1
Exhibit 10.12
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
[XXXXXX MICRO LOGO]
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT ("Agreement"), is entered into this 15th
day of December, 1997, by and between XXXXXX MICRO INC. ("Ingram"), a Delaware
corporation, having its principal place of business at 0000 X. Xx. Xxxxxx Xxxxx,
Xxxxx Xxx, Xxxxxxxxxx 00000, and DRAGON SYSTEMS INC. ("Vendor"), a Delaware
corporation, having its principal place of business at 000 Xxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000. The parties desire to and hereby do enter into a
distributor/supplier relationship, the governing terms and mutual promises of
which are set out in this Agreement. This Agreement, upon the full execution
hereof, shall supersede in its entirety the mutual Start-up Agreement dated July
14, 1997.
1. DISTRIBUTION RIGHTS
1.1 Territory Vendor grants to Ingram, including its affiliates for resale, and
Ingram accepts, the non-exclusive right to distribute in North America all
computer products produced and/or offered by Vendor ("Product") during the term
of this Agreement. Ingram shall have the right to purchase, sell and ship to any
reseller within the territory or to Xxxxxx'x affiliate, or at Vendor's option
Xxxxxx'x affiliate may purchase direct from Vendor.
1.2 Product Vendor agrees to make available and to sell to Ingram such Product
as Ingram shall order from Vendor at the prices and subject to the terms set
forth in this Agreement. Ingram shall not be required to purchase any minimum
amount or quantity of the Product.
2. TERM AND TERMINATION
2.1 Term The initial term of this Agreement is one (1) year. Thereafter the
Agreement will automatically renew for successive one (1) year terms, unless it
is earlier terminated.
2.2 Termination
(a) Either party may terminate this Agreement, with or without cause,
by giving thirty (30) days written notice to the other party.
(b) Either party may immediately terminate this Agreement with written
notice if the other party:
2
(i) materially breaches any term of this Agreement and such
breach continues for thirty (30) business days after written notification
thereof; or
(ii) ceases to conduct business in the normal course, becomes
insolvent, makes a general assignment for the benefit of creditors, suffers or
permits the appointment of a receiver for its business or assets, or avails
itself of or becomes subject to any proceeding under any Bankruptcy Act or any
other federal or state statute relating to insolvency or the protection of
rights of creditors; or
(iii) attempts to assign or otherwise transfer its rights
hereunder unless both have agreed in writing to such assignment or transfer.
3. INGRAM OBLIGATIONS
3.1 Product Availability Ingram will list Product in its catalog(s) as
appropriate and endeavor to make such Product available to customers.
3.2 Advertising Ingram will advertise and/or promote Product in a commercially
reasonable manner and will transmit as reasonably necessary Product information
and promotional materials to its customers.
3.3 Support Ingram will make its facilities reasonably available for Vendor and
will assist in Product training and support. Ingram will provide reasonable,
general Product technical assistance to its customers, and will direct all other
technical issues directly to Vendor.
3.4 Administration
(a) Upon request, Ingram will furnish Vendor with a valid tax exemption
certificate.
(b) Ingram will provide Vendor standard sales-out and inventory reports
via its electronic Bulletin Board System.
(c) Ingram may handle its customers' Product returns by batching them
for return to Vendor at regular intervals.
4. VENDOR OBLIGATIONS
4.1 Shipping/Export
(a) Vendor shall ship Product pursuant to Ingram purchase order(s)
("P.O."). Product shall be shipped F.O.B. Xxxxxx'x designated warehouse with
risk of
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Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
loss or damage to pass to Ingram upon delivery to the warehouse specified in
Xxxxxx'x P.O.
(b) Ingram requires concurrent with the execution of this Agreement
Export Administration Regulations product classification and supporting
documentation: Certificate of Origin (General Use and/or NAFTA), Export
Commodity Control Number's; (ECCN's), General License and/or Individual
Validated License information and Schedule "B"/Harmonized Numbers. This applies
when distribution rights granted under Section 1.1 are outside the United States
for the initial Product/s and when additions or changes to these Products
occurs.
4.2 Invoicing For each Product shipment to Ingram, Vendor shall issue to Ingram
an invoice showing Xxxxxx'x order number, the Product part number, description,
price and any discount. At least monthly, Vendor shall provide Ingram with a
current statement of account, listing all invoices outstanding and any payments
made and credits given since the date of the previous statement.
4.3 Product Availability Vendor agrees to maintain sufficient Product inventory
to fill Xxxxxx'x orders. If a shortage of any Product exists, Vendor agrees to
allocate its available inventory of such Product to Ingram in proportion to
Xxxxxx'x percentage of all of Vendor's customer orders for such Product during
the previous sixty (60) days.
4.4 Product Marketing Vendor will clearly xxxx each unit of Product with the
Product name and computer compatibility. Such packaging will also bear a
machine-readable bar code identifier scannable in standard Uniform Product Code
(UPC) format. The bar code must identify the Product as specified by the Uniform
Code Council (UCC). If the Vendor or Ingram customers' require serial number
tracking the serial number must be clearly marked and bar coded on the outside
of the individual selling unit. The bar code shall fully comply with all
conditions regarding standard product labeling set forth in Exhibit B in the
then-current Ingram Guide to Bar Code: The Product Label. Vendor may be assessed
a reasonable per unit charge for all Product not in conformance herewith.
4.5 TechNotes Vendor will within thirty (30) days of execution of this Agreement
sign the CIS/ Manufacture Product Information Library - TechNotes and Content
Distribution Agreements as shown in Exhibit C and provide the required product
information in the designated template format.
4.6 Support [**], Vendor shall support Product and any reasonable Ingram efforts
to sell Product. Vendor shall also provide to Ingram, its employees, and its
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Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
customers reasonable amounts of sales literature, advertising materials, and
training and support in Product sales, during Vendor's regular business hours.
4.7 New Product Vendor shall endeavor to notify Ingram at least thirty (30) days
before the date any new Product is introduced. Vendor shall make such Product
available for distribution by Ingram no later than the date it is first offered
for sale in the marketplace.
