Exhibit 10.36
AGREEMENT
THIS AGREEMENT ("Agreement") is made as of December ___, 2001 ("Effective
Date") by and between NUWAVE Technologies, Inc. located at Xxx Xxxxxxx Xxxxxx,
Xxxxxxxxx, Xxx Xxxxxx 00000 ("NUWAVE") and Gemini Industries, Inc., located at
000 Xxxxx Xxxx, Xxxxxxx, Xxx Xxxxxx 00000 ("Gemini").
RECITALS
WHEREAS, NUWAVE and Gemini are parties to a certain Memorandum of
Understanding dated November 28, 2001 (the "MOU") regarding a business
relationship between the parties; and
WHEREAS, the MOU contemplates that the parties will enter into a definitive
agreement setting forth the terms and conditions of their business relationship;
and
WHEREAS, the parties desire, for their mutual benefit, to enter into this
Agreement to set forth their respective rights and obligations and the terms and
conditions of their business relationship.
NOW, THEREFORE, in consideration of the mutual covenants set forth herein,
the parties agree as follows:
ARTICLE I
EXCLUSIVE DISTRIBUTOR
Section 1.1. Appointment of Distributor. NUWAVE hereby appoints Gemini as
its exclusive distributor of the Products (as defined below) in the Territory
(as defined below) during the Term (as defined below). Gemini hereby accepts
such appointment.
Section 1.2. Products. "Products" means NUWAVE's set top Video Game
Enhancement (or "VGE") product, which is a set top box made to NUWAVE's
specifications (the current specifications for which are set forth on Schedule
1.2) and incorporating the NUWAVE developed NVP104 ASIC chip (with analog video
processing circuitry and its related software), the application of which is
utilized in Video Game Enhancement Accessory Products. "Products" shall include
newer versions of the VGE but shall exclude the above-described ASIC chip itself
(together with enhancements or new versions of it, the "Chip"), whether the Chip
is sold by itself or incorporated into television receivers or other consumer
electronic products which are not themselves set top boxes for video game
enhancement. Current specifications for the Chip are set forth in Schedule 10.1.
Section 1.3. Territory. "Territory" means the United States, its
territories and possessions, Canada and Mexico. NUWAVE reserves the exclusive
right to sell the Products in the Territory to Radio Shack. Gemini is not
authorized to sell (on an exclusive or a nonexclusive basis) Product anywhere
other than in the Territory. In addition, Gemini is not authorized to sell (on
an exclusive or a non-exclusive basis) Product to any exporter or other Person
for resale outside the Territory. As used in this Agreement, "Person" means an
individual, a partnership, a corporation, a limited liability company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, a governmental entity or any department, agency or political
subdivision thereof or any other legal entity.
Section 1.4. Covenants of Good Faith and Fair Dealing. Each party covenants
to act in good faith and in a manner of fair dealing with respect to this
Agreement. Gemini agrees to endeavor in good faith to market and distribute the
Product in the Territory in the manner one would expect from an exclusive
distributor.
Section 1.5. Term. The term of this Agreement shall commence on the
Effective Date and shall end at 5:00 p.m. New York time on _______, unless
sooner terminated in accordance with the terms of this Agreement ("Term").
ARTICLE II
CONDITIONS TO EXCLUSIVITY
In order for Gemini to retain the exclusive distribution rights for the
Products in the Territory set forth in Section 1.1 above, the following
conditions must be met:
Section 2.1. Inventory. Gemini shall, upon execution of this Agreement, pay
by wire transfer to NUWAVE, USD $____/unit of Product for all finished goods
Product in NUWAVE's inventory at the time of signing this Agreement (up to a
maximum of _____ units), subject, however, to Gemini's inspection of that
inventory and to mutual agreement between Gemini and NUWAVE of the amount of
that inventory which is useable in its current condition. The number of units of
such inventory and total amount payable with respect thereto is listed on
Schedule 2.1 hereto. The inventory shall be purchased F.O.B. the warehouse in
which it is located at the time of signing this Agreement.
Section 2.2. Initial Chip Order. Upon execution of the Agreement, Gemini
shall supply to its vendor, Good Mind Industries Co., Ltd., an electronic goods
vendor located in Taiwan ("Good Mind"), a signed, firm, non-cancelable purchase
order ("Purchase Order") for a number of Chips equal to _____ less the number of
Products being purchased out of NUWAVE's inventory pursuant to Section 2.1. Also
upon execution of this Agreement, Gemini shall then issue and send to NUWAVE a
signed Purchase Order for all of those Chips. Gemini shall pay NUWAVE for the
Chips covered by such Purchase Order within ___ days after the date of such
Purchase Order.
