EXHIBIT 10.5
_____________, 2001
Pitney Xxxxx Office Systems, Inc.
000 Xxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Re: Pitney Xxxxx Management Services, Inc./Pitney Xxxxx Office
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Systems, Inc. - Reseller Agreement
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Ladies and Gentlemen:
In connection with the spin-off of the capital stock of Pitney Xxxxx Office
Systems, Inc. ("Office Systems" or "you") by Xxxxxx Xxxxx Inc. ("Pitney Xxxxx")
to its stockholders, Office Systems and Pitney Xxxxx Management Services, Inc.,
a wholly-owned subsidiary of Pitney Xxxxx ("PBMS," "we" or "us") hereby enter
into a reseller agreement to provide for the purchase of equipment by PBMS from
Office Systems (the "Reseller Agreement"). This letter agreement together with
the term sheet attached hereto as Exhibit A (the "Term Sheet") constitute the
Reseller Agreement. The entering into and purchasing under the Reseller
Agreement by the parties herein described and the other transactions
contemplated hereby, entered into and consummated in connection therewith are
herein referred to as the "Transactions".
The parties hereby agree to be bound by the covenants and obligations set
forth in this Reseller Agreement. No amendment or waiver of any provision of
this Reseller Agreement shall be effective unless in writing and signed by the
parties hereto and then only in the specific instance and for the specific
purpose for which given. This Reseller Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York. Each of the
parties hereto waives all right to trial by jury in any action, proceeding or
counterclaim (whether based upon contract, tort or otherwise) related to or
arising out of any of the Transactions or the other transactions contemplated
hereby, or the performance by either party of the services contemplated hereby.
Please confirm that the foregoing correctly sets forth our agreement by
signing and returning to PBMS the duplicate copy of this Reseller Agreement
enclosed herewith.
Very truly yours,
PITNEY XXXXX MANAGEMENT SERVICES, INC.
By: _________________________________
Name:
Title:
Accepted and agreed to as of
the date first written above:
PITNEY XXXXX OFFICE SYSTEMS, INC.
By: _______________________________
Name:
Title:
2
PITNEY XXXXX MANAGEMENT SERVICES, INC.
PITNEY XXXXX OFFICE SYSTEMS
RESELLER AGREEMENT
1. Definitions
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Equipment - Shall mean the analog, digital and digital connected copiers,
facsimile equipment, and multifunctional equipment to be supplied under this
Agreement by mutual agreement of the parties from time to time by PBOS to PBOS.
Installation and Acceptance Date - Shall mean the business day on which
Equipment is installed and operational in accordance with its published
specifications.
Installation Site - Shall mean the location at which Equipment is or will be
installed.
Monthly Charges - Shall mean the "Monthly Rental" charge and the "Cost per
Click" charge ("CPC") for Rented Equipment, and EMA charges for leased or
purchased Equipment in amounts as agreed to by the parties.
PBMS Customers - shall mean a customer of PBMS under a Facilities Management or
similar Agreement.-
Rented Equipment - Shall mean Equipment which is rented by PBMS from PBOS
hereunder, and which is not leased from a third party leasing company or
purchased by PBMS from PBOS.
2. Equipment Ordering and Administration
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A. Ordering: All PBMS orders ("Orders") with PBOS will be placed by the
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Administrative Service Center (ASC) in Tampa, Florida.
All equipment rental, lease and maintenance agreements must be documented
on PBOS Order Agreements. All Order Agreements will be processed by the
ASC, and no orders may be accepted from any other location. All Order
Agreements must note a Capital Investment Proposal (CIP) number, which must
be noted in the section reserved for Purchase Order number on the PBOS
invoice. Order Agreements will be provided by the PBOS Sales Representative
to the PBMS Representative. All order forms submitted to PBMS must note the
following information:
. Xxxx Xx address as noted in the Billing section below
. Install address
. Customer Account Number
. Quantity, Description and Pricing of equipment ordered
. Sales Representative Name, Sales Number, and Telephone Number
All order forms submitted by PBMS to PBOS must note the following
information:
. Information noted above
. Tax Exempt Status
. Tax Exemption Number
. CIP Number noted in Equipment Purchase Order Number field
. Approval Name and Signature of Authorized PBMS employees
The list of PBMS employees authorized to approve equipment orders shall be
agreed upon by the parties. This list will be updated as any changes occur.
Order agreements that do not meet the above requirements may not be
accepted by PBOS, and will be returned to PBMS for correction.
All supply orders will be placed by the ASC with a Purchase Order (PO)
reference. All Order Agreements and supply orders will be processed by the
ASC, and no orders may be accepted from any other location. All supply
orders will note a PO number, which must be noted in the section reserved
for Purchase Order number on the PBOS invoice.
Any orders accepted by PBOS that do not follow these requirements will not
be binding upon PBMS.
To facilitate future ordering, a web-based application will be developed by
PBOS for PBMS to place all supply and equipment orders. A single point of
contact will be dedicated by PBOS for PBMS to place orders.
B. Billing: All invoices will be in electronic format, and will be transmitted
to PBMS via EDI on a monthly basis for equipment rental, lease or
maintenance invoices, and on a weekly basis for supplies and after-hours
service invoices. The sole "Bill To" address for PBMS is:
Pitney Xxxxx Management Services, Inc.