4.8 Insurance Vendor shall carry insurance coverage for product
liability/completed operations with minimum limits of [**]. Within ten (10) days
of full execution of this Agreement, Vendor shall provide Ingram with a
Certificate of Insurance. This Certificate of Insurance must include: (i) a
broad form endorsement naming Ingram as an additional insured, and (ii) a
mandatory thirty (30) day notice to Ingram of insurance cancellation.
4.9 Warranties/Certification
(a) General Warranty Vendor represents and warrants that (i) it has
good transferable title to the Products, (ii) the Product will perform in
conformity with specifications and documentation supplied by Vendor, (iii) to
the best of Vendor's knowledge, the Product or its use does not infringe any
patents, copyrights, trademarks, trade secrets, or any other intellectual
property rights, (iv) to the best of Vendor's knowledge, there are no suits or
proceedings pending or threatened which allege any infringement of such
proprietary rights other than described in Exhibit G, and (v) the Product sales
to Ingram do not in any way constitute violations of any law, ordinance, rule or
regulation in the distribution territory.
(b) Warranty Vendor hereby represents and warrants that any Product
offered for distribution does not contain any obscene, defamatory or libelous
matter or violate any right of publicity or privacy.
(c) End-User Warranty Vendor shall provide a warranty statement with
Product for end user benefit. This warranty shall commence upon Product delivery
to end-user. NO OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED
TO THE WARRANTIES OF MERCHANTABIITY AND FITNESS FOR A PARTICULAR PURPOSE ARE
MADE BY VENDOR WITH RESPECT TO THE PRODUCT. INGRAM SHALL NOT EXTEND ANY
ADDITIONAL WARRANTIES TO ANY RESELLERS OR END-USERS OF THE PRODUCT. IN NO EVENT
WILL XXXXXX BE LIABLE FOR ANY LOST PROFITS OR ANY OTHER INCIDENTAL OR
CONSEQUENTIAL DAMAGES, EVEN IF INGRAM HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES. VENDOR SHALL IN NO EVENT BE LIABLE
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FOR ANY DAMAGES RESULTING FROM LOSS OF DATA, PROFITS OR USE OF EQUIPMENT, OR FOR
ANY SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR IN CONNECTION
WITH THE USE OR PERFORMANCE OF THE LICENSED PROGRAM.
IT IS ALSO UNDERSTOOD BY BOTH PARTIES TO THIS AGREEMENT THAT SPEECH
RECOGNITION IS INHERENTLY A STATISTICAL PROCESS; THAT SPEECH RECOGNITION ERRORS
ARE INHERENT IN THE PROCESS OF SPEECH RECOGNITION; THAT SPEECH RECOGNITION
APPLICATIONS AND USAGE MUST BE DESIGNED TO ALLOW FOR SUCH ERRORS IN THE SPEECH
RECOGNITION PROCESS.
(d) Millennium Compliance Warranty Vendor warrants and represents that
the Product will properly (a) record, store, process, calculate or present
calendar dates falling on and after (and if applicable, spans of time including)
January 1, 2000 as a result of the occurrence, or use of data consisting of,
such dates and (b) calculate any information dependent on or relating to dates
on or after January 1, 2000 in the same manner, and with the same functionality,
data integrity and performance, as such Product records, stores, processes,
calculates and presents calendar dates on or before December 31, 1999, or
information dependent on or relating to such dates.
(e) EU Warranty Vendor further warrants and represents for Products
distributed to the European Union ("EU") that the Products will be accepted
under all EU directives, regulations and the EU country's legislation.
(f) Made in America Certification Vendor by the execution of this
Agreement certifies that it will not label any of its products as being "Made in
America," "Made in U.S.A.," or with similar wording, unless all components or
elements of such Product is in fact made in the United States of America. Vendor
further agrees to defend, indemnify and hold harmless from and against any and
all claims, demands, liabilities, penalties, damages, judgments or expenses
(including attorney's fees and court costs) arising out of or resulting in any
way from Product that does not conform to the Certification.
5. PRICING
5.1 Ingram Pricing The suggested retail price and any Ingram discount for
Product is set out in Exhibit D. Vendor may modify Exhibit D with a minimum of
thirty (30) days advance written notice to Ingram. All Ingram orders for Product
will be billed at the price in effect when the order is placed. Ingram shall
have sole discretion as to selling price of Product to its customers.
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Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
5.2 Vendor Pricing Vendor agrees that [**]. If Vendor [**] Vendor's other like
distributors.
5.3 International Pricing If Vendor [**] into that territory.
5.4 Price Adjustments If Vendor [**], Vendor will [**] and its customers'
Product inventory, including: (i) any Customer Product in-transit from/to
Ingram, (ii) any unshipped orders, and (iii) orders in-transit to Ingram [**].
In the event that Vendor shall raise the list price of a Product, all orders for
such Product placed prior to the effective date of the price increase [**].
Vendor shall provide Ingram with thirty (30) days advance notice of any price
increases.
5.5 Payment Terms Payment terms shall be [**]. Payment shall be deemed made on
the payment postmark date. All checks will be sent via FedEx at Vendor's
expense.
5.6 Right to Withhold Notwithstanding any other provision in this Agreement to
the contrary, Ingram shall not be deemed in default if it withholds any specific
amount to Vendor because of a legitimate dispute between the parties as to that
specific amount pending the timely resolution of the disputed amount.
5.7 Bulletin Board System (BBS) Ingram will provide the Detailed Vendor Buying
Report weekly by its electronic BBS. The standard reports will include sales by
zip code, state, product/quantity sold and the detailed Vendor Buying Report.
Ingram will provide reporting on a monthly basis on sell-through including SKU,
title, version, company, zip, number sold subject to a separate Proprietary
Information Non-Disclosure Agreement attached hereto as Exhibit H.
5.8 Rebate Vendor will provide a guaranteed [**], for reporting under Section
5.7. In addition, Vendor will offer Ingram a minimum [**], based on gross sales,
for achieving sell-through quotas. The sell through quotas shall be mutually
agreed between both parties. The rebate will be paid by check within thirty (30)
days after the quarter end. If no check is received within that period Ingram
shall deduct that amount from the Vendor's next payment.
6. MARKETING
6.1 Trademarks Ingram may advertise and promote the Product and/or Vendor, and
may thereby use Vendor's trademarks, service marks and trade names according to
Vendor's guidelines. Neither party shall acquire any rights in the trademarks,
service marks or trade names of the other.
