Exhibit 10a
DISTRIBUTOR AGREEMENT
between
DKS TECHNOLOGIES INC. (DKS)
and
BIG EQUIPMENT SERVICES INC. (Distributor)
Whereas Distributor is desirous of representing and selling
the DKS Fuel Stabilizer System (FSS) and the Installation
Parts Kit (IPK) to end users and dealers in the territory
and
Whereas DKS is desirous of supplying the DKS FSS and IPK to
Distributor on a
non-exclusive Distributor basis; and
Whereas both parties wish to establish a working
relationship to accomplish their respective goals by
entering into this Distributor Agreement;
Therefore, the following are the terms and conditions agreed to: -
1. CONTRACTOR - Distributor shall be an independent
contractor and is not an agent or legal representative of
DKS. DKS shall be the supplier of goods and services.
2. SUPPLY - DKS agrees to ship the DKS FSS & IPK as ordered
by the Distributor within the following times.
On orders of 50 Systems or less = 3 to 30 days,
On orders of 51 Systems or more = 5 to 60 days,
unless prevented by circumstances beyond DKS control.
3. EQUIPMENT PRICING - DKS agrees to deliver the FSS & IPK,
F.O.B. Factory, at the following prices: FSS = $489.00;
IPK = $117.00: IPK (10SAE) = $137.00.
The above prices are subject to review every six months.
Distributor will be given 60 days notice of any price
changes.
Volume Discount Policy:
Schedule Disc FSS System Disc. IPK Kit IPK Kit(10SAE)
-------- ---- ---------- ----- ------- --------------
1 - 49 $489.00 $117.00 $137.00
50 - 99 5.0% $464.55 3% $113.50 $132.89
100 - 149 7.5% $452.25 6% $110.00 $128.78
150 - 299 10.0% $440.10 6% $110.00 $128.78
300 & up 12.5% $427.87 6% $110.00 $128.78
After the first order of 50 Systems has been processed, all
subsequent orders will be invoiced at the 50-99 price.
Qualification for the additional discounts will be based on
single orders in the categories of 100-149, 150 - 299 and
300 & up.
4. TERMS - 50% Cash with order - 50% on Delivery.
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5. TERRITORY - Distributor will concentrate the sales
efforts in the territory as described below:
Southern and Central California, Arizona and Nevada
6. LIABILITY INSURANCE - DKS will maintain General
Liability Insurance of not less than 1 Million Dollars.
Distributor shall maintain a policy of General Liability
Insurance of not less than 1 Million Dollars listing DKS
Technologies Inc., as additional named insured.
7. INVENTORY REQUIREMENT - Distributor is not required to
place an initial inventory order. It is accepted that when
sales are being achieved an inventory adequate to service
these sales will be carried.
8. WARRANTY OF QUALITY - DKS shall honor the terms and
provisions of the warranty as described in the warranty
policy information supplied with the FSS & IPK.
9. R & D TESTING - DKS is involved in an ongoing R & D and
testing program designed to update the FSS & IPK for new
engines and to improve and enhance the features, benefits
and performance of the FSS. DKS will support, participate
in and share costs as agreed to, on tests initiated and
recommended by Distributor and approved by DKS. Distributor
shall not perform tests without prior approval from DKS,
other than those described in the DKS marketing program.
10. INSTALLATION - Distributor shall be responsible to
perform all installation services and/or installation
training. DKS shall assist when requested.
11. SALES Quotas - It is agreed that Distributor is
committed to selling within its territory the following
minimum number of FSS per calendar quarter.
2002 2003 2004
---------------------- ----------------------- -----------------------
Quarter*1 - 80 Systems Quarter 1 - 120 Systems Quarter 1 - 210 Systems
Quarter 2 - 90 " Quarter 2 - 150 " Quarter 2 - 240 "
Quarter 3 - 120 " Quarter 3 - 180 " Quarter 3 - 270 "
Quarter 4 - 120 " Quarter 0 - 000 " Xxxxxxx 0 - 000 "
---------- ----------- -----------
Total 410 Systems 660 Systems 1020 Systems
* Quarter 1 includes Nov- Dec 2001.
12. TIME -This Agreement shall be in effect for three (3)
years from the date of agreement and shall be automatically
renewed for additional two (2) year periods, subject to a.
the sales quota requirements and other conditions for the
preceding period having been met and b. the new sales quotas
for the renewal period being not less than the quota of year
3 of the initial period and year 2 of subsequent renewal
periods respectively.
13. CONFIDENTIALITY - Distributor will protect and not
reveal any confidential information and/or trade secrets
relating to the product, installation procedures or customer
lists unless authorized to do so, in writing from DKS.
Distributor will comply at all times with laws, permits and
regulations having application for and pertaining to doing
business in its territory.
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14. EXCLUSIVITY - During the term of this Agreement and for
two years thereafter, Distributor will not manufacture or
promote the sale of any device the same or similar to the
FSS by design and/or function.
15. INDEMNIFICATION & DISPUTE RESOLUTION - Distributor and
DKS shall indemnify and save each other harmless from and
against all claims, damages and actions arising out of any
of the acts, omissions or breaches of either party, their
employees or agents.
Any dispute arising between Distributor and DKS in relation
to the operation and/or interpretation of this Agreement
shall be subject to the provisions of the code of civil
procedure (California) and referred to a single arbitrator
whose decision shall be binding upon the parties; providing
however, that if the parties are unable for a period of
fourteen days to agree on a single arbitrator, a panel of
arbitrators will be appointed to resolve the dispute.
16. TERMINATION - The following shall be causes for
immediate termination by either party: - Acts of fraud
- Gross misrepresentation - Negligence - Bankruptcy.
The following shall be cause for termination, but only after
the offending party has been granted 30 days written notice
to remedy the default:
- Failure by either party to live up to terms and
conditions as contained in this Agreement, including
the achievement of the quarterly sales quotas.
17. This Agreement constitutes the entire agreement
regarding distribution of the FSS & IPK between the parties
and supersedes all prior agreements, negotiations and
discussions whether written or oral.
IN WITNESS WHEREOF, the parties have duly authorized and
caused this Agreement to be executed on the 12 day of
November, 2001.
Signed: /s/ Xxx Xxx Signed: /s/ Xxxxx Xxxxxxxx
-------------- ------------------
It's President It's President
DKS TECHNOLOGIES INC. BIG EQUIPMENT SERVICES INC.
0000 Xxxxxx Xxx #000 000 Xxxxx Xxxxxxx Xx. # X-00
Xxxxx Xxxx XX 00000 Xxx Xxxxxx XX 00000
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