EXHIBIT 10.19
INTERNATIONAL DISTRIBUTION AGREEMENT
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THIS AGREEMENT is made and entered into as of January 1, 1997, by and between
Xxxxxx Snowboards, Inc., (hereinafter referred to as "Manufacturer"), an Oregon
corporation having its offices in Salem, Oregon, United States, and X.X. Xxxxxx
Japan, a corporation organized under the laws of Japan and having its offices in
Osaka, Japan (hereinafter referred to as "Distributor").
RECITALS:
A. Manufacturer presently offers a line of snowboards and snowboard
equipment, apparel and accessories for sale under the "Xxxxxx(R)" brand
("Product" or "Products") and desires to continue to market such products in
Japan.
B. Distributor currently markets winter recreation products in Japan and has
substantial resources, personnel and experience which would enable Distributor
to market these products for manufacturer in Japan.
C. Distributor has previously purchased and distributed the Products in
Japan.
D. Manufacturer and Distributor would like to enter into an agreement whereby
Distributor would use its existing resources, personnel and experience to market
certain of the Products in Japan.
WITNESSETH:
In consideration of the mutual covenants and conditions herein contained, and
intending to be legally bound hereby, the parties mutually agree as follows:
1. Products and Territory
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(a) Manufacturer hereby appoints Distributor on an exclusive basis as its sole
distributor for the sale of the Products described in Exhibit A during the term
of this Agreement.
Distributor shall not place orders for Products in a calendar year in amounts
greater than Distributor reasonably believes can be sold in the season beginning
in the current year and shall orderly liquidate any overstock of prior season's
Products. Manufacturer reserves the right to add or delete specific products
from the Products covered by this Agreement and to change the design or
specification of Products, to delete Product models or lines, and to add Product
models and lines in the Manufacturer's sole discretion.
Distributor shall use its best efforts to promote and sell the Products to the
maximum number of responsible customers in the Territory.
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(b) Manufacturer is appointing Distributor hereunder with respect to the resale
of Products to any purchasers whose principal place of business is located in
the following described territory (the "Territory"): Japan.
(c) Distributor shall not solicit orders for any Product from any prospective
purchaser with its principal place of business located outside the Territory. If
Distributor receives an order for any Product from a prospective purchaser whose
principal place of business is located outside the Territory, Distributor shall
immediately refer that order to Manufacturer. Distributor shall not accept any
such orders. Distributor may not deliver or tender (or cause to be delivered or
tendered) any Product outside of the Territory. Distributor shall not sell any
Product to a purchaser if Distributor knows or has or should have reason to
believe that such purchaser intends to remove that Product from the Territory.
(d) Manufacturer reserves the right, in its sole discretion, at any time upon
thirty (30) days' prior written notice to Distributor, to expand or reduce in
any manner the Products which are covered by this Agreement.
2. Prices and Payment.
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(a) Distributor shall order Products from Manufacturer by submitting a written
purchase order using the Manufacturer's purchase order form and identifying the
Products ordered, requested delivery date(s) and any export/import information
required to enable Manufacturer to fill the order. All orders for Products are
subject to acceptance or rejection by Manufacturer's V.P. Sales/International at
Manufacturer's office at 0000 Xxxxxxx Xxxx XX, Xxxxx in Manufacturer's sole
discretion. Manufacturer shall have no liability to Distributor with respect to
purchase orders which are not accepted; provided, however, that Manufacturer
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will not unreasonably reject any purchase order for Products which do not
require any modifications or additions in order to meet the specifications of
Distributor or its customers. All purchase orders for initial sales for each
calendar year must be placed by March 1st each year, provided such order may be
increased up to April 15th each year. Manufacturer may accept reorders in its
sole discretion thereafter. Manufacturer may allocate production among
Distributor, other distributors, dealers and others as the Manufacturer deems
appropriate in its sole discretion if orders exceed scheduled production and
scale shipments over several months.
(b) If a purchase order is accepted in accordance with Section 2(a) above, the
prices for Products covered by such purchase order shall be Manufacturer's net
distributor prices ex works the shipment location for export sales in comparable
quantities, which are in effect on the date of Manufacturer's acceptance.
Manufacturer may from time to time change those prices, such change being
effective immediately upon Distributor's receipt of notice thereof; provided,
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however, that no price change shall affect purchase orders offered by
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Distributor and accepted by Manufacturer prior to the date such price change
becomes effective.
(c) Distributor shall be free to establish its own pricing for Products which
it sells. Distributor shall notify Manufacturer of its pricing, as in effect
from time to time.
