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EXHIBIT 10.1
DISTRIBUTORSHIP AGREEMENT (EXCLUSIVE)
THIS DISTRIBUTORSHIP AGREEMENT, hereinafter referred to as "this
Agreement", BETWEEN DOWNHOLE PRODUCTS (UK), LTD., a company incorporated
under the Companies Acts (registered number 145401) and having a place of
business at 144 North Deeside Road, Peterculter, Aberdeen AB14 OUD, hereinafter
referred to as "the Supplier", and , TURBECO INC., having its Registered Office
at, 7030 Empire Central Drive, Houston, Texas 77O4O, hereinafter referred to
as "the Customer".
WHEREAS, the Supplier is in the business of manufacturing the
Products; and the Customer carries on the business of selling and servicing the
Products in the Territory and wishes to purchase the Products from the supplier
for that business and the Supplier is willing to supply the Products to the
Customer on the terms set out in this Agreement; and
WHEREAS, the Supplier and the Customer have agreed that the Customer
shall be the exclusive and sole distributor for the products in the Territory
for the duration of this Agreement.
NOW THEREFORE, it is hereby contracted upon and agreed between the
parties as follows:
1 DEFINITIONS
1.1 In this Agreement and Schedule the following words shall have
the following meanings attributed to them unless otherwise specified.
1.1.1 COMMENCEMENT DATE means JUNE 7, 1996.
1.1.2 AMOUNT means the amount set forth in Schedule 1 of this
Agreement.
1.1.3 ORDER(S) means a written order for Products in such form as
the Supplier may prescribe from time to time.
1.1.4 PRODUCTS means Spir-o-lizer, Spir-o-lizer Stop collars, and
related products as manufactured by the Supplier as listed in Schedule
1 of this Agreement.
1.1.5 SCHEDULE means the schedules and their constituent parts
annexed hereto and forming part of this Agreement.
1.1.6 TERRITORY means The North American Continent, specifically
excluding Alaska, and others to be mutually agreed.
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1.2 The headings are inserted for convenience only and shall not
affect the construction or interpretation of this Agreement.
2 SUPPLY OF THE PRODUCTS
2.1 Subject to the provisions of this Clause, the Supplier shall
accept Orders from the Customer to buy the Products from the start of
business on the Commencement Date.
2.2 Acceptance by the Supplier of any Order shall result in a
contract for the sale of the Products which are the subject of such
Order.
2.3 The Customer agrees to submit its Order(s) as far as possible
in advance of the required delivery dates.
2.4 The Supplier will use its best efforts to fill the Order(s) of
the Customer promptly upon receipt. All deliveries shall be made and
delivered to the Customer F.O.B. point of shipment. The Customer is
responsible for all shipment costs and customs duties and taxes
payable on the product. The Customer may return any Products which are
defective at the expense of the Supplier. The Supplier will replace
such defective Products at its own expense as soon as practicable.
3 RISK AND TITLE
3.1 Risk or damage to or loss of the Products shall pass to the
Customer at the date and time of delivery of the Products to the
Customer in Houston, USA.
3.2 Notwithstanding delivery and the passing of risk in the
Products, or any other provision of this agreement, the property in
and title to the Products shall not pass to the Customer until the
Supplier has received in cash or cleared funds payment in full of all
sums then due from the Customer to the Supplier.
4 CONDITIONS OF SALE
4.1 On the date of shipment of the Products to the Customer, the
Supplier shall send to the Customer an invoice specifying the products
shipped.
4.2 The Customer shall pay to the Supplier for the products within
thirty (30) days of the products arrival in Houston, USA, or such
other location as the Customer may from time to time designate.
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4.3 Any standard casing size Products not required by the Customer
may be returned to the Supplier for refund. Notwithstanding the
foregoing all shipment and transport costs shall be the sole
responsibility of the Customer. All products must be returned within
or before the termination period, if any credit or refund is to be
received. All products must be in a resaleable condition.
5 EXCLUSIVITY
5.1 For the duration of this Agreement:
5.1.1 The Supplier shall be the exclusive supplier to the
Customer in the Territory of the Products;
5.1.2 The Customer shall be the sole exclusive customer of
the Supplier in the Territory for the sale of the Products;
and
5.2 Except as otherwise agreed between the parties, for a period
of three (3) months following the termination of this
Agreement;
5.2.1 The Supplier shall continue to be the exclusive
supplier to the Customer (or any party nominated by TURBECO
INC.) in the Territory of the Products;
5.2.2 The Customer (or the nominee of TURBECO INC.) under
Clause 5.2.1 shall continue to be the exclusive customer of
the Supplier in the Territory for the sale of the Products;
and
5.2.3 The Customer shall not resell the Products outside of
the Territory, but each party shall retain the rights and
ability to sell the products in the Territory on a non
exclusive basis after the three (3) month period has expired.