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Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
6.2 Advertising Vendor agrees to cooperate in Xxxxxx'x or Xxxxxx'x customers'
advertising and promotion of Product and hereby grants Ingram a cooperative
advertising allowance of [**] of Product invoice amount for such advertising
featuring Product and/or Vendor. Ingram shall submit advertising to Vendor for
review and approval prior to any initial release, and Vendor shall not
unreasonably withhold or delay such approval. Upon receipt of reasonable
evidence of such advertising expenditures, Vendor agrees to credit the amount
thereof against future Ingram purchases.
6.3 Programs
(a) Ingram may offer marketing programs to Vendor including but not
limited to launch programs and reseller pass through opportunities. If Vendor
elects to participate, Vendor agrees to pay such funds as may be required for
this purpose.
(b) Vendor may be asked to prepay all marketing activities until a
mutually agreed upon sell through rate is achieved.
(c) All marketing pass through activities are subject to Ingram/buyer
pre-approval.
6.4 Support Product Vendor shall consign a reasonable amount of demonstration
Product to aid Ingram in its support and promotion of Product. All such
consigned Product will be returned to Vendor upon request.
7. RETURNS
7.1 Stock Balancing Notwithstanding anything herein to the contrary, Ingram may
return throughout the term any Products which are in their original packaging to
Vendor [**]. Ingram will pay all freight charges for returned Products.
7.2 Post-Term/Termination [**], Ingram may return to Vendor any Product for
credit against outstanding invoices, or if there are no outstanding invoices for
a cash refund. Any credit or refund due Ingram for returned Product shall be
equal to the Product purchase price plus all freight charges incurred by Ingram
in returning the Product.
7.3 Product Discontinuation Vendor shall give Ingram thirty (30) days' advance
written notice of Product discontinuation. Ingram may return all such Product to
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Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
Vendor for full credit of Product purchase price plus all freight charges
incurred by Ingram in returning the Product, [**].
7.4 Defective Product
(a) Ingram may return any Product to Vendor that Ingram or its customer
finds defective. Vendor shall immediately credit Ingram for the Product purchase
price, plus all freight charges incurred by Ingram in returning the defective
Product.
(b) If any Product is recalled by Vendor because of defects, revisions
or upgrades, Ingram will, at Vendor's request, provide reasonable assistance
with the recall. Vendor will pay Xxxxxx'x expenses in connection with such
recall.
8. INDEMNIFICATION
8.1 Product Indemnity Vendor shall defend, indemnify, and hold harmless Ingram
from and against any claims, demands, liabilities, or expenses (including
attorney's fees and costs) for any injury or damage, including, but not limited
to, any personal or bodily injury or property damage, arising out of or
resulting in any way from any defect in Products. This duty to indemnify Ingram
shall be in addition to the warranty obligations of Vendor.
8.2 General Indemnity Each party shall indemnify, defend and hold the other
harmless from and against any and all claims, actions, damages, demands,
liabilities, costs and expenses, including reasonable attorney's fees and
expenses, resulting from any act or omission of the acting party or its
employees under this Agreement, that causes or results in property damage,
personal injury or death.
8.3 Intellectual Property Rights Indemnity Vendor shall defend, indemnify and
hold Ingram, its resellers and their customers, harmless from and against all
damages and costs incurred by any of them arising from the infringement of any
patent, copyright, trademark, trade secret or other proprietary right by reason
of the manufacture, sale, marketing, or use of Product.
8.4 Product Infringement Upon threat of claim of infringement, Vendor may, at
its expense and option (i) procure the right to continue using any part of
Product, (ii) replace the infringing Product with a non-infringing Product of
similar performance, or (iii) modify Product to make it non-infringing. If
Vendor does not so act within ninety (90) days after such claim, Ingram may
return Product to Vendor for a full credit against future purchases or for a
cash refund, at Xxxxxx'x option.
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8.5 Multi-Media Indemnity Vendor shall defend, indemnify and hold Ingram, its
resellers and their customers, harmless from and against all damages and costs
incurred by any of them to the extent it is based upon a claim that the Product
either (i) violates a third party's right of publicity and/or right of privacy,
or (ii) contains any obscene, defamatory or libelous matter.
8.6 European Indemnity For Products distributed to a country of the EU, the
Vendor accepts full responsibility for, and will indemnify Ingram for, all costs
and damages arising from any non-compliance with any manufacturer-directed EU
decree, regulation or directive.
8.7 Millennium Compliance Indemnity Vendor agrees to indemnify and hold Ingram
and its shareholders, officers, directors, employees, agents, successors, and
assigns harmless from and against any and all claims, suits, actions,
liabilities, losses, costs, reasonable attorney's fees, expenses, judgments or
damages, whether ordinary, special or consequential, resulting from any third
party claim made or suit brought against Ingram or such persons, to the extent
such results from Vendor's breach of the warranty specified in Section 4.9(d).
8.8 Limitation of Liability NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR LOST
PROFITS OF BUSINESS, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES, WHETHER BASED
IN CONTRACT OR TORT (INCLUDING NEGLIGENCE, STRICT LIABILITY OR OTHERWISE), AND
WHETHER OR NOT ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
THIS LIMITATION IS IN NO WAY MEANT TO LIMIT VENDOR'S LIABILITY FOR
PERSONAL INJURY OR DEATH AS A RESULT OF A DEFECT IN ANY PRODUCT IN THOSE
JURISDICTIONS WHERE THE LAW DOES NOT ALLOW THIS LIMITATION.
9. COMPLIANCE WITH FEDERAL LAWS AND REGULATIONS
9.1 Executive Order 11246 Vendor agrees to include the Equal Employment
Opportunity Clause by reference in every contract, agreement and purchase order
entered into with subcontractors or suppliers as required by 41 CFR 60-1.4.
9.2 Employer Information Report EEO-1 Written Affirmative Action Program Vendor
agrees that if the value of any contract or purchase order is fifty thousand
dollars ($50,000) or more and the Vendor has fifty (50) or more employees,
Vendor will (i) file an EEO-1 report (Standard Form 100) and comply with and
file such other compliance reports as may be required under Executive Order
11246, as amended, and Rules and Regulations adopted thereunder and (ii) will
develop a written
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affirmative action compliance program for each of its establishments as required
by Title 41 CFR 60-1.40.
