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AEROVOX AUTHORIZED ELECTRONIC INDUSTRIAL
DISTRIBUTOR AGREEMENT
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THIS AGREEMENT, made as of the 24 day of August 1970, between Aerovox
Corporation 740 Belleville Avenue New Bedford, Mass. (hereinafter referred to
as MANUFACTURER,) and
Name Jaco Electronics, Inc.
Address Engineers Road
City and State Hauppauge, New York 11787
(hereinafter referred to as DISTRIBUTOR).
In consideration of the mutual covenants and agreements hereinafter, the
parties hereto agree as follows:
1. APPOINTMENT
MANUFACTURER hereby appoints DISTRIBUTOR its non-exclusive distributor,
and DISTRIBUTOR hereby accepts such appointment for the sale of certain items,
hereinafter referred to as the "Products", more fully described in the
"Supplemental Terms and Conditions" attached hereto as Exhibit "A", in the
territories specified in Exhibit A. DISTRIBUTOR agrees to inventory, invoice,
and ship products only from such franchised territories.
2. TERM OF AGREEMENT
The term of this Agreement shall commence on August 24, 1970, and
continue for a period of one (1) year thereafter, unless sooner terminated as
provided in Paragraph 10(a) hereof. In the event that the parties do not enter
into a written extension of this Agreement prior to the end of the one (1) year
specified, this Agreement shall be deemed to continue thereafter until
terminated as provided in Paragraph 10(a) hereof.
3. RESPONSIBILITIES
(a) MANUFACTURER
MANUFACTURER shall make reasonable efforts to manufacture quantities of
the Products sufficient to meet the resale requirements of DISTRIBUTOR.
MANUFACTURER'S field representative shall work closely with DISTRIBUTOR to
assist in the readjusting of inventories, advising of customer usage as to
quantity and type, and in the promotion and increase of the sale of the
Products.
(b) DISTRIBUTOR agrees:
(i) to use its reasonable efforts to promote the sale of the Products
and to serve the interests of MANUFACTURER in any and all matters in accordance
with this Agreement.
(ii) To maintain an inventory of the Products in a supply sufficient to
meet the needs of its customers in accordance with reasonable recommendations
which may be made by MANUFACTURER or its representative, as to specific items
and quantities. These requirements are specified in Paragraph 4 of exhibit A.
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(III) To provide reports as set forth in Paragraph 14 of this agreement.
(IV) To hold in confidence during the term of this Agreement, and at
all times thereafter, any and all information of a confidential nature regarding
MANUFACTURER'S business or affairs, including without limitation, customer lists
and data regarding the design and/or methods of manufacture of the Products, and
not to disclose the same to any person, firm or corporation.
(V) To assist MANUFACTURER'S field representatives in every
reasonable manner, including obtaining information useful in expanding product
usage and data concerning customer requirements, and to participate, after
reasonable notice, in training activities sponsored by MANUFACTURER.
4. PRICE AND PRICE PROTECTION
(a) PRICE. DISTRIBUTOR agrees to pay MANUFACTURER for the Products
purchased hereunder in accordance with price purchase schedules or bulletins
supplied by MANUFACTURER from time to time. The presently applicable schedule
is attached hereto as Exhibit "B". MANUFACTURER reserves the right to change
the price of any of the Products without liability to DISTRIBUTOR for any loss
which may be sustained by DISTRIBUTOR, except as provided in Paragraph 4(c)
hereof. The price to DISTRIBUTOR shall be the price in effect at the time of
receipt and acceptance by MANUFACTURER of DISTRIBUTOR'S purchase order. All
specials will be manufactured to meet the DISTRIBUTOR or DISTRIBUTOR'S customer
requirements. No price protection can be offered, but Aerovox will supply such
products to the DISTRIBUTOR at the same price as to the user for like
quantities. (b) TERMS AND PAYMENT. The terms of payment and applicable
discounts, if any, shall be as provided in Exhibit A attached hereto.
(b) TERMS AND PAYMENT. The terms of payment and applicable discounts,
if any, shall be as provided in Exhibit A attached hereto.
PRICE PROTECTION
(c) If prices are decreased, DISTRIBUTOR shall receive a credit against
future shipments for the difference between the net price paid and the reduced
price on applicable Products remaining in DISTRIBUTOR'S inventory which were
purchased within the six months prior to the effective date of such price
reduction. DISTRIBUTOR shall furnish MANUFACTURER with an itemized inventory of
applicable Products within thirty (30) days after the effective date of such
price reduction and MANUFACTURER shall have the right to inspect said inventory.
