerations to the benefit
of one or more of the Parties of this Agreement, while excluding equal or agreed
to benefit to any other of the Parties of this Agreement. The Parties
hereby irrevocably affirm and warrant the assign that they will not circumvent,
avoid bypass each other in conducting business with introduced Parties
represented, or are associated with, including brokers, investors, financiers,
or any other third Parties, directly or indirectly to avoid payment, fees, or
commissions in any and all transactions with any and all corporations,
partnerships, or individuals revealed by either Party in connection with any and
all transactions involving the Company’s Products, or additions, renewals,
extensions, new contracts, amendments or renegotiations, or third Party
assignments thereof, without specific and agreed to written permission of the
other Party.
15.0 Public
Announcements
The
Company and the Exclusive Agent will have the right to publicly announce in
press releases, print media, radio, online or TV interviews significant
developments related to this Agreement and the nature of the business
relationship. Each Party hereto shall use best efforts to inform the
other Party of all public announcements contemplated by them, and provide a copy
of such announcement.
16. Damages:
16.1 The
Company shall not be liable for any losses, injuries, damages or claims of any
nature whatsoever arising from the negligence or fault, whether intentional or
negligent, of Agent, its employees, sub-contractors, or agents which Agent may
be subject to or incur as a result of any of its activities in connection with
this Agreement. Agent shall carry adequate business insurance, at its own
expense, to cover such contingencies and will, upon request, submit proof
thereof to the Company's satisfaction. Agent shall indemnify and hold the
Company harmless from any claims, injuries, damages or losses for property
damage, personal injury, or any other liability arising from the negligence or
fault, whether intentional or negligent, of Agent, its employees,
sub-contractors or agents.
16.2
The Company liability under this Agreement shall be limited to losses, injuries,
damages or claims which Agent may be subject to or incur as a result of the
negligence or fault of the Company and/or any of its employees, agents or
suppliers, including manufacturing defects or faults in any of the
Products.
16.3
The Company shall indemnify and hold Agent harmless from any claims or
losses for property damage, personal injury, or any other liability arising from
the above stated in art 16.2.
17.0 Miscellaneous
This
Agreement: (a) constitutes the entire agreement of the parties with respect to
its subject matter and supersedes all previous agreements or understanding,
whether oral or written; (b) may be amended or modified by Company at any time
with notice to Agent, but may not be amended by Agent without Company’s prior
written consent; (c) is binding upon and will inure to the benefit of the
parties and their respective successors, transferees, personal representatives,
heirs, beneficiaries and permitted assigns; (d) may not be assigned in whole or
part by Agent except with the prior written consent of Company; and (e) shall be
governed by and interpreted in accordance with the laws of the State of Florida,
without regard to its conflict of laws and rules.
18.0 Arbitration
This
Agreement is governed under the laws of the State of Florida. The parties agree
that they will attempt to resolve any claim, dispute, or other difference
between them informally and in good faith. If the parties are not successful,
the claim, dispute, or other difference shall be exclusively resolved by binding
arbitration pursuant to the Commercial Arbitration Rules of the American
Arbitration Association, with arbitration to occur at Tampa, Florida (unless
otherwise required by applicable law). The decision of the arbitrator will be
entitled to enforcement in any court of competent jurisdiction. This provision
shall not be construed so as to prohibit the Company from obtaining preliminary
and permanent injunctive relief in any court of competent
jurisdiction.
19.0 Notices
All
notices shall be delivered by hand, or sent via certified mail, postage prepaid,
return receipt requested, or via facsimile or E-mail to the address and/or fax
number of the party as it appears below:
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OptiCon
Systems, Inc.
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000
Xxxxxxx Xxxxxx, Xxxxx 000
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Xx.
Xxxxxxxxxx, Xxxxxxx 00000 XXX
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Phone
(000) 000-0000 ** Fax (000) 000-0000
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Attention:
Xxx Xxxxxx, Chairman
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E-mail:
xxxxxx@xxxxxxxxxxxxxxxxx.xxx
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As to the
Company:
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Mfumo
Networking Solutions cc
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00
Xxxxxxxxxx Xxxxxx
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Xxxxxx,
Xxxxx Xxxxxx 0000
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Phone/Fax:
000 000 0000 Mobile: 000 000-0000
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Attention:
Xxxx Xxxxxxx
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E-mail:
xxxx@xxxxxxxxxxxxxxx.xx.xx
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As to the
Agent:
20.0 Severability
If any
provision of this Agreement is determined by a court or other governmental
authority to be invalid, illegal or unenforceable, such invalidity, illegality
or unenforceability shall not affect the validity, legality or enforceability of
any other provisions of this Agreement. Further, the provision that is
determined to be invalid, illegal or unenforceable shall be reformed and
construed to the extent permitted by law so that it will be valid, legal and
enforceable to the maximum extent possible.
As to the
Company:
___/s/ Xxx
Talari________________
Authorized
Signature
NameSam
Xxxxxx
Title: Chairman
of the Board
Executed
this 24th day of February, 2009.
As to the
Agent:
___/s/ Phil
Mabunda_____________
Authorized
Signature
Name:
Xxxx X. Xxxxxxx
Title:
Managing Director
Executed
this 24th day of February, 2009.
(SIGNATUE
PAGE MFUMO NETWORKING SOLUTIONS AND OPTICON SYSTEMS, INC.
EFFECTIVE
THIS 10th. DAY OF FEBRUARY,
2009)
EXHIBIT
A
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I.
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PRODUCTS:
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The
Company products covered by this Agreement are listed below, but not limited
to:
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i.
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OptiCon
Network Manager™ Version R-3.0.0.1
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ii.
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OptiCon
Maintenance Contracts
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II.
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SERVICES:
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Data
Services, including professional services relating to the installation of the
OptiCon Network Manager™, mapping and monitoring the Customers’ fiber optic,
wireless, or other telecommunication networks, training and support, and any
other services relating to the Customer use of the Opticon Network
Manager™. Charges for Data Services to Customers in the Territory
shall be determined by mutual consent of the Company and the Agent, and are to
be based on standard billing rates for similar services.
EXHIBIT
B
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I.
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TERRITORY/ACCOUNTS:
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The
following Territory/Account(s) is/are hereby assigned to Mfumo Networking
Solutions cc as the Exclusive Agent for OptiCon Systems, Inc. relating to their
Products and Services as described in this Agreement:
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i.
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Territory:
Republic of South Africa
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ii.
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Other
Territories/Accounts: Subject to pre-approval by the
Company.
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II.
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HOUSE
ACCOUNTS:
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The
following house accounts are assigned to the Agent for installation of the
OptiCon Management Software and all other related services being provided by the
Agent, and made part and parcel to this Agreement.
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III.
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EXCLUSIVE
TERRITORY/ACCOUNTS:
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The
Company assigns accounts by customer. When a Agent introduces a potential
customer to the Company by providing his name, position and title, the
organization that he is affiliated with and his email address or telephone
number and address, the Company provides approval to the Agent in writing and
the potential customer is then entered into our data base. Once this information
is presented to the Company this customer is designated as the Agent’s Exclusive
account as long as the Agent Agreement is in effect, provided that this account
places an order with the Company within the 12 month period after the
registration. If the account has not placed an order within the
twelve month period, the customer must be reregistered with the Company for
another 12 month period. Exclusive accounts are listed
below. This schedule shall be updated regularly.
IV. REFERRING BUSINESS
AGENT: Develco cc
