18
DISTRIBUTORSHIP AGREEMENT
This Agreement, made and entered into to be effective as of
the 1st day of July by and between:
MILLIPORE CORPORATION
Analytical Division
00 Xxxxx Xxxx
Xxxxxxx, XX 00000
a corporation organized under the laws of the state of
Massachusetts, hereinafter referred to as SUPPLIER; and
XXXXXX SCIENTIFIC COMPANY
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
a corporation organized under the laws of the state of Delaware,
hereinafter referred to as DISTRIBUTOR.
W I T N E S S E T H
WHEREAS, SUPPLIER desires to sell and/or market certain
selected products to the laboratory market through the use of an
exclusive distributor; and
WHEREAS, DISTRIBUTOR desires to purchase such selected
products of SUPPLIER for resale to customers in the laboratory
market; and
WHEREAS, the Parties desire to enter into a distributorship
agreement governing their relationship;
NOW, THEREFORE, in consideration of the mutual terms and
conditions set forth herein, and intending to be legally bound
hereby, the Parties hereto agree as follows:
1. PRODUCTS
1.1 Products: The products covered by this Agreement are
those products set forth on Exhibit A attached hereto (the
"Products"), manufactured by or for SUPPLIER, and any improved
or updated versions thereof, as well as all replacements and/or
modifications, together in each case with accessories, parts and
components SUPPLIER deems necessary for their maintenance and
repair. Exhibit A may be amended from time to time by mutual
consent of the Parties and shall be amended from time to time to
include replacement and/or enhancing Products.
1.2 New Products: SUPPLIER shall offer to DISTRIBUTOR in
writing the ability to distribute any new filtration product
(developed or acquired by SUPPLIER) with same or substantially
similar application in analytical laboratories as the Products.
Excepted from this requirement to offer are SUPPLIER's EZ-PAK
line of products as well as all its products for microbiological
detection and/or analysis. If such "New Product" is a direct
replacement or modification of a Product, the discount will be
consistent with the discounts, by product group, of Exhibit A;
otherwise the discount shall be mutually agreed upon by the
parties.
2. GRANT OF RIGHTS
2.1 Distribution Rights: SUPPLIER hereby appoints
DISTRIBUTOR and DISTRIBUTOR accepts the appointment as the
exclusive (except as otherwise provided in this Agreement)
Distributor of the Products during the term of this Agreement.
DISTRIBUTOR shall have the right to appoint sub-distributors
and/or "resellers" if it so chooses.
2.2 Territory: The territory in which the DISTRIBUTOR has
the exclusive right to sell and distribute the Products shall be
the United States, Canada and Puerto Rico (the "Territory"). The
Territory can be expanded only by a mutual written agreement.
DISTRIBUTOR is not authorized to resell Products to customers
outside the Territory.
2.3 Reserved Rights: SUPPLIER reserves the right to sell
the Products directly to end users in the Territory (hereinafter
"Supplier Direct Sales"). The Parties shall promote conversion
of such Direct Sales to sales through DISTRIBUTOR (hereinafter,
when combined with all other sales by DISTRIBUTOR, "Distributor
Product Sales"). In addition, SUPPLIER reserves the right to
sell Products to the following specific distributors with which
it has existing relationships, as follows (hereinafter "Supplier
Indirect Sales"):
2.3.1 Certain specific Products to Sigma
Xxxxxxx Company, Inc. (SUPPLIER has disclosed to
DISTRIBUTOR's counsel in confidence the products
included in this agreement);
2.3.2 Certain specific Products to Varian
Corporation (SUPPLIER has disclosed to DISTRIBUTOR's
counsel in confidence the products included in this
agreement);
2.3.3 Certain specific Products to Xxxx-Xxxxxx
Inc. (SUPPLIER has disclosed to DISTRIBUTOR's counsel
in confidence the products included in this agreement);
2.3.4 Some or all Products to VWR Scientific
Products Company ("VWR") and/or its affiliate IBS, for
Dupont and nine other specific corporate customers who
have integrated supply arrangements with VWR and/or IBS
("Supply Customers");
2.3.5 some or all of the Products to VWR
and/or IBS for one or more additional Supply Customers,
provided that SUPPLIER has given DISTRIBUTOR a
reasonable opportunity to demonstrate to SUPPLIER's
reasonable satisfaction that DISTRIBUTOR can fulfill
the particular Supply Customer's requirements for
Products either by direct sale from DISTRIBUTOR to the
customer or by sale from DISTRIBUTOR to the customer
through VWR and/or IBS.
It is SUPPLIER's current intention not to extend its relationship
with Xxxx Xxxxxx beyond the end of the life cycle of their
catalog listing SUPPLIER's products, or the relationship with
Sigma Xxxxxxx beyond the end of 1997, if at those times SUPPLIER
believes DISTRIBUTOR can fulfill the related customer demand for
Product directly or though sales by DISTRIBUTOR to Sigma Xxxxxxx
or Xxxx-Xxxxxx.
2.4 Small Business Resellers: SUPPLIER further reserves
the right to sell Products to Government Scientific Source and
certain other small business resellers; such current small
business resellers are on a list that SUPPLIER has provided to
DISTRIBUTOR's counsel in confidence. Such sales by SUPPLIER to
small business resellers shall also be considered Supplier
Indirect Sales. Supplier agrees (i) not to knowingly add
additional resellers, and (ii) to use its reasonable best efforts
to redirect business with existing resellers to and/or through
DISTRIBUTOR.