9.3 Veterans Employment Clause Vendor agrees to abide by and comply with the
provisions of the Affirmative Action Clause, 41 CFR 60-250.4.
9.4 Employment of Handicapped Persons Vendor agrees that it will abide by and
comply with the provisions of the Affirmative Action Clause, 41 CFR 60-741.4.
9.5 Small Business Concerns and Small Business Concerns Owned and Controlled by
Socially and Economically Disadvantaged Individuals Where a government contract
is expected to exceed five hundred thousand dollars ($500,000), Vendor agrees to
comply with all requirements of P.L. 95-507 and regulations promulgated
thereunder. Vendor shall comply with instructions contained in Exhibit E.
9.6 Women-Owned Business Concerns Vendor shall comply with instructions
contained in Exhibit F. Where a government contract is expected to exceed five
hundred thousand dollars ($500,000), Vendor agrees to comply with all
requirements of Executive Order 12138 and all regulations promulgated
thereunder.
10. GOVERNMENT PROGRAM
10.1 Partnership America Vendor may, at its sole option, participate in Xxxxxx'x
government reseller program in which case the provisions of Exhibit F,
Partnership America, shall apply. A draft copy is provided solely for your
information and review.
11. GENERAL PROVISIONS
11.1 Notices Any notice which either party may desire to give the other party
must be in writing and may be given by (i) personal delivery to an officer of
the party, (ii) by mailing the same by registered or certified mail, return
receipt requested, to the party to whom the party is directed at the address of
such party as set forth at the beginning of this Agreement, or such other
address as the parties may hereinafter designate, and (iii) by facsimile or
telex communication subsequently to be confirmed in writing pursuant to item
(ii) herein.
11.2 Governing Law This Agreement shall be construed and enforced in accordance
with the laws of the State of California, except that body of law concerning
conflicts of law. The United Nations Convention on Contracts for the
International Sale of Goods shall not apply to this Agreement.
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11.3 Cooperation Each party agrees to execute and deliver such further documents
and to cooperate as may be necessary to implement and give effect to the
provisions contained herein.
11.4 Force Majeure Neither party shall be liable to the other for any delay or
failure to perform which results from causes outside its reasonable control.
11.5 Attorneys Fees In the event there is any dispute concerning the terms of
this Agreement or the performance of any party hereto pursuant to the terms of
this Agreement, and any party hereto retains counsel for the purpose of
enforcing any of the provisions of this Agreement or asserting the terms of this
Agreement in defense of any suit filed against said party, each party shall be
solely responsible for its own costs and attorney's fees incurred in connection
with the dispute irrespective of whether or not a lawsuit is actually commenced
or prosecuted to conclusion.
11.6 Export Regulations Ingram agrees by the purchase of Products to conform to,
and abide by, the export laws and regulations of the United States, including
but not limited to, the Export Administration Act of 1979 as amended and its
implementing regulations. Ingram shall include a statement in it's standard
sales terms and conditions that any shipment of Product outside the United
States will require a valid export license. Ingram further agrees to distribute
Product in accordance with the territory as defined in Section 1.1. Whenever a
EU country is specified as Territory under Section 1.1, Territory shall include
all EU countries.
12. AGREEMENT
12.1 Counterparts This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
12.2 Section Headings Section headings in this Agreement are for convenience
only, and shall not be used in construing the Agreement.
12.3 Incorporation of all Exhibits Each and every exhibit referred to
hereinabove and attached hereto is hereby incorporated herein by reference as if
set forth herein in full.
12.4 Severability A judicial determination that any provision of this Agreement
is invalid in whole or in part shall not affect the enforceability of those
provisions found to be valid.
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12.5 No Implied Waivers If either party fails to require performance of any duty
hereunder by the other party, such failure shall not affect its right to require
performance of that or any other duty thereafter. The waiver by either party of
a breach of any provision of this Agreement shall not be a waiver of the
provision itself or a waiver of any breach thereafter, or a waiver of any other
provision herein.
12.6 Binding Effect/Assignment This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto, and their respective
representatives, successors and permitted assigns. This Agreement shall not be
assignable by Vendor, without the express written consent of Ingram, which
consent shall not be unreasonably withheld, except to a Person in which it has
merged or which has otherwise succeeded to all or substantially all of such
party's business and assets to which this Agreement pertains and which has
assumed in writing or by operation of law its obligations under this Agreement.
Any attempted assignment in violation of this provision will be void.
12.7 Survival Sections 5.5 (Payment Terms), 5.6 (Right to Withhold), 7.2
(Post-Term Termination) and 8. (Indemnification) shall survive the expiration or
earlier termination of this Agreement.
12.8 Entirety This Agreement constitutes the entire agreement between the
parties regarding its subject matter. This Agreement supersedes any and all
previous proposals, representations or statements, oral or written. Any previous
agreements between the parties pertaining to the subject matter of this
Agreement are expressly terminated. The terms and conditions of each party's
purchase orders, invoices, acknowledgments/confirmations or similar documents
shall not apply to any order under this Agreement, and any such terms and
conditions on any such document are objected to without need of further notice
or objection. Any modifications to this Agreement must be in writing and signed
by authorized representatives of both parties.
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12.9 Authorized Representatives Either party's authorized representative for
execution of this Agreement or any amendment hereto shall be president, a
partner, or a duly authorized vice-president of their respective party. The
parties executing this Agreement warrant that they have the requisite authority
to do so.
IN WITNESS WHEREOF, the parties hereunto have executed this Agreement.
"Ingram" "Vendor"
Xxxxxx Micro Inc. Dragon Systems Inc.
0000 X. Xx. Xxxxxx Xxxxx 000 Xxxxxx Xxxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000 Xxxxxx, Xxxxxxxxxxxxx 00000
By: \s\ XX Xxxxxx By: \s\ Xxxxx X. Xxxxx
-------------------------- -------------------------------
Name: Name: Xxxxx X. Xxxxx
------------------------ -----------------------------
Xxxxxxxx X. Xxxxxx
Title: Sr. Vice President Purchasing Title: President
---------------------- ----------------------------
Date: 1-15-98 Date: 31 Dec. 1997
------------------------ -----------------------------
* AGREEMENT MUST BE SIGNED BY PRESIDENT OR BY A DULY AUTHORIZED VICE PRESIDENT
OR PARTNER.
