EXHIBIT 10.13
DISTRIBUTION AGREEMENT
This agreement is made as of 28th January 2005 between SeaLife Marine Products,
Inc, a wholly owned subsidiary of SeaLife Corporation, Xxxxxx Xxxx, Xxxxxxxxxx
00000 and Sealife Marine Africa PTY Ltd., The Distributor, address 203 Xxxxxx
Street, Fairland, Johanesburg, Guteng, South Africa 2195.
1. KEY TERMS.
(a) TERRITORY. "Territory" means the country or countries of Sub
Saharan Africa.
(b) PRODUCTS. "Products" mean all products that SeaLife Marine may
elect in its discretion to distribute in the Territory. See exhibit "A" for
product listing. Products are targeted to the marine market and other applicable
markets as agreed upon by SeaLife Corporation.
2. APPOINTMENT. SeaLife Marine Products appoints Sealife Marine Africa PTY
Ltd. as the exclusive distributor for sales of Products to be delivered in the
Territory as listed in items 1(a) and 1(b).
3. OBLIGATIONS OF DISTRIBUTOR.
(a) MARKETING EFFORTS. Distributor will use its best efforts to
maximize sales of Products in the Territory. Distributor shall perform its
duties in a professional manner and in accordance with the highest industry
standards. Distributor will coordinate its sales and marketing activities with
SeaLife's business representative in Europe, RKR.
(b) NO AUTHORITY. Distributor shall not make any representation or
warranty on behalf of SeaLife Marine, or in any manner assume or create any
obligation or responsibility, express or implied, on behalf of, or in the name
of, SeaLife Marine or act for or bind SeaLife Marine in any respect (it being
understood that any representation, warranty or obligation may only be created
directly by SeaLife Marine). No advertising, publicity, promotional or other
materials in any medium (nor any SeaLife's service marks, trademarks or trade
names) may be used by Distributor without SeaLife's prior written approval and
then only in accordance with SeaLife's instructions. The Distributor shall be
entitled to trade under the name of SeaLife Marine Products and to protect this
name by registration under the Companies Act No. 61 of 1973 ( as amended) or
alternately under the laws relating to the registration of trade marks.
(c) OTHER ACTIVITIES. Distributor shall promptly notify SeaLife
Marine in writing if Distributor desires to distribute or sell products that are
competitive with the Products and must have written approval from SeaLife prior
to such sales.
4. OBLIGATIONS OF SEALIFE MARINE PRODUCTS, INC. SeaLife Marine shall
inform and instruct Distributor as to the Products as listed in Exhibit A and
provide guidance and promotion of the Products, as SeaLife Marine deems
appropriate. SeaLife Marine shall supply materials required, in the sole
judgment of SeaLife Marine, for the proper promotion and handling of sales and
instructions for use of such materials. Additional obligations are attached as
Annexure "A".
5. STOCKING REQUIREMENTS, PAYMENT TERMS AND OPTION TO PURCHASE FROM MASTER
DISTRIBUTOR
(a) Stocking Requirements
The Distributor will stock adequate inventories of all SeaLife
Marine products listed in Exhibit A to support all marketing and sales
activities in the designated Territory. The initial purchase order due for one
container (not to exceed $200,000 USA). Shipment contingent on SABS approval
(b) Payment Terms
The ownership of the products invoiced to the distributor
shall pass to the distributor when the invoiced products are placed on board
ship at a harbor approved by the parties hereto and payment therefore shall
become due from and payable by the distributor in net cash on receipt of
shipping documents except in so far as other terms of payment may from time to
time be agreed to by the parties hereto. The payment may be processed through a
predetermined escrow account whereby the funds are transferred to SeaLife upon
presentation of shipping documents or as mutually agreed upon.
(c) The Distributor, at its own option, may purchase SeaLife
Products from Gramyco, The Master Distributor for Europe. Pricing is agreed upon
strictly between the Distributor, and the Master Distributor and SeaLife has no
involvement or liability.
