AUTHORIZED RESELLER AGREEMENT
This Authorized Reseller Agreement ("Agreement") dated March 22, 2005
("Effective Date") is between Megola, Inc., a Nevada corporation having its
principal place of business at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇ #▇▇▇, ▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇
("MEGOLA") and BUYMAX, LLC, a Missouri limited liability company having its
principal place of business at ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇ ("RESELLER").
1. PURPOSE; APPOINTMENT OF MEGOLA.
(a) This Agreement provides the terms and conditions for the sale by
MEGOLA to RESELLER and the purchase and resale by RESELLER of MEGOLA's Products
as described more fully on Schedule 1(a) attached hereto, as it may be amended
by the parties from time to time ("Products").
(b) Subject to the terms and conditions of this Agreement, MEGOLA appoints
RESELLER and RESELLER accepts appointment as its authorized, sole and exclusive
RESELLER of the residential ScaleGuard devices (TFK) for the term of this
Agreement. RESELLER has the right to purchase such Products as may be made
available to RESELLER by MEGOLA from time to time for resale only to authorized
customers within the United States of America or other locations agreed to by
the parties in writing and as listed on Schedule 1(b) attached hereto, as it may
be amended by the parties from time to time (each, an "Approved Location").
(c) Nothing in this Agreement or otherwise shall preclude RESELLER from
marketing, offering and selling any other products to customers in conjunction
with the Products.
(d) MEGOLA agrees not to market, offer or sell the Products to any
contractor, company, entity or individual under any trade name or its parent,
subsidiaries or affiliates for the term of this agreement. MEGOLA may, however,
market, offer and sell the Products under its own trade name to any commercial,
industrial contractors who do not, directly or indirectly, market, offer or sell
the Products to residential customers.
2. GENERAL RESELLER REQUIREMENTS. During the term of this Agreement, RESELLER
agrees to:
(a) Use reasonable efforts to market and sell the Products in the Approved
Locations and comply with the policies, programs, and requirements regarding
marketing and Products support as may be communicated in writing by MEGOLA to
RESELLER from time to time.
(b) Maintain an inventory of the Products at each Approved Location
adequate to fulfill sales in the Approved Location.
(c) Comply with all applicable laws and regulations.
3. MINIMUM ANNUAL RESALE REQUIREMENT.
(a) In consideration of granting RESELLER exclusive resale rights,
RESELLER shall comply with the following Minimum Annual Resale Requirement (as
defined below). During each year that this Agreement is in effect, RESELLERs
purchases of Products to serve customers within the Approved Location shall be
greater than or equal to 1,000 Products. Each subsequent year this Agreement is
in effect, RESELLER's purchases of Products to serve customers within the
Approved Location shall be greater than or equal to 2,000 Products. The term
"minimal Annual Resale Requirement" refers to each of the foregoing amounts for
the first year of this Agreement and each subsequent year that this Agreement
remains in effect. If RESELLER fails to meet such Minimum Resale Requirements,
RESELLER shall lose its exclusive resale status. If This Agreement is renewed at
the end of the Initial Term the parties may determine future minimum annual
resale requirements (each, a "Revised Minimum Resale Requirement"). If this
Agreement is renewed and the parties do not determine a Revised Minimum Resale
Requirement, the then-existing Minimum Resale Requirement shall remain in effect
and shall apply to each Renewel Term until parties agreed on a Revised Minimum
Resale Requirement.
4. TRADEMARKS. RESELLER agrees to conspicuously display such signs and other
identification of the Products at each Approved Location so as to make potential
customers and customers aware of the availability of the Products at such
locations and to market the Products as required by this Agreement, subject to
the following terms and conditions as to such usage.
(a) Subject to the terms and conditions of this Agreement, each party
grants to the other a revocable, limited, nonexclusive, nontransferable license
(without right of sublicense) to use the other party's trade names, trademarks,
service marks and other business source identifiers (collectively, "Marks") only
within the Approved Locations solely for promoting and advertising the sale and
use of the Products. Each party shall at all times comply with the other party's
quality control guidelines and procedures relating to the Marks.