Administrative Service Center
0000 Xxxxxxx Xxxxxx Xxxxx
Xxxxx 000
Xxxxx, XX 00000
(P) (000)000-0000
(F) (000)000-0000
Invoices may not be sent to any other location for any reason. All
inquiries for billing and collection, including aging statements and
xxxxxxx letters, will be directed to the ASC at the address shown above.
Under no circumstances will any billing communication in any form be
directed to PBMS site locations or clients.
Billing must follow the ordering requirements documented above. Any invoice
submitted by PBOS to PBMS that does not follow these requirements
(including disputed line items in electronic invoices) will not be
considered for payment. Such election invoices or line items, where
applicable, will be returned to PBOS within 5 business days, and paper line
items and such consolidated paper invoices will be returned within 10
business days, with explanations why the invoices cannot be processed for
payment. PBOS will credit and re-bill (if necessary) any such invoices
within 30 days. Any incorrect invoices must be deleted from PBMS' aging
statement, and payment for the re-billed invoice will follow the terms
described in the Payment section below.
All standard rental billing will include the current month's base cost plus
the prior month's service cost. PBMS will provide monthly meter reads no
later than the 5th business day of each month via EDI to facilitate billing
by PBOS. If PBMS does not provide meter reads within such time, PBOS will
use an estimated meter read based on prior usage. PBOS agrees to reconcile
estimated meter reads with actual meter reads every six (6) months by
providing credits or invoices to PBMS for the difference. PBOS will bill
PBMS for only the pro-rated monthly base expense for new installations and
cancellations based on the days of the month the equipment is installed.
Monthly Charges shall begin on the Installation and Acceptance Date unless
otherwise agree to by the parties.
C. Payment: Payment on all line items in electronic and paper invoices and
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consolidated paper invoices not subject to a bona fide dispute will be due
to PBOS no later than 30 days from the date of invoice receipt. Payment on
all disputed line items in electronic and paper invoices, and consolidated
paper invoices, will be due within 30 days of the re-bill date, unless such
dispute by PBMS of the line item in the electronic or paper invoice, or of
the consolidated paper invoice is shown to be incorrect by PBOS and in this
circumstance PBMS shall pay such line item or invoice within 5 days of the
response by PBOS. Payment will continue to be made by check, and both
companies will move toward developing payment via Electronic Funds Transfer
(EFT). Both companies shall move forward to develop electronic invoicing
for the current paper invoices.
3. Equipment Pricing
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A. Pricing for the Equipment shall be as agreed upon from time to time by the
parties pursuant to this Agreement.
B. PBOS may provide discounted pricing for cases in which PBMS is replacing
competitive equipment with PBOS Equipment. Such pricing discounts shall be
negotiated on a case-by-case basis.
C. PBOS shall provide reduced rental pricing for continued after-term rental
of Equipment, including rates for month-to-month and 1, 2 and 3 additional
years.
D. PBOS shall, upon request from PBMS, provide short-term rental
pricing (i.e., 6 months or less) for Equipment.
E. Cost per copy charges will include all maintenance, drums, parts and
consumable supplies, excluding paper, staples and costs directly
attributable to Excluded Causes (as defined herein).
F. PBMS and PBOS shall meet quarterly to discuss and update prices for
Equipment and supplies. PBMS and PBOS shall meet annually to discuss and
update cost per copy charges with the agreement that any increases to the
cost per copy charge shall not exceed the increase to the Consumer Price
Index for such year.
G. As PBOS moves into higher end equipment (i.e., copiers rated at making 100
or more copies per minute), PBOS shall provide 3 and 5 year pricing as well
as low and high volume plans (with ability of PBMS to switch from low to
high or high to low on 90-day notice).
H. Any Equipment, rental and/or EMA, as applicable, assumed by a PBMS Customer
may be assumed at PBMS' or other negotiated rates, subject to PBOS credit
approval.
I. PBOS and PBMS agree to negotiate pricing in good faith on a case-by-case
basis where the PBMS Customer is seeking lower pricing than that offered by
PBMS.
J. PBOS hereby waives any and all installation and removal charges for
facsimile Equipment.
K. At the end of the original copier rental term, PBMS may renew such rental
at an agreed-upon rate on an annual basis. Such annual rental shall be
subject to published increases to the PBOS maintenance charges. If PBMS
does not renew pursuant to these terms, PBMS may continue to rent the unit
on a month-to-month basis at the same rental and maintenance charges.
L. At the end of the original fax machine rental term, PBMS may renew such
rental for either one (1) or three (3) year periods at PBMS' discretion in
accordance agreed upon pricing. PBMS shall also have the right to renew
such rental at the then-current rental rate on a month-to-month basis.
M. PBOS shall provide standard Starter Kits (including toner and drums,
operating instructions, cables and other standard supplies) for fax
machines to PBMS at no charge.
N. PBMS shall pay for all installation or removal/relocation charges for
copier Equipment.
4. Warranty
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A. For each PBOS product rented, leased or purchased by PBMS, PBOS shall non-
exclusively transfer to PBMS all warranties, remedies and indemnifications
that it holds from the equipment manufacturer. PBOS shall non-exclusively
transfer to PBMS all Epidemic Failure and related warranties that PBOS
receives from its vendors. If the warranty is not transferable, PBOS will
covenant to provide PBMS with the practical benefits of such warranty
and/or indemnification. Any and all warranty claims by PBMS or PBMS's
Customer shall be made to PBOS and not to the Equipment manufacturer.