6. ORDERS AND PRICING.
(a) ORDERS. All orders are subject to acceptance or rejection by
SeaLife Marine, which reserves the right to reject any order or part thereof (or
cancel after acceptance), for credit or for any other reason, in its sole
discretion, or as mutually agreed upon. All orders are to be expressed in USA
dollars and payments in respect thereof are to be made in dollars and shall be
effected free of exchange at Los Angeles.
The price of the products will not increase more than 10% over a 12 month
period. The exception to this is if the raw materials of the product increase
more than 10%, this increase will be passed onto the distributor.
7. PROPRIETARY RIGHTS:
(a) OWNERSHIP. SeaLife Marine owns all Products and materials and
all intellectual property rights related to or used in connection therewith (the
"Rights"). Distributor shall not at any time, during or after the Term, contest,
or aid any other person in contesting, or do anything which otherwise impairs
SeaLife's interests in the Rights.
(b) NON-USE AND NON-DISCLOSURE. Distributor shall treat all
information regarding SeaLife or its customers or vendors, or the sale,
manufacture or distribution of the Products, including actual and prospective
customer and vendor names, lists and information, the methods by which sales of
the Products are conducted, any method by which customers, products or supplies
of the Product are obtained, business and marketing plans and financial
information and all other information that might by its nature be viewed as
trade secret, proprietary or confidential (collectively, "Confidential
Information"), as SeaLife Marine confidential and proprietary information and
shall not, without SeaLife Marine prior written consent, at any time during or
after the Term, directly or indirectly (a) use any Confidential Information for
its own account or for the benefit of any third party, or (b) disclose, make
accessible or furnish any Confidential Information
or intellectual property rights therein to any third party or (c) or permit the
occurrence of any of the foregoing.
8. TERM. The term of this Agreement (the "Term") commences on the
Effective Date and shall continue for a period of three (3) years thereafter,
unless earlier terminated as provided below. In addition, unless either party
provides written termination at least sixty (60) days before the end of such
three year period, the Term shall continue until terminated by either party on
sixty (60) days prior written notice to the other party. SeaLife Marine may also
terminate this Agreement at its sole discretion immediately for (a) material
breach or failure of performance by Distributor as outlined in Section 5 (Sales
performance and Payment terms)or (b) any acts of moral turpitude by
Representative or other acts which might injure the reputation of SeaLife
Marine. In addition, either party shall have the right to terminate this
Agreement and end the Term at any time, with or without cause, upon sixty (60)
days advance written notice to the other party. Upon termination by either
party, the Distributor will return all collateral marketing materials, samples
and other designated SeaLife Marine property in the distributor's possession.
9. MISCELLANEOUS.
(a) RIGHT TO CONTACT CUSTOMERS. Nothing herein will prohibit any
contact or communications between SeaLife Marine and any customer. In addition,
in the event that Distributor is unable to solicit, contact or otherwise sell
Products to any account, SeaLife may solicit, contact and assist the Distributor
in selling Products to such account. In the event of the Company soliciting,
contacting with the distributors customers, or assisting the distributor in
selling the products as envisaged in clause 9(a), then in that event, all profit
emanating from such sale will accrue to the distributor.
(b) ENTIRE AGREEMENT. This Agreement contains the parties' entire
agreement regarding its subject matter and supercedes all prior agreements,
understandings and negotiations regarding that subject matter. This Agreement
may not be changed, modified, amended or supplemented except by a written
instrument signed by both parties. This Agreement shall control over additional
or different terms of any order, confirmation, invoice or similar document, even
if accepted in writing by both parties; waivers and amendments shall be
effective only if made by non-pre-printed agreements clearly understood by both
parties to be an amendment or waiver of this Agreement and its terms.