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EXHIBITS:
A - Vendor Routing Guide (if applicable)
B - Guide to Bar Code: The Product Label
C - TechNotes
D - Product Price List
E - Small And Disadvantaged Business Certification
F - Partnership America
G - Pending Litigation
H - Proprietary Information Non-Disclosure Agreement
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EXHIBIT A
VENDOR ROUTING GUIDE
Not Applicable
-------------------
Attached
-------------------
16
EXHIBIT C Vendor #: ____________
PA #: ____________
Job #: __________
CIS Manufacturer Product Information Library
TechNotes Agreement
This agreement ("Agreement") is made and entered into as of the ________ day of
_________,1997 between _________ ("Manufacturer Name"), with its principle place
of business at __________ ("Manufacturer Address") and Xxxxxx Micro Inc.
("lngram"), with its principal place of business at 0000 X. Xx. Xxxxxx Xxxxx,
Xxxxx Xxx, Xxxxxxxxxx 00000. By Manufacturer's signature below, Manufacturer
agrees to participate in Xxxxxx'x TechNotes program, according to and bound by
the terms and conditions of this Agreement including those printed on the
reverse side of this page.
PARTICIPATION DETAILS AND REQUIREMENTS:
1. Ingram will distribute all information authored by the Manufacturer
under the terms and conditions of this Agreement.
2. Ingram will provide the Manufacturer with authoring screens for product
templates via the World Wide Web, (Manufacturer must have Internet
access and a frame compatible browser such as Netscaps(R) 2.0. or later
or Internet Explorer 3.0.)
3. Manufacturer must maintain the content in the Electronic Catalog by
either maintaining product templates via the authoring tools OR provide
Ingram with product information necessary for Xxxxxx to complete the
TechNotes Templates.
4. Manufacturer agrees to identify a contact person: ____________________
_____________________________________________________________________.
(person who will be providing the content to Ingram and can authorize
its distribution)
Title:___________ Telephone #:_____________ FAX #: ___________________
Address:______________________________________ E-mail:________________
5. 1997 SIGN UP/ OPTIONAL TEMPLATE
PARTICIPATION FEE STANDARD BASE PRICE ENTRY SERVICE
----------------- ------------------- -------------
FREE if you sign
up in 1997 $1,000 Value $50 Per SKU (1-100 SKUs)
$35 Per SKU (101-150
SKUs)
and $25 Per SKU (150+ SKUs)
vendor maintains 80% TechNotes completion rate within 60 days of
signing up for program. See details below.
17
TEMPLATES WILL BE FILLED AND UPDATED BY (check one) / / Manufacturer
/ / Ingram (must indicate $ amount below)
Manufacturer will incur no sign up fees in 1997 if Manufacturer agrees to the
program prior to December 30, 1997. Fee will be completely waived in 1997 if
Manufacturer completes 80% of eligible TechNotes within 60 days of signing
contract and maintains an average completion rate of 80%. Manufacturer will be
notified in the event participation level drops below 80% and will be given a
grace period in which to complete necessary TechNotes.
If Manufacturer selects the "Ingram" box above, Manufacturer agrees to have
Xxxxxx'x Technical Support department fill out TechNotes on Manufacturer's
behalf and agrees to pay the service fees indicated above and below. Billing
will be done on a quarterly basis for TechNotes authored during the previous
quarter. Fees for the first 100 TechNotes will be $50 each. The next 50
TechNotes will be $35 each.
Additional TechNotes will be $25 each.
$ THERE ARE TWO TYPES OF AUTHORING FEES AVAILABLE TO MANUFACTURERS WHO HAVE
SELECTED TO HAVE INGRAM COMPLETE TECHNOTES: A ONE-TIME START-UP FEE AND A
QUARTERLY MAINTENANCE FEE. Start-up fees should be used to fund initial TechNote
completion for existing products. Quarterly Maintenance Fees are to be used for
completion of TechNotes for new products as they are released each quarter.
Please indicate the amount Manufacturer agrees to pay for each of the following:
Start-up: $______ OR/AND Quarterly Maintenance $ ______. MANUFACTURER WILL ONLY
BE BILLED FOR COMPLETED TECHNOTES UP TO THE MAXIMUM AMOUNT INDICATED. Payment is
due within thirty (30) days of the invoice billing date. If payment is not
received within 30 days, Ingram has the right to deduct monies from
Manufacturer's invoices.
METHOD OF PAYMENT SOURCE OF FUNDS (Check One) ONLY FILL IN THIS SECTION IF INGRAM WILL FILL TECH/NOTES
(Check One)
______ Check Payable to ______ MDF ______ CO-OP
Xxxxxx Micro
______ Credit Memo (Request ______ In-House MDF ______ Other (MVP, Etc) _____ (Please Specify)
Buyer Approval)
Agreement will continue one year from the date above. Thereafter, the Agreement
will be automatically renewed for additional one year periods, subject to the
right of either party to terminate at the end of the term by delivering written
notice to the party at least thirty (30) days prior to the end of the period.
Manufacturer may terminate this Agreement, with or without cause.
Ingram reserves the right, at any time, to review and/or edit information added
to the Manufacturer Product Information.
18
Library's Electronic Catalog without notice, and to refuse or cancel
participation for any reason at any time.
[3 arrows] THE FOLLOWING INFORMATION IS VERY CRITICAL. PLEASE COMPLETE!
[2 arrows] PLEASE INDICATE ALL VENDOR NUMBERS ASSOCIATED WITH THIS MANUFACTURER:
____________________________________________
[1 arrow] WHO IS THE BUYER __________________________ EXT. _______ AND MARKETING
MANAGER ____________________________________ EXT._____________
Return completed agreement to marketing manger or buyer.