2.5 Aggregate Net In-Market Sales: As used in this
Agreement and in Exhibit B hereto, "Aggregate Net In-Market
Sales" shall mean the sum of (a) Distributor Product Sales, (b)
Distributor Private-Label Sales (those sales of SUPPLIER's
products made by DISTRIBUTOR in accordance with the Agreement
between SUPPLIER and DISTRIBUTOR dated August 1, 1995, at the
prices as provided therein), (c) Supplier Direct Sales and (d)
Supplier Indirect Sales, measured in each case except (b) above
at "Dealer Cost" which shall be determined by SUPPLIER's list
price for that unit minus any discount granted to DISTRIBUTOR in
accordance with Exhibit A and as set forth in Section 6.2. In
the event that Distributor Product Sales are reduced because of
SUPPLIER's discontinuation of a Product or group of Products or
because of SUPPLIER's failure or delay in filling purchase orders
accepted under Section 3.2, the parties shall negotiate an
adjustment to the Aggregate Net In-Market Sales to compensate for
such reduction as provided in Section 4.1.
2.6 Conversion of Distributorship to Non-Exclusive:
DISTRIBUTOR's limited exclusivity under Section 2.1 may be
terminated by written notice from SUPPLIER to DISTRIBUTOR, given
in the first calendar quarter of 1999, if the Aggregate Net In-
Market Sales for 1998 are less than the Exclusivity Threshold set
forth in Exhibit B (for 1997, 1998 and 1999). If the Aggregate
Net In-Market Sales for 1998 have equaled or exceeded the
Exclusivity Threshold for 1998, the limited exclusivity, granted
in Section 2.1 shall be automatically renewed for an additional
two years in which event the Parties shall negotiate in good
faith during the first quarter of 1999 an Exclusivity Threshold,
a Clawback Threshold and a Bonus Threshold for 2000. If the
limited exclusivity under Section 2.1 remains in effect at the
end of 1999 and the Aggregate Net In-Market Sales for 1999 have
equaled or exceeded the Exclusivity Threshold for 1999, then the
parties shall negotiate in good faith during the first quarter of
2000 an Exclusivity Threshold, a Clawback Threshold and a Bonus
Threshold for 2001. Such procedure to continue as long as this
Agreement is in force. Failure of the parties to agree upon such
targets for any year after 2001 shall cause the limited
exclusivity of Section 2.1 to end automatically on June 30 of the
following year.
2.7 Clawback for failure to achieve Clawback Thresholds:
DISTRIBUTOR agrees that, in each of the annual periods in which
the limited exclusivity of Section 2.1 is in effect and in which
the Aggregate Net In-Market Sales have not achieved the Clawback
Threshold as set forth in Exhibit B or as established pursuant to
Section 2.6, SUPPLIER shall be entitled to invoice DISTRIBUTOR in
an amount which is fifty percent (50%) of the amount by which
Aggregate Net In-Market Sales fell short of the Clawback
Threshold, provided, however, that this percentage is subject to
downward adjustment of one percent (1%) for each one percent (1%)
reduction in the conversion of Millipore Direct Sales and
Millipore Indirect Sales to Distributor Sales, all as reflected
on Exhibit B.
2.8 Bonus for exceeding Exclusivity Thresholds: SUPPLIER
agrees that, in each of the annual periods in which the limited
exclusivity of Section 2.1 is in effect and in which the
Aggregate Net In-Market Sales have exceed the Exclusivity
Threshold as set forth in Exhibit B or as established pursuant to
Section 2.6, DISTRIBUTOR shall be entitled to deduct from
payments otherwise due to SUPPLIER an amount which is fifty
percent (50%) of the amount by which Aggregate Net In-Market
Sales have exceeded the Exclusivity Threshold.
2.9 Penalty for Sales Outside the Territory: DISTRIBUTOR
agrees that should it, or any of its sub-distributors or
"resellers" sell or transfer any of the Products outside the
Territory, SUPPLIER will be entitled to invoice DISTRIBUTOR for
the full amount of the discount allowed to DISTRIBUTOR in
connection with the original sale to it by SUPPLIER. This right
to invoice shall not apply if DISTRIBUTOR has obtained in advance
of the relevant sale of Product written approval of SUPPLIER's
Analytical Division Vice President either to make the particular
sale of Product or to make a class of Product sales which
includes the particular sale. None of such sales shall be
counted towards the Bonus Threshold unless otherwise agreed to at
the time of the approval of such sale or sales.
3. FORECASTS; ORDERS
3.1 Forecasts: DISTRIBUTOR shall provide SUPPLIER with non-
binding forecasts of anticipated purchases of Products by
DISTRIBUTOR and DISTRIBUTOR's Canadian subsidiary a minimum of
two quarters prior to anticipated delivery dates. The forecasts
will be revised and extended in each succeeding quarter.
3.2 Orders: DISTRIBUTOR agrees to initiate purchase of
Products hereunder by issuing SUPPLIER non-cancelable purchase
orders not less than ten (10) days for Products designated as "A
Products" in Exhibit A and twenty (20) days for Products not so
designated prior to the delivery date set forth therein.
DISTRIBUTOR further agrees to spread its delivery dates over the
applicable calendar quarter in a reasonable fashion reasonably
consistent with its previously submitted forecasts. SUPPLIER
agrees subject to provisions of Section 4.1 to accept and ship
against any order issued in accordance with this Section 3.2
which specifies quantities consistent with those set forth in the
purchase forecasts for such quarter and to use its reasonable
best efforts to meet the delivery dates specified therein, and to
promptly notify DISTRIBUTOR's designated purchasing agent as soon
as SUPPLIER determines that a delivery date will not be met.