Should PBMS purchase an
EMA (as hereinafter defined) on a unit of Equipment, the coverage
afforded under such EMA shall be in addition to any warranty provided
herein.
B. Any additional or conflicting warranty terms provided by PBMS to its
Customers not previously agreed to in writing by PBOS shall be at PBMS's
sole risk and expense.
C. THESE WARRANTIES ARE THE ONLY WARRANTIES APPLICABLE TO THIS RESELLER
AGREEMENT, THE EQUIPMENT AND THE SUPPLIES, AND ARE EXPRESSLY IN LIEU OF ALL
OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR ANY OTHER WARRANTY.
UNLESS OTHERWISE SET FORTH IN A PBOS VENDOR WARRANTY, REPAIR OR REPLACEMENT
OF THE EQUIPMENT OR REPLACEMENT OF SUPPLIES IS PBMS'S SOLE REMEDY. PBOS
DOES NOT ASSUME RESPONSIBILITY FOR ANY CONSEQUENTIAL, INDIRECT, INCIDENTAL
OR PUNITIVE DAMAGES INCURRED BY REASON OF THE FAILURE OF THE EQUIPMENT TO
OPERATE AS INTENDED.
5. Nonexclusivity
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A. The relationship between PBMS and PBOS shall be nonexclusive.
"Nonexclusive" means that PBMS may purchase, lease or rent copiers and
facsimile machines, supplies, peripherals and all associated parts and
services from any vendor it chooses. PBMS shall have no minimum volume
purchase requirements with PBOS.
6. Equipment Cancellation
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A. PBMS shall have the ability to cancel up to twenty percent (20%) per PBMS
Customer of the PBMS fleet population of Facsimile Equipment each year. All
requests for cancellation shall be submitted by the ASC in Tampa, Florida
in writing to PBOS no less than thirty (30) days prior to the requested
Equipment removal date via facsimile or email to the address set forth
hereinafter, provided that the Equipment unit has been installed a minimum
of ninety (90) days and is not replaced with competitive equipment by PBMS.
B. PBMS will remain responsible for any base and overage expenses during the
notification period. After that period, PBMS will no longer be responsible
for any costs associated with the equipment. Billing will cease after the
effective cancellation date.
C. PBMS will work with PBOS in every loss of business situation to retain PBOS
equipment on-site by the Client or FM successor. PBMS will notify the PBOS
National Account Manager of loss of business situations promptly after the
Client communicates the same to PBMS.
D. If PBOS fails to remove requested Equipment in accordance with the
cancellation provisions above, PBOS will be liable for any removal and
storage costs incurred by PBMS to meet a Customer's removal request. PBMS
shall be responsible for any costs associated with removal of Equipment
prior to the effective date.
7. Indemnification
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A. PBOS shall indemnify, defend and hold harmless PBMS, its affiliates,
directors, officers, and employees, from and against any losses, claims of
losses, damages and expenses (including without limitation court costs and
attorneys' fees) caused by:
1. Defective Equipment to the extent provided by the equipment
manufacturers to PBOS
2. Defective maintenance and associated services provided by PBOS
hereunder
3. any other matters pertaining to the subject matter of this
Agreement with respect to which PBOS receives indemnification
and/or defense from its vendors or third parties
B. Each party agrees to indemnify, defend and hold harmless the other, its
affiliates, directors, officers, and employees, from and against any
losses, claims of losses, damages and expenses (including without
limitation court costs and attorneys' fees) to the extent caused by the
negligence or willful misconduct of the indemnifying party, its directors,
officers, or employees.
C. The party entitled to indemnification under this Agreement (the
"indemnified party") shall promptly notify the party required to indemnify
(the "indemnifying party") of any indemnification claims. The indemnifying
party shall have the right to control the defense of such claim including
the right, with the consent of the indemnified party, to compromise or
settle such claim. The indemnified party shall participate in such defense
if requested by the indemnifying party and shall be reimbursed for the
expenses incurred as a result of such participation.
D. PBOS will, at its sole expense, indemnify, defend, and hold harmless PBMS,
its parent, directors, officers and employees from and against all
liability as a result of a claim or action asserted by any third party
based upon PBMS's or PBMS's Customers' use and/or possession of the
Equipment infringing any U.S. patent, copyright, trade secret, trademark or
other intellectual property right or interest of any third party
("Infringement"), and PBOS will pay damages, costs, expenses, settlement
amounts and judgments finally awarded against PBMS or PBMS's Customers and
relating thereto (including court costs and attorneys' fees). PBMS agrees
to promptly notify PBOS in writing of any matters in respect to which the
foregoing indemnity may apply and PBOS shall be relieved of its obligations
under this Section to the extent it is prejudiced by PBMS's failure to
timely notify it of such matter. PBOS shall have the exclusive right to
control and conduct the defense and settlement of all such claims or
actions. PBMS agrees to provide such assistance at PBOS' expense that may
be reasonably required by PBOS in connection with such settlement or
defense. If final judgment shall be obtained against PBMS's or PBMS's
Customers' use or operation of the Equipment, or any part thereof, by
reason of such Infringement, or if in PBOS's opinion, the Equipment is
likely to become subject to a claim of Infringement, PBOS shall, at its
sole expense and option, either (a) modify the Equipment so that it becomes
non-infringing without materially altering its capacity or performance; (b)
procure for PBMS the right to continue to use the Equipment; or (c)
substitute for the infringing Equipment other equipment having a capability
equivalent to the Equipment. If neither (a) through (c) above is reasonably
available to PBOS, then PBOS will remove the infringing Rented or leased
Equipment at its sole cost and expense and PBMS shall have no further
liability for payment therefore, or if the Equipment is purchased by PBMS
then PBOS shall refund to PBMS the purchase price of such unit of Equipment
paid, pro ratable, based upon a thirty-six (36) month useful life. PBOS
shall have no liability with respect to any such claim or action to the
extent caused by the combination, operation or use of the Equipment with
any equipment, device, or alteration to the Equipment not made or
authorized in writing by PBOS. The foregoing states the entire liability of
PBOS to PBMS for Infringement.
