Exhibit 10.3
AMENDED JOINT MARKETING AGREEMENT
This Joint Marketing Agreement ("Agreement") is made effective retroactively to
October 1, 1997 by and between Tech Logistics, Inc., a Division of Tech
Laboratories, Inc., a NJ Corporation ("First Party") and Elektronik Apparatebau
GmbH (EAG), a German Corporation; W.T. Sports, Ltd., a NY Corporation; and FUA
Safety Equipment, AG, a Swedish Corporation ("Second Party").
First Party and Second Party separately market products and/or services which
are complimentary, meaning the products and/or services are each sold to the
same general end users or consumers and are often used by them for related
purposes.
The parties desire to cooperate in marketing their products for their mutual
benefit.
NOW, THEREFORE, it is agreed:
1. Products.
First Party will manufacture two-beam sensors and jointly market them in the
United States, Canada, and South America ("First Party's Product"). Second Party
will export to the United States four-beam infra red sensors to be marketed in
the United States, Canada and South America by First Party. ("Second Party's
Product"). First Party's Product and Second Party's Product may hereinafter be
referred to collectively as the "Products". The Products may be marketed to and
purchased by the same categories of end users and/or consumers. First Party and
Second Party agree that First Party shall have the exclusive rights to market
the Products as provided in this Agreement. This Agreement may be amended from
time to time to include additional products. The Products shall be marketed by
Tech Logistics and/or Tech Laboratories in its own name.
2. General Duties.
In connection with the joint marketing of the First Party's Product and the
Second Party's Product, the parties agree to the following mutual duties:
A. To share information with respect to product distribution channels, methods
of distribution, competitive information and any other information which can be
disclosed without violating any law or breaching any obligations of
confidentiality.
B. To include, where appropriate, literature concerning the other party's
product in individual direct mail or other direct marketing and with product
shipments.
C. To provide, at the earliest practical date, information about product
development, new Products or modification to existing Products jointly marketed
pursuant to this Agreement.
D. To share information with respect to sales leads.
Bernard M. Ciongoli
Werner Teichmann
Wilfred Teichmann
E. To provide a reasonable number of samples, demonstration units or other
models of products to the other party.
F. To mention or include the other party's products in advertisements,
brochures, promotion and press releases.
G. To share information with respect to trade shows, seminars and meetings which
may be beneficial to the other party.
H. To advise the other party about ideas or recommendations for new products or
enhancements to existing Products which may be appropriate for the other party's
product lines.
3. Specific Duties.
In addition to the general duties set forth in Section 2 above, the parties
agree to engage in the following specific joint marketing activities during the
Initial Term of this Agreement:
A. Trade Shows. The parties agree to jointly participate in the following trade
show(s): The parties will register for each designated trade show in their joint
names, if permitted. If joint registration is not permitted, First Party shall
register on behalf of both parties. The parties shall jointly share the cost of
registration and participation in the trade show; transportation, preparation,
construction and removal of a booth at the trade show; and reasonable related
expenses, such as cost of refreshments and other items not specific to the
Products. Each party shall separately pay its own cost for transportation of its
samples, demonstration units or products to the trade show, travel, lodging and
meals for representatives at the trade show and special or extra customer
meetings or entertainment. The parties agree to jointly staff the trade show
booth at all times.
B. Training. Each party agrees to provide one individual to attend a sales
meeting of the other party for the purpose of demonstrating and training sales
personnel with respect to the party's product. Each party shall bear its own
expenses for transportation and other out-of-pocket expenses for sending its
representative to the other party's sales meeting.
C. Advertising. The parties may select an advertising agency and shall jointly
pay the expenses related to preparation of at least one advertisement which
shall equally promote the First Party's Product and Second Party's Product.
Nothing shall prevent the selection of an advertising agency which represents or
has represented either one of the parties. The parties shall share evenly in the
amount paid to the advertising agency for the joint advertisement. After the
joint advertisement is prepared, each party shall have the equal right to
utilize the advertisement in the media of its choice without limitation,
provided that each party shall pay one-half of the cost of same during the
Initial Term. Additional joint advertisements may be prepared following the
agreement of the parties.
E. Gross Sales. All sales of the Products shall be invoiced to purchasers by
First Party.
