Exhibit 10(a)
DVDO RESELLER AGREEMENT
This Agreement is executed between DVDO, Inc. (a California
corporation) with offices at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and
Sound Designs, Inc. ("Reseller") Nevada corporation with offices at ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇ ▇▇▇ ▇▇▇. The Effective Date of this
Agreement is September 14, 1999.
DVDO wishes to sell iScan(TM) products ("Product") to Reseller and
Reseller wishes to buy such Product from DVDO for resale under the terms and
conditions contained herein.
SELLER:
BY /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ BY /S/ ▇▇▇▇▇ ▇▇▇▇
---------------- ------------------------
NAME ▇▇▇▇▇ ▇▇▇▇ NAME ▇▇▇▇▇ ▇▇▇▇
TITLE PRESIDENT TITLE PRESIDENT
1. Term and Termination. The term of this Agreement shall be from the Effective
Date until terminated by either party with 30 days written notice. Immediate
termination will result from any of the following (i) an uncured breach of a
term hereof, (ii) an unauthorized disclosure of DVDO confidential information as
defined in Section 10 hereof, (iii) or the cessation of either party to conduct
business in the normal fashion (bankruptcy, etc.).
2. Purchase, Pricing and Shipment. Reseller shall purchase Product either by a
credit card accepted by DVDO or by written purchase order. Pricing shall be
based on the quantity of each shipment in accordance with the then effective
DVDO Reseller price list ("Price List"), a copy of which, current as of the
Effective Date, is attached hereto. The first one hundred (100) units of Product
purchased hereunder must be prepaid by Reseller. Upon approval of Reseller's
credit by DVDO, subsequent purchases may be made with Net 30 day terms provided,
however, that DVDO shall have the right to re-impose prepaid cash terms, by
written notice and effective upon Reseller's next purchase, in the event that
Reseller fails to pay any invoice within thirty (30) days of the invoice date.
All payments shall be made in U.S. dollars. Shipment shall be FOB point of
origin and the ship method shall be that specified by Reseller from the options
offered by DVDO. DVDO shall make every effort to ship Product according to the
lead times specified in the then effective Price List and will notify Reseller
of any unavoidable delay. BUYER:
3. Minimum Advertised Pricing. While Reseller shall retain the right to set its
own resale price for Product, the minimum price for each type of Product which
Reseller may display by an public means, including but not limited to any
advertising or Internet forums or chat rooms, shall be that specified in the
then effective Price List. Further, Reseller agrees to impose this requirement
on any of its customers who will resell Products to end users. Failure to comply
with this term shall be a material breach of this Agreement.
4. Relationship of the Parties. The relationship of the parties hereto shall be
that of seller and buyer. No form of agency or other special relationship is
created hereby. Neither party may obligate the other party to any condition
whatsoever.
5. Exclusivity. In consideration of Reseller's issuance of a prepaid purchase
order for one hundred (100) units of Product to be shipped in a single lot
immediately upon the execution of this Agreement, DVDO grants to Reseller
exclusive distribution rights in the country of Canada as further defined in
this Section. The initial grant of exclusivity shall be for a period of six (6)
months from the Effective Date. In the event that, within this initial
exclusivity period, Reseller places additional non-cancelable purchase orders
with DVDO for a minimum of 200 units of Product, then the exclusivity defined
herein will be extended for another six (6) month period. During that second
exclusivity period, DVDO and Reseller may determine a mutually agreeable Product
sales goal, the achievement of which will extend the exclusivity defined herein
for additional period(s). During any period of exclusivity, DVDO agrees to refer
Reseller all Canadian distributors and dealers and not to sell Product to them
directly. DVDO may, however, sell Product directly to any Canadian end user who
purchases units at the then current Product MSRP. Further,
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DVDO will make no effort to monitor purchases of Canadian distributors or
dealers from non-Canadian resellers.