8. Service Level Agreements
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A. Customer Penalties.
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PBOS agrees to be subject to the penalties, discounts, cancellations,
reductions, etc. imposed by PBMS Customers for failing to achieve the SLA
requirements as negotiated with PBMS and approved by PBOS in writing on a
case by case basis. PBOS' total exposure with regard to penalties,
discounts, cancellations, reductions, etc. may also be subject to a
mutually agreed upon "not to exceed" amount as negotiated on a
contract-by-contract basis prior to execution of the agreement between PBMS
and its Customer. PBMS will use commercially reasonable efforts to
negotiate SLA requirements in accordance with those set forth below.
However, PBOS acknowledges and agrees that PBMS may enter into agreements
with stricter SLA requirements. PBMS will notify PBOS in such cases prior
to
entering into an agreement with its Customer. PBOS agrees to negotiate
stricter SLA requirements with PBMS upon request on a case-by-case basis.
B. Equipment Uptime.
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Providing PBMS continually (barring reasonable gaps in time for administrative
and renewal procedures) maintains an equipment maintenance agreement with PBOS
("EMA") for a unit of Equipment ("Covered Equipment"), PBOS shall maintain a
PBMS Covered Equipment average fleet Uptime of 97% on a per month, per PBMS
Customer basis. "Uptime" is defined as the time other than the time from a
service call being placed until the unit of Covered Equipment is repaired based
on a 9 hour workday and 5 day workweek.
Uptime Percentage = Hours of Operation - Equipment Downtime
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Hours of Operation
"Equipment Downtime" shall mean the Covered Equipment is not functioning in
substantial compliance with its specifications but shall not include time when
the Covered Equipment is inoperable due to: (i) Excluded Causes; (ii) failure of
a non-standard part; (iii) the use of the Equipment for training exercises; or
(iv) the performance of preventative maintenance.
PBOS will make all necessary adjustments, repairs and parts replacement
necessary to keep the Covered Equipment in good working order in accordance with
its published specifications at no additional charge to PBMS or PBMS Customers,
unless such adjustments, repairs or parts replacement are required due to: (i)
the failure of PBMS or a PBMS Customer to operate the Covered Equipment under
suitable temperature, humidity, line voltage, or any specified environmental
conditions; (ii) the lack of reasonable care by PBMS or a PBMS Customer in
handling, operating, and maintaining the Covered Equipment, including damage by
misuse or malintent; (iii) the use of the Covered Equipment not in accordance
with the agreed applications and for the ordinary purpose for which it is
designed; (iv) any act or failure to act on the part of PBMS; (v) the use of
non-approved accessories, materials or non-approved alterations or additions to
the Covered Equipment, or the use of damaged materials, such as paper or
envelopes; (vi) the use of the Covered Equipment in excess of its volume rating;
(vii) malfunction of equipment, parts, components, or software provided by PBMS
or third parties which interfaces with the Covered Equipment, or (viii) any loss
or damage resulting from perils or casualty, including fire, water damage or
other external cause; (all of the foregoing causes collectively the "Excluded
Causes"). PBMS shall promptly notify PBOS of any unauthorized alteration of, or
addition to the Covered Equipment.
C. PBOS shall perform maintenance service necessitated by Excluded Causes or for
non Covered Equipment at PBOS's then current published time and materials rates.
PBOS will quote an estimate of the cost for such maintenance services in
advance.
D. In the event PBOS has failed to meet the Uptime Percentage or has received
three (3) requests for maintenance service on any particular unit of Covered
Equipment in any consecutive thirty (30) day period, PBOS will (i) repair the
malfunctioning unit; and (ii) upon receipt of a fourth (4th) request for
maintenance service for such unit (unless any such maintenance is due to an
Excluded Cause) order a replacement unit of Covered Equipment which will be
shipped to PBMS in accordance with the time frame set forth in this Agreement
and will be promptly installed by PBOS. In addition, PBOS shall provide for the
repair or replacement of the Covered Equipment within ten (10) days of written
notice of defect. If such Covered Equipment is not or cannot be repaired within
such time, PBOS shall provide comparable loaner Equipment until such defective
Covered Equipment is repaired.