19
CIS/MANUFACTURER PRODUCT INFORMATION LIBRARY CONTENT DISTRIBUTION AGREEMENT
The agreement "Agreement" is made and entered into as of the ____day of
__________1997 (The "Commencement Date") between Xxxxxx Micro Inc., a Delaware
corporation ("Ingram"), and ________________________________("Manufacturer"), a
_______________________________ corporation.
The parties agree as follows:
1. DELIVERY AND LICENSE. Manufacturer agrees to provide Ingram data and
information regarding Manufacturer's products and services (collectively
"Information") for distribution by Ingram through its information distribution
services which may be updated from time to time (hereinafter referred to as the
"Manufacturers Product Information Library" or "MPIL"), including, but not
limited to, distribution via the World Wide Web, Fax, CD-ROM, Floppy disk, and
other electronic media. Manufacturer hereby grants Ingram a non-exclusive
worldwide license to market, license, distribute, display, perform, transmit and
promote the information through the MPIL. Manufacturer agrees to deliver the
information to Ingram in the manner and format set forth in the MPIL Policies
and Procedure Manual ("Procedures"). Manufacturer agrees that it is both
necessary and of mutual benefit to the parties that the Information be as error
free as is commercially feasible.
2. USE. Both parties agree that the MPIL (and Manufacturer's Information
therein) will be made available to users which have registered with Ingram to
use the MPIL. Manufacturer acknowledges that the Information will be made
available to such users worldwide via the World Wide Web or other methods of
distribution.
3. INFORMATION WARRANTIES. Manufacturer hereby represents and warrants that the
Information (i) will not infringe on or violate any copyright, patent or any
other proprietary right of any third party, and (ii) will not contain any
content, materials or services which violate any applicable law, regulation or
third party right, and (iii) contains no computer virus or similar program or
data.
4. INGRAM OPERATING RESPONSIBILITIES. Ingram will maintain and implement such
facilities, equipment, programming and data communications network and any other
combination of hardware and software as are necessary to offer and provide MPIL.
Ingram shall not be responsible for screening, editing, or monitoring the
information prior to its distribution by MPIL.
5. LIMITATION OF LIABILITY. UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE
TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY
DAMAGES (EVEN IF THAT PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES), ARISING FROM THE USE OR INABILITY TO USE THE MPIL OR THE INFORMATION,
OR ANY OTHER PROVISIONS OF THIS AGREEMENT, SUCH AS, BUT NOT LIMITED TO,
20
LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST BUSINESS.
6. NO ADDITIONAL WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,
NEITHER PARTY MAKES ANY, AND EACH PARTY HEREBY SPECIFICALLY DISCLAIMS ANY
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPUED, REGARDING THE MPIL OR THE
INFORMATION, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE AND IMPLIED WARRANTIES ARISING FROM COURSE OF DEALING OR
COURSE OF PERFORMANCE.
7. INDEMNITY. Either party will defend, indemnify, save and hold harmless the
other party and the officers, directors, agents, affiliates, distributors,
franchisees and employees of the other party from any and all third party
claims, demands, liabilities, cost or expenses, including reasonable attorney's
fees ("Liabilities"), resulting from the indemnifying party's material breach of
any duty, representation, or warranty in this Agreement, except where
Liabilities result from the gross negligence or knowing and willful misconduct
of the other party.
8. LAW. The validity, construction, and performance of this Agreement will be
governed by the substantive law of the State of California, not including its
law on conflicts of laws. If any provision of this Agreement is held by a court
of competent jurisdiction to be illegal, invalid, unenforceable, or otherwise
contrary to law, the remaining provisions of this Agreement shall remain in full
force and effect.
9. INDEPENDENT CONTRACTORS. The parties hereto hereby agree that in the
performance of their respective obligations hereunder, they are, and shall be
independent contractors, and not agents of each other.
10. WAIVER. The failure of either party to enforce or to exercise, at any time
or for any period of time, any term of or any right arising pursuant to this
Agreement does not constitute, and shall not be construed as, a waiver of such
term or right, and shall in no way affect that party's right later to enforce or
exercise it.
11. CONFIDENTIAL INFORMATION. Each party acknowledges that Confidential
Information may be disclosed to the other party during the course of this
Agreement. Each party agrees that it shall take reasonable steps, at lease
substantially equivalent to the steps it takes to protect its own proprietary
information, during the period this Agreement is in effect, and for a period of
three (3) years following expiration or termination of this Agreement, to
prevent the duplication or disclosure of Confidential Information, other than by
or of its employees or agents who must have access to the Confidential
Information to perform such party's obligations hereunder, who shall each agree
to comply with this Section 11. Nor shall there be "Confidential Information"
for purposes of this Agreement, any information relating to or disclosed in the
course of the Agreement, which is or should be reasonably understood to be
confidential or proprietary to the disclosing party, including, but not limited
to, the material terms of this Agreement, technical processes and formulas, and
21
source codes, sales, projections and marketing data.
12. NOTICES. All notices or other communications required to be given hereunder
shall be in writing and delivered either personally or by mail or overnight
courier to the parties at the address provided by each party below, unless such
address has been changed and notice of such change has been delivered in
accordance with this provision.
13. ENTIRE AGREEMENT. The provisions of this Agreement or other agreements
authorizing Ingram to distribute manufacturer's information constitute the
entire Agreement between the subject matter hereof, except other related
agreements referenced herein. No amendment, modification, or waiver of any
provision of this Agreement shall be effective unless it is set forth in a
writing that refers to the Agreement and provisions so affected and is executed
by authorized representatives of both parties.
--------------------------------------------------------------------------------
AGREED AS OF THE COMMENCEMENT DATE STATED ABOVE.
"MANUFACTURER"
(Company Name)_________________________________________________________________
(Mailing Address)______________________________________________________________
(City, State, Zip)_____________________________________________________________
By: _________________________________________________________________ (print)
_____________________________________________________________________ (sign)
Title:_________________________________________________________________________
"INGRAM"
Xxxxxx Micro Inc.
0000 X. Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000
By: _________________________________________________________________ (print)
_____________________________________________________________________ (sign)
Title:___________________________________________________________ Ext,_________
(must be signed by marketing manager or buyer)
22
EXHIBIT D
PRODUCT PRICE LIST
The prices for the Products offered under this Agreement shall be (check one):
___________ As shown on Vendor's price list dated ________________.
___________ As shown below.
Product List Price Discount
------- ---------- --------
23
EXHIBIT E
BUSINESS SIZE AND CLASSIFICATION
CERTIFICATION
Contact Name:__________________________________________________________________
Company:_______________________________________________________________________
Address:_______________________________________________________________________
City, State & Zip:_____________________________________________________________
(Please correct your address if it is incorrect or incomplete)
In order for XXXXXX MICRO INC. to comply with federal and state guidelines, we
must obtain certain information about our suppliers. This information will be
requested on an annual basis only. Therefore, please complete the basic
information requested below.