(d) Minimum Order. Catalog Items................$100.00 per order
25.00 per line item
Specials...................... 50.00 minimum line item
5. DELIVERY
(a) General. MANUFACTURER shall use reasonable efforts to fill all
orders promptly upon receipt and acceptance thereof. However, if because of
Acts of God, casualty, labor difficulties or conditions beyond the control of
MANUFACTURER arise which prevent compliance with normal delivery schedules,
MANUFACTURER shall not be liable for damages, general, special or otherwise.
Deliveries shall be made F.O.B. point of manufacture. DISTRIBUTOR shall have
the right to select the carrier of its choice. Drop or direct shipments to
DISTRIBUTOR'S customers ordinarily will not be made by MANUFACTURER, unless
individually approved by MANUFACTURER'S authorized representative. No single
shipment shall exceed the value of Twenty-Five Thousand Dollars ($25,000.00).
(b) Cancellation of Orders. In the event DISTRIBUTOR cancels an order
for non-stock items which has been accepted by MANUFACTURER, DISTRIBUTOR shall
reimburse MANUFACTURER for all direct costs incurred as a result of such order.
(c) Risk of Loss. MANUFACTURER shall retain title and bear the risk of
loss until such time as a shipment has been placed on board the carrier, at
which time title shall pass to, and the risk of loss shall be borne by,
DISTRIBUTOR.
(d) Taxes. DISTRIBUTOR shall pay any Federal, State or local taxes
which may be imposed upon the Products sold to it hereunder or directly to
DISTRIBUTOR'S customer, by reason of receipt, sale or delivery thereof, or
shall reimburse MANUFACTURER in the event MANUFACTURER becomes obligated to pay
and pays the same. 3
6. REFERRALS
DISTRIBUTOR quantity orders for standard catalog Products emanating
from the territory assigned to DISTRIBUTOR hereunder shall be referred to
DISTRIBUTOR; except that MANUFACTURER reserves the right to bid on, negotiate
and make sales of Products directly to any department, agency or instrumentality
of the Federal, State or local governments and not otherwise, except as may be
specified in Exhibit A attached hereto, with no liability to DISTRIBUTOR for
commissions thereon. Receipt of any order of stock products in DISTRIBUTOR
protected quantities will be referred to the franchise DISTRIBUTOR in the area,
provided that they are known to stock the item. If not, orders will be filled
by the factory and the DISTRIBUTOR will be notified that such an order has been
accepted and the DISTRIBUTOR will be asked to stock such items for future
referrals. Orders received from non-franchised DISTRIBUTORS will be referred to
the nearest authorized Industrial DISTRIBUTOR.
7. STOCK ADJUSTMENT
(a) Obsolescence. MANUFACTURER shall give DISTRIBUTOR written notice
of the discontinuance of any Product. Within thirty (30) days of receipt of
such notice, DISTRIBUTOR shall notify MANUFACTURER in writing of its intention
to return for credit the discontinued Products in its inventory purchased by
DISTRIBUTOR from MANUFACTURER within one (1) year prior to receipt of such
notice and shall submit an itemized inventory of all such Products returned. On
receipt thereof in satisfactory condition, freight prepaid by DISTRIBUTOR,
MANUFACTURER shall issue a credit for the net price paid by DISTRIBUTOR for
these products. The return provision of this subparagraph shall not apply to
items specially prepared by MANUFACTURER to DISTRIBUTOR'S specifications.
(b) Slow Moving Items. Where DISTRIBUTOR has maintained in its
inventory Products for more than six (6) months but not longer than one (1)
year, MANUFACTURER shall exchange such Products purchased by DISTRIBUTOR from
MANUFACTURER for other Products having in the aggregate the same net dollar
cost to DISTRIBUTOR, provided prior written authorization (not to be
unreasonably withheld) is obtained from MANUFACTURER and the Products are
returned, freight prepaid by DISTRIBUTOR, subject to reasonable tests and
inspection by MANUFACTURER. The exchange privilege granted DISTRIBUTOR
hereunder shall be limited to five (5) per cent of the net dollar amount of
purchases made by DISTRIBUTOR during the preceding twelve (12) months, and
shall not apply to items specially prepared by MANUFACTURER to DISTRIBUTOR'S
specifications.
(c) Damaged Inventory. DISTRIBUTOR agrees to notify MANUFACTURER
immediately of any accident, fire, flood, storm, explosion, sprinkler leakage or
other occurrence or act of God which causes damage to the DISTRIBUTOR'S
inventory or any part thereof. DISTRIBUTOR further agrees to return such damaged
inventory to MANUFACTURER for inspection, test and evaluation. MANUFACTURER
shall have the exclusive right to determine what disposition shall be made of
any damaged or defective inventory, and DISTRIBUTOR agrees to be bound by such
determination. DISTRIBUTOR will not relinquish its inventory or any part thereof
in settlement of any claim, nor attempt to sell or salvage any damaged inventory
in its possession, without MANUFACTURER'S written consent. If MANUFACTURER fails
to consent to any settlement, sale or salvage, then MANUFACTURER shall
repurchase such damaged or defective inventory from DISTRIBUTOR for the amount
DISTRIBUTOR would otherwise have received by such settlement, sale or salvage.