E. Customer Service.
1. PBOS agrees to respond to all service calls within a fleet average of
four and one-half (4 1/2) business hours, as measured from receipt of
the PBMS's call for PBMS Customers located within a twenty-five (25)
mile radius from the nearest PBOS location. For PBMS Customers located
beyond the twenty-five (25) mile radius, PBOS shall respond within a
fleet average of six (6) business hours. Normal business hours are
defined as 8:00am to 5:00pm, Monday to Friday, except holidays.
2. PBOS shall provide a staffed customer service center from 8:00am to
5:00pm in each time zone at no additional cost to PBMS.
3. PBOS shall establish and/or maintain a toll-free number for use by
PBMS or PBMS Customers to report service calls.
4. PBOS shall provide competitive pricing to PBMS for 24x7 service on a
case by case basis.
5. PBOS shall respond to all calls by telephone within one (1) business
hour.
F. Demos.
PBOS agrees to review PBMS Equipment demo or trial units requests on a case
by case basis.
X. National Account Manager.
PBOS shall appoint a full-time, dedicated National Account Manager (NAM)
who reports directly to the Vice President, Sales of PBOS, to be the
contact person for all PBMS informational requests, complaints, etc.
H. Training.
PBOS shall provide training at no charge at its discretion on a case by
case basis to designated PBMS employees for new Equipment model use and
specifications. PBOS shall provide to PBMS, at no extra cost for facsimile
Equipment and included in the cost of installation for copier Equipment,
training of PBMS's or PBMS Customers' "Key Operator(s)" at the PBMS
Customer site for each unit of Equipment to a maximum of three (3) training
sessions for ninety (90) days from the date of Equipment installation.
Additional training will be billed at PBOS's standard rates at the time
such training is requested.
I. On-Site Personnel. Except as otherwise provided herein, PBOS shall provide
competitive pricing and the parties agree to negotiate with each other in
good faith on a case-by-case basis for the placement of on-site PBOS
employees at Customer locations. Such on-site PBOS employees must pass
PBOS' standard background checks prior to working on site at Customer
locations. PBOS shall perform and PBMS shall pay for any background checks
beyond PBOS' standard background checks.
Notwithstanding the foregoing, in the event that a PBMS Customer: has in
one (1) building or a "close cluster of buildings" either a) 143 or more
units of PBOS copier Equipment or b) makes 1,430,000 or more copies per
month, then, for every 143 copiers or 1,430,000 copies per month, PBOS
shall place one (1) full-time maintenance technician on such PBMS Customer
site at no charge to PBMS or PBMS's Customer.
J. Installation.
PBOS shall install Equipment within three (3) days of notification (via fax
or e-mail) from PBMS of equipment receipt by the customer. PBOS agrees to
coordinate with PBMS and each PBMS Customer to ensure proper installation
requirements are met.
After-hours service requests before 8 AM and after 5PM on weekdays and all
day on weekends or holidays may be accepted from field locations. The
requesting site will be required to fax to PBOS a PBMS Purchase Requisition
(PR) to request the service. The PR number must be noted in the section
reserved for Purchase Order number on the PBOS invoice.
9. Reports
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PBOS will provide PBMS with service, quality and administrative reports on a
monthly basis as defined below.
. Copier equipment response time with a pareto showing percentage of calls
with a response of four and a half (4 1/2) hours or less, percentage of
calls with a response between four and a half (4 1/2) hours and six (6)
hours, percentage of calls with a response between six (6) hours and eight
(8) hours, and percentage of calls with a response time over eight (8)
hours.
. All equipment with three (3) or more calls in thirty (30) days (3/30's),
with regard to customer calls only
. Facsimile equipment response time, including the average telephone repair
time from the Melbourne Diagnostic Center.
10. Past Agreements
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For those transactions for the sale, lease or purchase by PBMS of copier and
facsimile equipment from PBOS which originated prior to the effective date
hereof, PBOS agrees to honor its past practices, including but not limited to
fleet management agreements agreed upon by PBMS with its customers, with PBMS to
the extent they were followed prior to the effective date hereof.
11. Agreement Term and Termination
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(a) The initial term of this Agreement shall begin on the Effective Date and
shall continue for a period of two (2) years ("Initial Term"). The Agreement
may be extended for additional one (1) year periods (the "Renewal Term") upon
mutual written agreement of the parties at least sixty (60) days prior to the
end of the Initial Term. The Initial Term and Renewal Term are collectively
referred to as the "Term" of this Agreement, which shall be extended as to
individual units of Equipment as set forth in Section (b) below.
(b) It is specifically understood and agreed by the parties that each unit of
Equipment rented by PBMS from PBOS hereunder shall be rented for the term set
forth in the individual rental order, which term shall be mutually agreed to by
the parties and shall begin on the Installation and Acceptance Date (the
"Equipment Term") and that the applicable terms and conditions of this Agreement
relating to such unit of Equipment shall be extended accordingly. Should a unit
of Equipment be leased from a third party leasing company by PBMS, the terms and
conditions of the lease shall be controlling, excepting as to the maintenance
and warranty provisions, and the termination of such maintenance provisions, set
forth herein.
(c) If any additional accessory equipment or other item is rented from PBOS and
is added to any unit of Equipment, the rental term of such item shall be
coterminous with the Equipment Term of the unit of Equipment to which it is
attached and the price of the Equipment shall be adjusted accordingly based on
the price of accessory equipment or other item added to the Equipment.