Please complete, sign and return this certification to the address or fax below
at your earliest convenience. FAILURE TO PROVIDE THIS INFORMATION, MAY RESULT IN
YOUR COMPANY BEING REMOVED FROM OUR VENDOR LIST.
Thank you in advance for helping us in out efforts to maintain accurate records,
which will in return facilitate an on-going relationship with your company.
Return this form by mail to: Xxxxxx Micro Inc. OR FAX to: (000) 000-0000
Attn: Government Division
XX Xxx 00000
Xxxxx Xxx, XX 00000-0000
-------------------------------------------------------------------------------------------------------------------
Indicate the category which appropriately describes your business: (Refer to the
reverse of this form for category definitions.)
1. Business Size:
/ / Small Business / / Large Business
2. Business Classification (if applicable):
/ / Disadvantaged Business / / Women-owned Business
/ / Minority Business
3. Business Status:
Corporation: / / Yes / / No
Taxpayer ID No. (TIN) # _ _ - _ _ _ _ _ _ _
24
OR Social Security # _ _ _ - _ _ - _ _ _ _
(if individual)
The above information is certified true and correct on ___________ day of
_______________________ , 19 ______ by:
__________________________________ ___________________________________
Authorized Signature Title
__________________________________ ___________________________________
Name (print or type) Phone Number
25
BUSINESS SIZE
SMALL A business concern that, including domestic and
foreign affiliates is independently owned and
operated, not dominant in the field of operation in
which it is bidding on Government contracts, and
qualifies as a small business under the criteria and
size standards set forth in Title 13 of the Code of
Federal Regulations (CFR), Part 121.
LARGE The business concern exceeds the small business size
code standards established by the Small Business
Administration as set forth in Title 13 of the Code of
Federal Regulations (CFR), Part 121.
BUSINESS CLASSIFICATION
SMALL DISADVANTAGED A small business concern that is at least 51% owned
by one or more socially and economically
disadvantaged individuals (or a publicly owned
business having at least 51% of its stock
unconditionally owned by one or more socially or
economically disadvantaged individuals) and whose
management an daily business operations are
controlled by one or more of such individuals.
WOMEN-OWNED A business concern that is at least 51% owned,
controlled and operated by a woman or women.
MINORITY LARGE BUSINESS A concern which meets the criteria and definition of
'Disadvantaged' business, but which is not a small
business by the SBA's size standards.
FOREIGN BUSINESS More than 50% of production or services must be
performed outside of the United States or its
possessions.
NONPROFIT BUSINESS Any organization not conducted or maintained
for the purpose of making profit. Included in this
category are sheltered workshops, universities, colleges
and local, state and federal governments.
BUSINESS STATUS
26
CORPORATION A business entity that is registered with a state in the
United States as a corporation, including non-profit
corporations, but excluding professional corporations.
OTHER DATA Enter Federal Employer ID number or social Security
number, whichever is applicable.
27
EXHIBIT F
PARTNERSHIP AMERICA(SM) PROGRAM ADDENDUM
THIS PARTNERSHIP AMERICA(sm) PROGRAM ADDENDUM ("Addendum") is made and entered
into this _________________ day of __________________________ 199____________ by
and between XXXXXX MICRO INC., a Delaware corporation ("Ingram") and
________________________________________("Vendor") a ________________________
corporation (state of incorporation).
RECITALS
A. On or about 199 , Ingram and Vendor entered into a Distribution
Agreement ("Distribution Agreement"), whereby Ingram was granted the
right to distribute in the U.S., all microcomputer products
manufactured, produced and/or offered by Vendor ("Vendor Products").
X. Xxxxxx and Vendor now desire to sell and distribute Vendor Products,
through resellers and system integrators, to federal, state and local
governments and their various agencies and departments ("Government")
in accordance with the terms and conditions of this Addendum.
NOW, THEREFORE, for valuable consideration, receipt of which is hereby
acknowledged, and in consideration of the mutual covenants and promises
contained herein, the parties agree as follows:
1. PARTNERSHIP AMERICA(SM) PROGRAM Vendor hereby grants to
Ingram, and Ingram hereby accepts, the non-exclusive right to
provide product and services to resellers and system
integrators in connection with Xxxxxx'x sale and distribution
of Vendor Product(s) to the Government in support of specific
government contract opportunities.
2. VENDOR OBLIGATIONS
2.1. PRODUCT NOTIFICATION Vendor shall notify Ingram of
any new Vendor Product(s), or any major revision of a
Vendor Product(s), and shall make such Vendor
Product(s) available for distribution by Ingram no
later than the date of first introduction into the
Government marketplace.
2.2. FIRM FIXED PRICING Upon request, Vendor shall provide
"Firm Fixed Pricing" which shall guarantee the
pricing of the Vendor Product(s) for the effective
term of a specific Government contract. Vendor shall
give Ingram thirty (30) days advance written notice
of any Vendor Product(s) being discontinued.
28
2.3. REPRESENTATIONS AND CERTIFICATIONS Vendor understands
that due to the nature of Government bidding, Vendor
may be required to enter into a procurement specific
nondisclosure agreement or make certain
representations and certifications before any Vendor
Product(s) are sold or distributed into the
Government marketplace. In addition, Vendor agrees to
provide Ingram with an annual statement of
representations and certifications.
3. INGRAM OBLIGATIONS
3.1. GOVERNMENT SALE SPECIALISTS Ingram shall maintain a
separate government sales office, which shall include
sales specialists with an understanding of Government
regulations and Government contract terms and
conditions, to support resellers and system
integrators in the Government marketplace.
3.2 CONFIGURATION Ingram shall maintain a configuration
facility for system integration and testing in
support of Government specific contracts and
opportunities for resellers.
3.3. REPORTS Ingram agrees to make available to Vendor,
within ten (10) days after the close of each month,
via an electronic bulletin board system, a
point-of-sale report, by zip code, of Vendor Products
sold or distributed to resellers for Government
specific contracts. Vendor shall provide Ingram with
a list of individuals authorized to receive such
reports.