Bernard M. Ciongoli
Werner Teichmann
Wilfred Teichmann
F. Net Profits. All pre-tax profits shall be calculated according to generally
accepted accounting principles fairly and consistently applied; and shall be
distributed quarterly in arrears, 70% to the First Party and 30% the Second
Party. On April 1, 2001 and annually thereafter for the balance of the Term of
this Amended Joint Marketing Agreement or any renewal term as provided herein,
the Party shall reanalyze the profit sharing allocation. Such reanalyzation
shall involve an analysis of the actual pre-tax profit of the First Party as to
the sale of the Products. If the actual pre-tax profit of the First Party is
more than 16% then the profit share of the First Party and the Second Party
shall be reallocated to increase the percentage of the Second Party and decrease
the percentage of the First Party to properly reallocate the profit earned by
party of the First Party in excess of 16%. If the profit of the First Party is
less than 16%, then the First Party shall have the unilateral right to terminate
this Amended Joint Marketing Agreement.
F. Royalties. In addition to any other sums earned under this Amended Agreement,
the Party of the Second Party shall earn a Royalty equal to 5% of the cost of
any Products manufactured by Tech Laboratories, Inc. and marketed pursuant to
this Amended Joint Marketing Agreement.
4. Confidentiality.
During this Agreement, each party may disclose to the other information that is
confidential and proprietary to the disclosing party ("Confidential
Information"). Confidential Information may include, but is not limited to,
business plans, marketing plans, financial statements, competitive analysis,
market research, Product development plans, computer programs, designs, and
models, communicated orally, in writing, or by electronic media. Confidential
Information disclosed orally or electronically shall be identified as such
within five (5) days of disclosure. Confidential Information disclosed in
writing shall be marked "Confidential." Each party agrees that it will maintain
the Confidential Information of the other party in confidence and shall use such
information only for the purposes of this Agreement. Confidential Information
may be disclosed by a receiving party within its organization only to specific
employees who have a need to know such information for the purposes of this
Agreement and who have agreed in writing not to disclose it. Upon expiration or
termination of this Agreement or, sooner if demanded by a party, a receiving
party shall return to a disclosing party's any of the disclosing party's
Confidential Information including all copies thereof. If this Agreement or any
subsequent agreement between the Parties or extension hereof is terminated for
any reason by either Party, then and in that event, the Second Party shall
retain ownership to the Products, as well as to any and all modifications,
improvements and extensions of the Products or the related technology whether
such was created, implemented, designed, or paid for, by First Party or Second
Party. Upon such Termination, Second Party shall pay to First Party, First
Party's reasonable expenses in redesigning castings, if any, related to such
modifications, improvements and extensions of the Products or the related
technology. The obligations of each party in this section shall continue for a
period of Two (2) years following the expiration or termination of the
Agreement. The obligations of this section shall not apply to any Confidential
Information that:
Bernard M. Ciongoli
Werner Teichmann
Wilfred Teichmann
A. Is or becomes public through no act of a receiving party;
B. Is rightfully received from a third party without obligations of
confidentiality; or
C. Is independently developed by a receiving party without reference to the
other party's Confidential Information.
5. Conflicts.
During this Agreement and for a period of Six (6) months thereafter, each party
agrees that it will not engage in any marketing, promotion, advertising, or
sales effort, individually or jointly, with respect to any product that is
competitive with the other party's Product or with respect to any entity that
markets, promotes, or sells a product in competition with the other party.
Nothing herein shall prevent either party from engaging in any activity that
promotes any other product or entity that does not compete with the other party
or its products.
6. Term and Termination.
A. The "Initial Term" of this Agreement shall start on October 1, 1997 and shall
end on September 30, 2007. At least sixty (60) days prior to the end of the
Initial Term or any renewal term as provided herein, the parties shall each
notify the other as to whether it desires to renew this Agreement. If either
party notifies the other that it does not desire to continue this Agreement,
then the Agreement shall end upon the expiration of the Initial Term or renewal
terms. If, however, both parties desire to renew the Agreement, then the parties
shall meet to confer and determine the following:
(i) their specific duties for the renewal term in lieu of the specific
duties set forth in Section 3 herein as applicable to the preceding Initial
Term or renewal term;
(ii) the period for the renewal term; and
(iii) any other proposed amendments. If the parties fail to agree on all of
the foregoing items before end of the Initial Term or renewal term, then
this Agreement shall expire as of the end of the Initial Term or the
renewal term. If the parties agree to all of the foregoing items, then the
Agreement will continue with such specific duties and other amendments for
the renewal term agreed upon.