SUPPLIER shall also make reasonable efforts to accept and ship
quantities ordered in excess of those forecasted, subject to
Product availability and other sources of Product demand, and
shall promptly notify DISTRIBUTOR's designated purchasing agent
as to each order which SUPPLIER does not accept as issued,
including any proposed delivery date for the excess quantities
ordered for such purchasing agent to include in an amended or new
order. All purchase orders shall be on DISTRIBUTOR's standard
purchase order form (a copy of which has been delivered to
SUPPLIER). The terms and conditions of purchase enumerated on
the reverse side of such standard purchase order form shall
prevail over any inconsistent or conflicting language as may
exist on invoices, confirmation or order acknowledgment forms of
SUPPLIER, provided, however, that in the event any terms thereof
are in conflict, or are inconsistent with any terms of this
Agreement, the terms and conditions hereof shall prevail.
4. SHIPPING AND DELIVERY
4.1 Shipping: SUPPLIER shall ship all Products F.O.B.
point of origin, freight collect, to any one of DISTRIBUTOR's
five (5) locations listed on Exhibit A-1 attached hereto, and to
the single designated location of DISTRIBUTOR's Canadian
subsidiary (also listed on Exhibit A-1), palletized in accordance
with DISTRIBUTOR's instructions. DISTRIBUTOR's Canadian
subsidiary shall be responsible for all duty due on Products
shipped to DISTRIBUTOR's Canadian subsidiary. In addition, those
Products identified as "Non-Stocking" on Exhibit A shall also be
shipped F.O.B. point of origin freight collect to those locations
of DISTRIBUTOR as specified in DISTRIBUTOR's Purchase Order. New
Products added to this Agreement under Section 1.2 shall be
considered "Non-Stocking" unless and until a date five (5) days
after SUPPLIER has filled DISTRIBUTOR's initial stocking order
for the new Product at two (2) or more of the locations listed in
Exhibit A-1. SUPPLIER shall drop ship Products not so labeled as
Non-Stocking to DISTRIBUTOR's customers and to Distributor
locations not listed in Exhibit A-1 up to fifty (50) times each
calendar quarter through March 31, 1997 and up to twenty five
(25) times in each subsequent calendar quarter at no extra charge
to DISTRIBUTOR, provided that the following drop shipments shall
not apply against such thresholds:
(a) shipments to a customer who has placed on a single
order Products designated as Non-Stocking and Products not
designated as Non-Stocking,
(b) shipments to a customer of a Product not designated Non-
Stocking for which delivery against DISTRIBUTOR's accepted
restocking order for the location on Exhibit A-1 serving the
particular customer is overdue, and
(c) shipments to a customer of replacement Products or
sample Products under circumstances in which DISTRIBUTOR is
not charged for the Products.
All drop shipments in a quarter above such threshold shall be
billed at fifty dollars ($50) per drop shipment. SUPPLIER will
not be liable for any failure or delay in delivering Products
ordered by DISTRIBUTOR based upon shortages of supply, whether
caused by unanticipated demand or any other reason, but the
Parties shall in such situations make an appropriate mutually-
agreed adjustment to Aggregate Net In-Market Sales pursuant to
Section 2.1. In periods of short supply of any Product SUPPLIER
will allocate such Products to DISTRIBUTOR and SUPPLIER's other
customers in a manner which SUPPLIER determines to be equitable
under the circumstances.
4.2 Overstocked Inventory: To the extent, but only to the
extent, SUPPLIER has recommended in writing to DISTRIBUTOR that
DISTRIBUTOR carry, for a specified period of time, a certain
level of inventory with respect to one or more Products, and
DISTRIBUTOR upon review of the level of such inventory at the end
of such period of time shall determine that it has excess
inventory of such Product or Products, then DISTRIBUTOR shall
notify the SUPPLIER in writing, describing such Products, and
SUPPLIER shall, at DISTRIBUTOR 's election, either:
(i) credit DISTRIBUTOR with the full purchase price
paid by DISTRIBUTOR for each such Product upon return of the
Product; or
(ii) exchange, at SUPPLIER's expense, all such
Products for Products which are selected by DISTRIBUTOR.
4.3 Obsolete Inventory:
(a) In the event that SUPPLIER determines to make a material
change to the Specification of any Product or to release an
improved or updated version of any Product it shall give
DISTRIBUTOR ninety (90) days notice of any such proposed
change or release;
(b) In the event SUPPLIER determines to discontinue or
eliminate any Product from Exhibit A it shall give
DISTRIBUTOR one hundred twenty (120) days notice of any such
discontinuance or elimination;
and in the event SUPPLIER shall not have given DISTRIBUTOR less
than such ninety (90) or one hundred and twenty (120) days of
advanced notice respectively, or have given DISTRIBUTOR no
advance notice, and the respective event shall make any Products
owned by DISTRIBUTOR unsalable in DISTRIBUTOR's reasonable
opinion then any such Products shall be repurchased from
DISTRIBUTOR by SUPPLIER within thirty (30) days following
DISTRIBUTOR 's request therefor at the price paid for such
Product(s) by DISTRIBUTOR. SUPPLIER shall additionally pay for
return freight and related transportation and insurance charges
for all such Products. Nothing contained in this Section 4.3
shall give SUPPLIER, so long as DISTRIBUTOR has maintained its
exclusive rights hereunder, the unilateral right to remove any
Product from Exhibit A which it shall continue to market directly
or otherwise.
4.4 Delivery: SUPPLIER reserves the right to ship to
DISTRIBUTOR direct from any of its overseas locations should it
deem it advisable and in its best interests, provided only that
DISTRIBUTOR will not incur any more costs than if shipment had
been from Burlington, Massachusetts.