Section 2.3. Subsequent Purchases. Gemini shall issue Purchase Orders for
and purchase at least _____ Chips per full calendar month for each full or
partial month during the Term (the "Monthly Quota"); provided that:
(a) Gemini shall not be obligated to begin to meet its Monthly Quota
until July 1, 2002 (the date that is approximately six months
after the Effective Date of this Agreement);
(b) in the event that Gemini fails to take receipt of its Monthly
Quota of Chips, Gemini shall, prior to the fifteenth (15th) day of
the following calendar month, pay NUWAVE for the difference
between the actual number of Chips it received and the Monthly
Quota (at the rate set forth in Article VI). NUWAVE shall issue to
Gemini a credit (a "Chip Credit") for Chips to be delivered in the
future (as described in Section 2.4). Late payment shall be
subject to interest at the Prime Rate (as defined below) plus __
%. "Prime Rate" means the "Prime Rate" published in The Wall
Street Journal (Eastern Edition) in the "Money Rates" table on the
first Business Day (as defined herein) of the calendar month in
which such late payment occurred. "Business Day" means a day,
other than a Saturday or Sunday or any other day on which
commercial banks in New York are permitted or authorized by law to
be closed for the general transaction of business. If the Prime
Rate is not being published as aforesaid on such date, the "Prime
Rate" shall be _% per annum;
(c) in the event that Gemini is granted exclusive distribution rights
for the Product in additional territories, NUWAVE and Gemini will,
in good faith, agree in writing to increased Monthly Quotas for
the Product;
(d) conversely, in the event that the Territory in which Gemini is
granted exclusive distribution is reduced, NUWAVE and Gemini will,
in good faith, agree in writing to decrease the Monthly Quotas for
the Product; and
(e) in the event that Gemini is granted exclusive distribution rights
of any additional NUWAVE offerings, NUWAVE and Gemini will, in
good faith, agree in writing to Monthly Quotas for those
offerings.
Section 2.4. Mechanics of Arrangements. Prior to the signing of this
Agreement, Gemini shall have provided to NUWAVE evidence reasonably satisfactory
to NUWAVE that Gemini has entered into an agreement with Good Mind to purchase
Product. The mechanics of the arrangements for production of Product are as
follows:
(a) Gemini shall provide information to NUWAVE regarding anticipated
production schedules. Gemini shall issue a Purchase Order to Good
Mind for Product, and shall provide NUWAVE with a copy of such
Purchase Order. At approximately the same time, as appropriate,
NUWAVE shall notify Good Mind that it is authorized to manufacture
for and ship to Gemini the Product incorporating the Chip, and
Gemini shall issue a Purchase Order to NUWAVE for Chips. NUWAVE
shall, in turn, supply Chips to Good Mind for use in Product, and
Good Mind shall build Product based upon Gemini's Purchase Orders;
(b) Good Mind shall ship Product to Gemini and shall invoice Gemini;
(c) Upon receipt of each shipment of Product from Good Mind, Gemini
shall pay NUWAVE the amounts due in accordance with Article VI of
this Agreement. In the event that a shipment of Product is lost
after leaving Good Mind but prior to receipt by Gemini (such as in
the event that the ship carrying Product sinks), Gemini shall pay
NUWAVE the amounts due with respect to the lost Product within
five (5) Business Days after such loss occurs;
(d) NUWAVE shall give effect to Chip Credits of Gemini in accordance
with the terms of this Agreement.
(e) Gemini shall in good faith provide assistance, as reasonably
requested by NUWAVE, to put appropriate arrangements in place
between Good Mind and NUWAVE in accordance with the foregoing, but
Gemini shall not be party to the agreement between Good Mind and
NUWAVE.
Section 2.5. Forecasts. Commencing on March 1, 2002, every 90 days, Gemini
will provide NUWAVE with non-binding quarterly sales forecasts for the upcoming
3 calendar quarters by country.
ARTICLE III
PRODUCTS VENDORS
Gemini shall have the right, in its sole discretion, to select vendors to
manufacture the Products and will negotiate the terms and conditions of purchase
with them; provided that: (1) prior to changing vendors, NUWAVE must have
obtained in a writing reasonably satisfactory to NUWAVE: (x) the right to buy
the Product from such new vendor, and (y) an agreement with that new vendor
which is substantially similar to the arrangements NUWAVE had (and are not worse
to NUWAVE in any material respect than the arrangements NUWAVE had) with the
prior vendor, (2) NUWAVE must have given consent to the use of the new vendor,
which shall not be unreasonably withheld or unduly delayed, (3) NUWAVE shall
have received evidence reasonably satisfactory to NUWAVE that Gemini has entered
into an agreement with such vendor to purchase Product, and (4) any change to
the xxxx of materials for the Product or to the specifications of the Product
must be pre-approved by NUWAVE in writing, which approval or denial shall not be
unreasonably withheld or unduly delayed. The opening order shall be placed with
Good Mind. Lead times for the production of the Products will be negotiated by
Gemini with its vendors, as required. Nothing contained in this Agreement shall
be construed to limit in any way NUWAVE's rights to buy Product for its own
account from any vendor whatsoever.
ARTICLE IV
TRANSITIONAL PROVISIONS
Section 4.1. Pending Orders and Inventory. With regard to orders placed by
NUWAVE for Products with its vendors that are pending on the Effective Date of
this Agreement, if any, Gemini will negotiate in good faith with NUWAVE for the
purchase of those Products.
