INTERNATIONAL DISTRIBUTION REPRESENTATION AGREEMENT
This Agreement is made as of the 16th day April, 2003 (the
"Effective Date"), by and between eAcceleration Corp., a Delaware corporation
(the "Company"), with its principal place of business at 0000 XX Xxxxxxxx
Xxxxxx, Xxxxx 000X, Xxxxxxx, Xxxxxxxxxx 00000, and Plasma Devices, Inc., a
Washington corporation ("Plasma" or "You"), with its principal offices located
at 000-000xx Xxx. XX, Xxxxx 0000, Xxxxxxxx, Xxxxxxxxxx 00000.
WHEREAS, eAcceleration markets and sells eAnthology Membership
Online Services and the related computer software products (the "Product");
WHEREAS, Plasma desires to continue identifying non-US
distributors ("Customers") and to negotiate international software retail
distribution agreements (each, a "Distribution Agreement") for the Product or
its components throughout the world other than the United States [and Canada],
in exchange for a fee;
NOW, THEREFORE, in consideration of the foregoing and of the
mutual promises contained herein, the parties hereto agree as follows:
1. Services; Exclusivity.
(a) The Company hereby agrees to retain you and you
agree to act as an independent representative of the Company for the term set
forth herein, subject to the terms and conditions hereof and to the direction of
the executive officers of the Company, for consideration as set forth in Section
2 below with respect to identifying and negotiating the terms of Distribution
Agreements between the Company and distributors outside the United States for
the Product or its components.
(b) The Distribution Agreements will be subject to the
following:
(i) The Company and you will work together to
identify each Customer's designated geographic
area.
(ii) Each Customer will be required to maintain a
minimum sales volume in order to obtain and
retain exclusive distribution rights in its
geographic area. These minimum sales levels
will be determined by the Company after
consultation with you.
(iii) In light of the Product already being
distributed worldwide by the Company via the
Internet, any Distribution Agreement that
contemplates the cessation of sales of the
Product via the Internet in the geographic
area covered thereby will need to be
determined on a case by case basis, depending
upon, among other things, the minimum sales
level for such geographic area.
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(iv) Each Customer will be responsible for
translating the Product into the local
language of its geographic area. In connection
with this, the Company will cooperate with respect
to translating the Product into approximately
twelve languages.
(v) Distribution Agreements are expected to
provide for including differing amounts of
subscription time for the Product in various
retail packages. The Company may consider
promotional programs offering bonus periods
with specific retail packages of the Product.
(c) You will have the exclusive right to act as the Company's
representative with respect to Distribution Agreements from the date hereof
through and until June 30, 2003 (the "Initial Period"). Your exclusivity will
continue until the earlier of (i) June 30, 2004, or (ii) the expiration of any
quarterly period ending on or after June 30, 2003 in which the Company does not
execute and deliver a Distribution Agreement with a Customer introduced by you
or through exchange of drafts show to a reasonable persons judgment that a
Distribution Agreement is imminent. Upon the lapse of your exclusivity, you will
continue to have non-exclusive rights with respect to Distribution Agreements
during the term of this Agreement.
(d) You shall, except as otherwise provided herein, be subject
to the Company's rules, practices and policies applicable to the Company's
independent contractors, as such rules, practices and policies may be revised
from time to time by the Board of Directors or the executive officers of the
Company.
2. Compensation.
(a) In the recognition of your role in introducing the Company
to SSI Corporation, the Company will pay to you, during the term of the
Company's agreement dated April, 2003 with SSI Corporation (the "SSI Contract"),
an amount per month equal to the lesser of (i) $50,000 or (ii) one third of the
guaranteed monthly payment actually received by the Company under the SSI
Contract.
(b) As compensation for your services hereunder, the Company
will pay to you an amount equal to 5% of the payments received by the Company in
respect of Distribution Agreements entered into pursuant to the terms of this
Agreement (including pursuant to the SSI Agreement) to the extent that such
payments exceed $150,000 per month.
(c) All Distribution Agreements shall provide for payment to
the Company in U.S. Dollars or the equivalent. In the event that for any reason
any Customer makes any payment to the Company under a Distribution Agreement in
any currency other than U.S. Dollars, the Company may pay you your commission
pursuant to paragraph 2(b) of this Agreement in such local currency, and you
will be responsible for any taxes with respect thereto.
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(d) Each payment to you hereunder will be made by the Company
by check and will be sent to you by the Company within ten (10) days after
receipt by the Company of payment from its Customer.