5. MARKETING PLAN; SALES & MARKETING SUPPORT
5.1 Marketing Plan: Attached hereto as Exhibit C is the
initial marketing plan jointly prepared by the Parties (the
"Marketing Plan"). Among others the Marketing Plan covers the
following issues:
(a) The training and travel plans of the DISTRIBUTOR's
sales force and marketing organization;
(b) The specific technical support which SUPPLIER is
prepared to provide to DISTRIBUTOR's sales personnel and
customers;
(c) The promotion program with respect to the marketing of
the Products to be implemented by DISTRIBUTOR, the initial
announcement of the alliance evidenced by this Agreement and
the procedure for the use by DISTRIBUTOR's of SUPPLIER's
catalog;
(d) The initial inventory levels to be purchased by
DISTRIBUTOR and the terms of payment with respect thereto;
(e) The methodology for determining which Products will be
considered "Stocking Inventory" by DISTRIBUTOR, as well as
the methodology for determining what Products shall be "A
Products," "B Products" and "C Products;"
(f) The procedure for determining the number of samples
DISTRIBUTOR shall be entitled to;
(g) The procedure to be followed to comply with the request
of DISTRIBUTOR's Canadian subsidiary that catalogs and other
material supplied in Canada either carry no prices or prices
in Canadian dollars;
(h) The procedure for the mailing by Distributor of certain
of SUPPLIER's literature;
(i) The procedure to be followed in dealing with the GSA
and GSA contracts; and
(j) Such other items as the Parties shall mutually agree as
being appropriate for inclusion therein.
5.2 Technical Support: SUPPLIER shall provide the
technical support and samples to DISTRIBUTOR in accordance with
specifics set forth in the "Marketing Plan" (Exhibit C). In
addition, SUPPLIER shall provide at its own expense a toll free
long distance telephone service for sales and customer support.
5.3 Promotion: DISTRIBUTOR shall make reasonable best
efforts to market, sell and distribute the Products during the
term.
5.4 Sales Reports: DISTRIBUTOR shall submit to SUPPLIER on
a monthly basis copies of a first report summarizing Distributor
Product Sales in sufficient detail to enable SUPPLIER to
compensate SUPPLIER's sales representatives on Distributor
Product Sales in the United States, Canada and Puerto Rico.
DISTRIBUTOR shall further submit to SUPPLIER, on a monthly basis
during the period of limited exclusivity under Section 2.1, a
second report, indicating DISTRIBUTOR's Product sales by customer
in the United States, Canada and Puerto Rico. SUPPLIER shall
treat the information in both reports as confidential under the
provisions of Section 12.1 and shall not use such information to
promote direct sales of Products or sales of Products through
other distributors either during the term of this Agreement or
for two (2) years thereafter. In addition, so long as the
limited exclusivity of Section 2.1 remains in effect and there is
an Exclusivity Threshold, Clawback Threshold and/or Bonus
Threshold in effect, DISTRIBUTOR shall monthly disclose to
SUPPLIER the total amount of Distributor Product Sales at Dealer
Cost and SUPPLIER shall monthly disclose to DISTRIBUTOR at Dealer
Cost the total amount of Supplier Direct Sales and the total
amount of Supplier Indirect Sales; each such report shall provide
separate totals for the United States and Puerto Rico and for
Canada.
5.5 Sales Commissions. SUPPLIER shall compensate its sales
representatives for Distributor Product Sales at an amount no
less favorable than the compensation for such Product sales if
sold directly by SUPPLIER.
6. PRICE AND PAYMENT TERMS
6.1 Price: SUPPLIER shall supply and ship Products to
DISTRIBUTOR's U.S. and Canadian locations at the Dealer Cost
therefor (determined in accordance with Section 2.5) through
December 31, 1996 ("Firm Price Period").
6.2 DISTRIBUTOR Discount: DISTRIBUTOR's cost (the "Dealer
Cost") for the Products shall be the list price as reflected on
Exhibit A less the discount specified thereon with respect to the
applicable Product category as indicated thereon. This discount
may not be reduced except with prior written approval by
DISTRIBUTOR.
6.3 Price Increases: After the expiration of the Firm
Price Period, list prices may be increased by SUPPLIER at its
discretion no more than once in any calendar year to be effective
January 1 of the next following calendar year. Provided,
however, in situations where SUPPLIER can demonstrate to
DISTRIBUTOR's reasonable satisfaction that SUPPLIER's costs to
produce or obtain a Product have increased due to circumstances
beyond SUPPLIER's control by more than five percent (5%), then
SUPPLIER may increase DISTRIBUTOR's cost for the affected Product
on sixty (60) day prior written notice by an amount not to exceed
the amount of SUPPLIER's cost increase. The parties shall
promptly confer during the first thirty (30) days of such sixty
(60) day notice period to resolve any disagreements about the
amount of the cost increase. Supplier shall with respect to any
January 1 increase give DISTRIBUTOR at least sixty (60) day
period written notice. Shipments shall be billed at the price in
effect at time of order placement.
Notice of price changes shall be sent to:
PRICING DEPARTMENT
Xxxxxx Scientific
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
With a copy to: CENTRAL PURCHASING.
In addition, prices changes affecting Canada shall be sent
to:
Purchasing Department
Xxxxxx Scientific Ltd.
000 Xxxxxxxxx Xxxx
Xxxxxx, Xxxxxxx, Xxxxxx X0X 0X0
6.4 Payment Terms: Payment terms shall be two percent (2%)
ten net forty-five (45) days from the date of receipt of the
invoice. DISTRIBUTOR shall not be in breach of this Agreement
unless payment from the DISTRIBUTOR is more than thirty (30) days
overdue.
6.5 Resale: DISTRIBUTOR shall be entitled to resell
Products on such terms as it may, in its sole discretion,
determine, including without limitation price, returns, credit
and discounts.