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(d) The ultimate shipment of orders to Distributor shall be subject to the
right and ability of Manufacturer to make such sales, and obtain required
licenses and permits, under all decrees, statutes, rules and regulations of the
government of the United States and agencies or instrumentalities thereof
presently in effect or which may be in effect hereafter. Any order which has
been accepted by Manufacturer but which cannot be fulfilled due to such decrees,
statutes, rules and regulations shall be considered to have been rejected when
submitted to Manufacturer for acceptance or rejection.
(e) Distributor hereby agrees: (i) to assist Manufacturer in obtaining any such
required licenses or permits by supplying such documentation or information as
may be requested by Manufacturer; (ii) to comply with such decrees, statutes,
rules and regulations of the government of the United States and agencies or
instrumentalities thereof; (iii) to maintain the necessary records to comply
with such decrees, statutes, rules and regulations (iv) not to export any
Products except in compliance with such decrees, statutes, rules and regulations
(v) to obtain all governmental approvals and licenses necessary to import the
Products into the Territory; (vi) not to sell, transfer or otherwise dispose of
Products in violation of the export laws of the United States; and (vii) to
indemnify and hold harmless Manufacturer from any and all fines, damages,
losses, costs and expenses (including reasonable attorneys' fees) incurred by
Manufacturer as a result of any breach of this subsection (e) by Distributor or
any of Distributor's customers.
(f) Unless Distributor requests otherwise, all Products ordered by Distributor
shall be packed for shipment and storage in accordance with Manufacturer's
standard commercial practices. It is Distributor's obligation to notify
Manufacturer of any special packaging requirements (which shall be at
Distributor's expense). Shipment dates shall be those specified in
Manufacturer's confirmation of acceptance of Distributor's purchase order,
unless otherwise agreed between the parties. Risk of loss and damage to a
Product shall pass to Distributor upon the removal of such Products from
Manufacturer's facility. Notwithstanding anything contained herein, Manufacturer
shall have the right to make partial shipments and each shipment shall be deemed
a separate sale. Further, all delivery dates are estimates only. Shipment shall
be ex works Manufacturer's Salem, Oregon facility or other facility designated
by Manufacturer.
The Manufacturer warrants that the Products are free from defect in materials
and workmanship and conform to the Manufacturer's standard product
specifications. All claims for non-conforming shipments must be made in writing
to Manufacturer within three (3) months of the passing of risk of loss and
damage, as described above. Any claims not made within such period shall be
deemed waived and released. Distributor is responsible for any damage to
Products if the damage occurs after the Products have been delivered ex works
from the shipment facility to a carrier.
(g) Distributor shall, within thirty (30) days after receiving notice of
Manufacturer's acceptance of a Purchase Order, establish a confirmed Irrevocable
Letter of Credit ("ILC") in favor of Manufacturer issued by a bank chartered in
the United States acceptable to Manufacturer (the "Bank"), payable in U.S.
Dollars, in an amount equal to the total then-current distributor prices ex
works Manufacturer's factory at Salem, Oregon, of the Products ordered under
such
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Purchase Order. The ILC shall be in a form satisfactory to Manufacturer and
shall provide that Manufacturer may draw upon it in full upon presentation to
the Bank of two (2) copies of a certificate of Manufacturer that it has tendered
such Products at Manufacturer's factory at Salem, Oregon in accordance with
Section 2(f) hereof. No part of any amount payable to Manufacturer hereunder may
be reduced due to any counterclaim, set-off, adjustment or other right which
Distributor might have against Manufacturer, any other party or otherwise.
(h) In the event of any discrepancy between any purchase order accepted by
Manufacturer and this Agreement, the terms of this Agreement shall govern.
(i) The Manufacturer may cancel any accepted orders or refuse or delay shipment
of any orders if Distributor fails to meet any obligation arising under this
Agreement.
3. Other Obligations of Distributor.
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(a) Distributor shall maintain an active sales organization which is
knowledgeable with respect to the functional capabilities and uses of the
Products.
(b) Distributor shall employ competent and experienced service personnel,
provide appropriate service shop facilities, and maintain an adequate stock of
spare parts so as to render prompt and adequate service to the users of the
Products in the Territory. As part of Distributor's obligations under this
Agreement, Distributor agrees to provide, at Distributor's expense, any and all
repair or other Product service of the Products after they have been sold or
otherwise distributed by Distributor to any customer.