Section 4.2. Assumption of NUWAVE Accounts. NUWAVE has existing accounts
with retailers for sale of the Product (together with any other accounts
procured before or during the Term other than by Gemini ("Existing Accounts")).
NUWAVE shall exercise its good faith commercially reasonable efforts to assist
Gemini in assuming the Existing Accounts. Such assistance will include, if
requested by Gemini, but not be limited to making joint visits with
representatives of Gemini to persuade those Existing Accounts to do business
with Gemini. NUWAVE has provided to Gemini, and Gemini has reviewed, a list of
the Existing Accounts and the receivables ("Existing Receivables") owed by them
to NUWAVE (with aging information). Gemini, in consultation with NUWAVE (but in
Gemini's discretion), has determined that it shall undertake, using commercially
reasonable efforts, to collect for NUWAVE the Existing Receivables. Gemini's
undertaking of the collection of Existing Receivables shall consist of, in large
part, (1) working to collect amounts owed to NUWAVE and promptly remitting those
collections to NUWAVE, (2) providing information to NUWAVE concerning
collections, (3) extending payment terms (as determined by Gemini, in its sole
discretion) for new receivables to the customers who have those receivables, and
(4) agreeing that any money collected or received by Gemini from an Existing
Account that is a new customer to Gemini who has an Existing Receivable, whether
collected in payment of that receivable or for new Product, shall be deemed to
be a payment in respect of that Existing Receivable and Gemini shall promptly
remit it to NUWAVE; provided, however that in the event of a written dispute
regarding an Existing Receivable with an Existing Account that is a new customer
to Gemini, Gemini and NUWAVE will negotiate in good faith to determine how
payments shall be applied. For all other customers, money collected or received
by Gemini shall be applied first against receivables held by Gemini and then
against Existing Receivables.
Section 4.3. Assistance and Training. NUWAVE shall assist Gemini, as
reasonably requested and upon reasonable notice, in the sales, marketing and
technical training of its employees during the first _____ months after the
effective date of this Agreement; provided that NUWAVE shall not be obligated to
expend an unreasonable amount of person hours and provided further that Gemini
shall reimburse NUWAVE for its reasonable out of pocket expenditures incurred in
connection with this (travel, etc.), subject to Gemini's receipt of appropriate
invoices or other appropriate documentation with regard to these expenditures.
This assistance and training may be extended by mutual written agreement of the
parties if deemed necessary by Gemini.
ARTICLE V
NEW PRODUCTS
Gemini shall be granted a right of first offer on any new NUWAVE set top
box merchandise in the following fields (a) video game enhancement, (b) video
enhancement, or (c) other video products for retail distribution. The right of
first offer shall be that Gemini shall have until 5:00 PM New York time on the
30th day (the "End of Offer Time") following the date on which NUWAVE provided
to Gemini a beta model or other functional prototype of the new offering, to
negotiate, execute and deliver a written amendment to this Agreement to include
Gemini's distribution of the product and the expansion of the Monthly Quota, as
described above. Nothing in this Agreement shall be deemed to preclude NUWAVE
from entering into any arrangements with third parties with respect to such new
offerings after the End of Offer Time.
ARTICLE VI
COMPENSATION
The parties understand that NUWAVE will sell the Chips to Gemini for USD
$6/Chip, F.O.B. the factory at which the Chips are manufactured.
ARTICLE VII
INTELLECTUAL PROPERTY
Section 7.1. Branding and Trademarks. Gemini will have the right, in its
sole discretion, to market and sell the Products under the major consumer
electronic brand registered trademarks to which Gemini has secured appropriate
rights and which marks are listed on Schedule 7.1(a) hereto (which Schedule may
be amended or modified from time to time with the consent of NUWAVE, which
consent shall not be unreasonably withheld or unduly delayed). Gemini will pay
all license fees incurred in connection with any such use. In the event that
Gemini decides to market and sell the Products under any other trademark it owns
or otherwise has appropriate rights to use (together with the marks set forth on
Schedule 7.1(a), the "Gemini Marks"), if that trademark is not on Schedule
7.1(a), Gemini must first obtain NUWAVE's prior written consent, the granting or
denial of which shall not be unreasonably withheld or unduly delayed. All
Products and the packaging for all products must prominently display the
trademarks of NUWAVE, in a manner reasonably acceptable to NUWAVE and any
changes to the use of those marks shall be subject to NUWAVE's prior written
consent, the granting or denial of which shall not be unreasonably withheld or
unduly delayed. All Product must also contain appropriate patent marking for
NUWAVE patents, as set forth in Schedule 7.1(b), as the same may be amended from
time to time (which may be done unilaterally by NUWAVE to address changes with
respect to its patents, such as adding new patents, as applicable).
