EXHIBIT 4
MAXpc DISTRIBUTOR AGREEMENT
AGREEMENT made this 26th day of March, 1999, by and between MAXpc TECHNOLOGIES,
INC., a Texas corporation, with offices at 8115 Preston Road, Eighth Floor East,
Dallas, Texas 75225 ("MAX") and Jasper Resources LTD., a British Virgin Islands
corporation ("Distributor").
RECITALS
A. MAX warrants that it owns the worldwide, exclusive right and license
to manufacture and sell a multimedia computer add-in card bearing the
specifications set forth on attached Exhibit A, which it currently manufactures
and sells under the trademark/trade name "OOMPH", together with all
enhancements, upgrades, and modifications thereof (the card and all trademarks,
trade names and copyrights associated therewith herein referred to as the
"Product").
B. The parties desire that Distributor become the exclusive distributor
of the Product for MAX in the countries on the European continent identified at
Exhibit B (the "Territory").
AGREEMENT
1. Appointment. MAX hereby appoints Distributor as the exclusive
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distributor for the Product in the Territory, to resell the Product to original
equipment manufacturers, other customers located within the Territory who are
providing the products for resale to merchants, wholesalers, and retailers
within the Territory, and directly to commercial and noncommercial final users.
2. Right of First Refusal. Distributor shall have the right of first
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refusal to be the exclusive distributor of the Product in the remainder of
Europe, including all constituent political subdivisions, as well as the States
of the former Soviet Union and South America.
3. Limitations on Exclusivity. Distributor shall not acquire any
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right, title or interest in and to the MAX trademarks, trade names or
copyrights. In addition, Distributor's rights to the Products shall become
nonexclusive in the event Distributor shall fail to achieve the following
minimum sales volumes through no fault of MAX, including its inability to ship
such volumes in a timely manner.
Calendar Quarter Ending Minimum Units
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March 31, 1999 0
July 31, 1999 1,000
September 30, 1999 2,000
March 31, 2000 3,000
June 30, 2000 4,000
Thereafter 4,500 units per quarter
4. Purchase Orders
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a. Distributor shall purchase the Products from MAX by means of Purchase
Orders in the from set forth at Exhibit C.
b. Under the terms of a Purchase Order, MAX will ship all orders of the
Product to Distributor's distribution center, as set forth on each individual
purchase order, in compliance with the following delivery schedule:
Units Ordered Days to Delivery
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Up to 300 21
More than 300 30
c. All shipments shall be D.D.P., unloaded upon delivery, distribution
center. Risk of loss shall pass to Distributor at the time Products are received
at the distribution center. Terms of payment shall be net amount due thirty (30)
days after received at distribution center. The parties' other burdens and
obligations with respect to delivery are governed by the Vienna Convention of
1980 (CISG), except for those for which the parties expressly contract,
including Section 17(c), infra, notwithstanding the signatory status of the
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country constituting the Territory.
d. To effect payment of invoices, Distributor shall deliver to MAX an
international letter of credit in the amount of each invoice, in a form to
comply with the International Chamber of Commerce Uniform Custom and Practices
for Documentary Credits. Such letter of credit shall enable MAX to draw thereon
on or after thirty (30) days from the date of shipment received at distribution
center.
e. All Purchase Orders to Distributor shall be based on a price reflected
in United States Dollars that is 20% below the lowest price charged to MAX's
distributors for purchases of similar quantities. Such price shall in no event
increase on future purchase orders for similar quantities.
f. Each Purchase Order shall clearly state the appropriate DVD Code
Number for the country for which copies of the Product are intended. It is
understood that the inclusion of a DVD Code Number shall not operate to widen
the scope of the Territory.
g. All payments to MAX shall be payable in Dallas, Texas in United States
Dollars, and Distributor and its customers shall bear all risk of currency
fluctuations. MAX will bear the risk of inflation changes.
h. MAX shall reasonably inform Distributor of the delivery status of any
units ordered.
5. Duties of Distributor
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a. Distributor shall, at its expense, exercise commercially reasonable
efforts to optimize the sales potential of the Products in the Territory,
including that Distributor shall support, honor and perform all commercially
reasonable sales programs sponsored by MAX to the extent they are appropriate in
the Territory.
b. Distributor shall train its sales and service personnel to be
sufficiently knowledgeable about the Product to provide its use in the
Territory.
c. Distributor shall not engage in sales of any computer card that
competes with the Product in terms of its use and the functions offered thereon,
in the Territory.
d. Distributor shall furnish MAX with monthly sales reports and
projections of monthly sales for the ensuing three months, together with a long
range forecast of sales for the following nine months once a quarter.
e. Distributor shall, at its expense, provide for the establishment of
its sales hierarchy in the Territory, and shall design and translate in the
dominant language of each country in the Territory, the packaging materials and
instructions for the Product.
f. Distributor shall not be restricted from distributing non-competing
products within the Territory manufactured by competing companies.