(c) Distributor shall prepare, at Distributor's cost, a reasonable number of
catalogs, brochures or other promotional materials which may be reasonably
necessary to promote the sale of the Product. Distributor shall translate, at
its own expense, all user and technical manuals and advertising and marketing
information with respect to the Products into the Japanese language and provide
Manufacturer with advance copies (in both English and Japanese) of all such
materials for approval by Manufacturer. Copies of any such material shall be
approved in advance by Manufacturer with English language translation of any
foreign language text. Distributor shall assign all copyrights in such
translations to Manufacturer. Distributor shall have a non-exclusive right
during the term of this Agreement, in connection with its activities pursuant to
this Agreement, (i) to use such translations, and (ii) to incorporate such
translations into its own manuals, advertising and marketing information.
Manufacturer shall not be liable for translation errors made by Distributor or
at Distributor's direction or for the non-conformance of such translated
materials with laws and regulations in force from time to time in the Territory.
Distributor shall indemnify and hold Manufacturer harmless to the extent that a
third party brings claims against Manufacturer based on such errors or non-
conformance.
(d) Distributor shall comply with all applicable laws, statutes, regulations
and treaties relating to the marketing, sale and distribution of the Products in
the Territory and the performance of Distributor's duties and obligations
hereunder and obtain all governmental import, product registration, currency
(including foreign exchange) and other approvals, licenses or authorizations
Page 4--INTERNATIONAL DISTRIBUTION AGREEMENT
necessary in Japan or necessary for distribution and the performance of
Distributor's obligations hereunder.
(e) Distributor shall maintain satisfactory international communication devices
and retain one or more members of its staff who is proficient in reading and
writing English.
(f) Distributor shall each calendar year undertake the level and type of
specific promotional activities Distributor has previously undertaken to promote
the Product.
4. Relationship of the Parties.
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(a) Distributor shall be considered to be an independent contractor. The
relationship between Manufacturer and Distributor shall not be construed to be
that of employer and employee, nor to constitute a partnership, joint venture or
agency of any kind.
(b) Distributor shall pay all of its expenses, including without limitation all
travel, lodging and entertainment expenses, incurred in connection with its
services hereunder. Manufacturer shall not reimburse Distributor for any of
those expenses. Distributor's sole compensation for the performance of its
duties will arise from its resale of Products.
(c) Distributor shall have no right to enter into any contracts or commitments
in the name of, or on behalf of, Manufacturer, or to bind Manufacturer in any
respect whatsoever. Neither party shall have the right to represent the other
party to a third party. Should either of the parties inflict any losses on the
other party because it has acted in the name of or as an agent for the other
party, the inflicting party shall hold the damaged party harmless from such
losses and expenses incurred thereby.
(d) In addition, Distributor shall not obligate or purport to obligate
Manufacturer by issuing or making any affirmations, representations, warranties
or guaranties with respect to Products to any third party, other than the
warranties described in Exhibit B attached hereto and made a part hereof.
(e) Each party shall furnish the other party with information which is
necessary to help further sales promotion of the Products.
5. Minimum Purchase Requirements.
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Distributor shall annually purchase a sufficient amount of Products from
Manufacturer so as to meet or exceed the minimum purchase requirements set forth
in Exhibit A. For the purposes of this provision, a "purchase" of Products
within a specified time period shall mean both ordering such Products and paying
Manufacturer for such Products on or before the last day of such period.
Failure to meet such minimum requirements in any calendar year ("Annual
Requirement") or the additional requirement to purchase 80% of a Product
Category (as defined in Exhibit A) for any
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Product Category on or before April 15 of such calendar year ("Partial Year
Requirement") shall constitute a material breach of this Agreement for the
purposes of Section 10 (Termination and Term) hereof; provided, however, that as
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long as purchases of each Product Category are at least 50% of the Partial Year
Requirement or the Annual Requirement for that Product Category, whichever is
then applicable, instead of terminating this Agreement pursuant to Section 10
("Partial Year Requirement") (Termination and Term) based on such breach, the
exclusive rights granted to Distributor under Section 1 (Products and Territory)
shall become non-exclusive rights, in which case Manufacturer shall then have
the right to appoint additional non-exclusive distributors in the Territory and
the right to sell the Products itself in the Territory, either directly
(including without limitation with the assistance of sales representatives) or
through one or more or more of its affiliates.
6. Trademarks, Service Marks and Trade Names.
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(a) Right to Use. Distributor may use Manufacturer's trademarks, service marks
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and trade names listed below (hereinafter referred to as the "Trademarks") on an
exclusive basis in the Territory only for the duration of this Agreement and
solely for display or advertising purposes in connection with selling and
distributing the Products in accordance with this Agreement subject to
conversion to nonexclusive use as provided herein:
XXXXXX; XXXXXX SNOWBOARDS; REVERT; 3-D REVERT; REVERT X; XXXX XXXXXXXX; SPOON;
4TEN; RAIL; SLICK; MODEL T; XXXX XXXXXXXX; JUNYOR; A-1; B-1; M-1; M-3; ROTO.