Section 7.2. License of NUWAVE Trademarks. NUWAVE hereby grants to Gemini
for the Term the nonexclusive, royalty-free right and license to use the
trademarks listed on Schedule 7.2 (the "NUWAVE Marks") on or in association with
the Product in the Territory. It is understood and agreed that this license
shall pertain only to the NUWAVE Marks and the Product and does not extend to
any other xxxx, product or service. Gemini acknowledges that the NUWAVE Marks
have acquired secondary meaning. Gemini agrees that its use of the NUWAVE Marks
inures to the benefit of NUWAVE and that Gemini shall not acquire any rights in
the NUWAVE Marks as a result of the license. Gemini shall not at any time do or
knowingly permit to be done any act or thing which would in any way impair the
rights of NUWAVE in the NUWAVE Marks, affect the validity of the NUWAVE Marks or
depreciate their value or reputation. Gemini agrees that it shall never
challenge the validity or ownership of the NUWAVE Marks or any registration
thereof and, to the extent reasonably requested by NUWAVE, shall cooperate with
NUWAVE in furthering and/or continuing the registration of the NUWAVE Marks so
long as NUWAVE fully reimburses Gemini for any reasonable costs it incurs in
connection with such cooperation.
Section 7.3. Gemini Representations and Warranties. Gemini represents and
warrants to NUWAVE that it has the valid right to use the Gemini Marks in
connection with the Product and in the manner proposed to be used. Gemini
covenants and agrees only to use the Gemini Marks in connection with the Product
in a manner in which it has valid rights to do so.
Section 7.4. NUWAVE Representations and Warranties. NUWAVE represents and
warrants to Gemini that it has the valid right to use the NUWAVE Marks in
connection with the Product and in the manner proposed to be used. Furthermore,
NUWAVE represents and warrants to Gemini that it has been granted the United
States patents listed on Schedule 7.1(b) and that, to its knowledge, such
patents do not infringe upon any United States patents.
Section 7.5. Post-termination Use of Marks. In the event of any termination
or expiration of the exclusive distribution arrangements in this Agreement, the
parties shall cooperate in good faith (1) to permit NUWAVE to use the Gemini
owned marks, if any, that had been used by Gemini to market and sell the
Products for a transition period of 6 months following any such termination,
expiration or other event, and (2) for marks not owned by Gemini, if any, that
had been used by Gemini to market and sell the Products, to permit NUWAVE to
purchase from Gemini at cost a sufficient amount of inventory bearing such xxxx
or marks (with such amount to be agreed to in good faith by the parties) to
effect a transition over a period of __ months following any such termination.
NUWAVE acknowledges that the Gemini Marks have acquired secondary meaning.
NUWAVE agrees that its use of the Gemini Marks inures to the benefit of Gemini
or the trademark owners, as appropriate, and that NUWAVE shall not acquire any
rights in the Gemini Marks as a result of this Agreement. NUWAVE shall not at
any time do or knowingly permit to be done any act or thing which would in any
way impair the rights of Gemini or the trademark owners in the Gemini Marks,
affect the validity of the Gemini Marks or depreciate their value or reputation.
NUWAVE agrees that it shall never challenge the validity or ownership of the
Gemini Marks or any registration thereof and, to the extent reasonably requested
by Gemini, shall cooperate with Gemini in furthering and/or continuing the
registration of the Gemini Marks so long as Gemini fully reimburses NUWAVE for
any reasonable costs it incurs in connection with such cooperation.
ARTICLE VIII
EXCLUSIVITY IN FAVOR OF NUWAVE
Except as expressly provided below, during the Term and for 9 months
thereafter (the "Restricted Period"), Gemini shall not, directly or indirectly,
engage in Restricted Conduct. "Restricted Conduct" means (1) sell, market, offer
for sale, or solicit sales of anything that competes with Product (whether in
the Territory or not), (2) market, solicit the sale of or actually sell anything
that competes with any NUWAVE Product to an Existing Customer (except for
general marketing that is not directed to any specific customer or group of
Existing Customers), or (3) negotiate an agreement, understanding or arrangement
(written or oral) to do any of the things described in (1) or (2) above.
Notwithstanding the foregoing, in the event that NUWAVE terminates the exclusive
distributorship other than for Cause (as defined below) or in the event that
Gemini has fulfilled all of its obligations in connection with a Without Cause
Termination by Gemini or a Quota Termination (both as defined below), then the
Restricted Period shall be limited to the Term and Gemini shall not, for 9
months after the Term, directly or indirectly (x) solicit or sell to any
Existing Customer any merchandise that competes with the Product or (y)
negotiate an agreement, understanding or arrangement (written or oral) to do any
of the things described in (x) above. For purposes of this Article VIII, the
term "Product" shall be deemed to include any and all NUWAVE merchandise
distributed at any time by Gemini (including without limitation new products
distributed pursuant to the exercise of the right of first offer set forth in
Article V of this Agreement).
ARTICLE IX
TERMINATION
Section 9.1. Without Cause Termination by Gemini. Gemini may, after July
30, 2002, terminate the Agreement without Cause by (1) providing 120 day written
notice thereof, (2) forfeiting any Chip Credit it might have as of the date on
which notice is given, (3) paying, as liquidated damages, for its Monthly Quotas
through the end of the calendar month in which the above-described 120 day
notice period ends and paying to NUWAVE any other amounts it owes NUWAVE.