(c) ASSIGNABILITY. Distributor may not assign this Agreement
without prior written consent of SeaLife Marine. SeaLife Marine may assign this
Agreement to any entity that acquires substantially all of its assets or
business and to any of its affiliates. The distributors restriction on the
distributor from assigning his rights in terms hereof shall not be unreasonably
withheld by the Company or it's assigns
(d) ARBITRATION. The parties hereby agree that all controversies,
claims and matters of difference shall be resolved by binding arbitration before
JAMS/Endispute (the "JAMS") located in Los Angeles, California according to the
rules and practices of the JAMS from time-to-time in force; PROVIDED HOWEVER
that the parties hereto reserve their rights to seek and obtain injunctive or
other equitable relief from a court of competent jurisdiction, without waiving
the right to compel such arbitration pursuant to this section.
(e) SEVERABILITY. If any provision of this Agreement is held
illegal or unenforceable, that provision shall be limited or eliminated to the
minimum extent necessary so that this Agreement shall otherwise remain in full
force and effect and enforceable.
(f) NOTICES; REPORTS. All notices, consents, approvals and reports
required by this Agreement shall be in writing, sent by certified or registered
mail, postage prepaid, or by facsimile or email (if confirmed by certified or
registered mail) to the parties at the addresses first set forth above or such
other addresses as be designated in writing by the respective parties in
accordance with these notice requirements. Notice shall be deemed effective on
the date of mailing (or the date of facsimile or email if confirmed by certified
or registered mail sent within one day thereafter).
(g) RELATIONSHIP. Distributor is an independent business entity in
the performance of this Agreement, is solely responsible for its employees and
agents and labor costs and expenses arising in connection therewith and is
responsible for, and will indemnify SeaLife Marine Products, Inc. and its parent
company, SeaLife Corporation from, all claims, liabilities, damages, debts,
settlements, costs, attorneys' fees, expenses and liabilities of any type
whatsoever that may arise on account of the activities of Distributor, its
employees or agents (including providing unauthorized representations or
warranties, failing to effectively disclaim warranties and liabilities of
SeaLife Marine to its customers or breaching any term, representation or
warranty of this Agreement, and all claims made by any entity on account of an
alleged violation by Distributor of any law, regulation code or other legal
requirement). SeaLife Marine is not responsible for the actual performance of
this Agreement by Distributor, nor with Distributor's employment of other
persons or incurring of other expenses. Except as expressly provided herein,
SeaLife shall have no right to exercise control whatsoever over the activities
or operations of Distributor.
(h) WAIVERS. The waiver by either party of a breach of any
provisions contained herein shall be in writing and shall in no way be construed
as a waiver of any succeeding breach of such provision or the waiver of the
provision itself.
(i) APPLICABLE LAW; EXCLUSIVE FORUM. This Agreement shall be
governed by and construed in accordance with the laws of the State of California
without regard to its conflicts of laws provisions. The exclusive jurisdiction
and venue of any action with respect to this Agreement and all transactions
related to its execution, performance and interpretation shall be the Superior
Court of California for Los Angeles County or the U.S. District Court for the
Central District of California and each party hereto submits itself to the
exclusive jurisdiction and venue of such courts for the purpose of any such
action. The prevailing party in any such legal action shall be entitled to
reasonable costs and attorneys' fees, including upon any appeal thereof.
(j) CAPTIONS. Paragraph captions are inserted for convenience only
and in no way are to be construed to define, limit or affect the construction or
interpretation hereof.
(k) INJUNCTIVE RELIEF. The parties acknowledge and agree that (a)
the extent of damages to SeaLife Marine in the event of a breach by Distributor
of any obligation hereunder, including its obligations under Section 7, may be
impossible to ascertain and (b) SeaLife Marine will have no adequate remedy at
law to compensate it in the event of breach of such obligations; consequently,
Distributor agrees that if it breaches any obligation hereunder, in addition to
any other rights and remedies available, SeaLife Marine shall be entitled to
enforce all such obligations by injunctive or other equitable relief ordered by
any court of competent jurisdiction in accordance with the provisions of
Paragraph 8(h) herein, all without the requirement of any bond or other surety.
(l) COUNTERPART. This Agreement may be executed in one or more
counterparts, which shall together constitute the entire Agreements of the
parties.