Distributor upon thirty (30) days written notice may add or delete trademarks
from this list. Distributor shall not at any time do or permit any act to be
done which may in any way impair the rights of Manufacturer in the Trademarks.
Such rights are in addition to any rights granted or obligations assumed under
the Trademark License Agreement between Manufacturer and Distributor dated
November 21, 1996.
(b) Quality Control. In order to comply with Manufacturer's quality control
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standards, Distributor shall: (i) use the Trademarks in compliance with all
relevant laws and regulations; (ii) accord Manufacturer the right to inspect
during normal business hours, without prior advance notice, Distributor's
facilities used in connection with efforts to sell Products in order to confirm
that Distributor's use of such Trademarks is in compliance with this Section;
and (iii) not modify any of the Trademarks in any way and not use any of the
Trademarks on or in connection with any goods or services other than the
Products. Any approved modifications or uses shall become the property of
Manufacturer.
7. Limited Warranty.
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(a) As to all components of the Products manufactured by Manufacturer,
Manufacturer makes the warranties set forth in Exhibit B, attached hereto and
made a part hereof. As to all components of the Products manufactured by any
entity other than Manufacturer, Manufacturer extends to Distributor the
warranties as to such components provided by such other entity to Manufacturer
for the length of time that such warranty remains valid for Manufacturer. The
time and scope of
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the warranties described in Exhibit B shall not exceed the time and scope of any
warranties granted by Distributor to any purchaser of such Product.
(b) Under no circumstances shall the warranties set forth in Exhibit B apply to
any Product which has not been properly installed or set-up or which has been
used with unapproved assemblies or sub-assemblies or to any Product which has
been customized or modified, damaged or misused. Notwithstanding any other
provision in this Agreement, Manufacturer shall not be held responsible for any
damage which may result from a defective part, except for the replacement of
such part as set forth in Exhibit B.
(c) THE PROVISIONS OF THE FOREGOING WARRANTIES ARE IN LIEU OF ANY OTHER
WARRANTY, WHETHER EXPRESS OR IMPLIED, WRITTEN OR ORAL (INCLUDING ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE).
(d) Any different or additional warranty given by Distributor to its customers
shall be at Distributor's sole cost, expense and risk and Distributor shall
indemnify the Manufacturer against any liablity arising out of any such
different or additional warranty.
(e) Manufacturer may elect to satisfy any warranty claim by replacing the
defective Product or refunding the total purchase price at the Manufacturer's
option. If requested, the Distributor shall return the defective Product at its
expense to the Manufacturer.
8. Limitations on Liability.
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(a) MANUFACTURER'S LIABILITY ARISING OUT OF THE MANUFACTURE, SALE OR SUPPLYING
OF THE PRODUCTS OR THEIR USE OR DISPOSITION, WHETHER BASED UPON WARRANTY,
CONTRACT, TORT OR OTHERWISE, SHALL NOT EXCEED THE ACTUAL PURCHASE PRICE PAID BY
DISTRIBUTOR FOR THE PRODUCTS.
(b) IN NO EVENT SHALL MANUFACTURER BE LIABLE TO DISTRIBUTOR OR ANY OTHER PERSON
OR ENTITY FOR SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, BUT NOT
LIMITED TO, LOSS OF PROFITS, LOSS OF DATA OR LOSS OF USE DAMAGES) ARISING OUT OF
THE MANUFACTURE, SALE OR SUPPLYING OF THE PRODUCTS, EVEN IF MANUFACTURER HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR LOSSES.
9. Indemnification.
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(a) Distributor hereby agrees to indemnify, defend and hold harmless
Manufacturer, its affiliates and all officers, directors, employees and agents
thereof (hereinafter referred to as "Indemnitees") from all liabilities, claims,
damages, losses, costs, expenses, demands, suits and actions (including without
limitation attorneys' fees, expenses and settlement costs) (collectively,
"Damages") arising out of or related to any use or operation of any Product sold
by Distributor,
Page 7--INTERNATIONAL DISTRIBUTION AGREEMENT
including without limitation Damages arising out of or related to damage or
injury to property or persons or to any representations or warranties of
Distributor not authorized hereunder.