Section 9.2. Quota Termination. In the event that NUWAVE wishes to
terminate the Agreement because Gemini has failed to fulfill any Monthly Quota
as provided in Section 2.3, NUWAVE may do so provided that it provides written
notice and a 45 day cure period. Gemini may cure such a default by (1) tendering
to NUWAVE payment in full of any and all amounts owed plus payment of the
Monthly Quota for all months outstanding through and including the month after
the calendar month in which the above mentioned 45 day notice period ends. In
the event that Gemini fails to cure such default in a timely manner, Gemini
shall, upon such 45th day, (1) forfeit any Chip Credit it had as of the end of
the calendar month in which the above mentioned 45 day notice period ends (the
"Last Month"), (2) pay as liquidated damages to NUWAVE the Monthly Quota for
each of the four calendar months following the Last Month; provided that if the
Last Month is or is prior to July 1, 2002, then such payment shall be for each
calendar month through November 30, 2002, and (3) pay any other amounts due to
NUWAVE.
Section 9.3. Termination for Cause. This Agreement may be terminated as
follows (with a termination under any of the following constituting a
termination for "Cause"):
(a) by either party, if (i) the other party materially breaches this
Agreement and does not cure such breach within 45 days after
receiving notice of the breach from the other party, or (ii) any
warranty or representation of the other party in Section 7.3 or
7.4 of this Agreement, respectively, is inaccurate in any material
respect, any such termination to be effected by giving notice of
termination at the end of the 45-day cure period or thereafter in
the case of clause (i) of this Section 9.3(a) or at any time after
the discovery of such inaccuracy in the case of clause (ii) of
this Section 9.3(a);
(b) by either party, if the other party is adjudicated bankrupt, files
a petition for relief under any bankruptcy or insolvency law, or
makes an assignment for the benefit of creditors, any such
termination to be effected by giving notice of termination; or
(c) by either party, if a petition is filed against the other party
under any bankruptcy or insolvency law or a receiver is appointed
for all or any part of its property and such other party fails to
have such petition or appointment dismissed within 45 days after
such filing or appointment any such termination to be effected by
giving notice of termination at the end of the 45 day period or
thereafter.
(d) The parties acknowledge that the patented technology set forth in
Schedule 7.1 (b) is "intellectual property" as defined in Title
11, Xxxxxxx 000 (00X) xx xxx Xxxxxx Xxxxxx Bankruptcy Code.
In the event that NUWAVE terminates this Agreement for Cause as provided in
this Section 9.3, such termination shall have the same effect, and Gemini will
have the same obligations, as if the termination had been a Quota Termination
not cured by Gemini pursuant to Section 9.2.
Section 9.4. Post-Termination Inventory Purchase Right. In the event of any
termination or expiration of the exclusive distribution arrangements in this
Agreement, NUWAVE or its designee shall have the right to purchase from Gemini
at cost all or any portion of Gemini's inventory of the Product. For purposes of
this Section 9.4, the term "Product" shall be deemed to include any and all
NUWAVE merchandise distributed at any time by Gemini (including without
limitation new products distributed pursuant to the exercise of the right of
first offer set forth in Article V of this Agreement). NUWAVE and Gemini agree
that NUWAVE's purchase, if any, of Gemini's inventory of the Product is in the
nature of a liquidation sale of inventory and that it does not represent and
shall not be construed by the parties as an appointment of NUWAVE by Gemini as a
licensee or sublicensee of the Gemini Marks.
ARTICLE X
DISCLAIMER OF WARRANTIES
Section 10.1. Express Warranties. NUWAVE represents and warrants to Gemini
that the Chip performs in accordance with and complies in all material respects
with the specifications set forth in Schedule 10.1 (which Schedule may be
amended or modified from time to time with the consent of Gemini, which consent
shall not be unreasonably withheld or unduly delayed), but no other express
warranty is made with respect to the Chip, and no express warranty is made with
respect to the Product.
Section 10.2. DISCLAIMER OF WARRANTIES. NUWAVE DOES NOT MAKE ANY IMPLIED
WARRANTIES WHATSOEVER, AND SPECIFICALLY DOES NOT MAKE ANY EXPRESS OR IMPLIED
WARRANTY OF THE MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE CHIP
OR THE PRODUCT. NUWAVE DOES NOT MAKE ANY EXPRESS WARRANTIES EXCEPT AS
SPECIFICALLY STATED IN SECTION 10.1. NUWAVE DOES NOT MAKE ANY EXPRESS OR IMPLIED
WARRANTY WHATSOEVER TO OR FOR THE BENEFIT OF GEMINI'S CLIENTS, CUSTOMERS, AGENTS
OR ANY THIRD PARTY.
