EXHIBIT 10.4 (c)
***: CERTAIN MATERIAL HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES EXCHANGE
COMMISSION.
DISTRIBUTORSHIP AGREEMENT
BETWEEN
NDC AUTOMATION, INC.
AND
SCHABMULLER GmbH
This DISTRIBUTORSHIP AGREEMENT ("Agreement") is made and entered into
by and between NDC AUTOMATION, INC. a Delaware, U.S.A. corporation with its
principal place of business in Charlotte, North Carolina ("DISTRIBUTOR"), and
Schabmuller GmbH, a German company with its principal place of business in
Berching-Sollngriesbach ("COMPANY").
STATEMENT OF BACKGROUND, PURPOSE AND INTEREST
COMPANY manufactures low voltage motors and drives and related
accessories and equipment and sells these items throughout the world.
DISTRIBUTOR's main business is to sell controls and navigation technology and to
provide engineering for the design and implementation of automatic guided
vehicle systems, primarily to OEM manufacturers in North America. DISTRIBUTOR
and COMPANY have had a business relationship under another Distribution
Agreement, which has been terminated to replace it with this agreement (the
"Agreement"). The purpose of this Agreement is to set forth the terms and
conditions whereby DISTRIBUTOR acts as the exclusive distributor for COMPANY in
North America.
THEREFORE, in consideration of these premises, the covenants herein
given and other good and valuable consideration, the sufficiency of which is
hereby acknowledged, the parties hereby agree as follows:
A G R E E M E N T
1. APPOINTMENT AS DISTRIBUTOR. COMPANY hereby appoints DISTRIBUTOR to be its
exclusive Distributor for COMPANY's "Products" (as hereinafter defined)
within the "Territory" (as hereinafter defined) for the "Term" (as herein
defined) of
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this Agreement and subject to its terms. As used herein, "Products" shall
mean "Motor-In-Wheel-Drives" for all applications, except for class 1,2 and
3 electric trucks. The Products are listed in Exhibit 1 (subject to
change), attached hereto and incorporated herein by reference, plus such
other products as the parties may hereafter agree to add to Exhibit 1.
"Territory" shall mean the countries of North America (Canada, Mexico and
the U.S.A.). The "Term" of this Agreement shall mean the period of time
defined in paragraph 7.1 herein.
2. OBLIGATIONS OF DISTRIBUTOR.
2.1 DISTRIBUTOR shall use its best commercial efforts to sell
and to promote sales of Products and to protect and promote
the good name and best interests of COMPANY and the Products
throughout the Territory.
2.2 DISTRIBUTOR may promote or distribute the products of
other companies and otherwise represent other companies, with
the exception of products which are identical or similar to
Products as listed in Exhibit 1. Nothing in this Agreement
shall be construed to prevent DISTRIBUTOR from selling its own
products. However, Distributor commits not to enter into
direct competition with his customers or enter into any other
business that would prevent Distributor from meeting his
obligations under this Agreement.
2.3 DISTRIBUTOR shall purchase and resell Products for its own
account and its own risk. However, the Parties acknowledge the
fact that direct sales by COMPANY to customers in the
Territory with commission to DISTRIBUTOR may be necessary in
certain cases in order to obtain a contract. In such cases,
the Parties agree to negotiate in good faith the terms and
conditions for such direct sales. As guidelines for such
negotiations, DISTRIBUTOR's normal commission for direct sales
by COMPANY shall be ***.
2.4 DISTRIBUTOR shall pay for all Products ordered from
COMPANY in accordance with the prices, terms of payment and
other terms and conditions of sale which are attached hereto
as Exhibit 2***. COMPANY warrants that such prices, terms of
payment and the terms and conditions of sale are no less
favorable than those in effect for other similarly situated
distributors of Products elsewhere in the world. Unless
otherwise agreed, the terms of payment for all Products shall
be net sixty (60) days from date of invoice.
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2.5 DISTRIBUTOR shall maintain a proper place of business
including offices, demonstration, test and repair space,
maintenance and spare parts storage. DISTRIBUTOR shall
maintain the capability to demonstrate the operation of
Products.
2.6 DISTRIBUTOR shall maintain an inventory of Products and
spare parts adequate to meet routine commercial demand without
delay and shall provide spare parts, training and maintenance
services to its customers upon their request.
