Sales Representative Agreement

§ 12.15 Form: Sales Representative Agreement

THIS AGREEMENT is made this day of , by and between , a New York corporation ("Manufacturer"), and , a New York corporation ("Representative").

WHEREAS, Manufacturer is the manufacturer and developer of certain computer hardware and software products; and

WHEREAS, Representative desires to act as Manufacturer's sales representative to sell Manufacturer's products, and Manufacturer desires to appoint Representative as its sales representative pursuant to the terms and conditions contained herein;

NOW, THEREFORE, the parties hereto agree as follows:

1. Definitions

As used in this Agreement:

a) "Agreement" means this Agreement including all the Schedules attached hereto;

b) "Manufacturer Products" means the hardware, firmware and software described in Schedule A annexed hereto, and shall include any Enhancements which Manufacturer has announced or may announce during the term of this Agreement;

c) "Area" means the territory described in Schedule B annexed hereto;

d) "Customer" means any end-user or reseller of the Manufacturer Products;

e) "Documentation" means the standard visually readable materials which Manufacturer has published or may publish, during the term of this Agreement, for customer use with the Manufacturer Products, including any user manuals or technical manuals for the Manufacturer Products;

f) "Effective Date" means the date upon which this Agreement is executed by the last party to sign;

g) "Enhancements" means all improvements, changes, revisions, modifications, replacements and updates relating to the Manufacturer Products and Documentation.

2. Appointment as Representative

Manufacturer hereby designates and appoints Representative as its non-exclusive selling representative in the Area to actively promote and solicit orders for the Manufacturer Products or any components thereof for the term of this Agreement. Manufacturer shall have the right to limit the Area and the Manufacturer Products covered by this Agreement, and the right to limit the type of the Customers to be solicited by the Representative within the Area, as Manufacturer deems advisable in its sole discretion, upon written notice to Representative. Manufacturer may designate and appoint other selling representatives in the Area, as it deems advisable in its sole discretion.

3. Term of Agreement

The term of this Agreement shall commence on the Effective Date and shall terminate one year from the Effective Date, unless terminated earlier by the parties pursuant to the terms and conditions contained herein, or extended by the mutual written agreement of both parties.

4. Obligations of Representative and Manufacturer

4.1 Obligations of Representative

a) Representative shall use its best efforts to market and promote the sale of the Manufacturer Products throughout the Area.

b) Representative shall perform the services hereunder in a professional manner and by qualified personnel. Representative's employees assigned to perform any services hereunder shall have the proper skill, training and background so as to enable them to perform in a competent and professional manner.

c) Representative shall not have any right or authority to and shall not make any representation or warranty on behalf of Manufacturer, or in any manner assume or create any obligation or responsibility, express or implied, on behalf of or in the name of Manufacturer, or act for or bind Manufacturer in any respect except as expressly permitted pursuant to this Agreement. No advertising, publicity or promotional material shall be undertaken or distributed by Representative without the prior written approval of Manufacturer.

d) Representative shall be responsible for the prompt return to Manufacturer, upon Manufacturer's request or termination of this Agreement, of any and all Manufacturer Products, Documentation or related materials delivered by Manufacturer to Representative pursuant to this Agreement.

e) Representative shall not engage in any business activity, either directly or indirectly, in any manner or capacity, in his own behalf or in behalf of any other person, firm, corporation or organization, or accept or continue any obligations which may interfere with or impair its ability to perform any of its duties or obligations under this Agreement.

4.2 Obligations of Manufacturer

a) Manufacturer shall pay Representative the commissions and expense reimbursements in accordance with the provisions of Section 7 herein.

b) Manufacturer shall inform and instruct Representative as to the Manufacturer Products, and provide guidance, as Manufacturer deems necessary in its sole judgment, in carrying out Representative's responsibilities under this Agreement.

c) Manufacturer shall supply the necessary Manufacturer Products, Documentation, price lists, brochures and other publications required, in the sole judgment of the Manufacturer, for the proper promotion and handling of sales in the Area. All such products, documentation and materials shall remain the property of Manufacturer and shall be subject to the confidentiality provisions contained in this Agreement.

5. Licenses

5.1 Display License

Manufacturer hereby grants and Representative hereby accepts a non-exclusive right and license within the Area to display the operation of the Manufacturer Products to potential Customers in connection with the efforts of Representative to promote the sale of Manufacturer Products under the terms of this Agreement.

5.2 Documentation License

Manufacturer hereby grants and Representative hereby accepts a non-exclusive right and license within the Area to display the Documentation in connection with the efforts of Representative to promote the sale of the Manufacturer Products to potential Customers under the terms of this Agreement.

5.3 Demonstration License

Manufacturer hereby grants and Representative hereby accepts a non-exclusive right and license within the Area to utilize on a reasonably necessary need to know basis the Manufacturer Products and Documentation for purposes of demonstration of the Manufacturer Products to potential Customers of Manufacturer.

5.4 Promotional Materials License

Manufacturer hereby grants and Representative hereby accepts a non-exclusive, royalty-free right and license within the Area during the term of this Agreement to reproduce or copy sales promotional literature, including but not limited to brochures, pamphlets, product outlines and product summaries for the Manufacturer Products in which Manufacturer holds copyrights, statutory or otherwise, which Representative deems reasonably necessary to fulfill its promotional obligations under this Agreement.