Inquiries from outside the Territory will always be discussed,
without exception, between the Supplier and the Customer,
prior to any action.
6 CUSTOMER RESPONSIBILITIES, DUTIES AND OBLIGATIONS
6.1 The Customer covenants and agrees, for the benefit of the
Supplier, that the Customer shall:
6.1.1 Provide all after sales and services for parties to
whom it has sold the Products;
6.1.2 Sell the Products as a principal and not on behalf
of, or in the name of, the Supplier;
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6.1.3 Be responsible for, and at risk for, the collection
of all payment from its customers for the sale of the
Products;
6.1.4 Notify the Supplier of any invention or improvement
it may make relating to any of the Products and promptly enter
into negotiations in good faith to transfer all rights to the
invention or improvement to the Supplier on such terms as may
be agreed. Any new products invented by the Customer which
are not related to the Supplier's products covered by this
Agreement shall belong to the Customer.
6.1.5 Keep the Supplier informed of any complaint or
dispute concerning the Products;
6.1.6 Inform customers of the Supplier's requirements
regarding the installation, use and maintenance of the
Products set out in the Supplier's instruction manuals as from
time to time amended; and
6.1.7 Not make any modification to the Products save as the
Supplier may from time to time authorize in writing.
6.2 The Customer shall not be authorized to make any
representations or warranties on behalf of the Supplier with respect
to the Products and any representations or warranties made or
agreements entered into by the Customer in relation to the Products or
otherwise shall be its exclusive responsibility.
6.3 The Supplier sells the Products with the intent that they are
free of defects in manufacture and workmanship at the time of sale.
The Supplier warrants that each of its Products will be free of
defects in material and workmanship under normal use and service. The
obligation of the Supplier under this warranty shall be limited to the
requirement that it make good at the Supplier's place of business any
part or parts which are returned to the Supplier by the Customer. If
any Products are determined to be defective, all costs associated with
regard to the return of the products shall be paid by the Supplier.
The Supplier does not warrant any products which are or have been the
subject of misuse, accident, repair or alteration which affects the
Products' stability or reliability.
6.4 The Supplier agrees to defend, indemnify, and protect the
Customer and hold It harmless from any loss or claim which arises out
of any defect in the Products which exist at the time the Products are
sold to the Customer.
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The Customer shall give the Supplier immediate notice of any such loss
or claim and cooperate fully with the Supplier in the handling of such
loss or claim. The Customer agrees to defend, indemnify, and hold the
Supplier harmless from any loss or claim which arises out of its
negligence or that of it agents, employees or representatives in the
installation, sale, servicing or use of the Products.
7 INTELLECTUAL PROPERTY AND MARKETING MATERIAL
7.1 All drawings, notebooks, operating data, specifications,
intellectual property, patent rights, and other information,
data, and materials concerning the Products furnished to the
Customer by the Supplier ("Know-how") shall remain the proprietary and
confidential property of the Supplier and shall be used by the
Customer only with respect to the sale of the Products pursuant to
this Agreement and shall not be used by the Customer in connection
with any other project. Such proprietary and confidential information
and data shall not be shown or otherwise made available to any third
party at any time without the Supplier's prior written consent nor
shall any third party be permitted to measure or otherwise technically
examine or test the Products without the Suppliers prior written
consent. Any such proprietary and confidential information which the
Customer determines must be disclosed to its employees shall only be
disclosed to its employees on a need-to- know basis for the sale of
the Products. Intellectual property or patent rights as may be
obtained on the basis of the Know-how given or made available to the
Customer or with respect to the Products shall remain the exclusive
property of the Supplier.
7.2 The Customer may use such of the Supplier's trademarks and
logos as the Supplier may from time to time authorize in writing.
7.3 The Customer shall not apply any such trademarks or logos to
any item other than a Product or supply or offer to supply any other
item in such a way as to mislead purchasers or prospective purchasers
into thinking that it is a Product.
7.4 The Customer shall promptly notify the Supplier of any
infringement of the Know-how or trademarks of the Supplier of which it
becomes and of any claim that the sale of the Products infringes on
any person's rights of which it may become aware and shall at the
request and expense of the Supplier take such action in respect of the
infringement or claim as the Supplier may request.