(d) PBOS and PBMS shall have the right to terminate this Agreement and/or
affected Order(s) as the case may be upon the occurrence of any of the following
events of default, provided however, that for any default specified in (i)
below, either party may terminate only those units of Equipment which are the
subject of the default:
(i) A party fails to perform any material obligation under this Agreement
and such failure continues unremedied for a period of thirty (30) days
after the non-defaulting party provides written notice as to the failure to
perform;
(ii) PBMS shall fail to make any undisputed payments when due
under this Agreement and such failure shall continue for thirty (30) days
after PBOS provides written notice of such failure;
(iii) A proceeding is commenced by or against a party under any law
relating to bankruptcy, or a court assumes jurisdiction of a party's assets
under any law authorizing reorganization of its debts, or a trustee or
receiver shall be appointed for all or a substantial portion of the party's
assets;
(iv) A party shall become insolvent or suspends its business for
any length of time; or
(v) A party shall make an assignment of its assets
for the benefit of its creditors.
(e) In addition to other remedies available to PBOS herein, and without
exclusion of any remedy available to PBOS at law or in equity, upon the
occurrence of any of the events of default set forth above by PBMS, PBOS may
take, or retain, possession of the affected Equipment and may remove the same,
and for such purpose may enter upon any premises where the same shall be
situated with the permission of PBMS. Upon PBOS retaining or retaking possession
of a unit of Equipment as provided in this Section, the affected order(s) (and
the rental(s) contained therein) shall immediately terminate, without prejudice,
however, to any other right or claim of PBOS against PBMS.
(f) The parties acknowledge that PBOS has based its pricing for the rental and
maintenance services provided hereunder in reliance on PBMS's fulfillment of all
of its obligations under this Agreement for the entire Term, as extended by
Section 11 (b). Therefore, should this Agreement terminate due to PBMS default
prior to the end of the Term, as extended by Section 11 (b), for all Rented
Equipment, the unpaid total Monthly Rental charge, or, if the Monthly Charge for
the unit of Equipment is based solely on CPC charges, the greater of the average
of CPC charges for the 3 months prior to such termination date, or the minimum
CPC charges for each unit of Equipment, as agreed upon by the parties, for each
unit of Rented Equipment and its accessories, for the balance of the Equipment
Term(s) of each of such units of Equipment, shall be accelerated and PBMS shall
promptly pay to PBOS within thirty (30) days of the termination of this
Agreement the outstanding total Monthly Charges or minimum CPC Charges, as
applicable, for all such units of Equipment and its accessories for the
remaining balance of their Equipment Term(s).
(g) In the event of PBOS default and failure to cure pursuant to Section
11(d)(i) above, PBMS shall have the right to terminate all Orders at the
affected PBMS Customer (the "Terminated Orders") at no cost to PBMS. PBMS shall
provide written notice to PBOS as to when PBMS requires the Rented Equipment to
be removed by PBOS, such date to be no later than 120 days from the date of
notification. PBOS shall continue to provide maintenance pursuant to this
Agreement on the Terminated Orders providing PBMS continues to pay for such
maintenance and for all rental payments due on the Rented Equipment rented under
such Terminated Orders until the effective date of termination. Upon such
termination effective date, PBOS shall remove all Rented Equipment subject to
the Terminated Orders at its cost. For PBMS-purchased Equipment that is subject
to this Section 11(g), PBOS shall pay to PBMS within thirty (30) days of the
effective termination date a refund of the purchase price of each unit of
purchased Equipment pro-rated over a thirty-six (36) month time period,
providing such Equipment is returned to PBOS in good condition, reasonable wear
and tear and any defects caused by PBOS excepted.
12. Scope of the Agreement
----------------------
This is an agreement between PBOS and PBMS to enable PBMS to rent or purchase
Equipment from PBOS, or lease Equipment from third party leasing companies, for
the purpose of providing such Equipment to PBMS Customers pursuant to a PBMS
Facilities Management agreement (or
other similar agreement), purchasing supplies therefore, and for PBOS to
maintain such Equipment pursuant to the provisions set forth herein. The
provisions of this Agreement shall only apply to Equipment rented, leased or
purchased by PBMS on or after the effective date of this Agreement. All
Equipment rented, leased or purchased by PBMS prior to the effective date of
this Agreement shall be subject to the terms pursuant to which they were rented,
leased or purchased by PBMS.
13. Taxes/Liens
------------
In addition to payment of the charges set forth herein for Equipment, and the
payment for Supplies, and any additional services or parts, PBMS shall pay all
applicable sales taxes on Equipment and property taxes on purchased or leased
Equipment which may now or hereafter be imposed or levied upon the Equipment,
its use or operation, the Supplies, and any additional services or parts
(exclusive of taxes based on or measured by PBOS's net income, personal
property, business privilege and franchise taxes), unless PBMS provides PBOS
with a valid tax exemption certificate. PBOS shall be responsible for all
applicable property taxes on Equipment rented by PBMS. PBMS shall keep the
Equipment free of all liens, levies or other encumbrances.