(d) Product and Policy Changes. MANUFACTURER reserves the right from
time to time, in its absolute discretion, without thereby incurring any
liability to DISTRIBUTOR with respect to any purchase order theretofore placed
by DISTRIBUTOR, or otherwise, to discontinue or to limit its production of any
Product, in time of shortage to allocate or to terminate or limit deliveries of
any Product the production of which is discontinued or limited, to alter the
design or construction of any Product, to add new and additional Products to
its lines, and upon reasonable notice to DISTRIBUTOR to change its sales and
distribution policies, not inconsistent with the terms of this agreement.
8. ADVERTISING
MANUFACTURER shall supply reasonable quantities of materials such as
catalogs, brochures of new Products, and reprints of its advertising at no
charge to DISTRIBUTOR. DISTRIBUTOR shall have the right to conduct advertising
campaigns with respect to the Products but shall be required to obtain the
approval of MANUFACTURER prior to releasing the same. DISTRIBUTOR agrees to
refrain from making any claims or representations concerning the Products in
excess of those made by MANUFACTURER.
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9. WARRANTIES
Materials and Workmanship. MANUFACTURER warrants its Products for a
period of one (1) year from the date of shipment to DISTRIBUTOR to be free from
defects caused by faulty materials or poor workmanship and to conform to
specifications furnished or approved by MANUFACTURER. The liability of
MANUFACTURER under this warranty is limited to replacing or repairing or
issuing credit at its option for any product which is returned by
DISTRIBUTOR, provided:
(I) MANUFACTURER is promptly notified in writing within ten (10)
days after discovery of such defect by DISTRIBUTOR, and
(II) The defective unit is returned to MANUFACTURER, freight
prepaid, by DISTRIBUTOR, and
(III) MANUFACTURER'S examination of such units shall disclose to
its reasonable satisfaction that such defects exist and have not been
caused by misuse, neglect, improper installation, repair, alteration or
accident occasioned by parties other than MANUFACTURER.
In no event shall MANUFACTURER be liable to DISTRIBUTOR for collateral
or consequential damages of any nature. This warranty is in lieu of all other
warranties, express or implied, except as to title.
10. TERMINATION
(a) General. The Distributorship hereby created may be terminated:
(I) By an agreement in writing duly signed by the parties
hereto, or
(II) By either party at will, with or without cause, upon not
less than ninety (90) days notice in writing, given by registered or
certified mail to the other party, or
(III) By either party hereto upon ten (10) days like notice in
the event the other party hereto attempts to assign this Agreement or
any rights hereunder without the other party's written consent, except
as specifically provided in Paragraph 13 (c) hereof, or either party
ceases to function as a going concern or to conduct its operations in
the normal course of business, or a receiver is appointed and not
removed within ten (10) days thereafter, or a petition under the Federal
Bankruptcy Act is filed by or against either party and not dismissed
within ten (10) days, or either party makes an assignment for the
benefit of creditors.
(b) Stock Repurchase. Within thirty (30) days after the termination of
the Distributorship hereby created, regardless of which party instituted said
termination, MANUFACTURER shall be obligated to repurchase from DISTRIBUTOR
standard stock items which have been purchased from MANUFACTURER within the
preceding twelve (12) months, subject to inspection at MANUFACTURER'S plant, at
the net price paid by DISTRIBUTOR to MANUFACTURER, less a charge for
inspecting, handling and restocking. This charge will be based on cost for this
work but in no case will it be less than five (5) per cent nor greater than
fifteen (15) per cent of the total repurchase price. Any Products to be
returned to MANUFACTURER under this provision shall be shipped freight prepaid
to MANUFACTURER. The repurchase provision of this subparagraph shall not apply
to items specially prepared by MANUFACTURER to DISTRIBUTOR'S specifications:
however, MANUFACTURER shall have the option to purchase the same for thirty
(30) days after the effective date of termination at the net price paid by
DISTRIBUTOR. The repurchase provision of this subparagraph shall not apply to
inventory purchased prior to the date of this contract.
(c) Deliveries after Termination. After a date for termination of the
Distributorship hereby created shall have been established otherwise than
pursuant to subparagraph (a)(III) above, MANUFACTURER shall be obligated to
deliver and DISTRIBUTOR shall be obligated to accept hereunder only orders for
Products accepted by MANUFACTURER prior to establishment of such date of
termination.