ARTICLE XI
LIMITATION OF LIABILITY; INDEMNIFICATION
Section 11.1. LIMITATION OF CONSEQUENTIAL DAMAGES. NEITHER PARTY SHALL BE
LIABLE TO THE OTHER OR TO ANY OTHER PERSON (UNDER ANY CONTRACT, NEGLIGENCE,
STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY) FOR CONSEQUENTIAL,
INDIRECT, SPECIAL, PUNITIVE OR INCIDENTAL DAMAGES ARISING FROM THE BREACH OF
THIS AGREEMENT BY SUCH PARTY, THE USE OF THE PRODUCT, ANY ACTS OR OMISSIONS OF
SUCH PARTY OR IN ANY OTHER MANNER.
Section 11.2. Indemnification by NUWAVE. Subject to the limitations set
forth in Sections 11.1 and 11.5, NUWAVE shall indemnify and hold harmless
Gemini, its subsidiaries, affiliates, and each of their permitted successors and
assigns, officers, directors, employees, agents and representatives, and any
Person claiming by or through any of them, (collectively, the "Indemnified
Gemini Parties") against and in respect of any and all third party claims, and
costs, expenses, damages, liabilities, losses or deficiencies (including,
without limitation, counsel's fees and other costs and expenses incident to any
suit, action or proceeding) arising in third party claims ("Damages") resulting
from or incurred in connection with (i) any inaccuracy in any representation or
warranty made by NUWAVE in this Agreement, (ii) the breach by NUWAVE of any
covenant or agreement to be performed by it hereunder or (iii) any act or
omission by NUWAVE which constitutes negligence or willful misconduct to which
Gemini has not contributed. Gemini shall promptly notify NUWAVE in writing of
any claim or Damages, and shall not settle or compromise any claim without
NUWAVE's express prior written approval. NUWAVE shall have the right to assume
control of the claim at its expense. Gemini shall assist and cooperate with
NUWAVE in connection with the defense thereof at its own expense. If NUWAVE
elects not to assume control of such claim, then NUWAVE shall pay counsel's fees
for one law firm pre-approved in writing by NUWAVE, which approval shall not be
unreasonably withheld or unduly delayed.
Section 11.3. Trademark and Patent Infringement Indemnity by NUWAVE.
(a) Subject to the limitations set forth in Sections 11.1 and 11.5,
NUWAVE shall defend, indemnify and hold harmless the Indemnified
Gemini Parties from and against any and all suits, actions,
claims, judgments, debts, obligations or rights of action, of any
nature or description, ("Claims") and all costs including
reasonable attorney's fees incurred by Gemini in connection
therewith, arising out of or relating to claims of trademark and
copyright infringement in Gemini's use of the NUWAVE Marks in the
manner expressly authorized by this Agreement. Gemini shall
promptly notify NUWAVE in writing of any Claim, and shall not
settle or compromise any Claim without NUWAVE's express prior
written approval. NUWAVE shall have the right to assume control of
the Claim at its expense. Gemini shall assist and cooperate with
NUWAVE in connection with the defense thereof at its own expense.
If NUWAVE elects not to assume control of such claim, then NUWAVE
shall pay counsel's fees for one law firm pre-approved in writing
by NUWAVE, which approval shall not be unreasonably withheld or
unduly delayed. This indemnity does not extend to any Claim based
upon infringement or alleged infringement of any trademark or
copyright by the alteration of any Product or NUWAVE Xxxx or by
the combination of any Product or NUWAVE Xxxx with one or more
other elements, nor does it extend to any product or trademark of
Gemini's or any third party's design. The foregoing states the
entire liability of NUWAVE for trademark or copyright
infringement.
(b) Subject to the limitations set forth in Sections 11.1 and 11.5,
NUWAVE shall defend the Indemnified Gemini Parties against all
Claims based upon a claim that any Product furnished by NUWAVE
hereunder infringes a United States Patent, and shall pay costs
and damages finally awarded under any such Claim. Gemini shall
promptly notify NUWAVE in writing of any Claim, and shall not
settle or compromise any Claim without NUWAVE's express prior
written approval. NUWAVE shall have the right to assume control of
the Claim at its expense. Gemini shall assist and cooperate with
NUWAVE in connection with the defense thereof at its own expense.
If NUWAVE elects not to assume control of such claim, then NUWAVE
shall pay counsel's fees for one law firm pre-approved in writing
by NUWAVE, which approval shall not be unreasonably withheld or
unduly delayed. If the use or sale of any Product furnished by
NUWAVE hereunder is enjoined as a result of such Claim, NUWAVE, at
its option and at no expense to Gemini, shall (i) use reasonable
commercial efforts to obtain for Gemini the right to use or sell
said Product, (ii) substitute an equivalent Product reasonably
acceptable to Gemini and extend this indemnity thereto, or (iii)
have the right to terminate the Agreement, accept the return of
the Product and reimburse the purchase price therefor, depreciated
over a three year life. This indemnity does not extend to any
Claim based upon infringement or alleged infringement of any
patent by the alteration of any Product or by the combination of
any Product with one or more other elements, nor does it extend to
any product of Gemini's or any third party's design. The foregoing
states the entire liability of NUWAVE for patent infringement.