6.6 Special Pricing: If DISTRIBUTOR reasonably determines
that it is entitled to special pricing, it shall request the same
from SUPPLIER stating the reasons therefore, and SUPPLIER shall
in its discretion determine whether or not such special pricing
is, in all the circumstances, appropriate.
6.7 Information Exchange: All price changes and additions,
deletions, modifications, etc., of the Products shall be sent to
DISTRIBUTOR at the address set forth in Section 6.4 hereof in an
electronic format as provided to SUPPLIER. In addition, SUPPLIER
shall use its reasonable best efforts, with appropriate
assistance from DISTRIBUTOR to implement as soon as practicable
full Electronic Data Interchange (EDI) capability in a format
compatible with DISTRIBUTOR's systems for receipt of purchase
orders and transmission of invoices.
7. PACKAGING
7.1 Packaging: SUPPLIER shall supply Products in packaging
configurations corresponding to those such as may be set forth in
Exhibit A as it may be amended from time to time. DISTRIBUTOR
agrees to use SUPPLIER's catalog numbers with respect to all the
Products.
7.2 Bar Coding: At DISTRIBUTOR's request, and with
DISTRIBUTOR's assistance SUPPLIER agrees to use its reasonable
best efforts to bar code the Products in a manner acceptable to
the DISTRIBUTOR.
7.3 Lot Numbers and Expiration Date: DISTRIBUTOR agrees to
accept SUPPLIER's methodology for designating and displaying lot
numbers and expiration dates, if any.
8. TERM AND TERMINATION
8.1 Term: This Agreement will become effective on the date
of execution by the last signing Party (the "Effective
Date"), and unless terminated sooner by mutual consent or in
accordance with the provisions of this Agreement will remain
in effect through December 31, 2001, (the "Initial Term").
In the event that the Parties establish an Exclusivity
Threshold, Clawback Threshold and Bonus Threshold under
Section 2.6 for the year 2001, then the term shall
automatically be extended through December 31, 2002. In
similar fashion, if such target and thresholds are
established pursuant to Section 2.6 for any subsequent year
(X+1) then the term shall automatically extend to the end of
the second year (X+2).
8.2 Termination: Notwithstanding the foregoing, this
Agreement may be terminated for cause at any time as follows:
(i) In the event of default or material breach of the terms
of this Agreement by either Party, written notice thereof
may be given to the defaulting Party. Thereafter, the
defaulting Party shall have thirty (30) days to cure said
breach. In the event that said breach has not been cured
within said thirty (30) day period, the non-defaulting Party
may, at its sole discretion, terminate this Agreement upon
ten (10) days written notice.
(ii) By SUPPLIER on one hundred eighty (180) days
written notice in the event that DISTRIBUTOR failed to meet
the Exclusivity Threshold in all of the years 1997, 1998 and
1999.
(iii) In the event of nationalization, expropriation,
liquidation or bankruptcy of, or an assignment for the
benefit of creditors or insolvency of either Party.
9. PROCEDURES ON TERMINATION
9.1 Procedures: On the termination of this Agreement,
except pursuant to Sections 8.2(i) and 8.2 (ii), SUPPLIER shall
continue to honor DISTRIBUTOR's orders for Products up to the
effective date of termination and for a period of sixty (60) days
thereafter, provided such orders
are no greater than ten percent (10%) above the quantities
established during the sixty (60) days prior to the date of the
notice of termination, and DISTRIBUTOR shall pay for all such
Products on the terms and conditions of this Agreement. The
foregoing proviso shall also apply to all orders received during
the one hundred eighty (180) day period set forth in Section
8.2(ii) above.
9.2 Survival: The rights and duties of each Party under
this Agreement and the Exhibits hereto in respect of performance
prior to termination or non-renewal shall survive and be
enforceable in accordance with the terms of this Agreement.
9.3 Existing Inventory: Within fifteen (15) days following
termination or non-renewal of this Agreement, DISTRIBUTOR may
and, at SUPPLIER's request shall, disclose to SUPPLIER in
confidence the amounts of inventory that DISTRIBUTOR and/or its
Canadian affiliate hold of each Product. The parties shall then
negotiate in good faith concerning what portion, if any, of that
inventory DISTRIBUTOR and/or its Canadian affiliate shall return
to SUPPLIER for credit, giving due consideration to the
salability of the returned inventory by SUPPLIER relative to its
inventory levels and production plans and to the amounts
projected to be needed by DISTRIBUTOR's customers for various
Products in the ninety (90) day period after termination or non-
renewal relative to the amounts of such Products in DISTRIBUTOR's
inventory. Once agreement is reached, DISTRIBUTOR and/or its
Canadian affiliate shall deliver the designated amounts of
Product to SUPPLIER, F.O.B. origin, freight collect and shall be
reimbursed by SUPPLIER within ten (10) days at DISTRIBUTOR's
current cost for each Product. SUPPLIER shall not be obligated,
under this Paragraph, to take back inventory in excess of ten
percent (10%) of the prior year's purchases by DISTRIBUTOR and
its Canadian subsidiary, measured at cost to DISTRIBUTOR.
10. WARRANTIES, INDEMNITY, RECALL, AND INSURANCE
10.1 Warranties: In addition to the warranties of SUPPLIER
to DISTRIBUTOR set forth in the Continuing Guaranty which is
attached hereto as Exhibit D, SUPPLIER warrants to DISTRIBUTOR
that the Products will conform to the specifications set forth in
SUPPLIER's product literature, and that they will comply and be
manufactured, packaged, sterilized (if applicable), labeled and
shipped by SUPPLIER in compliance with all applicable federal,
state and local laws, orders, regulations and standards.