(e) You may be required to travel from time to time in the
performance of your services, and you shall be entitled to receive no additional
compensation hereunder in connection with such travel, and you shall bear all of
your travel, lodging and other related expenses.
(f) The amounts payable to you pursuant to this Section 2
shall be full consideration for the performance of your Services and obligations
hereunder.
(g) All payments for the Product shall be made directly by the
customer to the Company. Any payments collected by you to the Company's account
shall be immediately remitted to the Company without offset for commissions or
claims of any nature whatsoever.
3. Company Responsibilities.
(a) During the term hereof, the Company will do the following:
(i) Provide the Product to Customers on terms
consistent with the Company's established sales
prices and terms for the Product or other price
acceptable to the Company.
(ii) Furnish you with copies of all Distribution
Agreements entered into with Customers.
(iii) Furnish you upon request with the Company's terms
and conditions of sale in effect from time to
time, price lists, standard literature and
advertising material as available.
(b) The Company shall have the right at any time to supplement
your sales efforts by advertisement, promotion, publicity, direct solicitation
or any other means at Company's sole discretion and expense, but the Company
will have no obligation to do so.
(c) Company personnel will not be required to travel farther
than to either Bellevue or Seattle, Washington for any negotiations, meetings or
for any other purposes in connection with the transactions contemplated by this
Agreement.
4. Your Responsibilities.
During the term hereof, you will do the following:
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(a) Use your best efforts to identify Customers and negotiate
terms of Distribution Agreement providing compensation to the Company as
comparable as possible to the Company's U.S. pricing for the Product.
(b) Submit in writing to the Company not later than the 10th
day of each month a report summarizing the status of negotiations for
Distribution Agreements in each country in which you are active.
(c) Comply with all applicable laws, rules and regulations
concerning the promotion and sale of Product. You shall furnish all information
reasonably requested by the Company in order to ensure and to document
compliance with applicable laws and regulations.
(d) You shall solicit the sales of Products hereunder only in
accordance with the Company's terms and conditions of sale as established by the
Company from time to time, including without limitation, terms and conditions of
shipment, deliveries, passage of title to Products, risk of loss, insurance,
termination for convenience, warranty, payment and prepayments.
5. Non-Solicitation; Confidentiality, Non-Interference and
Proprietary Information; Non-Competition.
(a) Non-Solicitation. You shall not employ or otherwise
engage, or solicit, entice or induce on behalf of yourself or any other person,
entity or corporation, the services or employment of any person who has been an
employee, sales representative, consultant to, or agent of the Company within
one year of the date of such offer or solicitation.
(b) Confidentiality. In the course of your retention by the
Company, you will have access to and possession of valuable and important
confidential or proprietary data or information of the Company and its
operations. You will not during your retention by the Company or at any time
thereafter divulge or communicate to any person nor shall you direct any Company
employee, representative or agent to divulge or communicate to any person (other
than to a person bound by confidentiality obligations similar to those contained
herein and other than as necessary in performing your duties hereunder) or use
to the detriment of the Company or for the benefit of any other person, any of
such confidential or proprietary data or information or make or remove any
copies thereof, whether or not marked or otherwise identified as "confidential"
or "secret." You shall take all reasonable precautions in handling the
confidential or proprietary data or information within the Company to a strict
need-to-know basis and shall comply with any and all security systems and
measures adopted from time to time by the Company to protect the confidentiality
of the confidential or proprietary data or information. The term "confidential
or proprietary data or information" as used in this Agreement shall mean
information not generally available to the public, including, without
limitation, all intellectual property, database information, personnel
information, financial information, customer lists, supplier lists, trade
secrets, forms, information regarding operations, systems, trade programs,
services, know how, computer and any other processed or collated data, computer
programs, pricing, marketing and advertising data.
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(c) Non-Interference. You agree that neither you nor the
employees will at any time after any termination of your retention by the
Company hereunder, for your own account or for the account of any other person
or entity, interfere with the Company's relationship with any of its suppliers,
customers, employees, representatives or agents.
(d) Return of Property. All written materials, records and
documents made by you or coming into your possession during your retention by
the Company concerning any products, processes or equipment manufactured, used,
developed, investigated, purchased, sold or considered by the Company or
otherwise concerning the business or affairs of the Company shall be the sole
property of the Company, and upon termination of your retention by the Company,
or upon request of the Company during your retention by the Company, you shall
promptly deliver the same to the Company. In addition, upon termination of your
retention by the Company, you will deliver to the Company all other Company
property in your possession or under your control, including, but not limited
to, tangible property, financial statements, marketing and sales data, customer
and supplier lists, database information and other documents.