2.7 DISTRIBUTOR shall employ and train skilled technical and
other personnel sufficient to promptly and efficiently
discharge its responsibilities hereunder.
2.8 DISTRIBUTOR shall provide normal after-sales services to
its customers. Subject to paragraph 4.2 of this Agreement,
DISTRIBUTOR may provide warranty service to its customers.
DISTRIBUTOR may charge its customers for all such services
except for those covered by its warranty or COMPANY's
warranty, in either case, if any.
2.9 DISTRIBUTOR shall, at its own expense, advertise and
promote the Products for sale within the Territory.
2.10 DISTRIBUTOR commits to provide COMPANY with periodic
reports as follows:
(i) Once a year, a market/sales plan with sales budget
for next year
(ii) Twice a year, a general market report
(iii) Four times a year, a review and up-date of sales
forecast
(iv) Visit reports
3. OBLIGATIONS OF COMPANY.
3.1 COMPANY shall not appoint or support any other
representative or other distributor of Products within the
Territory. COMPANY shall not sell Products directly to other
persons or entities within the Territory or without the
Territory for resale into the Territory, except for sales to
COMPANY's OEM customers who incorporate Products into their
equipment for export into the Territory. ***
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3.2 COMPANY shall provide training, free of charge (except for
travel expenses), to DISTRIBUTOR's personnel at mutually
agreed times and places. COMPANY shall provide price lists,
technical bulletins, material safety data sheets and other
technical information to DISTRIBUTOR as reasonably necessary
for the promotion, sale and servicing of the Products at no
cost to DISTRIBUTOR as long as it is standard/available
material.
4. PRODUCT QUALITY, WARRANTIES, AND REPRESENTATIONS.
4.1 COMPANY warrants to DISTRIBUTOR that, at the time of
delivery, all goods sold shall conform in all material aspects
to all technical specifications and all descriptions of
function or performance contained in documents provided to
DISTRIBUTOR by COMPANY and further warrants that all goods
sold shall be free from defects in material or workmanship for
a period of twelve (12) months of operation or fifteen (15)
months following delivery, whichever occurs first. COMPANY, at
its election, shall repair or replace any Product which fails
to meet the foregoing warranty which DISTRIBUTOR reports to it
within fifteen (15) months after delivery.
In no event shall COMPANY be responsible for any damage or
failure caused by failure to properly store Products, poor or
inadequate maintenance, normal wear, improper use, abuse,
power fluctuations, failure of electrical power, other
utilities or environmental controls, non-dedicated circuits,
or unauthorized attachments to or modification of the
Products.
DISTRIBUTOR is not authorized to give on COMPANY's behalf any
representation or warranty as to the Products and DISTRIBUTOR
shall itself make no representation or warranty more extensive
than the warranty granted herein.
THIS WARRANTY IS EXPRESSLY IN LIEU OF ANY OTHER EXPRESS OR
IMPLIED WARRANTIES, INCLUDING ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, AND IS
IN LIEU OF ANY OTHER OBLIGATION ON THE PART OF COMPANY.
WAIVER OF CONSEQUENTIAL DAMAGES:
THE PARTIES AGREE THAT UNDER NO CIRCUMSTANCES
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SHALL THE OTHER PARTY BE LIABLE FOR INDIRECT, INCIDENTAL,
SPECIAL OR CONSEQUENTIAL DAMAGES, FOR LOST PROFITS, INJURY TO
PERSON OR PROPERTY (OR ANY OTHER INCIDENTAL OR CONSEQUENTIAL
LOSS), WHETHER ARISING UNDER WARRANTY, NEGLIGENCE, STRICT
LIABILITY, TORT OR ANY OTHER THEORY.
4.2 COMPANY agrees to maintain a comprehensive liability
insurance coverage including product liability coverage
throughout the term of this Agreement, which covers
REPRESENTATIVE as a vendor, according to Exhibit 2.
REPRESENTATIVE agrees to maintain a comprehensive liability
insurance coverage including product liability throughout the
term of this Agreement.
