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EXHIBIT 10.18
CLIENT SYSTEMS, LLC
DISTRIBUTION AGREEMENT
This Distribution Agreement (the "Agreement") is made and entered into
this 17th day of March, 1998, by and between Client Systems, LLC, a Colorado
limited liability company (the "Distributor") and Xxxxx Xxxxxxx & Associates,
a(n) _______________ Sole Proprietor, Partnership, Limited Liability Company,
Limited Liability Partnership, "C" Corporation or "S" Corporation (the
"Reseller").
R E C I T A L S:
Reseller acknowledges that he/she has completed the appropriate
reseller application for each Vendor Reseller wishes to represent (where
applicable). Reseller further acknowledges that the application, when once
approved by said Vendor, appoints Reseller as an authorized, non-exclusive
Reseller for the products listed on or contained within said instrument of
authorization or any addenda thereto (the "Authorization Agreement").
1. TERM. The term of this Agreement shall be co-terminous with any and
all Authorized Agreement(s), unless earlier terminated as provided herein.
2. RESELLER RESPONSIBILITIES. Reseller hereby certifies that as a
Reseller:
(a) The products purchased hereunder for Reseller purposes
shall be incorporated in a system consisting of hardware, and/or software,
and/or services which Reseller manufactures, develops, sells or provides (the
"Added Value") which Reseller sells or leases to end-users as a regular course
of business.
(b) Reseller is aware that Hewlett-Packard, Oracle or any
other vendor having appointed Reseller as an authorized, non-exclusive Reseller
(the "Vendor") may withdraw its permission for sales to Reseller with or without
cause at any time by notifying Distributor and Reseller in writing, as outlined
in the respective agreement with said Vendor.
(c) Distributor requires documentation, per order, from
Reseller regarding end-user customer prior to processing orders. Each order
requires end-user company name, end-user company contact name, street address
(cannot be a P.O. box), City, State, Postal Code, Country (where products will
be installed and put into service), telephone number, and facsimile number.
3. LIMITS ON DISTRIBUTOR RESPONSIBILITIES.
(a) Distributor accepts no responsibility for the performance
of the Reseller's application in the end-user's environment.
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(b) Distributor will not be liable for delays in performance
or for the nonperformance due to unforeseen circumstances or causes beyond its
reasonable control.
4. RELATIONSHIP. Reseller's relationship with Distributor will be that
of an independent contractor. Neither party will have, nor represent that it
has, any power, right or authority to bind the other party, or to assume or
create any obligation or responsibility, expressed or implied, on behalf of the
other party's name except as expressly permitted.
5. PRICING.
(a) Pricing is subject to change without prior notice.
(b) Net Reseller price does not include state and local taxes.
(c) Reseller must provide completed sales tax exemption
certificates for his/her state and all states into which Reseller requests
Distributor to ship product. The sales and use tax exemption certificate(s) must
be received prior to opening a new account or shipping into a newly designated
state.
(d) Distributor will invoice Reseller for those taxes, based
on point of delivery, unless the appropriate resale exemption certificates are
on file at Distributor's order entry point, or Distributor agrees the sale is
otherwise exempt.
(e) Reseller is responsible for reporting all use tax with
respect to all orders placed by Reseller for his/her own use.
(f) All standard Vendor terms and conditions of sale apply, as
outlined in the Authorized Agreement(s) or any addenda thereto.
6. INTERNATIONAL ORDERS. Reseller must apply for international access
with each Vendor Reseller wishes to represent internationally. Upon being
granted said access, Distributor will work with designated Vendor and products
quoted will reflect the "export" price and configuration. The "export" price and
configuration differs from the domestic price and configuration in several ways
including the following:
(a) The "export" price provides competitive parity with the
destination country (the term "export" does not explicitly and/or implicitly
imply the cost of actually exporting the order).
(b) The configuration may vary based on the destination
country; the options, such as voltage requirements, may be different dependent
upon the destination country.
(c) All shipments are shipped FOB shipping point. All
shipments will be shipped to the Reseller unless Reseller specifies another
DOMESTIC address in writing on the purchase order
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or via facsimile or e-mail. Reseller is responsible for all duty, taxes and
any/all additional costs associated with said international order.
7. SHIPPING. All shipments are shipped FOB shipping point. The standard
method of shipping is ground. Shipments for all orders will be shipped ground
free of charge. Requests for expedited methods of shipping must be specified on
the Reseller's purchase order or must be received in writing via facsimile or
e-mail and will be assessed an additional charge.
8. WILL CALL. Distributor will provide Reseller the option and
convenience of picking up his/her order at Distributor's warehouse. Pick-up
hours are from 8:00 am. to 5:00 p.m. Mountain Standard Time.
9. RETURN POLICIES AND PROCEDURES. All shipments should be inspected
and tested upon receipt. Reseller is responsible for proper usage, installation
and support of all products. If product is believed to be defective or if there
is a shipping or billing problem, Reseller is required to:
(a) Call Distributor immediately at (000) 000-0000.
(b) Save all original packing materials.
(c) Claims for incorrect shipments, billing errors, or DOA
products must be made within ten (10) days from receipt of shipment.
(d) If Reseller finds it necessary to return product(s) for
credit, Reseller must call Distributor at (000) 000-0000. Within twenty-four
(24) hours of an approved return, Distributor will issue an RMA number to
Reseller via facsimile. RMA numbers are valid for ten (10) business days from
issuance. Reseller must clearly display RMA number on the packing slip and
shipping label on the outside of each carton returned. Distributor may refuse
any return received without an RMA number. PRODUCTS MUST BE RETURNED IN THEIR
ORIGINAL PACKAGING OR BOXING and must be in the same condition as received with
all manuals, diskettes, cables, warranty cards and packing material. Returns
must be shipped freight prepaid to Distributor.