(b) Upon the termination, expiration or cancellation of this Agreement, or
upon a party's demand, the other party shall immediately discontinue all use of
the Marks.
5. MEGOLA WARRANTIES. MEGOLA represents and warrants to RESELLER that:
(a) MEGOLA has all corporate or other authority to perform under this
Agreement and that such performance does not and shall not violate any agreement
to which MEGOLA is a party;
(b) MEGOLA holds all necessary federal, state and local licenses, permits,
and other permissions for MEGOLA to perform under this Agreement (including
without limitation, reselling the Products at each Approved Location) in
accordance with all applicable laws and regulations;
(c) MEGOLA is not involved in any action or proceeding and has not
received notice of any threatened action or proceeding that would jeopardize
MEGOLA's performance under this Agreement; and
(d) the Products shall be delivered to RESELLER with good title free of
any rightful third party claim of infringement of any patent, copyright,
trademark, trade secret or other intellectual property right recognized or
registered within the United States and its possessions.
6. PRODUCT WARRANTIES; DISCLAIMER; LIMITATION OF LIABILITY
(a) RESELLER agrees to display all required warranties and notices in
accordance with MEGOLA's instructions and with all applicable federal, state and
local laws and regulations. RESELLER shall have the right to extend, enhance or
exclude any guarantee, warranty or representation relating to the Products or
otherwise to any customers, prospective customers or any other third parties
beyond the manufacturer's standard written warranty set forth on Schedule 6(a)
attached hereto, as it may be amended from time to time ("Manufacturer's
Warranty").
(b) All warranty claims for the Products received by RESELLER shall be
processed in accordance with MEGOLA's or the manufacturer's warranty procedures,
as may be applicable from time to time.
(c) IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY INCIDENTAL, INDIRECT,
CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES, INCLUDING WITHOUT LIMITATION, LOST
REVENUES, LOST BUSINESS AND LOST PROFITS, REGARDLESS OF THE FORM OF ACTION
WHETHER IN CONTRACT, TORT, STRICT PRODUCTS LIABILITY, OR OTHERWISE, EVEN IF
MEGOLA OR RESELLER OR ANY OF THEIR RESPECTIVE SUPPLIERS HAVE BEEN ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.
7. INDEMNIFICATION.
(a) Each party shall indemnify, defend and hold harmless the other, and
their respective parent, subsidiaries, and affiliates, and each of their
respective directors, officers, employees and members from any and all damages,
injuries, costs, claims, liabilities, and expenses (including without
limitation, reasonable attorneys' fees and costs and expenses) (collectively,
"Claims") that arise out of or are related to a party's performance or failure
to perform under this Agreement, any material breach of this Agreement, and/or
any gross negligence or intentional misconduct of a party, its directors,
officers, employees and/or agents.
(b) In addition to the foregoing general indemnity, MEGOLA shall also
indemnify, defend and hold harmless RESELLER and its respective parent,
subsidiaries, and affiliates, and each of their respective directors, officers,
employees, shareholders and members from any and all damages, injuries, costs,
claims, liabilities, and expenses (including without limitation, reasonable
attorneys' fees and costs and expenses) if any of the Products or parts thereof
are held to constitute an infringement of any third party's rights and its
intended use is enjoined. MEGOLA shall, at its option, modify the Products or
parts to become non-infringing, remove them and refund to RESELLER the purchase
price, procure for Reseller the right to continue using the Products or part, or
replace it with non-infringing Products or parts.
8. TERMS OF SALE. RESELLER agrees to purchase the Products from MEGOLA
subject to the following terms of sale:
(a) RESELLER shall deliver a purchase order ("P.O.") to MEGOLA by
facsimile, electronic mail or such other methods as are agreed to by the
parties.