(e) Injunctive Relief. With respect to the covenants contained
in Section 5 of this Agreement, you agree that any remedy at law for any breach
or threatened or attempted breach of such covenants may be inadequate and that
the Company shall be entitled to specific performance or any other mode of
injunctive and/or other equitable relief to enforce its rights hereunder or any
other relief a court might award without the necessity of showing any actual
damage or irreparable harm or the posting of any bond or furnishing of other
security.
(f) The provisions of this Section 5 shall survive the
termination of this Agreement.
6. Term; Termination.
(a) This Agreement shall terminate on the earlier of (i) the
third anniversary of the Effective Date or (ii) after a material breach hereof,
upon thirty (30) days' notice to the breaching party by the non-breaching party;
provided, that: (1) so long as the SSI Agreement remains in effect through the
end of your period of exclusivity as provided in Section 1(b) above, then this
Agreement will terminate on the third anniversary of the earlier of (A) June 30,
2004 or (B) the end of your exclusivity (the "Extended Termination Date"); (2)
unless either party notifies the other at least thirty days prior to the
Extended Termination Date, the term of this Agreement will be extended by one
additional year after the Extended Termination Date if as of the Extended
Termination Date the SSI Contract is still in full force and effect and the
Company has received all payments thereunder in an amount equal to not less than
$150,000 per month; and (3) upon either party to the SSI Contract notifying the
other of a termination thereof, either party hereto may terminate this Agreement
upon thirty (30) days' notice to the other party, which termination shall be
effective on the next anniversary of the date of this Agreement.
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7. Independent Contractor; Authority; Taxes.
It is understood that you are engaged hereunder as an
independent contractor and not as an employee or agent of the Company and that
you will not have any authority to bind the Company or execute any agreements or
contracts on behalf of the Company, all of which shall be subject to approval of
and execution by the authorized officers of the Company. The Company will not be
responsible for any income tax withholding with respect to any remuneration paid
or payable to you hereunder, and each party will be responsible for their own
taxes, both domestic and international.
8. Notices.
All notices hereunder shall be in writing and shall be sent by
hand delivery, nationally recognized overnight courier service, facsimile
transmission electronically confirmed, electronic mail, express mail or by
certified or registered mail, postage prepaid, return receipt requested, if to
you, to your address as listed in the Company's records, and if to the Company,
to eAcceleration Corp., at the Company's address set forth above, Attention:
President; with a copy to Xxxxxxx & Associates, LLC, 00 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxxxxx,
Esq., Fax: (000) 000-0000, e-mail: xxxxx@xxxxxxxxx.xxx.
9. Miscellaneous.
This Agreement is the complete agreement of the parties with
respect to the subject matter hereof and supercedes any and all prior agreements
between the parties. This Agreement may not be modified or amended except by an
instrument in writing signed by the party against which enforcement may be
sought. The waiver by any party of a breach of any provision of this Agreement,
which waiver must be in writing to be effective, shall not operate as or be
construed as a waiver of any subsequent breach. This Agreement shall not be
assignable by you. This Agreement shall be binding upon and inure to the benefit
of you, your successors and assigns, and shall be binding upon and inure to the
benefit of the Company, its successors and assigns. Except as specifically set
forth or referred to herein, nothing in this Agreement, expressed or implied, is
intended or shall be construed to confer upon or give to any person or
corporation other than the parties hereto and their successors or permitted
assigns any rights or remedies under or by reason of this Agreement. This
Agreement shall be construed and governed in accordance with the laws of the
State of Washington, without giving effect to the conflicts or choice of law
provisions thereof. The headings in this Agreement are intended solely for
convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement. Any term or provision of this Agreement which
is invalid or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction.
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10. Review of this Agreement; No Conflicting Agreements.
You acknowledge that you have carefully read this Agreement,
and you hereby represent and warrant to the Company that your entering into this
Agreement, and the obligations and duties undertaken by you and the employees
hereunder, will not conflict with, constitute a breach of or otherwise violate
the terms of any other agreement to which you or any employee is a party and
that you are not required to obtain the consent of any person, firm, corporation
or other entity in order to enter into this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first above written.
EACCELERATION CORP.
By: /s/ Xxxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
President
PLASMA DEVICES, INC.
By: /s/ Xxxxxx Xxxxxxx
Xxxxxx Xxxxxxx
Title: President
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