14. Equipment Delivery, Installation/Removal
----------------------------------------
(a) PBOS will make reasonable efforts to ship all Equipment to the Installation
Site(s) within ten (10) business days of receipt of PBMS's Order(s), or an order
from a leasing company to ship such Equipment, unless a shorter period of time
is mutually agreed upon by the parties. However, PBOS will ship all Equipment to
the Installation Site(s) within twenty (20) business days of receipt of PBMS's
Order(s). In the event that PBOS has discontinued the rental of such Equipment
or the Equipment is otherwise not available for shipment to PBMS for reasons
other than those covered under Section 22, Force Majeure, PBOS shall ship
Equipment which has the same or comparable functionality, performance and
operation as the discontinued or unavailable Equipment at the same price.
(b) PBOS' installation services include uncrating, unpacking, connection to
peripherals, power, communication and other utilities, training and rendering
the Equipment ready for use, all subject to the applicable terms of this
Agreement.
(c) PBMS shall have the area at the Installation Site where the unit of
Equipment is to be installed prepared and ready to receive the unit of Equipment
prior to its delivery, including providing adequate power, analogue phone line
(if required for the unit of Equipment), lighting, humidity control, HVAC, and
security.
15. Location/Identification
-----------------------
The Installation Site(s) of the Equipment may be changed by PBMS upon thirty
(30) days prior written notice to PBOS. PBOS, at the request of PBMS, will
disconnect and reconnect such Equipment. PBMS will be responsible for any
transportation charges associated with such movement of Equipment. PBMS shall
not remove from the Rented Equipment any label affixed thereto, which identifies
the Rented Equipment as being PBOS's property and shall not alter or modify the
Equipment in any way.
16. Access
------
Where applicable, PBOS, its employees and authorized agents shall have
reasonable access to the Equipment to provide maintenance service and obtain
copy counts, subject to the reasonable and standard security regulations and
operational procedures existing at the Installation Site. PBMS or PBMS's
Customer will inform PBOS in writing of all appropriate security regulations and
operational procedures, and any changes thereto.
17. Surrender, Removal and Return of Equipment
------------------------------------------
Upon termination of this Agreement or upon termination of the rental of any unit
of Equipment pursuant to this Agreement, PBMS will make such Equipment available
for removal and pick-up by PBOS. PBOS will be responsible for the removal of the
Rented Equipment from the Installation Site(s) pursuant to the terms set forth
herein.
18. Quiet Enjoyment
---------------
During the Term of this Agreement and so long as PBMS is not in default of any
material obligation hereunder, PBMS and PBMS Customers shall be entitled to use
the Rented Equipment without disturbance.
19. Title to Equipment
------------------
With regard to Rented Equipment only, the Equipment is, and shall at all times
remain, the property of PBOS. PBMS shall acquire no right, title or interest
therein. The Rented Equipment shall for all purposes remain personal property
notwithstanding that the Equipment may become attached or affixed to real
property or any improvements thereon.
20. Limitation of Liability
-----------------------
Neither party shall be liable one to the other for any special, indirect,
incidental, punitive, exemplary or consequential damages (including without
limitation loss of profits) arising out of or in connection with this Agreement,
the Equipment and servicing thereof, Supplies, parts, and Order(s) issued
hereunder.
21. International Rentals
---------------------
All rentals of Equipment made outside of the United States must be negotiated
with PBOS's local authorized distributor and are not subject to the terms and
conditions of this Agreement.
22. Force Majeure
-------------
Neither party shall be liable to the other for any delay or failure to perform
its obligations due to any cause beyond its reasonable control including any act
of God, the action of any government or judiciary; provided that in any such
event, the parties shall notify the other of any such delay and make a diligent
effort to resume its responsibilities hereunder.
23. Insurance
---------
(a) PBOS shall at all times during the term of this Agreement maintain the
indicated levels of the following types of insurance, with carriers that
maintain a Best rating of A or better.
A. General Liability $4,000,000
B. Worker's Compensation Statutory
C. Employer's Liability $2,000,000
D. Automobile Liability $2,000,000
E. Employee Crime Liability $1,000,000
F. Product Liability $2,000,000
(b) PBOS shall furnish to PBMS, upon request, a standard form Certificate of
Insurance naming PBMS as an additional insured under PBOS's general liability
coverage. Such Certificate of Insurance shall also provide that the insurer
shall give PBMS notice thirty (30) days prior to cancellation, modification or
material reduction of any policy referenced in the certificate.
24. Audit
-----
PBOS agrees that its books, records and related documents pertaining to
maintenance of the Equipment under an EMA Contract or Warranty, or the amounts
charged to PBMS by PBOS hereunder shall at all reasonable times be subject to
inspection and audit upon thirty (30) days written notice and during normal
business hours by an independent accounting firm selected by PBMS. Such firm
shall keep all such information confidential and shall agree in writing to be
subject to the confidentiality requirements of this Agreement. The firm shall
confirm the maintenance statistics or charges to PBMS but shall not release to
PBMS any information that is confidential or proprietary to PBOS. PBOS agrees to
keep detailed, complete and accurate records for all Equipment rented, sold,
maintained and returned hereunder. In the event any such audit reveals that PBMS
made an overpayment to PBOS under this Agreement, then subject to a review of
the audit by PBOS, PBOS shall pay such overpayment amount to PBMS within thirty
(30) days of overpayment notification, unless subject to a bona fide dispute in
which case such amount shall be negotiated in good faith between the parties.