5. RESTRICTIVE COVENANT
DISTRIBUTOR acknowledges that from time to time during the term of this
Agreement it will acquire information concerning secret processes, designs,
formulae, know-how, prices, margins, plans, strategies, customers, markets and
other confidential information of or concerning COMPANY, its affiliates or the
Products or processes of COMPANY or its affiliates, which information is
valuable, gives COMPANY a competitive advantage and which COMPANY uses
reasonable means was to keep secret ("Confidential Information"). DISTRIBUTOR
acknowledges COMPANY's exclusive right, title and interest in the Confidential
Information and in COMPANY's trademarks, trade names, patents and copyrighted
material and agrees to do nothing during or after the term of this Agreement to
impair such right, title, and interest or to disclose to any third party any
Confidential Information acquired by DISTRIBUTOR pursuant to this Agreement or
otherwise. DISTRIBUTOR agrees that all Confidential Information shall at all
times be the exclusive property of COMPANY. DISTRIBUTOR further agrees to
discontinue all use of COMPANY's name, trademarks, patents, copyrighted material
and Confidential Information immediately upon the termination or expiration of
this Agreement for any reason. The obligation to maintain the confidentiality of
Confidential Information shall not extend to:
(a) Information which is or becomes part of the public domain
through no fault of DISTRIBUTOR;
(b) Information which can be shown to have been legally
disclosed to DISTRIBUTOR by a third party which has not
breached any
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obligation as to non-disclosure;
(c) Information which can be shown by DISTRIBUTOR to have been
acquired by DISTRIBUTOR without restriction prior to
disclosure of the same information to it by COMPANY;
(d) Information which can be shown by DISTRIBUTOR to have
been developed by it independently of any disclosure of
Confidential Information to it pursuant to this Agreement;
or
(e) Information about market conditions or customers which
DISTRIBUTOR develops as a result of its performance of its
duties hereunder.
In the event of an actual or threatened violation of this restrictive
covenant by DISTRIBUTOR, COMPANY shall have the right to terminate this
Agreement immediately upon giving written notice of termination to DISTRIBUTOR
and to obtain temporary and permanent injunctive relief to prevent any such
violation.
6. PATENT INFRINGEMENT. DISTRIBUTOR shall notify COMPANY promptly upon learning
of any claim of infringement brought against DISTRIBUTOR or its customers of any
patent owned or assigned to any other person or business on account of the sale
or use of any of the Products within the Territory. Upon notification, COMPANY
shall undertake to defend, settle or dispose of any such claim, charge or
proceeding and to pay the final amount of any settlement agreed to by COMPANY or
any judgment awarded against DISTRIBUTOR or COMPANY. COMPANY reserves the sole
right to defend or not to defend and to settle or not to settle any such claim,
and DISTRIBUTOR shall cooperate with COMPANY in its lawful disposition of such
claim. COMPANY shall keep DISTRIBUTOR fully informed of all actions taken or to
be taken by it to dispose of any such claim of infringement.
7. TERMINATION.
7.1 Unless earlier terminated as provided for herein, the Term
of this Agreement shall be three (3) years, beginning on the
date of execution of this Agreement; provided, that this
Agreement shall automatically be renewed for successive one
year periods unless either party gives written notice not less
than ninety (90) days prior to the end of the initial term (or
any succeeding term) that it does not wish to further extend
this Agreement ("Notice of Expiration").
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7.2 In addition to the rights of termination provided
elsewhere in this Agreement, this Agreement may be terminated:
(a) By an agreement in writing between COMPANY and
DISTRIBUTOR; or
(b) By either party in the event the other does or
attempts to do any of the following:
(i) assigns its rights or obligations
hereunder without the other party's
consent;
(ii) ceases business as a going concern;
(iii) liquidates, dissolves or adopts a plan
to liquidate or dissolve;
(iv) files for bankruptcy or seeks to have a
receiver, trustee or conservator of its
assets appointed or takes other action
to gain relief from its creditors
generally;
(v) is the subject of an involuntary
petition for bankruptcy, or for the
appointment of a receiver, trustee or
conservator of its assets or any other
judicial proceeding for relief from
creditors generally and the same is not
dismissed within sixty days after
filing;
(vi) commits a material breach of any
provision of paragraph 6 herein.
(vii) is subject to a major change in control
and/or management that would seriously
hinder the party to carry out his
obligations under this Agreement.
(c) By either party by thirty (30) days prior
written notice identifying the breach in the
event the other party commits a material breach
of any provisions of this Agreement and does not
cure such breach by the end of the notice
period.