(d) Sales after Termination. The acceptance of any order from or the
sale of any Product to DISTRIBUTOR after the termination or expiration of the
Distributorship hereby created, shall not be construed as a renewal or
extension thereof nor as a waiver of termination.
(e) No Liability for Termination. Neither MANUFACTURER nor DISTRIBUTOR
shall, by reason of the termination or nonrenewal of the Distributorship hereby
created, be liable to the other for compen-
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sation, reimbursement or damages on account of the loss of prospective profits
on anticipated sales, or on account of expenditures, investments, leases or
commitments in connection with the business or good will of MANUFACTURER or
DISTRIBUTOR, or otherwise.
(f) Trade Names. If during the term of this agreement, DISTRIBUTOR uses
signs containing the name of MANUFACTURER or uses any trade name, trade-mark,
or the listing of MANUFACTURER'S name in any telephone book, directory, public
record or elsewhere, DISTRIBUTOR, regardless of the cause of termination of
this Agreement, will take all reasonable and necessary steps to discontinue any
usage of the aforementioned in any manner whatsoever and cause the removal of
MANUFACTURER'S name from any such listing.
11. CONFIRMING ORDERS
It shall be DISTRIBUTOR'S responsibility to mark confirming orders as
"confirming". Duplication of shipments resulting from such unmarked orders may
be returned only upon written authorization of MANUFACTURER and will be subject
to a service and restocking charge of twenty per cent (20%).
12. AUDITING OF DISTRIBUTOR RECORDS
The continued authorization of DISTRIBUTOR is dependent upon adherence
to the procedures and policies described herein and therefore, it may be
necessary for authorized auditors or personnel of MANUFACTURER to examine,
without prior notice, all or part of DISTRIBUTOR'S books and records pertaining
to Products. DISTRIBUTOR agrees to allow such examination when deemed necessary
by MANUFACTURER from time to time.
13. MISCELLANEOUS
(a) Construction. This Agreement constitutes the entire agreement
between the parties and supersedes all prior agreements between them, whether
written or oral, relating to the Products covered by this Agreement. This
Agreement shall be construed in accordance with the laws of the Commonwealth of
Massachusetts.
(b) Failure to Enforce. The failure of either party to enforce at any
time or for any period of time the provisions hereof shall not be construed to
be a waiver of such provisions or of the right of such party thereafter to
enforce each and every such provision. An inadvertent and immaterial failure to
comply with any term of this Agreement by either party shall not give rise to a
cause of action on the part of the other party.
(c) Assignment. This Agreement is not assignable or transferable by
DISTRIBUTOR in whole or in part, except with the written consent of
MANUFACTURER. However, this Agreement shall not prohibit the assignment or
transfer of this Agreement to wholly owned subsidiaries or divisions of Aerovox
Corporation.
(d) Notices. Any notice given or required pursuant to the terms of this
Agreement shall be in writing and forwarded by registered or certified mail to
MANUFACTURER or DISTRIBUTOR, as the case may be, to its address indicated on
the first page of this Agreement or to such other address as the party to be
notified shall have last designated in writing to the other party.
(e) Relationship of Parties. The parties hereto agree that DISTRIBUTOR
shall operate as an independent contractor and not as an agent or employee of
MANUFACTURER. DISTRIBUTOR has no express of implied authorization to incur any
obligation or in any manner otherwise make any commitments on behalf of
MANUFACTURER. DISTRIBUTOR shall employ its own personnel and shall be
responsible for them and their acts and in no way shall MANUFACTURER be liable
to
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DISTRIBUTOR, its employees or third parties for any losses, injuries, damages
or the like occasioned by DISTRIBUTOR'S activities in connection with this
Agreement, except as expressly provided herein. In addition, DISTRIBUTOR shall
carry adequate liability and property insurance at its own expense to cover
such risks, and, if requested by MANUFACTURER, shall supply evidence of such
insurance satisfactory to MANUFACTURER.
14. SALES AND INVENTORY REPORTS
To insure maximum cooperation between the MANUFACTURER'S representative
and the DISTRIBUTOR, the commission to the MANUFACTURER'S representative will be
paid on DISTRIBUTORS selling price and determined by point of sale. Therefore,
it is necessary that the DISTRIBUTOR provide to the MANUFACTURER on a monthly
basis a sales report showing customer, quantity, product and selling price. This
report must be made monthly by the fifth working day of the succeeding month.
To insure proper stock movement it will be necessary for the DISTRIBUTOR
to provide the MANUFACTURER with a complete inventory no less than twice per
calendar year.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement the
day and year first above set forth.
/s/ Joel Girsky AEROVOX CORPORATION
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By /s/ Jaco Elect. By /s/ Matthew A. Simon 8/24/70
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Distributor