SUPPLIER warrants the Products to DISTRIBUTOR's customers against
defects in materials and workmanship when used in accordance with
the applicable instructions for a period of one (1) year from the
date of shipment of the Products. SUPPLIER MAKES NO OTHER END
USER WARRANTY, EXPRESS OR IMPLIED. THERE IS NO WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. The
warranty provided herein and the data, specifications and
descriptions of SUPPLIER Products appearing in SUPPLIER's
published catalogs and product literature may not be altered
except by express written agreement signed by an officer of
SUPPLIER. Representations, oral or written, which are
inconsistent with this warranty or such publications are not
authorized. In the event of a breach of the foregoing warranty,
SUPPLIER asserts that its sole obligation to the end user shall
be to repair or replace, at its option, any Product or part
thereof that proves defective in materials or workmanship within
the warranty period, provided the customer notifies SUPPLIER or
DISTRIBUTOR promptly of such defect. The exclusive remedy
provided herein shall not be deemed to have failed of its
essential purpose so long as SUPPLIER is willing and able to
repair or replace any nonconforming SUPPLIER Product or part.
SUPPLIER disclaims liability for special, direct, indirect,
incidental or consequential damages resulting from economic loss
or property damages of any nature (including without limitation,
loss of property, goodwill, reverse or disruption of any person's
business or operations as appropriate) sustained by any customer
from the use of its Products. SUPPLIER shall include notice of
the foregoing Product Warranty and limitation of liability,
together with notice that oral or written representations
inconsistent with such warranty are unauthorized and should not
be relied upon, in product literature directed primarily or
exclusive to Products; DISTRIBUTOR shall cooperate in such
inclusion to the extent that DISTRIBUTOR controls the preparation
of such literature, or contacts with subdistributors or
resellers.
10.2 Continuing Guaranty: SUPPLIER shall execute and abide
by the terms of DISTRIBUTOR 's Continuing Guaranty, a copy of
which is attached hereto as Exhibit D and incorporated herein by
reference. The terms and provisions of the Continuing Guaranty
shall survive the termination of this Agreement, but to the
extent any of the terms of the Continuing Guaranty are in
conflict, or are inconsistent with the terms of this Agreement,
the terms and conditions hereof shall prevail.
10.3 Insurance: SUPPLIER has provided DISTRIBUTOR with a
Certificate of Insurance which meets the requirements of
paragraph D of the Continuing Guaranty. SUPPLIER shall provide
DISTRIBUTOR with renewal insurance certificates in the form
mandated by paragraph D of the Continuing Guaranty during the
term of this Agreement, upon request therefor by DISTRIBUTOR.
10.4 Recall: In the event of a Product failure confirmed
by SUPPLIER, or a recall required by a government agency or
requested by SUPPLIER, SUPPLIER agrees to pay the costs of any
mailing it makes as well as return freight costs. SUPPLIER will
also bear the costs of supplying replacement Products, including
Products already delivered to DISTRIBUTOR's customers. All other
costs will be for the account of DISTRIBUTOR. In addition,
SUPPLIER shall notify DISTRIBUTOR immediately in writing should
SUPPLIER become aware of any defect or condition which may render
any of the Products in violation of any statute or regulation, or
which in any way alters the specifications or quality of the
Products.
11. TRADEMARKS
11.1 Trademarks and Trade Names: SUPPLIER recognizes that
DISTRIBUTOR is the owner of the trademarks and trade names
connoting DISTRIBUTOR or DISTRIBUTOR products which it may elect
to use in the promotion and sale of the Products. Nonetheless
DISTRIBUTOR acknowledges that SUPPLIER may use such trademarks
and trade names in connection with the advice to SUPPLIER's
existing and proposed customers of the existence of and the
limited exclusive distribution status created by this Agreement.
11.2 Trademark License: SUPPLIER hereby grants to DIS
TRIBUTOR the royalty-free right to use SUPPLIER's trademarks on
SUPPLIER's Products during the term of this Agreement, it being
expressly understood that DISTRIBUTOR must use SUPPLIER's
trademarks on SUPPLIER's Products which are the subject of this
Agreement and must use them properly (i.e., shall not delete,
alter, deface or conceal any trademark, trade name, logo, or
copyright notice appearing on any Products or containers or
related documents) and shall discontinue the use of such
trademarks in any new published material following the
termination hereof. Following the termination of this Agreement,
SUPPLIER grants DISTRIBUTOR the right to continue to use for a
reasonable period of time not to exceed one hundred eighty (180)
days its trademarks in connection with sale or service of
Products purchased by DISTRIBUTOR during the term of this
Agreement. DISTRIBUTOR disclaims any rights to SUPPLIER's trade
marks other than the said license. DISTRIBUTOR agrees that it
will display SUPPLIER's trademark in such a manner so as it shall
appear prominently and be readily read. Any proposed usage of
SUPPLIER's trademarks created by DISTRIBUTOR or its agents shall
be subject to prior review and approval by SUPPLIER for
compliance with SUPPLIER's corporate identity manual, a copy of
which has been provided to DISTRIBUTOR.