6. Duties of MAX
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a. MAX shall manufacture the Product in a good and workmanlike manner in
sufficient quantities to meet the delivery requirements and schedule set forth
in Section 4(b).
b. MAX shall honor all warranty claims in accordance with the warranty
policy attached hereto at Exhibit D. EXCEPT FOR THE WARRANTIES CONTAINED IN THE
COMPANY'S WARRANTY POLICY, MAX HEREBY DISCLAIMS ALL OTHER EXPRESS, STATUTORY AND
IMPLIED WARRANTIES APPLICABLE TO THE PRODUCTS AND OTHER ITEMS, INCLUDING,
WITHOUT LIMITATION, ALL IMPLIED WARRANTIES APPLICABLE TO THE PRODUCTS AND OTHER
ITEMS, INCLUDING, WITHOUT LIMITATION, ALL IMPLIED WARRANTIES OF MERCHANTABILITY
OR FITNESS FOR ANY PARTICULAR PURPOSE.
c. MAX shall provide technical training at its office in Dallas, Texas
for not more than
ten (10) of Distributor's personnel not more often than fifteen (I 5) days each
calendar year.
d. MAX will provide (in English) all training manuals, literature and
video documentation it has developed for the product.
e. MAX will make a trainer available in the Territory to Distributor and
its customers, at no expense to MAX, to assist with technical and sales
training.
7. Representations. Each party represents and warrants to the other as
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follows:
a. It has the corporate power and authority to enter into and perform
this Agreement.
b. This Agreement has been authorized and approved by all necessary
corporate actions.
c. This Agreement does not conflict with any other agreement or
instrument which either party or its property may be subject.
d. No government approval is required for the execution or performance of
this Agreement.
8. Confidentiality:
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a. As used herein, the term "Confidential Information" means and includes
any and all of the following: All information or materials furnished by one
party to the other pursuant to this Agreement, including technical data,
customer lists, manufacturing processes, analysis, compilations, studies, or
other documents or records prepared by either party or on behalf, either party
which contains or otherwise reflects or are generated from such materials. The
term Confidential Information shall not include information which is (a) already
known by a recipient without an obligation of confidentiality other than this
Agreement, (b) publicly known or becomes known through no unauthorized act of
the receiving party, (c) rightfully received by a receiving party from a third
person who is not subject to a confidentially or fiduciary obligation with
respect to such information, (d) is required to be disclosed pursuant to a court
order, a rule or a regulation of a governmental agency, or (e) is independently
developed by a party.
b. Distributor agrees that, during the term of this Agreement, and for a
period of five years thereafter, without the prior written consent of MAX,
Distributor will not, directly or indirectly, for its own benefit or for the
benefit of another, disclose or reveal to any other person, firm, venture,
corporation or other business entity, any of the Confidential Information
delivered to it by MAX. Distributor agrees to use all such information solely
for the purpose of performing its obligations under this Agreement and to take
all actions reasonably necessary or appropriate to ensure that none of the
employees, officers, directors, partners, owners, agents or affiliates of
Distributor, discloses or reveals Confidential Information delivered to it by
MAX in any manner whatsoever except on behalf of Distributor and at its
discretion and under its control in the course of its performance of its
obligations under this Agreement and solely in strict compliance with each of
the limitations and other provisions hereof. Distributor will disclose
Confidential Information
delivered to it by MAX only to those employees, agents or affiliates who need to
know such information in order to enable Distributor to comply with its
obligations under this Agreement.
c. MAX agrees that, during the term of this Agreement, and for a period
of five years thereafter, without the prior written consent of Distributor, MAX
will not, directly or indirectly, for its own benefit or for the benefit of
another, disclose or reveal to any other person, firm, venture, corporation or
other business entity, any of the Confidential Information delivered to it by
Distributor including any information related to Distributor's clients and
outlets. MAX agrees to use all such information solely for the purposes of
performing its obligations under this Agreement and to take all actions
reasonably necessary or appropriate to ensure that none of the employees,
officers, directors, partners, owners, agents or affiliates of MAX discloses or
reveals Confidential Information delivered to it by Distributor in any manner
whatsoever except on behalf of MAX and at its discretion and under its control
in the course of its performance of its obligations under this Agreement and
solely in strict compliance with each of the limitations and other provisions
hereof MAX will disclose Confidential Information delivered to it by Distributor
only to those employees, agents or affiliates who need to know such information
in order to enable MAX to comply with its obligations under this Agreement.
d. Upon the earlier of (1) the written request of MAX or Distributor, as
applicable, or (2) the expiration of the term of this Agreement, a receiving
party shall return all copies of such Confidential Information delivered to it
by the other party, and all derivatives thereof, to the other party or, if
directed by the other party, shall cause to be destroyed all copies of such
Confidential Information and such derivatives, and certify in writing to the
other party that such Confidential Information and derivatives have been
destroyed.