(b) Manufacturer shall indemnify Distributor against any claim that a Product
infringes any United States patent, provided Distributor gives the Manufacturer
prompt notice of any such claim which comes to its attention and provides all
assistance reasonably requested by the Manufacturer in connection with such
action. This indemnification shall not apply to any claim of patent infringement
based on any modification of the Product or use of the Product in conjunction
with any other equipment.
10. Termination and Term.
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(a) Upon the occurrence of a material breach or default as to any obligation
hereunder by either party and the failure of the breaching party to promptly
pursue (within thirty (30) days after receiving written notice thereof from the
non-breaching party) a reasonable remedy designed to cure (in the reasonable
judgment of the non-breaching party) such material breach or default, this
Agreement may be terminated by the non-breaching party by giving written notice
of termination to the breaching party, such termination being immediately
effective upon the giving of such notice of termination; provided, no cure
period shall be provided to meet the Partial Year or Annual Requirement.
(b) Upon the filing of a petition in bankruptcy, insolvency or reorganization
against or by Distributor, or Distributor becoming subject to a composition for
creditors, whether by law or agreement, or Distributor going into receivership
or otherwise becoming insolvent, this Agreement may be terminated by
Manufacturer by giving written notice of termination to Distributor, such
termination being immediately effective upon the giving of such notice of
termination.
(c) Upon the occurrence of a change in control or management or operating
personnel of Distributor, then Distributor shall promptly notify Manufacturer in
writing within ten (10) calendar days. If, in the reasonable opinion of
Manufacturer such change in control or management or operating personnel of
Distributor could have a material adverse effect on the business, prospects or
operations of Distributor and if Distributor fails to promptly pursue (within 90
days after receiving written notice thereof from Manufacturer) a remedy designed
to cure (in the sole judgment of Manufacturer) Manufacturer's objections to such
change, this Agreement may be terminated by Manufacturer by giving written
notice of termination to Distributor, such termination being immediately
effective upon the giving of such notice of termination.
(d) The term of this Agreement shall begin on the later of the date that (i)
Manufacturer executes this Agreement and (ii) Distributor executes this
Agreement (the "Effective Date"). The term of this Agreement shall expire on
December 31, 1999, subject to extension for an additional year as provided in
this Section 10(d) unless terminated earlier pursuant to the terms of this
Section 10 (Termination and Term). If Distributor has met all minimum purchase
requirements through June 1, 1999, Distributor is not in default under this
Agreement and this Agreement has not otherwise been terminated, this Agreement
has not been converted to a nonexclusive agreement under Section 5 of this
Agreement, Distributor may elect to extend this Agreement for
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an additional calendar year with an expiration of December 31, 2000 (such
extended term being subject to earlier termination as provided pursuant to the
terms of this Section 10) by giving written notice to Manufacturer of such
intention after June 1, 1999 and before June 30, 1999.
(e) In the event of a termination pursuant to any of subsections (a), (b) or
(c) above or upon expiration of this Agreement pursuant to subsection (d) above,
Manufacturer shall not have any obligation to Distributor, or to any employee of
Distributor, for compensation or for damages of any kind, whether on account of
the loss by Distributor or such employee of present or prospective sales,
investments, compensation or goodwill or otherwise. Distributor, for itself and
on behalf of each of its employees, hereby waives any rights which may be
granted to it or them under the laws and regulations of the Territory or
otherwise which are not granted to it or them by this Agreement. Distributor
hereby indemnifies and holds Manufacturer harmless from and against any and all
claims, costs, damages and liabilities whatsoever asserted by any employee,
agent or representative of Distributor under any applicable termination, labor,
social security or other similar laws or regulations.
(f) Termination of this Agreement shall not affect the obligation of
Distributor to pay Manufacturer all amounts owing or to become owing as a result
of Products tendered or delivered to Distributor on or before the date of such
termination, as well as interest thereon to the extent any such amounts are paid
after the date they became or will become due pursuant to this Agreement.
(g) Notwithstanding anything else in this Agreement to the contrary, the parties
agree that Sections of this Agreement, including without limitation, Sections 7,
8, 9, 17, 19, but excluding without limitation, Sections 1 and 2, shall survive
the termination or expiration of this Agreement, as the case may be, to the
extent required thereby for the full observation and performance by any or all
of the parties hereto and the completion of any obligations or rights, following
termination, that the parties have hereunder.
11. Publicity.
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Distributor agrees that any publicity or advertising which shall be released
by it in which Manufacturer is identified in connection with the Products shall
be in accordance with the terms of this Agreement and with any information or
data which Manufacturer has furnished in connection with this Agreement. Copies
of all such publicity and advertising shall be forwarded promptly to
Manufacturer in both the languages to be used in the Territory and English.