25. Confidentiality
---------------
PBMS and PBOS each agree that it shall not disclose, duplicate, copy or use for
any purpose other than the performance of this Agreement and Order(s) issued
hereunder and shall treat as confidential and as proprietary such information
(in whatever form) that relates to PBOS's (in the case of PBMS) or PBMS's or
PBMS's Customer's (in the case of PBOS) research, development, trade secrets,
business affairs or other confidential or proprietary information with at least
the same degree of care and protection it uses in the care and protection of its
own proprietary and confidential information; provided, however, the obligation
to treat as proprietary and confidential shall not apply to information which is
(a) publicly available through no wrongful act of either party; (b) in the other
party's possession on the date of this Agreement free of any obligation to keep
it confidential; (c) independently developed; and (d) obtained rightfully from a
third party not under any obligation of confidentiality. The foregoing shall in
no way restrict any disclosure by either party (a) pursuant to (i) any law of
the United States of America or of any State thereof, (ii) the order of any
court or governmental agency, (iii) the rules or regulations of any governmental
agency having regulatory authority, or (b) if either party in its reasonable
judgment, determines that any such disclosure is necessary in order to comply
with, or avoid violation of any request by a regulatory authority.
PBOS shall ensure that any of its employees or subcontractors who perform
services at an Installed Site execute confidentiality statements (or such
similar documents) as may be required by PBMS Customers.
26. Reseller Rights
---------------
For the term of this Agreement, PBOS hereby grants PBMS the nonexclusive right
to market, resell, re-lease, re-rent and bill for the Equipment to PBMS
Customers pursuant to Facilities Management Agreements or similar agreements and
subject to the provisions of any third party lease for Equipment. PBOS further
grants PBMS the right to use PBOS trademarks, trade names and other intellectual
property solely for the purposes set forth in this Agreement and subject to the
prior written approval of PBOS.
27. Assignment
----------
This Agreement may not be assigned without the prior written consent of the
other party, except that either party may assign this agreement to a parent,
subsidiary, affiliate, or successor to substantially all of the assets of such
party. Any purported assignment without consent shall be deemed null and void
and having no effect.
28. Miscellaneous Provisions
------------------------
(a) Section headings are included for convenience only and are not to be used
to construe or interpret this Agreement.
(b) Neither party's officers or employees, agents or contractors, will, by
virtue of this Agreement, be deemed officers, employees, agents, or contractors
of the other party for any purpose. It is understood by PBMS and PBOS that the
relationship between the parties hereunder shall at all times be that of
independent contractors.
(c) No delay, failure or waiver of either party's exercise or partial exercise
of any right or remedy under this Agreement shall operate to limit, impair,
preclude, cancel, waive or otherwise affect the existence of such right or the
exercise of such remedy at a future time.
(d) If any provision of this Agreement is held invalid, illegal, or
unenforceable, the validity, legality, or enforceability of the remaining
provisions shall in no way be affected or impaired thereby.
(e) This Agreement shall be construed and enforced in accordance with the laws
of the State of Connecticut without reference to the conflict of laws provisions
thereof. The parties hereby consent to the personal jurisdiction of the state
and federal courts within the State of Connecticut, County of Fairfield, for the
adjudication of all matters relating to, or arising under this Agreement.
(f) This Agreement may be executed by the parties hereto in one or more
counterparts, and each of which when so executed shall be an original, but all
such counterparts shall constitute but one and the same instrument.
(g) Written notice or submission of written replies required by this Agreement
shall be accomplished by personal delivery, registered mail or certified mail
(return receipt requested) postage prepaid addressed to the following location
or such other location provided by the parties during the term of this Agreement
by notice similarly given:
If to PBOS: If to PBMS:
Pitney Xxxxx Office Systems, Inc. Pitney Xxxxx Management Services, Inc.
000 Xxxxxxx Xxxxx 00 Xxxxx Xxxxx
Xxxxxxxx, XX 00000-0000 Xxxxxxxx, XX 00000-0700
Attn: Contracts Administrator Attn: Xxxxxxx Xxxxxxxxx
With a copy to: With a copy to:
Pitney Xxxxx Office Systems, Inc. Pitney Xxxxx Inc.
000 Xxxxxxx Xxxxx Xxx Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000-0000 Xxxxxxxx, XX 00000-0000
Attn: General Counsel Attn: Vice President & General Counsel, MSC 64-05
Notice will be effective upon personal delivery, or if mailed, as provided above
on the first business day following the date of mailing.
(i) This Agreement together with the Exhibits attached hereto and all Order(s)
issued hereunder, constitute the entire agreement between the parties,
concerning the subject hereof. No amendment, modification, or waiver of any term
of this Agreement shall be effective unless such amendment, modification, or
waiver is in writing and signed by PBOS and PBMS.
(j) If PBOS so requests, PBMS shall execute any such document as PBOS shall
deem reasonably necessary in writing to evidence PBOS's interests in Rented
Equipment or the applicable rental. PBOS is authorized to file a financial
statement signed only by PBOS with respect to the applicable rental, naming PBMS
as a renter or lessee, when permitted by the Uniform Commercial code solely for
the purpose of giving public notice of PBOS's ownership of the Rental Equipment
specified in the applicable rental.
(k) Any terms or conditions of this Agreement which by their express terms
extend beyond termination or expiration of this Agreement or which by their
nature shall so extend shall survive and continue in full force and effect after
any termination or expiration of this Agreement.