(b) Each P.O. shall be deemed an offer by RESELLER to purchase the
Products listed therein and when accepted by MEGOLA shall constitute a contract
in accordance with the terms and conditions of the P.O. and this Agreement. If a
conflict arises between the two, this Agreement shall control.
(c) Each P.O. shall include the quantity and type of Product(s) ordered,
Product descriptions, Product specifications, shipment and invoice information,
and shipping instructions.
(d) No terms of any P.O., except those specifying the quantity and type of
Product(s) ordered, shipment and invoice information and shipping instructions,
shall be binding if they contravene any term or condition of this Agreement,
unless specifically accepted or approved in writing and signed by an appropriate
representative of RESELLER and MEGOLA. RESELLER may initiate such changes or
additions to a previously accepted P.O. by submitting a modification of the P.O.
to MEGOLA with appropriate reference to the original P.O. Upon MEGOLA's written
acceptance of the modification or addition, MEGOLA shall process the P.O. in
accordance with the pricing terms and conditions of this Agreement.
(e) As an accommodation to RESELLER, MEGOLA may make Product substitutions
when the Products ordered are unavailable, provided that the substituted
Products are of equal or greater functionality than those contained on the P.O.
and that MEGOLA notifies Reseller of such substitution at the time of delivery.
RESELLER may reject any such Product substitutions within ten (10) days of
delivery.
(f) MEGOLA is responsible for payment of all shipping and handling fees
for delivery of Products. All deliveries of Products are FOB RESELLER's
distribution center in Fayetteville, Tennessee. Title and risk of loss shall
pass from MEGOLA to RESELLER or the customer at the point of delivery. RESELLER
shall inspect the Products within thirty (30) days of delivery and shall notify
MEGOLA of any nonconforming or defective Products. MEGOLA shall accept returns
for nonconforming or defective Products in accordance with MEGOLA'S standard
return policies and procedures..
(g) Prices for the Products purchased by RESELLER hereunder are listed on
Schedule 8(g) attached hereto. Such prices include any taxes, fees, duties,
shipping costs, insurance or other levies. The prices shall remain firm for the
Initial Term; thereafter MEGOLA and RESELLER may mutually agree on price changes
but any P.O. accepted by MEGOLA before a price change takes effect shall be
invoiced at the previous price;provided, however that if MEGOLA offers more
favorable pricing to any other third party, MEGOLA shall offer the same pricing
to RESELLER.reseller WILL PAY 50% of the invoiced amount within 20 days of
issuing a P.O. with the balance of the invoiced amount due within sixty(60) days
of receipt thereof. A 5% discount is available on all orders paid fully within
20 days of issuance of any P.O.
9. TERM.
(a) This Agreement shall remain in effect for three (3) years from the
Effective Date (the "Initial Term") and shall automatically be renewed for
one-year terms for as long as RESELLER meets the Minimum Annual Resale
Requirement (each a "Renewal Term"). Notwithstanding the foregoing, the parties
may terminate this Agreement sooner as provided for below.
(b) This Agreement may be terminated by either party without cause to the
extent permitted by law upon one hundred and eighty (180) days prior written
notice to the other party.
(c) Either party may terminate this Agreement immediately (or in the case
of events described in subsection (i), after the applicable cure period has
elapsed) and without prior written notice to the other party, upon the happening
of any of the following events of default:
(i) the other party materially breaches any obligation, warranty or
representation hereunder and such breach is not cured within thirty (30)
days after written notice thereof from the non-breaching party;
(ii) the other party makes a general assignment for the benefit of
its creditors, suspends business or commits any act amounting to business
failure, voluntarily assigns or transfers all or substantially all of its
property, files a voluntary petition or has an involuntary petition filed
against it seeking its reorganization, adjustment, liquidation, or
dissolution under any present or future law or regulation relating to
bankruptcy, insolvency, relief of debtors or protection of creditors,
termination of legal entities, or has a receiver, trustee, liquidator,
assignee or custodian appointed for it; or
(iii) the other party merges into or consolidates with any other
entity without the prior written consent of the party entitled to
terminate this Agreement, and such merger or consolidation results in a
material change to the other party's business operations or corporate
structure.