(m) SURVIVAL. The provisions of Section 7 and of each other
provision that by its nature gives rise to obligations that should survive
termination shall survive the termination or expiration of this Agreement for
any reason whatsoever.
(n) NO WARRANTIES. Distributor acknowledges that SeaLife Marine
makes no representation or warranty to Distributor with respect to the Products,
and makes only such representations and warranties to accounts as may be
expressly provided in any written accepted terms of any order. Without limiting
the foregoing, SEALIFE MARINE PRODUCTS, INC DOES NOT WARRANT TO DISTRIBUTOR THE
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE PRODUCTS OR THE
PERFORMANCE OR NONINFRINGEMENT THEREOF, DOES NOT MAKE ANY WARRANTY, EXPRESS OR
IMPLIED, WITH RESPECT TO THE PRODUCTS, SERVICE OR ANYTHING ELSE AND DOES NOT
MAKE ANY WARRANTY TO ACCOUNTS EXCEPT AS MAY BE SET FORTH IN THE WRITTEN TERMS OF
ANY ORDER WITH AN ACCOUNT. SEALIFE MARINE HAS NOT AUTHORIZED ANYONE TO MAKE ANY
REPRESENTATION OR WARRANTY ON ITS BEHALF.
(o) REMEDIES. Distributor's sole and exclusive remedy for any
breach of this Agreement by SeaLife Marine shall be to collect any monies that
may be due and payable under the terms of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers as of the day and year first written above.
SeaLife Marine Products, Inc. Distributor: SeaLife Marine (Africa)
By: /s/ Barre Rorabaugh By: /s/ A. Castle
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Title: President Title: President
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Date: August 28, 2005
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EXHIBIT "A"
PRODUCT LIST
SeaLife 1100 XP Red
SeaLife 1200 XP Black
SeaLife 1001 Red
SeaLife 1002 Black
SeaLife 1003 Dark Blue
SeaLife 1008 Light Blue
SeaLife 1005 Light Green
SeaLife 1004 Dark Green
SeaLife 1006 Xxxxx
SeaLife 1007 Xxxx
SeaLife 1009 Shark Fin White
ANNEXURE "A"
1 DUTIES OF THE COMPANY
The Company hereby agrees with the Distributor that it undertakes the
following during the continuance of this agreement:
1.1 RESTRICTIONS ON SALES BY COMPANY
The Company shall not sell any of the Products to any person within the
Territory with a view to the resale of the Products within the
Territory, save as provided in Clause 9 hereof.
1.2 TO SUPPLY SAMPLES
The Company shall at its own expense supply the Distributor with such
amount of samples, patterns, instruction books, technical pamphlets,
catalogues and advertising material as it considers reasonably
sufficient with a view to promoting sales of the Products within the
Territory.
1.3 TO SEND REPRESENTATIVES
The Company shall, whenever it considers it necessary, send at its own
cost a representative to visit the Distributor for the purpose of
promoting sales of the Products.
1.4 INSTRUCTION COURSES FOR DISTRIBUTORS EMPLOYEES
The Company shall provide courses for the instruction of employees and
agents of the Distributor in the demonstration of the Products and in
the provision of proper after-sales service; such courses shall be
provided either in the Republic of South Africa or the Territory at the
discretion of the Company and the expense thereof shall be borne, in
the case of courses provided in the Republic of South Africa, by the
Company and, in the case of courses provided in the Territory, equally
between the parties hereto, save that the traveling and maintenance
expenses of persons attending such courses shall not be regarded as
expenses of providing the courses.
1.5 TO SAFEGUARD DISTRIBUTOR'S EXCLUSIVE RIGHTS
The Company shall use its best endeavors to safeguard the sole and
excluding rights hereby granted to the distributor, including the
taking of such steps as may be available to it to prevent the
infringement of those rights by other distributors or agents of the
Company, and to prevent the infringement of its patents, trade marks,
emblems, designs and other similar industrial or commercial monopoly
rights within the Territory.