(d) Either party may terminate the Agreement with
three (3) months' written notice if the order
intake from the Territory is less than
threehundredthousand (300,000) dollars for the
first year, less than fourhundredfiftythousand
(450,00) for the second year and less than
sixhundredthousand (600,000) dollars for the
third year.
8. EFFECT OF TERMINATION.
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8.1 All rights extended to DISTRIBUTOR under this Agreement
shall immediately cease upon the expiration or termination of
this Agreement for any reason, but such expiration or
termination shall not extinguish any past due obligation of
DISTRIBUTOR hereunder.
8.2 The acceptance of any Product order or renewal parts order
from, or sale of any Products or renewal parts to, DISTRIBUTOR
after the expiration, termination, or the giving of Notice of
Expiration or notice of termination of this Agreement shall be
in the sole discretion of COMPANY. Any such acceptance or sale
shall not be construed as a renewal or extension thereof nor
as a waiver of expiration or termination but in the absence of
a written agreement otherwise, all such transactions shall be
governed by provisions identical with the applicable
provisions of this Agreement.
9. BENEFIT AND ASSIGNMENT. The rights, duties, and obligations of the parties
under this Agreement shall inure to the benefit and shall be binding upon their
respective successors and permitted assigns.
10. STATUS OF DISTRIBUTOR. With respect to the Products, the relationship
between COMPANY and DISTRIBUTOR is solely that of vendor and vendee, and nothing
in this Agreement shall constitute DISTRIBUTOR as the agent, partner, joint
venture or legal representative of COMPANY for any purpose whatsoever; nor shall
DISTRIBUTOR hold itself out as such. DISTRIBUTOR shall have no authority to bind
or commit COMPANY in any manner or for any purpose but rather shall act and
conduct itself in all respects as an independent contractor with respect to the
Products and the conduct of its business.
11. FORCE MAJEURE. No party to this Agreement shall be deemed to be in breach or
default of any provisions hereof by reason of delay or failure in the discharge
or performance of any duty or obligation hereunder due to strikes, lock-outs,
natural calamity, war, civil disorder, force majeure or any other cause beyond
the reasonable control of the party so affected.
12. SEVERABILITY; SURVIVAL. The provisions of this Agreement are hereby deemed
by the parties to be severable, and the invalidity or unenforceability of any
one or more of the provisions of this Agreement shall not affect the validity
and enforceability of the remaining provisions thereof. The provisions of
Sections 5, 6, 14 and 15 shall survive termination of this Agreement for any
reason.
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13. NOTICES. Any notice contemplated or required or permitted to be given under
this Agreement shall be sufficient if in writing and if delivered personally, or
sent registered or certified mail, return receipt requested, to the parties'
respective addresses below,
If to DISTRIBUTOR: NDC AUTOMATION, INC.
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000, XXX
If to COMPANY: SCHABMULLER GmbH
D-92334 Berching-Sollngriesbach
Xxxxxxxxxxxxxxx 0, Xxxxxxx
or to such other address as either party may direct by notice give to the other
as herein provided.
14. PROCEDURE IN CASE OF DISPUTE. Any controversy or dispute arising out of this
Agreement, or the breach thereof, shall be settled in accordance with the Rules
of Conciliation and Arbitration of the International Chamber of Commerce by on
or more arbitrators appointed according to these rules.
15. CONSTRUCTION OF AGREEMENT. This Agreement may be executed in counterparts in
order to provide each party with a fully-executed original hereof. Except as
otherwise provided herein, this Agreement may not be changed, modified or
amended except by an agreement in writing signed by both parties. The waiver by
any party to this Agreement of any breach or violation of any provisions of this
Agreement by any other party hereto shall not operate as a waiver of any other
breach. This Agreement reflects the complete understanding of the parties and
constitutes their entire agreement, superseding all prior negotiations,
representations, agreements, understandings, and statements.
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IN WITNESS WHEREOF, the parties have executed this Agreement by
signature of their respective duly authorized representatives as of the date
written below.
SCHABMULLER GmbH
By: /s/ Xxxxx Xxxxxxx
----------------------------
Title: President
-------------------------
Date: February 19, 1998
--------------------------
NDC AUTOMATION, INC.
By: /s/ Xxxxx Xxxxxxxxx
---------------------------
Title: President
------------------------
Date: February 19, 1998
-------------------------
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