(d) MEGOLA and RESELLER hereby acknowledge and agree that fraud,
violations of any local, state or federal law or regulation that relate to the
offer for sale, sale, distribution, installation of the Products, breaches of
commonly recognized business ethics, insolvency or bankruptcy, breaches that
potentially expose a party to criminal or civil liability, or breaches that
materially damage the name or reputation of either party or the Products will
not be considered curable.
(e) Neither party shall be liable to the other party for damages for the
proper termination of this Agreement in accordance with this Section 9.
(g) The following provisions shall survive the termination, cancellation
or expiration of this Agreement: Sections 4, 5, 6, 7, 9, 10, 11 and 12.
10. CONFIDENTIALITY
(a) MEGOLA and RESELLER each acknowledge and agree that they have been and
will be in a confidential relationship to the other party and that each has
gained and will gain knowledge that comprises valuable trade secrets and other
confidential information of the other party, including without limitation,
customer lists, other customer data and information, sales and marketing data
and information, technical data and information, and other data and information
concerning the Products or the party's respective businesses (collectively,
including the terms and conditions of this Agreement, the "Confidential
Information"). Each party agrees that it will not use the Confidential
Information for any purpose other than those expressly permitted in this
Agreement, nor disclose any of the Confidential Information to any third party,
or take any action which might reasonably be expected to lead to such
disclosure, during the term of this Agreement and thereafter.
(b) The confidentiality restrictions in subsection (a), above, shall not
apply to information: (i) that, at the time of disclosure, is in the public
domain, as evidenced by written or electronic publication; (ii) that, after
disclosure, becomes part of the public domain by written or electronic
publication through no fault of the receiving party (but only after, and only to
the extent that, it becomes part of the public domain by written or electronic
publication); (iii) that the receiving party can show (by written records) was
in its possession at the time of disclosure and was not acquired, directly or
indirectly, from the disclosing party or from a third party under a continuing
obligation of confidence to the disclosing party; (iv) that the receiving party
can show (by written records) that it received from a third party who did not
require the receiving party to hold it in confidence and who did not acquire it,
directly or indirectly, from the receiving party under a continuing obligation
of confidence; or (v) that the receiving party is required to disclose in
response to a valid court order or by law, but only if the disclosing party has
been given prompt written notice of the potential for such disclosure and the
opportunity to seek a protective order or obtain other relief to preserve the
confidentiality of the Confidential Information.
(c) MEGOLA and RESELLER each acknowledge and agree that the performance of
the obligations under this Section 10 is special, unique and extraordinary in
character and that any breach or threatened breach of this Section 10 will cause
irreparable injury to RESELLER and its business and that money damages will not
provide an adequate remedy to RESELLER. In addition to such other rights and
remedies that a disclosing party may have at equity or law with respect to any
breach by the receiving party of any of the provisions of this Section 10, the
disclosing party shall have the right and remedy to have such provisions
specifically enforced by any court of competent jurisdiction or to enjoin the
receiving party from performing any act taken by the receiving party in
violation of this Section 10.
11. GENERAL.
(a) All notices and communications required under this Agreement shall be
in writing (including communication by facsimile transmission) and shall be sent
by hand, by registered or certified mail return receipt requested, by overnight
courier service maintaining records of receipt, or by facsimile transmission
with confirmation in writing mailed first-class, in all cases with charges
prepaid, and shall be effective on the earlier of receipt or (i) the date
delivered by hand, or (ii) the third business day after being mailed, or (iii)
the following business day if sent by overnight courier service, or (iv) upon
sender's receipt of transmission confirmation, if sent by facsimile. All notices
shall be addressed to the parties at the addresses set forth in the preamble of
this Agreement until changed by notice pursuant to this subsection.
(b) Nothing in this Agreement shall be deemed to create any kind of
partnership, joint venture, or fiduciary relationship between RESELLER and
MEGOLA. Neither party shall represent itself to be a subsidiary, affiliate,
legal representative, agent, employee, franchisee or partner of the other.