Section 11.4. Indemnification by Gemini. Subject to the limitations set
forth in Sections 11.1 and 11.5, Gemini shall indemnify and hold harmless
NUWAVE, its subsidiaries, affiliates, and each of their permitted successors and
assigns, officers, directors, employees, agents and representatives, and any
Person claiming by or through any of them, against and in respect of any and all
Damages resulting from or incurred in connection with (i) any inaccuracy in any
representation or warranty made by Gemini in this Agreement, (ii) the breach by
Gemini of any covenant or agreement to be performed by it hereunder, (iii) any
act or omission by Gemini which constitutes negligence or willful misconduct to
which NUWAVE has not contributed, or (iv) any alteration to any Product caused
by Gemini or any combination of any Product with one or more other elements
caused by Gemini. NUWAVE shall promptly notify Gemini in writing of any claim or
Damages, and shall not settle or compromise any claim without Gemini's express
prior written approval. Gemini shall have the right to assume control of the
claim at its expense. NUWAVE shall assist and cooperate with Gemini in
connection with the defense thereof at its own expense. If Gemini elects not to
assume control of such claim, then Gemini shall pay counsel's fees for one law
firm pre-approved in writing by Gemini, which approval shall not be unreasonably
withheld or unduly delayed.
Section 11.5. Limitations. Each party's respective indemnification
obligation pursuant to Section 11.2, 11.3 or 11.4 above, as applicable, shall
not apply to any claim for Damages until the aggregate of all such claims total
$_____, in which case the indemnifying party's indemnification obligation shall
apply to the total amount in excess of $___. Except as provided in Section
11.3(a) and (b), NUWAVE's indemnification obligation pursuant to Section 11.2
shall be subject to a maximum dollar amount equal to the amount NUWAVE received
in cash from Gemini prior to the date on which the event triggering liability
occurred. Each party's indemnification obligation shall apply only to amounts in
excess of the amounts recoverable under the indemnified party's general
liability insurance policy or other applicable insurance policy.
Section 11.6. Exclusive Remedy. Except as otherwise provided in Articles
VIII and IX hereof, the provisions of Sections 11.2, 11.3 (a) and (b) and 11.4
shall constitute the sole and exclusive remedy of Gemini and NUWAVE,
respectively, for damages arising out of, resulting from, or incurred in
connection with any inaccuracy in any representations or warranty or breach of
any covenant or act or omission made by NUWAVE or Gemini, respectively, in
connection with this Agreement. The provisions of this Article XI shall survive
termination of this Agreement for the lesser of the applicable statute of
limitations or two (2) years after the date of termination.
ARTICLE XII
MISCELLANEOUS
Section 12.1. Confidentiality. The parties acknowledge that they are bound
by the terms and conditions of a Non-Disclosure Agreement dated (undated month
and day) 2001 and, therefore, any discussions between the parties or documents
exchanged between them, including but not limited to the terms and conditions of
this Agreement, which are confidential in nature, will survive termination of
this Agreement and be legally binding.
Section 12.2. Public Announcements. Subject to applicable law, any public
announcements relating to this transaction will be mutually agreed upon and
jointly made by the parties, such approval not to be unreasonably delayed or
withheld by either party; provided that the parties understand that NUWAVE is a
public company and, accordingly, NUWAVE may have to legally make disclosures
which it in good xxxxx xxxxx appropriate or necessary and may do so upon prior
written notice (rather than approval) to Gemini, as long as such prior notice
states that it is legally necessary and provides an explanation for same rather
than a request for approval.
Section 12.3. Relationship of the Parties. Neither party hereto shall have
any authority to represent the other party as agent or legally empowered
representative or to create any obligation, express or implied, on behalf of the
other party. The parties shall be deemed to be solely independent contractors
and this Agreement shall not be construed to create any partnership, joint
venture, agency or franchise.
Section 12.4. Fees and Expenses. Except as set forth in Section 4.3 above,
each party will bear its own costs and expenses incurred in connection with the
negotiation and execution of this Agreement and other documentation necessary to
consummate the proposed transaction.
Section 12.5. Binding Agreement: Survival. This Agreement shall be binding
upon, and shall inure to the benefit of, the parties and their respective
permitted successors and assigns. Section 7.5 and Articles VIII, IX, X, XI and
XII shall survive termination of this Agreement.
Section 12.6. Entire Agreement; Conflicts. This Agreement is the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements relating to such subject matter. In the event of
a conflict between this Agreement and a Purchase Order, this Agreement shall
control; provided, however, that in the event that the Product or the Chip is
ever purchased by Gemini directly from NUWAVE pursuant to a form of Purchase
Order prepared and approved by NUWAVE, then in such case the Purchase Order
shall control.
Section 12.7. Severability. If any provision of this Agreement shall be
determined by any court of competent jurisdiction to be invalid or unenforceable
to any extent, the remainder of this Agreement shall not be affected thereby,
and each provision hereof shall be valid and shall be enforced to the fullest
extent permitted by law.