B. This Agreement may be terminated at any time upon the occurrence of any of
the following events:
(i) if either of the parties shall default on any material obligation and
such default is not cured within fifteen days following notice from the
other party.
(ii) if a party files a petition of bankruptcy, is insolvent, makes an
assignment for benefit of creditors or if a trustee or receiver is
appointed for a party, and such remaining of the foregoing remains
undismissed for a period of sixty (60) days.
Bernard M. Ciongoli
Werner Teichmann
Wilfred Teichmann
(iii) either party shall cease to do business, the First Party ceases to
market First Party's Product or Second Party ceases to market Second
Party's Product.
7. Final Agreement.
This Amendment to Joint Marketing Agreement terminates and supersedes all prior
understandings or agreements on the subject matter hereof. This Agreement may be
modified only by a further writing that is duly executed by both parties.
8. Severability.
If any term of this Agreement is held by a court of competent jurisdiction to be
invalid or unenforceable, then this Agreement, including all of the remaining
terms, will remain in full force and effect as if such invalid or unenforceable
term had never been included.
9. Notices.
Any notice required by this Agreement or given in connection with it, shall be
in writing and shall be given to the appropriate party by personal delivery or
by certified mail, postage prepaid, or recognized overnight delivery service;
If to First Party:
Bernard M. Ciongoli, President
Tech Laboratories, Inc.
955 Belmont Avenue
North Haledon, NJ 07508
and if to Second Party:
Werner Teichmann, President
W.T. Sports, Ltd.
PO Box 23
Ellenville, NY 12428
Wilfred Teichmann, President
Elektronik Apparatebau GmbH
c/o Werner Teichmann
PO Box 23
Ellenville, NY 12428
Wilfred Teichmann, President
FUA-Safety Equipment, AG
c/o Werner Teichmann
PO Box 23
Ellenville, NY 12428
Bernard M. Ciongoli
Werner Teichmann
Wilfred Teichmann
10. Governing Law and Arbitration.
A. This Agreement shall be construed and enforced in accordance with the laws of
the state of New Jersey.
B. The parties agree that they will use their best efforts to amicably resolve
any dispute arising out of or relating to this Agreement. Any dispute that
cannot be resolved amicably shall be settled by final binding arbitration in
accordance with the rules of the American Arbitration Association and judgment
upon the award rendered by the arbitrator or arbitrators may be entered in any
court having jurisdiction thereof. Any such arbitration shall be settled by
final binding arbitration in accordance with the Rules of the American
Arbitration Association and judgment upon the award rendered by the arbitrator
or arbitrators may be entered in any court having jurisdiction thereof. Any such
arbitration shall be conducted in Paterson, New Jersey or such other place as
may be mutually agreed upon by the parties. Within fifteen (15) days after the
commencement of the arbitration, each party shall select one person to act as
arbitrator, and the two arbitrators so selected shall select a third arbitrator
within ten (10) days of their appointment. Each party shall bear its own costs
and expenses and an equal share of the arbitrator's expenses and administrative
fees of arbitration.
11. No Assignment.
Neither party shall assign this Agreement or any interest or obligation herein
without the prior written consent of the other party.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
W.T. Sports, Ltd., a NY Corporation FUA-Safety Equipment, AG, a
Swedish Corporation
By: /s/ Werner Teichmann By: /s/ Wilfred Teichmann
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Werner Teichmann, President Wilfred Teichmann, President
Tech Logistics, a Division of Elektronik Apparatebau GmbH(EAG)
Tech Laboratories, Inc., a NJ Corporation a Corporation of the Country of
Germany
By: /s/ Bernard M. Ciongoli By: Wilfred Teichmann
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Bernard M. Ciongoli, President Wilfred Teichmann, President
Bernard M. Ciongoli
Werner Teichmann
Wilfred Teichmann