(e) Reseller, unless otherwise directed by Distributor, is
responsible for the freight and insurance for product(s) returned from Reseller
or end-user to Distributor. Distributor, at its discretion, may reject any
returned product(s) and return said shipment to Reseller. Should Distributor
find cause to reject returned product, Reseller will be responsible for the
freight and insurance costs associated with the shipment of product from
Distributor back to Reseller.
(f) Distributor agrees to be bound by Vendor restrictions on
return of product. Current Vendor restrictions apply to all software whose
license seals have been broken.
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10. DAMAGED SHIPMENTS.
(a) If shipment is visibly damaged and deemed unacceptable
upon receipt, Reseller should refuse shipment and notify Distributor
immediately.
(b) If shipment is visibly damaged upon receipt but
acceptable, Reseller must note the damage when signing for the shipment.
(c) If shipment has concealed damage, Reseller should report
the damage to Distributor within twenty-four (24) hours of receipt.
11. NEW ACCOUNT POLICIES AND PROCEDURES. New Reseller accounts are
normally processed within three (3) business days and require the following
information:
(a) A completed Client Systems credit application, with trade
reference information and current financial statements that are to be updated
quarterly (audited statements are preferred).
Net-30 credit terms are available upon approval of
credit, at Client Systems sole discretion. Credit lines will be determined based
upon the financial strength and overall credit worthiness of Reseller based on
the financial statements provided and on the information obtained from
Reseller's trade references.
(b) A completed Client Systems, LLC Two-Tier Distribution
Agreement.
(c) A sales and use tax exemption certificate for every state
into which Reseller will sell product.
(d) A completed Reseller Authorization Agreement for each
Vendor Reseller wishes to represent (where applicable).
12. PAYMENT TERMS AND CONDITIONS. Client Systems extends an Early
Payment Discount to its partners. Your company will receive a 1% discount off
the net invoice amount if Client Systems receives payment for the full invoice
amount within 15 days of the invoice date! (Otherwise, Net 30 terms apply.)
Terms are net thirty (30) days from date of shipment. Reseller agrees to make
payment in full to Distributor for all amounts due according to Distributor's
invoice. If Reseller shall fail to pay any invoice or any other amounts or
charges due hereunder by the date upon which such payment is due, the unpaid
balance of such payments shall bear interest at the per annum rate of eighteen
(18%) percent from the date due to the date of payment. All payments shall be
paid by Reseller to Distributor at Client Systems, LLC, Xxxxxxxxxx 000, Xxxxxx,
Xxxxxxxx 00000-0000 or at such other place as may from time to time be
designated by notice from by Distributor to Reseller.
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13. CASH IN ADVANCE. Should Reseller fail to be in compliance with the
open account terms and conditions, Reseller will be placed on a "cash in
advance" status.
14. RETURNED CHECKS. If a Reseller's check is returned to Distributor's
bank, Reseller will be assessed a thirty-five ($35.00) dollar service charge per
check and will be required to wire transfer the amount due within forty-eight
(48) hours of notification by Distributor or the amount due will be placed for
collection.
15. NOTICES. Any notice required or permitted to be given pursuant
hereto, or in connection herewith, shall be deemed sufficient if in writing, to
the other party and sent by registered or certified United States Mail, return
receipt requested, postage prepaid, or sent by reputable overnight courier.
Notice shall be deemed to be received on the date of execution of the return
receipt or the date upon which the Postal Service or overnight courier first
attempted delivery of such notice and the same is undelivered or refused.
If to Distributor: Reseller Relations Administrator
Client Systems, LLC
0000 Xxxxx Xxxxxxx Xxx
Xxxxxx, Xxxxxxxx 00000
If to Reseller: -------------------------------
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Any party may change the notice address for purposes of this Section by
giving the other parties at least ten (10) days written notice of new address in
the manner set forth above.
16. TERMINATION. Distributor and/or Reseller shall have the right to
terminate this Agreement by giving the other party thirty (30) days written
notice of such termination. However, termination of this Agreement does not
relieve Reseller's obligation to pay Distributor all amounts due and owing under
this Agreement.
17. GOVERNING LAW. In view of the fact that the principal office of
Distributor is located in the State of Colorado, it is understood and agreed
that the construction and interpretation of this Agreement shall at all times
and in all respects be governed by the laws of the State of Colorado.
18. SEVERABILITY. The provisions of this Agreement shall be deemed
severable, and the invalidity or unenforceability of any one or more of the
provisions hereof shall not affect the validity or enforceability of the other
provisions hereof.
19. JURISDICTIONAL CONSENT. The parties hereto agree, stipulate and
consent that the court and authorities of the State of Colorado and the Federal
District Court for the District of Colorado
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shall have sole jurisdiction and venue over all controversies which may arise
with respect to the execution, interpretation and compliance with this
Agreement, and Reseller hereby waives any other jurisdiction and venue to which
he/she may be entitled by virtue of domicile or otherwise.
20. ATTORNEYS' FEES. In the event of a breach of this Agreement by
Reseller, and if Distributor places this Agreement in the hands of any attorney
for enforcement of the terms of this Agreement, whether suit is brought or not,
or for recovery of damages and other remedies as herein provided, Reseller shall
pay all costs of enforcement and litigation together with reasonable attorneys'
fees.
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IN WITNESS WHEREOF, Distributor and Reseller have duly executed this
Agreement as of the day and year first above written.
DISTRIBUTOR:
CLIENT SYSTEMS, LLC
By: /s/ Xxx Xxxxxxx
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Its: Vice President
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Date: 3/7/98
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RESELLER:
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By: /s/ Xxxx X. Xxxxx
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Its: President and CEO
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Date: 3/6/98
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