6. Returned Units. Other than units of Product returned under the warranty
provisions hereof, all other returns are limited to Products returned by end
users to Reseller within fifteen (15) days of the date of purchase from a
reselling customer of Reseller. In addition, DVDO will, for a period of ninety
(90) days from the Effective Date, accept returns of unopened units of Product
from Reseller's initial one hundred (100) piece purchase order. All non-
warranty returns shall be subject to a fifteen percent (15%) restocking charge
to be calculated by DVDO against the most recent price(s) paid by Reseller for
the Product. Prior to any return of Product, Reseller must obtain a Return
Authorization from DVDO. Failure to obtain such Authorization may result in the
refusal by DVDO of Reseller's shipment.
7. Technical Support. Reseller agrees to provide technical support to the end
users who are its customers. End users who DVDO directly will be referred to
their Reseller. DVDO will provide second level technical support to Resellers
during the term of this Agreement.
8. Grant of License. With the following exception, DVDO makes no grant of
license of any of its intellectual property to Reseller. During the term of this
Agreement, DVDO grants to Reseller a license to use DVDO's trademarks, including
but not limited to DVDO, PureProgressive and iScan, in Product advertising
prepared by Reseller. DVDO shall have the right to inspect Reseller's use of the
licensed trademarks and may, in its sole judgment, require Reseller to
immediately suspend such use.
9. Product Warranty. The Products are warranted against defects in materials and
workmanship for a period of twelve (12) months after receipt by Reseller's end
user customers but not longer than fifteen (15) months after shipment by DVDO to
Reseller, except the initial one hundred (100) unit shipment which shall be so
warranted for not longer than eighteen (18) months after shipment by DVDO to
Reseller. EXCEPT FOR THE WARRANTIES SET FORTH IN THIS SECTION, SELLER DISCLAIMS
ALL WARRANTIES WITH REGARD TO THE PRODUCT, INCLUDING ALL IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, AND THAT STATED EXPRESS
WARRANTIES ARE IN LIEU OF ALL OBLIGATIONS OR LIABILITIES ON THE PART OF SELLER
FOR DAMAGES, INCLUDING BUT NOT LIMITED TO SPECIAL, INDIRECT, OR CONSEQUENTIAL
DAMAGES ARISING OUT OF OR IN CONNECTION WITH THE SALE, LICENSE, USE OR
PERFORMANCE THEREOF FOR WHICH SELLER SHALL HAVE NO LIABILITY.
10. Indemnification. DVDO agrees to indemnify and hold harmless Reseller against
any and all claims that the unmodified Product delivered to Buyer by Seller
pursuant to this Agreement constitutes an infringement of any United States
patent, copyright, trademark or trade secret of any third party provided that
DVDO is given immediate notice of any alleged infringement and complete control
of the defense against such claims.
11. Confidential Information. From time to time, DVDO may provide confidential
information to Reseller, including but not limited to new product information
and the Price List, which Reseller agrees to hold in strict confidence until
such information is publicly announced by DVDO or until Reseller is given
written authorization by DVDO to release such information. Failure to comply
with this term shall be a material breach of this Agreement and will result in
its immediate termination.
12. General Terms and Conditions. With the exception of Section 10, the total
liability of DVDO to Reseller for any obligation contained herein shall be
limited to the total of all monies paid by Reseller to DVDO as of the date such
liability is incurred. All notices shall be in writing, sent to the address
provided above by overnight courier, and shall be considered to have been given
when picked up by the courier. If either party fails to perform an obligation
hereunder and is given notice of such non-performance by the other party, the
party in breach shall have thirty (30) days to cure the non-performance. All
durations specified herein are in calendar days. If any provision of this
Agreement is held to be invalid, the remaining provisions will in no way be
affected or impaired. The waiver or failure of either party to exercise any
right provided hereunder will not be deemed a waiver of any further right
hereunder. This Agreement expresses the complete understanding of the parties
with respect to the subject matter hereof and supersedes all prior proposals or
agreements, whether oral or written. Each executed copy of this Agreement shall
be deemed to be an original and, taken together, shall comprise one and the same
instrument. This Agreement may not be modified or altered except by a written
instrument duly executed by both parties.
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