4. PRICING The price and applicable discount for all Vendor
Products sold through the Partnership America(sm) Program is
set forth in Exhibit "A" attached hereto. The pricing and
discounts for Vendor Products set forth therein shall only
apply to Vendor Products sold through the Partnership
America(sm) Program into the Government marketplace. Ingram
will, in its sole discretion, determine the sale price to
resellers and system integrators for all Vendor Products. All
Vendor Product pricing and discounts set forth pursuant to
this Section shall not apply to, amend or affect the pricing
and discounts set forth in connection with any Vendor Products
sold and distributed pursuant to the Distribution Agreement.
Vendor understands and agrees that for certain Government
proposals/quotes, which specify a significant quantity of
Vendor Products, Vendor shall provide program specific pricing
that will include additional discounts to those set forth in
Exhibit "A".
5. TERMINATION Either Vendor or Ingram may terminate this
Addendum, with or without cause, by giving the other ninety
(90) days written notice. Termination of this Addendum shall
not result in the termination of the Distribution Agreement.
Termination of this
29
Addendum shall not affect the terms and conditions of any
Letter of Supply, issued by Vendor pursuant to Subsection 2.2.
In the event this Addendum is terminated, the rights of the
parties shall be determined under the terms and conditions of
the Distribution Agreement.
6. DISTRIBUTION AGREEMENT TERMS AND CONDITIONS Except as
otherwise provided pursuant to this Addendum, all terms and
conditions of the Distribution Agreement shall apply to the
Partnership America(sm) Program.
--------------------------------------------------------------------------------
30
AMENDMENT
March 10, 1998
Xx. Xxxxxxxx X. Xxxxxx
Xx. Vice President Purchasing
Xxxxxx Micro Inc.
0000 X. Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000
Dear Xx. Xxxxxx:
In light of the training and special use requirements of Dragon
NaturallySpeaking(TM), Deluxe Edition and other high-end products, we are now
requiring Certification of all our Resellers who resell our Deluxe Edition.
Distributors may not sell such product to any Reseller who does not have this
Certification. Therefore, the following provision amends the December 15, 1997
Agreement between DRAGON and Xxxxxx Micro Inc. and is to be inserted as
Paragraph 3.5 in the Agreement.
3.5 "Reseller Certification. Commencing on March 1, 1998, DRAGON requires that
all its Distributors ensure that their resellers procure a Certification Number
from DRAGON that allows the reseller to sell Dragon NaturallySpeaking(TM),
Deluxe Edition and other high-end DRAGON products. Resellers are specifically
prohibited from selling these products without this Certification. Distributor
may not sell such products without first ascertaining that the reseller has
procured such Certification."
Please sign below indicating your acknowledgment and acceptance of this
Amendment.
Sincerely,
\s\ X. Xxxxxxxxx
----------------------------------
Xxxxx Xxxxxxxxx
Director, North American Sales
ACKNOWLEDGED AND ACCEPTED
By: \s\ X.X. Xxxxxx
------------------------------------
Signature: Xxxxxxxx X. Xxxxxx
-----------------------------
Title: Sr. Vice President Purchasing
---------------------------------
Date: 3/25/98
----------------------------------
May 21, 1998
31
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
AMENDMENT #2
This Amendment Agreement effective as of the 21st day of May, 1998 (the
"Effective Date") is between Xxxxxx Micro Inc. ( hereinafter the "Distributor")
and Dragon Systems, Inc. (hereinafter "Dragon.")
Notwithstanding any provision to the contrary, the Agreement between the Parties
is hereby amended as follows:
Section 7.1 is hereby deleted in its entirety and the following Section 7.1 is
inserted in its place:
SECTION 7.1 STOCK ROTATION AND BALANCING
During the term of this Agreement, DISTRIBUTOR may return the Product(s) which
require Dragon certification and are sold through VAR Resellers i.e. non-retail
to DRAGON for stock rotation up to [**] of the dollar value of DISTRIBUTOR's
prior quarter's product orders, subject to the following conditions:
(a) DISTRIBUTOR must submit its request for stock rotation to DRAGON in
writing at least 14 days in advance of Distributor's proposed stock
return date, indicating in the request the identity, quantity, order
and invoice dates of the Products to be returned;
(b) The version of the Products being returned must be the current version
or the version immediately preceding the then-current version;
(c) Distributor must submit to DRAGON concurrently with its rotation
request, an order for Products equal to or greater than the value of
the Products being returned
(d) Distributor may submit only one stock rotation request [**]
(e) Products returned for rotation may not have been shipped by DRAGON more
than [**] before the date of the request; and
(f) the Products being returned must be new, resaleable, and in their
original, unopened packaging
(g) return shipping will be paid for by DISTRIBUTOR.
DRAGON, at its sole option, may amend or discontinue its stock rotation program.
For all other Products, Distributor may return such to DRAGON throughout the
term of this Agreement for full credit of the Product's purchase price provided
such Products are in their original packaging. Distributor will pay all freight
charges for returned Products.
32
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
Section 7.3 is hereby deleted in its entirety and the following Section 7.3 is
inserted in its place:
SECTION 7.3 DISCONTINUED PRODUCTS
Within [**] after notice by DRAGON of product discontinuance, DISTRIBUTOR may
return for credit all units of such Product then held by DISTRIBUTOR in
inventory, purchased [**] preceding such notice and not committed to sale. The
return rights set forth in this section are in addition to the Stock Rotation
rights described above.
Except as expressly modified herein, the Parties hereby ratify and affirm all
terms of the original agreement which terms and condition remain in full force
and effect as originally agreed to by the parties unless otherwise modified or
amended in writing.
IN WITNESS WHEREOF, each party has signed this Agreement on the day and year
written below effective as of the Effective Date.
DRAGON SYSTEMS, INC. XXXXXX MICRO, INC.
By/s/ Xxxxx X. Xxxxx By: /s/ X. Xxxxxxxxx
--------------------------- -------------------------------------
Printed Name Xxxxx X. Xxxxx Printed Name X. Xxxxxxxxx
----------------- ----------------------------
Title President Title Director
----------------------- ----------------------------------
Date 5/21/98 Date 5/21/98
------------------------ ------------------------------------