Neither party has the authority to assume, create or incur any obligation or
liability on behalf of the other.
(c) Neither party shall be liable for any delays or failures to perform
under this Agreement caused by act of God, fire, flood, riot, insurrection, war,
strike, labor disputes, interruption of transportation facilities, restrictions
by any governmental authority or agency, or other cause beyond a party's
control. If a force majeure event persists for more than sixty (60) days, the
adversely affected party may terminate this Agreement.
(d) Neither party shall advertise, issue a press release or make any other
public statement regarding RESELLER's appointment as an authorized reseller of
the Products or the terms and conditions of this Agreement without the other
party's prior written approval, such approval not to be unreasonably withheld or
delayed.
(e) This Agreement may not be modified or amended, and none of its
provisions may be waived except in a writing signed by duly authorized
representatives of each party. No waivers shall be implied, whether from any
custom or course of dealing or any delay or failure in either party's exercise
of its rights and remedies hereunder or otherwise. Any waiver granted by either
party shall not obligate such party to grant any further, similar, or other
waivers. All rights and remedies granted herein are cumulative and not
alternative, and are in addition to all other rights and remedies available at
law or in equity.
(f) The invalidity or unenforceability of any of the provisions of this
Agreement shall not affect the validity of the rest of this Agreement. Each
provision of this Agreement shall be enforceable to the fullest extent permitted
by law.
(g) This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Tennessee, without regard to its
conflict of laws provisions. The sole and exclusive venue for all actions
arising out of or relating to this Agreement, or the breach, termination,
cancellation, expiration or validity thereof, shall be the state and federal
courts located in Davidson County, Tennessee. BOTH PARTIES WAIVE ANY AND ALL
RIGHT TO ANY TRIAL BY JURY IN ANY ACTION OR PROCEEDING BETWEEN THE PARTIES
ARISING DIRECTLY OR INDIRECTLY HEREUNDER.
(h) In any dispute between the parties under this Agreement, the
prevailing party shall be entitled to costs and expenses relating to the
resolution of the dispute, including without limitation, reasonable attorneys'
fees.
(j) This Agreement shall be binding upon and inure to the benefit of
RESELLER and MEGOLA and their respective successors and assigns.
(k) This Agreement (including all schedules and exhibits attached hereto)
constitutes the entire agreement of the parties and supersede all prior and
contemporaneous understandings and agreements (whether oral, written, or
electronic) between the parties relating to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto, by their duly authorized
representatives have executed and delivered this Agreement as of the dates set
forth next to their signatures.
MEGOLA INC: BUYMAX, LLC
(Full legal name of business)
By:___________________________
Print Name: ▇▇▇▇ ▇▇▇▇▇▇▇ By:___________________________
Title: President/CEO Print Name:_____________________________
Title:__________________________________
Address for Notices: Address for Notices:
Megola Inc. BUYMAX, LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇ #▇▇▇,
▇▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ ___________________________________________
____________________________ ___________________________________________
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: ▇▇▇.▇▇▇.▇▇▇▇
Telephone: ▇▇▇ ▇▇▇ ▇▇▇▇ Fax: ▇▇▇.▇▇▇.▇▇▇▇
Fax: ▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
Schedule 1(a) to Authorized Reseller Agreement dated March 22, 2005
between MEGOLA, INC. and BUYMAX, LLC
Products
ScaleGuard Device
Schedule 1(b) to Authorized Reseller Agreement dated March 22, 2005 between
MEGOLA, INC. and BUYMAX, LLC
Approved Location(s)
The United States of America
Schedule 6(a) to Authorized Reseller Agreement dated March 22, 2005
between MEGOLA, INC. and BUYMAX, LLC
Manufacturer's Warranty
Schedule 8(g) to Authorized Reseller Agreement dated March 22, 2005
between MEGOLA, INC. and BUYMAX, LLC
Price