12. Modification.
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No modification or change may be made in this Agreement except by written
instrument duly signed by a duly authorized representative of each party. Any
change in course of conduct by the parties, whether of an isolated or repeat
nature, shall not be deemed to be a modification of this Agreement unless so
reduced to writing.
13. Assignment.
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This Agreement and the rights and obligations hereunder may not be assigned,
delegated or transferred by either party without the prior written consent of
the other party.
14. Notice.
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All notices given under this Agreement shall be in writing in the English
language and shall be addressed to the parties at their respective addresses set
forth below:
If to Distributor:
X.X. Xxxxxx Japan
0-0-0 Xxxxxxxxxxx, Xxxx-xx
Xxxxx, Xxxxx
Xxxxxxxxx: ___________________
Telecopy Number: 000-000-000-0000
If to Manufacturer:
Xxxxxx Snowboards, Inc.
0000 Xxxxxxx Xxxx XX
Xxxxx, Xxxxxx 00000
XXXXXX XXXXXX
Attention: VP Sales/International
Telecopy Number: 0-000-000-0000
Either party may change its address or its telecopy number for purposes of this
Agreement by giving the other party written notice of its new address or
telecopy number. Any such notice if given or made by registered or recorded
delivery international air mail letter shall be deemed to have been received on
the earlier of the date actually received and the date fifteen (15) calendar
days after the same was posted (and in proving such it shall be sufficient to
prove that the envelope containing the same was properly addressed and posted as
aforesaid) and if given or made by telecopy transmission shall be deemed to have
been received at the time of dispatch, unless such date of deemed receipt is not
a business day on which banks are open in Salem, Oregon, the United States, in
which case the date of deemed receipt shall be the next such succeeding business
day. None of this shall be effective if the sending party has reasonably given
such notice improperly or incompletely transmitted or otherwise not received by
the parties to whom it was sent.
15. Waiver.
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None of the conditions or provisions of this Agreement shall be held to have
been waived by any act or knowledge on the part of either party, except by an
instrument in writing signed by a duly authorized officer or representative of
such party. Further, the waiver by either party of
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any right hereunder or the failure to enforce at any time any of the provisions
of this Agreement, or any rights with respect thereto, shall not be deemed to be
a waiver of any other rights hereunder or any breach or failure of performance
of the other party.
16. Validity.
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Manufacturer warrants that this Agreement is lawful and may be performed in
accordance with its terms under all laws in force in the United States at the
time of execution of this Agreement. Distributor warrants that this Agreement is
lawful and may be performed in accordance with its terms under all laws in force
in Japan at the time of execution of this Agreement. Each party covenants and
warrants to the other party that it will advise the other party of any changes
in the laws of the country or countries as to which it is making a warranty in
this Section of which the party making such warranty becomes aware if such
changes might or will impair the validity or lawful performance of all or any
part of this Agreement.
17. Construction of Agreement and Resolution of Disputes.
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(a) This Agreement, which is in English, shall be interpreted in accordance
with the commonly understood meaning of the words and phrases hereof in the
United States of America, and it and performance of the parties hereto shall be
construed and governed according to the laws of the State of Oregon applicable
to contracts made and to be fully performed therein, excluding the United
Nations Convention on Contracts for the International Sale of Goods.
(b) Any dispute, controversy or claim arising out of or relating to this
Agreement or to a breach hereof, including its interpretation, performance or
termination, shall be finally resolved by arbitration. The arbitration shall be
conducted by one arbitrator selected by Manufacturer and Distributor or, if they
cannot agree on an arbitrator, by the President of International Chamber of
Commerce.
The arbitration shall be conducted in English and in accordance with the rules
of the International Chamber of Commerce, which shall administer the arbitration
and act as appointing authority. The arbitration, including the rendering of the
award, shall take place in Salem, Oregon, USA, and shall be the exclusive forum
for resolving such dispute, controversy or claim. For the purposes of this
arbitration, the provisions of this Agreement and all rights and obligations
thereunder shall be governed and construed in accordance with the laws of the
State of Oregon. The decision of the arbitrators shall be binding upon the
parties hereto, and the expense of the arbitration (including without limitation
the award of attorneys' fees to the prevailing party) shall be paid as the
arbitrators determine. The decision of the arbitrators shall be executory, and
judgment thereon may be entered by any court of competent jurisdiction.
Judgment based on the decision of the arbitrators may be entered by any court of
competent jurisdiction. Notwithstanding this, judgment upon the award of the
arbitration may be entered in any court where the arbitration takes place or any
court having jurisdiction thereof, and application may be made to any court for
a judicial acceptance of the award or order of enforcement.