9. Intellectual Property Rights. Distributor acknowledges that MAX has
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valuable and exclusive rights to patents, trademarks, trade names and copyrights
relative to MAX's products. The parties agree that Distributor may propose one
or more trade names for the Product for use in the Territory. Such name shall be
subject to MAX's approval and shall become the intellectual property of
Distributor if used. Distributor shall have the same right to use the additional
names as it does the OOMPH or successor trademarks and trade names as set forth
herein. A schedule of these patents, trademarks, trade names, and copyrights
along with the jurisdiction to which they apply pursuant to World Trade
Organization rules and regulations, is attached as Exhibit E.
10. Force Majeure. In no event shall the parties be liable to each other for
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failure or delay in the performance of any obligations contained in this
Agreement or in any purchase order accepted hereunder by MAX, arising, directly
or indirectly from acts of God, unforeseeable circumstances, acts (including
delay or failure to act) of any governmental authority (de jure or de facto),
war (declared or undeclared), riot, revolution, priorities, fires, floods,
weather, strikes,labor disputes, sabotage, epidemics, factory shutdowns or
alternations, embargoes, delays or shortages in transportation, delay or
inability to obtain or procure labor, manufacturing facilities or materials, or
causes of any other kind beyond the reasonable control of the hindered party.
II. Independent Contractor.
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a. Distributor is an independent contractor and is not the legal
representative or agent of MAX for any purpose.
b. MAX is an independent contractor and is not the legal representative
or agent of Distributor for any purpose.
c. The Products sold by MAX pursuant to this Agreement shall be purchased
by Distributor for its own account, payment to be made within thirty (30) days,
and the prices at which such Products are resold by Distributor shall be
determined solely by Distributor.
d. Distributor has no Del Credere obligations to MAX.
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12. Sales and Similar Taxes. The prices specified in each purchase order
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accepted by MAX hereunder do not include any federal, state or local property,
license, privilege, business, occupation, stamp, documentary, transfer, sales,
use, excise, gross receipts, value added or other similar taxes which may or
hereafter be applicable to, measured by, or imposed upon:
a. The sale or transfer of the Products;
b. The value or use of the products; or
c. The performance of any services in this Agreement. except as is
required for Seller to fulfill its delivery obligations, except as may
be required pursuant to MAX's shipping and delivery obligations under
Vienna Convention of 1980 (CISG).
13. Duration and Termination
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a. Unless earlier terminated in accordance with the terms of this
Agreement, this Agreement shall commence as of the date of this Agreement and
shall remain in effect for a period ending December 31, 2001. This Agreement may
be renewed at the beginning of each year during the term of this Agreement for
an additional three (3) year term upon the written agreement of both parties
during the first month of the year. If either party falls to agree in writing to
such renewal, this Agreement shall not be renewed and shall continue only for
the balance of the remaining term. For purposes of this paragraph, a "year"
shall be deemed a "calendar year."
b. In addition to all other remedies provided by law, or specified in the
Agreement, MAX may, at its option, terminate this Agreement, and any outstanding
and unperformed purchase orders previously accepted by MAX hereunder, by mailing
written notice of such termination to Distributor, upon the occurrence of any of
the following events:
(1) The insolvency of Distributor;
(2) The filing of a voluntary or involuntary petition in
bankruptcy by, against or on behalf of Distributor;
(3) The appointment of a receiver or trustee for all or
substantially all of the property of the Distributor;
(4) If Distributor otherwise commits an act of bankruptcy; or
any bankruptcy reorganization debt arrangement or other
proceeding under any bankruptcy or insolvency law, or any
dissolution or liquidation proceeding is instituted by,
against, or on behalf of Distributor;
(5) The breach or failure of Distributor to perform any of the
terms, conditions or covenants contained in this Agreement;
or
(6) The acquisition or control of Distributor, directly or
indirectly, by a competitor of MAX without the consent of
MAX which consent may be withheld in MAX's sole discretion.
c. Upon expiration of this Agreement, or upon its termination for any
reason whatsoever, Distributor shall immediately cease using MAX's intellectual
property. MAX shall continue to honor and provide warranty information to
Distributor's customers.
d. MAX shall repurchase Distributor's inventory of Products upon
expiration of this Agreement or upon its termination for any reason whatsoever,
at prices which are the same as those for which the inventory was originally
purchased by Distributor, shipped by Distributor E.X.W., no assistance in
loading. The foregoing price for the returned inventory shall be paid by MAX to
Distributor by means of an irrevocable sight letter of credit drawn on a U.S.
money center bank the date MAX receives the inventory.
e. It is further agreed that MAX and Distributor shall, following the
expiration of any termination of the Agreement, continue to perform all purchase
orders accepted by MAX prior to the date of such termination.
f. Distributor will be allowed to complete any outstanding purchase order
commitments it may have outstanding at time of termination.