12. CONFIDENTIALITY
12.1 The Parties expressly agree to hold as confidential
("Confidential Information")
any information which is designated in writing by the disclosing
Party as confidential, provided such information is clearly
marked as confidential, and the disclosing Party obtains a signed
receipt or agreement from the receiving Party acknowledging that
such information is confidential. In the event Confidential
Information is exchanged according to these guidelines, such
information will be retained by the other Party in confidence for
a period of two (2) years following the termination of this
Agreement; the transmittal of such information is and shall be
upon the express condition that the information is to be used
solely to effectuate this Agreement; and the receiving Party
shall not use, publish, or disclose said information, in whole or
in part, for any purpose other than that stated herein. SUPPLIER
expressly acknowledges and agrees that DISTRIBUTOR's customer
names, address and key contacts are and shall be the Confidential
Information of DISTRIBUTOR. Notwithstanding the foregoing, the
above restrictions on disclosure and use shall not apply to any
information which the Party can show by written evidence, was
known to it at the time of receipt, or which may be obtained from
third Parties who are not bound by a confidentiality agreement,
or which is in the public domain. Information disclosed to
DISTRIBUTOR's counsel pursuant to Section 2.3 shall be used for
purposes of monitoring the specified exceptions to the
exclusivity of Section 2.1 and of demonstrating DISTRIBUTOR's
abilities (as set forth in Section 2.3); and DISTRIBUTOR shall
use reasonable efforts to limit the dissemination of such
information on a need-to-know basis. Similarly, information on
monthly amounts of Supplier Direct Sales, Supplier Indirect Sales
and Distributor Product Sales exchanged pursuant to Section 5.4
shall be disclosed to employees of the recipient party on a need-
to-know basis; such restrictions shall not, however, apply to the
Aggregate Net In-Market Sales totals calculated from such
information.
13. MISCELLANEOUS
13.1 Force Majeure: The obligations of either Party to
perform under this Agreement shall be excused during each period
of delay if such delay arises from any cause or causes which are
reasonably beyond the control of the Party obligated to perform,
including, but not limited to, the following: acts of God, acts
or omissions of any government, or any rules, regulations or
orders of any governmental authority or any officer, department,
agency or instrumentality thereof; fire, storm, flood,
earthquake, insurrection, riot, invasion or strikes. The
affected Party shall use its best efforts to remedy the effects
of such force majeure. Any force majeure shall not excuse perfor
xxxxx by the Party, but shall postpone performance, unless such
force majeure continues for a period in excess of ninety (90)
days. In such event, the Party seeking performance may cancel
its obligations hereunder.
13.2. Dispute Resolution: Any and all disputes arising
under, out of or in connection with this Agreement other than
those relating to Section 13.3 hereof shall be mediated by the
alternative dispute resolution procedures specified in this
Section 13.2 ("ADR") only after such dispute has been presented
to a panel composed of two members of senior management from each
Party (the "Panel") and the Panel either (i) determines that such
dispute cannot be resolved by the Parties or (ii) has not taken
action for a period of sixty (60) days after such dispute has
been presented to the Panel. Each Party agrees to pursue ADR in
good faith and not to commence any suit or other proceeding or to
pursue any other remedies at law or in equity prior to the
conclusion of ADR. Each Party agrees to share all costs of
conducting ADR. All conduct, statements, promises, offers, views
and opinions, whether oral or written, and in the course of ADR
by either of the Parties, are confidential, shall, in addition
and where appropriate, be deemed to be work product and
privileged, and shall not be discoverable or admissible for any
purpose in any lawsuit arising out of this Agreement. Upon
written notice from either Party invoking ADR, each Party shall
designate in writing an individual who shall have authority to
settle the dispute on its behalf. The authorized individuals
shall be generally familiar with the industries in which the
Parties operate and shall make such investigation as they deem
appropriate and shall thereafter promptly commence discussions
concerning resolution of the dispute. If the dispute has not
been resolved within thirty (30) days thereafter, it shall be
submitted to a neutral Party in Washington, DC (the "Neutral")
designated by CPR Institute for Dispute Resolution to act as a
neutral Party to conduct the ADR in accordance with this Section
13.2. One week prior to the first scheduled session of ADR, each
Party shall deliver to the Neutral and to the other Party a
concise written summary of its views on the matter in dispute.
In addition to the authorized representative, each Party may
bring such additional persons as reasonably needed to respond to
questions, contribute information and participate in
negotiations. ADR may be conducted by means of both joint
meetings and separate private caucuses of each Party with
Neutral. The Neutral: (i) shall provide his or her opinion to
both Parties on the probable outcome should the matter be
litigated, and (ii) shall make one or more recommendations as to
the terms of a possible settlement. The Neutral shall base his
or her opinions and recommendations on information available to
both Parties, excluding such information as may be disclosed to
the Neutral by the Parties in confidence. While the opinions and
recommendations of the Neutral shall not be binding on the
Parties, the Parties agree to give good faith consideration to
the Neutral's views. After they have received the Neutral's
views, the Parties agree to negotiate in good faith to resolve
the dispute with the Neutral acting as a mediator. Each Party
agrees to participate in ADR to its conclusion, as designated by
the Neutral, and not to initiate legal proceedings seeking a
resolution to the matters in dispute until the earlier of (a) six
(6) months from the commencement of proceedings or (b) ten (10)
days after conclusion of proceedings. In the event that the
dispute relates to a matter upon which a third party has brought
a claim against DISTRIBUTOR or SUPPLIER, the foregoing obligation
not to initiate legal proceedings shall not preclude the filing
of third party complaints, cross-claims or similar pleadings by
one Party to this Agreement against the other in a civil action
brought by the third party at a time reasonably determined by the
Party filing such a pleading to be required to preserve its
rights under the applicable procedural and substantive law. The
filing Party shall make reasonable effort to notify the other
Party in advance concerning the proposed pleading and the basis
for its determination that timely filing of such proposed
pleading is required to preserve rights.