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(c) Notwithstanding anything contained in this Section 17 to the contrary, each
party shall have the right to institute judicial proceedings against the other
party or anyone acting by, through or under such other party, in order to
enforce the instituting party's rights hereunder through reformation of
contract, specific performance, injunction or similar equitable relief.
18. Manufacturer Marketing Office in the Territory.
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Manufacturer may from time to time maintain a marketing office at one or more
locations in or near the Territory. Personnel associated with such office or
offices shall be authorized to and may, from time to time, act on behalf of
Manufacturer and shall be entitled to exercise all of the rights of Manufacturer
under this Agreement. Such personnel shall be entitled to all information with
respect to all matters relevant to Distributor's performance under the
Agreement, and Distributor shall at all times cooperate with such personnel with
respect to all such matters.
19. Confidentiality Maintained.
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(a) Distributor agrees that Manufacturer has a proprietary interest in any
information provided to Distributor by Manufacturer, whether in connection with
this Agreement or otherwise, whether in written or oral form, which is (i) a
trade secret, confidential or proprietary information, (ii) not publicly known,
and (iii) annotated by a legend, stamp or other written identification as
confidential or proprietary information (hereinafter referred to as "Proprietary
Information"). For such purposes, information regarding the manufacture, design,
pricing, marketing and other aspects of the Products and the manner in which the
Manufacturer conducts its business, excluding information which is, or becomes,
public or general industry knowledge through no fault of the Distributor, shall
be deemed to be "Proprietary Information" whether or not stamped, legended or
otherwise identified as such. Distributor shall disclose the Proprietary
Information only to those of its agents and employees to whom it is necessary in
order properly to carry out their duties as limited by the terms and conditions
hereof. Both during and after the term of this Agreement all disclosures by
Distributor to its agents and employees shall be held in strict confidence by
such agents and employees. During and after the term of this Agreement,
Distributor, its agents and employees shall not use the Proprietary Information
for any purpose other than in connection with Distributor's sale of the Products
in the Territory pursuant to this Agreement. Distributor shall, at its expense,
return to Manufacturer the Proprietary Information as soon as practicable after
the termination or expiration of this Agreement. All such Proprietary
Information shall remain the exclusive property of Manufacturer during the term
of this Agreement and thereafter. This Section 19 shall also apply to any
consultants or subcontractors that Distributor may engage in connection with its
obligations under this Agreement.
(b) Notwithstanding anything contained in this Agreement to the contrary,
Distributor shall not be liable for a disclosure of the Proprietary Information
of Manufacturer, if the information so disclosed: (i) was in the public domain
at the time of disclosure without breach of this Agreement; or (ii) was known to
or contained in the records of Distributor from a source other than Manufacturer
at the time of disclosure by Manufacturer to Distributor and can be so
demonstrated or (iii) was independently developed and is so demonstrated
promptly upon receipt of the documentation and technology by Distributor; or
(iv) becomes known to Distributor from
Page 12--INTERNATIONAL DISTRIBUTION AGREEMENT
a source other than Manufacturer without breach of this Agreement by Distributor
and can be so demonstrated; or (v) must be disclosed pursuant to a contract or
subcontract with a governmental agency in order to obtain/retain a procurement
contract; or (vi) was disclosed pursuant to court order or as otherwise
compelled by law.
20. Entire Agreement.
----------------
This Agreement supersedes and cancels any previous agreements or
understandings, whether oral, written or implied, heretofore in effect and sets
forth the entire agreement between Manufacturer and Distributor with respect to
the subject matter hereof. This Agreement may be translated in the various
languages for the convenience of the parties hereto; however, in the event of
any discrepancy between the translated versions of this Agreement and the
original, the English version of this Agreement shall be controlling for all
purposes.
21. No Rights by Implication.
------------------------
No rights or licenses with respect to the Products or the Trademarks are
granted or deemed granted hereunder or in connection herewith, other than those
rights expressly granted in this Agreement or the Trademark License Agreement.
22. Responsibility for Taxes.
------------------------
Taxes, whether in Japan or any other country, now or hereafter imposed with
respect to the transactions contemplated hereunder, including without
limitation, assessments, duties, custom fees or charges, import fees, value
added taxes, special excise taxes and governmental impositions of any nature
whatsoever which may be levied upon the Products (with the exception of income
taxes or other taxes imposed upon Manufacturer and measured by the gross or net
income of Manufacturer), shall be the responsibility of Distributor, and if paid
or required to be paid by Manufacturer, the amount thereof shall be added to and
become a part of the amounts payable by Distributor hereunder.