Section 12.8. Governing Law. This Agreement and all matters arising
directly or indirectly herefrom will be governed by and interpreted in
accordance with the laws of the State of New Jersey without giving effect to the
principles of conflicts of laws, thereof, except as otherwise preempted by
federal law.
Section 12.9. Notices. All notices and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed duly
given (a) five days after being sent certified mail, return receipt requested,
(b) one Business Day after being sent by overnight courier service or (c) on the
date sent by telecopy with a confirmed receipt, to the following addresses:
Gemini Industries, Inc.
000 Xxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
Attn: Xx. Xxxxxx Xxxxxxx
Tel. (000) 000-0000
Fax: (000) 000-0000
NUWAVE Technologies, Inc.
Xxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xx. Xxxxxxxx X. X'Xxxxx
Tel. (000) 000-0000
Fax: (000) 000-0000
With a copy to:
Xxxxxxxxxx Sandier PC
00 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxx X. Xxxxxxxxx, Esq.
Tel. (000) 000-0000
Fax. (000) 000-0000
Xxxxxxx X. Xxxxxxxx, Esq.
Vice President and General Counsel
c/o Gemini Industries, Inc.
000 Xxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
Tel. (000) 000-0000
Fax: (000) 000-0000
Section 12.10. Counterparts. This Agreement may be executed in
counterparts, each of which will be deemed an original, but all of which taken
together will constitute one and same document.
Section 12.11. Amendment. Except for the amendment of Schedule 7.1(b)
(which may be done unilaterally by NUWAVE in accordance with Section 7.1), this
Agreement shall be amended or modified only by the written agreement of both
parties hereto.
Section 12.12. Waivers. No failure or delay by either party in exercising
any right, power or privilege under this Agreement will operate as a waiver
thereof nor will any single partial exercise thereof preclude any further
exercise of the full rights, powers and privileges granted hereunder.
Section 12.13. Assignment. Either party shall have the right to assign this
Agreement to a successor to all or substantially all of such party's business
upon prior written notice to the other party. In all other instances, either
party shall have the right to assign this Agreement with the written consent of
the other party, which consent will not be unreasonably withheld or unduly
delayed.
Section 12.14. BASIS OF THE BARGAIN. EACH PARTY RECOGNIZES AND AGREES THAT
THE WARRANTY DISCLAIMERS AND LIABILITY AND REMEDY LIMITATIONS IN THIS AGREEMENT
ARE MATERIAL BARGAINED FOR BASES OF THIS AGREEMENT AND THAT THEY HAVE BEEN TAKEN
INTO ACCOUNT AND REFLECTED IN DETERMINING THE CONSIDERATION TO BE GIVEN BY EACH
PARTY UNDER THIS AGREEMENT AND IN THE DECISION BY EACH PARTY TO ENTER INTO THIS
AGREEMENT.
Section 12.15. Interpretation.
(a) Article, Section and Subsection headings are not to be considered
part of this Agreement, are included solely for convenience and
are not intended to be full or accurate descriptions of the
contents thereof.
(b) The use of the terms "herein", "hereunder", "hereof' and like
terms shall be deemed to refer to this entire Agreement and not
merely to the particular provision in which the term is contained,
unless the context clearly indicates otherwise.
(c) The use of the word "including" or a like term shall be construed
to mean "including but not limited to".
(d) Schedules to this Agreement are an integral part of this Agreement
and are hereby incorporated and made a part hereof.
(e) Words importing a particular gender shall include every other
gender and words importing the singular shall include the plural
and vice-versa, unless the context clearly indicates otherwise.
Section 12.16. Force Majeure.
(a) In the event of an occurrence outside the reasonable control of
the parties, including without limitation fire, flood, explosion,
lightning, windstorm, earthquake, destruction, in whole or part,
of machinery or equipment, or discontinuity in the supply of
power, governmental interference, civil commotion, riot, war,
strikes, or any similar cause beyond the reasonable control of the
parties ("Force Majeure") which causes a party to fail to perform
any of the obligations imposed by this Agreement for a period in
excess of 30 days, the affected party shall be excused from
performance for as long as is reasonably necessary to complete
performance, subject to the provisions of subsection 12.16(c)
below. Unless sooner terminated in accordance with the provisions
of this Agreement (including subsection 12.16(c) below), the Term
shall be extended in correspondence to the amount of time for
which a party is excused from performance hereunder.
(b) The affected party shall notify the other party as soon as
practicable of the occurrence of a Force Majeure. The parties
shall make every reasonable effort to minimize the effect of a
Force Majeure upon the performance of this Agreement.
(c) If either party shall be excused from performance of any of its
obligations for a continuous period of three (3) months or more,
then the unaffected party may terminate this Agreement upon thirty
(30) days notice in writing provided that the relevant events
continue throughout the notice period.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the date first written above.
NUWAVE TECHNOLOGIES, INC.
By:
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Xxxxxx Xxxxx, President and CEO
GEMINI INDUSTRIES, INC.
By:
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Xxxxxxx X'Xxxx, President and CEO