14. Inspection of Records, Products and Other Items. During the term of this
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Agreement, Distributor shall maintain a log memorializing purchases and sales of
Products (the "Log") at its principal office. MAX, its employees and authorized
representatives, shall be entitled during business hours to inspect and copy all
of Distributor's Business Records and to inspect Products wherever located.
15. Amendments and Assignment of Agreement. This Agreement sets forth the
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entire Agreement between the parties. All previous oral and written agreements
between the parties are hereby terminated and neither party shall have any
continuing obligation of any kind thereunder. This Agreement may be changed,
altered, or amended only by an Agreement in writing signed by both parties and
may not be assigned by Distributor, in whole or in part, without the prior
consent of MAX, which consent may be withheld by MAX in its sole discretion
except for any entity or
person that is an affiliate of or controlled by Distributor. MAX shall have the
right to assign this Agreement without limitation. Subject to the foregoing
provisions, this Agreement shall be binding upon and inure to the benefit of the
successors, assigns and legal representatives of the parties hereto.
16. Notices. Except as otherwise provided in this Agreement, all writings,
notices, payments and reports required hereunder shall be sent by certified or
registered mail to the parties at their address specified below:
DISTRIBUTOR: To be provided within thirty (30) days
MAX: MAXpc Technologies, Inc. c/o Gary A. Raabe
8115 Preston Road, Eighth Floor East Dallas,
Texas 75225
17. Miscellaneous.
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a. Expenses. Each party to this Agreement shall bear its own legal and
accounting expenses in connection with the transactions provided for herein.
Each of the parties hereto agrees to hold the other harmless from and against
any liability for broker's or finder's fees in connection with the purchase and
sale provided for herein arising out of the contracts, express or implied, which
may be asserted against the noncontracting parties.
b. Waivers. The failure of any party to act to enforce rights hereunder
shall not be deemed a waiver and shall not preclude enforcement of any rights
hereunder. No waiver of any term or provision of this Agreement on the part of a
party shall be effective for any purpose whatsoever unless such waiver is in
writing and signed by such party.
c. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, INTERPRETED, AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICTS OF LAWS.
d. VENUE: THE PARTIES AGREE THAT ANY DISPUTE REGARDING THIS AGREEMENT
SHALL BE SUBJECT TO THE EXCLUSIVE JURISDICTION OF THE TEXAS STATE COURTS IN AND
FOR DALLAS COUNTY, TEXAS, UNITED STATES OF AMERICA, AND THE PARTIES AGREE TO
SUBMIT TO THE PERSONAL AND EXCLUSIVE JURISDICTION AND VENUE OF THESE COURTS. e.
No Benefit to Others. The representations, warranties, covenants, and agreements
contained in this Agreement are for the sole benefit of the parties hereto and
their respective successors, permitted assigns, heirs, executors,
administrators, and legal representatives, and shall not be construed as
conferring and are not intended to confer any rights on any other persons.
f. Invalid Provisions. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under present or future laws effective during
the, term hereof, such provision shall be fully severable. This Agreement shall
be construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a part hereof, and the remaining provisions hereof
shall remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance herefrom. Furthermore, in
lieu of such illegal, invalid or unenforceable provision there shall be added
automatically as a part of this Agreement a provision as similar in terms to
such illegal, invalid or unenforceable provision as may be possible and be
legal, valid and enforceable.
g. Indemnity. MAX will indemnify and hold harmless Distributor for any
and all claims relating to breach of MAXpc's warranty and strict liability or
breach of warranty related to products liability law of any jurisdiction in
which the goods may land in the stream of commerce.
h. No partnership. Nothing contained in this Agreement shall constitute
or be deemed to constitute a partnership between the parties.
i. Headings. The article and section headings contained in this Agreement
are for reference purposes only and shall not be deemed to be a part of this
Agreement or to affect the construction or interpretation of this Agreement.
j. Amendments. This Agreement may be amended or modified only by an
agreement in writing signed by all of the parties hereto.
k. Construction. Any alleged uncertainty or ambiguity in this Agreement
shall not be construed for or against a party based on attribution of drafting
to such party.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound
hereby, have duly executed, or through their duly authorized officers have duly
executed, this Agreement effective as of the date first written above.
MAXpc TECHNOLOGIES, INC.
By: /s/ Donald G. McLellan
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Donald G. McLellan, Vice President
JASPER RESOURCES LTD.
By: /s/Brahil Santos
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Brahil Santos, Attorney-in-Fact
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