23. Modification of Products.
------------------------
Distributor may not customize, modify or have customized or modified any
Product unless it obtains the prior written consent of Manufacturer, which
consent may be withheld in the sole discretion of Manufacturer. Any unauthorized
customizing or modification of any Product by Distributor or any third party
shall relieve Manufacturer from any obligation it would otherwise have had with
respect to such Product under the warranties described in Exhibit A hereto.
24. Force Majeure.
-------------
(a) Neither Manufacturer nor Distributor shall be liable in damages, or shall
be subject to termination of this Agreement by the other party, for any delay or
default in performing any obligation hereunder if that delay or default is due
to any cause beyond the reasonable control and
Page 13--INTERNATIONAL DISTRIBUTION AGREEMENT
without fault or negligence of that party; provided that, in order to excuse
-------- ----
its delay or default hereunder, a party shall notify the other of the occurrence
or the cause, specifying the nature and particulars thereof and the expected
duration thereof and provided, further, that within fifteen (15) calendar days
-------- -------
after the termination of such occurrence or cause, such party shall give notice
to the other party specifying the date of termination thereof. All obligations
of both parties shall return to being in full force and effect upon the
termination of such occurrence or cause (including without limitation any
payments which became due and payable hereunder prior to the termination of such
occurrence or cause).
(b) For the purposes of this Section 24, a "cause beyond the reasonable
control" of a party shall include, without limiting the generality of the
phrase, any act of God, act of any government or other authority or statutory
undertaking, industrial dispute, fire, explosion, accident, power failure,
flood, riot or war (declared or undeclared).
25. Compliance With Laws.
--------------------
Each of Distributor and Manufacturer covenants that all of its activities
under or pursuant to this Agreement shall comply with all applicable laws, rules
and regulations. In particular, but without limitation, Distributor shall be
responsible for obtaining all licenses, permits and approvals which are
necessary or advisable for sales of Products in the Territory and for the
performance of its duties hereunder.
26. Severability.
------------
If any provision of this Agreement is declared invalid or unenforceable by a
court having competent jurisdiction, it is mutually agreed that this Agreement
shall endure except for the part declared invalid or unenforceable by order of
such court. The parties shall consult and use their best efforts to agree upon a
valid and enforceable provision which shall be a reasonable substitute for such
invalid or unenforceable provision in light of the intent of this Agreement.
27. 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.
Page 14--INTERNATIONAL DISTRIBUTION AGREEMENT
28. Definition of Affiliates.
------------------------
For the purposes of this Agreement, "affiliates" shall mean all companies,
natural persons, partnerships and other business entities controlled by, under
common control with or controlling either party to this Agreement.
IN WITNESS WHEREOF, the parties hereto have signed this Agreement.
X.X. Xxxxxx Japan, as Distributor
By /s/ Minor Hase
-------------------
Name: Minor Hase
Title:
Xxxxxx Snowboards Inc., as Manufacturer
By /s/ Xxxxxx Xxxxxxxx
-----------------------
Name: Xxxxxx Xxxxxxxx
Title:
Page 15--INTERNATIONAL DISTRIBUTION AGREEMENT
EXHIBIT A
COVERED PRODUCTS AND MINIMUM PURCHASE REQUIREMENTS
COVERED PRODUCTS/1/
Xxxxxx(R) Xxxxxx(R) Xxxxxx(R) Xxxxxx(R) Apparel
Snowboard Products Bindings Boots and Accessories
------------------ -------- ----- ---------------
MINIMUM PURCHASE REQUIREMENTS PER PRODUCT CATEGORY
Xxxxxx(R) Xxxxxx(R) Xxxxxx(R)
Snowboard Bindings Boots Xxxxxx(R) Apparel
Year Product/2/ (Pairs) (Pairs) and Accessories/3/
---- --------- ------- ------- -----------------
1997 25,000 25,000 10,000
1998 31,250 31,250 12,500
1999 39,000 39,000 16,000
2000/4/ 50,000 50,000 20,000
-------------------
/1/ The Products covered by this Agreement are subject to change as provided in
Section 1.(a) of the Agreement.
/2/ Units of merchandise.
/3/ Dollar amount of invoices of products by Manufacturer to Distributor.
/4/ Assuming this Agreement is extended for the calendar year 2000.
Page 16--INTERNATIONAL DISTRIBUTION AGREEMENT
EXHIBIT B - LIMITED WARRANTY
Page 17--INTERNATIONAL DISTRIBUTION AGREEMENT