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7.5 The Supplier will provide the Customer with sufficient
quantities of catalogues, advertising materials, service and technical
guides relating to the products during the duration of this Agreement.
7.6 The provisions of this Clause 7 shall remain in full force and
effect after the termination of this Agreement.
8 NO AGENCY
8.1 Nothing in this Agreement shall be deemed in any way or for
any purpose to constitute any party an agent of any other party in the
conduct of such party's business. The Supplier and the Customer are
independent contractors and the Customer is not and shall not
represent itself to be an agent, employee, or representative of the
Supplier. The Customer will be entitled to describe itself as a
distributor of the Products.
9 MODIFICATION AND WAIVER
9.1 This Agreement may be amended, modified, supplemented, or
changed in whole or in part only by an agreement in writing making
specific reference to this Agreement executed by each of the parties
hereto. No waiver of any term or breach hereof shall be effective
unless in writing and executed by the party whose rights are waived
thereby.
10 DURATION
10.1 This Agreement shall continue in full force and effect for a
minimum of 2 years, automatically renewable on an annual basis
thereafter, until the parties terminate this Agreement by mutual
agreement or for good cause.
10.2 Without prejudice to the provisions of Clause 10.1, either
party shall be entitled:
10.2.1 By giving no less than ninety (90) days' notice to the
other to terminate this Agreement, if the other party fails to
make any payment in accordance with this Agreement or commits
any other material breach of this Agreement; or
10.2.2 The Supplier shall have the right to terminate
forthwith this agreement on the serving of ninety (90) days
notice in writing to the Customer if within three (3) months
of the date or dates hereof the Customer has not secured
orders with the Supplier.
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10.2.3 Forthwith to terminate this Agreement if any distress
or execution shall be levied upon any of the other party's
goods or if the other party offers to make an arrangement with
its creditors or the other party is unable to pay its debts as
they fall due or any resolution or petition to wind up the
other party (other than for the purpose of reorganization
without insolvency) shall be passed or presented or if a
receiver or manager shall be involuntarily appointed over the
whole or any part of the other party's business or assets or
if the other party shall suffer any analogous proceedings
under foreign law.
10.3 Any rights to terminate this Agreement shall be without
prejudice to the other rights of the parties.
11 GOVERNING LAW
11.1 This Agreement shall be governed by the Law of The State of
Texas, USA, and the parties hereby submit to the nonexclusive
jurisdiction of the Law of The State of Texas, USA.
12 SEVERABILITY
12.1 If any part of this Agreement is void, voidable, or
unenforceable for any reason, this Agreement shall then be considered
divisible as to such part with the remainder of this Agreement
remaining as valid and binding as though such part were not included
in this Agreement.
13 ASSIGNMENT
13.1 Neither party to this Agreement may assign any right or
interest in this Agreement without the written consent of the other
party.
14 ARBITRATION
1 4.1 Any or all controversies or claims arising out of or relating
to the breach of this Agreement shall be settled by arbitration at a
mutually convenient location in The State of Texas, in accordance with
the rules of the American Arbitration Association. Judgment on the
award entered by the arbitrators is binding and may be entered in any
court having jurisdiction thereof.
15 BINDING EFFECT
1 5.1 This Agreement shall benefit and be binding upon the
successors in interest and permitted assignees of the parties.
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16 NOTICES
16.1 Unless otherwise requested by either party, all notices
required or permitted to be made under this Agreement shall be made in
writing and shall be sent to the name and addresses indicated below:
SUPPLIER: CUSTOMER:
144 North Deeside Road 7030 Empire Central Drive
Peterculter, Aberdeen Houston,
AB14 OUD Texas 77040
17 SIGNING
17.1 Each person who signs this Agreement warrants that he or she
does so with the full and legal authority to execute this Agreement on
behalf of the respective parties.
IN WITNESS WHEREOF these presents consisting of this and the
preceding pages are executed in the following manner:
They are subscribed for and on behalf of DOWNHOLE PRODUCTS (UK), LTD. at
Peterculter, Aberdeen, on the 7 th day of June 1996, by:
/s/ ALISTAR CLARK
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Director
/s/ NOT LEGIBLE
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Director
They are subscribed for and on behalf of TURBECO INC. at
Peterculter, Aberdeen, on the 7 th day of June 1996, by
/s/ STEWART A. SIMPSON
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Division Operations Manager
/s/ BILL JAYROE
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President - CEO
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