13.3. Indemnification
(a) General: In the event of a claim by an unaffiliated
third party against either Party to this Agreement or its
affiliates or past, present and future officers, directors,
shareholders, partners, employees, lawyers, representative
or agents (collectively, the "Indemnified Party"), based
upon an alleged breach by the other Party (the "Indemnifying
Party") of any of its warranties or obligations under this
Agreement (including Exhibit D) ("Third Party Claim"), the
Indemnifying Party shall indemnify, defend and hold the
Indemnified Party harmless against all losses, costs,
damages, and expenses (including reasonable attorneys fees,
expert witness fees and expenses) incurred as a result of
such Third Party Claim.
(b) Notice of Claims: The Indemnified Party shall provide
the Indemnifying Party with prompt notice of the assertion
of any Third Party Claim, including the commencement of any
suit, action or proceeding, for which indemnity hereunder is
sought, specifying with reasonable particularity the basis
therefor. The Indemnified Party shall also provide all
information related to such Third Party Claim as the
Indemnifying Party may reasonably request.
(c) Assumption of Defense: Promptly after receipt of a
notice of a Third Party Claim, the Party asserted to be the
Indemnifying Party shall either: (i) deny it is required to
provide indemnification under the terms of this Agreement,
or (ii) agree that the Indemnified Party is entitled to
indemnification under the terms of this Agreement and, at
the discretion and expense of the Indemnifying Party, assume
responsibility for the defense of the Third Party Claim.
The Indemnified Party shall have the right (but not the
duty) to participate in such defense, employing separate
counsel retained at the Indemnified Party's expense.
Whether or not it employs separate counsel, the Indemnified
Party agrees that it will cooperate fully with the
Indemnifying Party in the defense of the Third Party Claim.
(d) Settlement or Compromise: If, after receipt of a
notice of a Third Party Claim, the Party asserted to be the
Indemnifying Party, agrees that the Indemnified Party is
entitled to indemnification under the terms of this
Agreement, the Indemnifying Party will have the sole
authority, at its expense, to enter into any compromise or
settlement of the Third Party Claim which shall be binding
upon the Indemnified Party in the same manner as if a final
judgment or decree had been entered by a court of competent
jurisdiction; provided, however, that no settlement or
compromise involving any restriction on the Indemnified
Party's future action or continuing obligation by the
Indemnified Party shall be binding upon it without its prior
written consent.
(e) Denial of Indemnification: If, after receipt of a
notice of a Third Party Claim, the Party asserted to be the
Indemnifying Party denies that it is required to provide
indemnification under the terms of this Agreement, the Party
providing such notice shall treat the denial as a Dispute
subject to resolution under paragraph 13.2 of this
Agreement.
13.4 Assignment: This Agreement shall not be transferable
by either Party by assignment or by operation of law without the
prior written consent of the other not to be unreasonably
withheld or delayed. Any purported transfer in violation of this
provision shall be void and constitute a breach of this
Agreement.
13.5 Notices: Any notice required by this Agreement other
than notice of price change shall be in writing and shall be
deemed sufficient if given personally or sent by registered or
certified mail, postage prepaid, or by any nationally recognized
overnight delivery service, to the
following:
If to SUPPLIER:
Xxxxx Xxxx, Vice President Analytical Division
Millipore Corporation
00 Xxxxx Xxxx
Xxxxxxx, XX 00000
with a copy to: SUPPLIER's Legal Department at
the same address;
If to DISTRIBUTOR:
J. Xxxxxxx Xxxxxx, Vice President Marketing
Xxxxxx Scientific Company
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
with a copy to: DISTRIBUTOR's Legal Department at
the same address
Either Party may, by notice to the other, change its address for
receiving such notices.
13.6 Entire Agreement: This Agreement, including exhibits,
constitutes the entire agreement between the Parties relating to
the subject matter hereof and cancels and supersedes all prior
agreements and understandings, whether written or oral, between
the Parties with respect to such subject matter.
13.7 Existing Obligations: SUPPLIER warrants that the
terms of this Agreement do not violate any existing obligations
or contracts of SUPPLIER. SUPPLIER shall protect, defend,
indemnify, and hold harmless DISTRIBUTOR from and against any
claims, demands, liabilities or actions which are hereafter made
or brought against DISTRIBUTOR and which allege any such
violation.
13.8 Governing Law: This Agreement and all transactions
under it will be governed by the laws of the Commonwealth of
Massachusetts. Neither the 1980 United Nations Convention on
Contracts for the International Sale of Goods nor the United
Nations Convention on the Limitation Period in the International
Sale of Goods will apply to this Agreement or any transaction
under it.
13.9 Relationship of the Parties: The Parties are
independent contractors. This Agreement does not constitute a
partnership or either Party as the franchisee, agent or legal
representative of the other for any purpose, and neither Party
has the authority to act for, bind or make commitment on behalf
of the other.
13.10 Failure to Enforce: Either Party's failure to
enforce any provision of this Agreement will not be deemed a
waiver of that provision or the Party's right to enforce the
provision in the future.
13.11 Amendment: Except as otherwise specifically provided
in this Agreement, no amendment, modification or waiver of the
terms of this Agreement will be binding on either Party unless
reduced to writing and signed by an authorized officer to the
Party to be bound. In ordering and delivering Products, the
Parties may employ standard form or other documents, but no
additional terms which may appear on the face or reverse side of
any such document will apply to, or be construed to modify or
amend the terms of this Agreement.
13.12 Headings: The headings in this Agreement have been
included solely for reference and are to have no force and effect
in interpreting the provisions of this Agreement.
IN WITNESS WHEREOF, the Parties have executed this Agreement
by their duly authorized representatives.
MILLIPORE CORPORATION XXXXXX SCIENTIFIC COMPANY
By: By:
Title: Title:
Date: Date:
MILLIPORE CORPORATION
By: ________________________
Xxxxx Xxxx
Title: ________________________
Vice President
Date: ________________________