5.5 General License Provisions

All licenses granted in this Section 5 shall be further subject to the following:

a) Manufacturer Products, Documentation, promotional and related materials, and any copies thereof, shall in all cases remain the property of Manufacturer.

b) Prior to any disclosure of substantial functional documentation relating to Proprietary Manufacturer Products, identified as such in Schedule A, or other Manufacturer proprietary confidential material to any potential Customer, Representative shall obtain from such Customer a written Confidentiality Agreement in the form annexed hereto as Schedule C.

c) Except as otherwise provided or permitted herein, Representative shall not make or permit its agents or employees to make any copies of the Proprietary Manufacturer Products, Documentation or other Manufacturer confidential proprietary material, nor shall it disclose or make available any such products, documentation and materials in any form to any person other than Representative, Manufacturer employees, and potential Customers of Manufacturer pursuant to paragraph 5.5 herein, without the prior express written consent of Manufacturer.

5.6 Confidentiality

Representative hereby acknowledges that the Manufacturer Products and Documentation are the property of Manufacturer; that certain of the Manufacturer Products identified in Schedule A are proprietary to Manufacturer; and that the Proprietary Manufacturer Products and the related Documentation, including the algorithms contained therein, constitute trade secrets of Manufacturer. Representative shall not sell, transfer, disclose, display or otherwise make available any Proprietary Manufacturer Products or related Documentation or copies or portions thereof to any other entity or third party except as permitted under this Agreement and in accordance with the requirement to obtain a signed copy of Schedule C. Representative agrees to secure and protect the Proprietary Manufacturer Products and related Documentation so as to maintain the proprietary rights of Manufacturer therein, including appropriate instructions to and agreement with its employees. Representative agrees not to use any Manufacturer Product, Documentation or information except as expressly provided for herein.

6. Orders and Pricing

6.1 Customer Orders

Representative shall promptly transmit all Customer orders for Manufacturer Products and Documentation in its Area to Manufacturer. All orders are subject to acceptance or rejection by an authorized officer of Manufacturer. Manufacturer reserves the right to reject any order, or to cancel any order or any part thereof after acceptance, for credit or for any other reason whatsoever deemed by Manufacturer in its sole discretion to be sufficient. Manufacturer shall transmit to Representative a copy of any written notification of acceptance or rejection sent to a Customer solicited by Representative.

6.2 Pricing and Terms

Manufacturer shall establish the prices and terms for the Manufacturer Products and Documentation at Manufacturer's sole discretion. Representative shall not make price quotations or delivery promises without Manufacturer's prior written approval. Representative shall not alter or limit orders, and shall not accept the return of or make any allowances for Manufacturer Products, without the prior written approval of Manufacturer.

7. Commissions and Payments

7.1 Commissions

Manufacturer shall pay to Representative, as commission, the percentage rates on "Net Invoice Price" as set forth in Schedule D annexed hereto, on Customer orders solicited by Representative and accepted by Manufacturer during the term of this Agreement. "Net Invoice Price" shall mean the total price at which an order is invoiced to the Customer, less shipping and mailing costs, taxes, insurance and any allowances or discounts granted by or paid by Manufacturer.

7.2 Payments

Commission payments shall be made as follows:

a) Commissions shall be paid on or before the 15th day of the month following the month in which Manufacturer receives full payment for the orders.

b) Manufacturer shall send Representative copies of all invoices pertaining to Customers solicited by Representative at the time Manufacturer invoices the Customer, and each invoice copy shall indicate the amount of commission due Representative. Manufacturer shall also send Representative copies of all correspondence and quotations made to Manufacturer Customers solicited by Representative during the preceding month.

c) Commissions previously paid to Representative on account of orders which have since been returned by the Customer or for which allowances are credited to Customer for any reason, shall be deducted from the commissions due Representative, and if no commission balance exists for that month, shall be reimbursed by Representative.

d) At the time of payment of commissions to Representative, Manufacturer will send Representative a commission statement showing: (i) commissions paid during that period, and (ii) a listing of invoices on which commissions are being paid and commissions due and owing Representative.

7.3 Expenses

Unless otherwise agreed to by Manufacturer in writing, Representative shall be responsible for all expenses incurred in the performance of its services pursuant to this Agreement.

8. Trademark, Trade Names and Proprietary Rights

8.1 Rights of Manufacturer

Representative recognizes the exclusive right of Manufacturer in and to all of the trademarks applied to the Proprietary Manufacturer Products as identified in Schedule A, and to any and all of Manufacturer's copyrights of material and or Documentation used in connection therewith.

8.2 Use By Representative

Representative agrees that it shall not use, make reference to or otherwise designate Manufacturer's trademarks or trade names except as they may be used for the benefit of Manufacturer in the promotion of the Manufacturer Products and Documentation and then only when the trademark notice referred to in Section 8.3 below is utilized.

8.3 Notice

Whenever Representative employs any trademark of Manufacturer to be mentioned in any form or printed material, Representative shall place an asterisk immediately after and slightly above the first use of the trademark referring to a footnote reading "Trademark of Manufacturer."

8.4 Non-Infringement

Manufacturer at its own expense will defend any action brought against Representative to the extent that it is based on a claim that any Proprietary Manufacturer Product and related Documentation within the scope of this Agreement infringes any patents, copyrights, licenses or other property rights, provided that Manufacturer is immediately notified in writing of such claim. Manufacturer shall have the right to control the defense of all such claims, lawsuits and other proceedings. In no event shall Representative settle any such claim, lawsuit or proceeding without Manufacturer's prior written approval. The foregoing states the entire liability of Manufacturer with respect to infringement of any copyrights or patents by the Proprietary Manufacturer Products or any parts thereof.

9. Limitation of Liability

In no event shall Manufacturer be liable for damages, including any lost profits, or other incidental or consequential damages, arising out of the use or performance of the Manufacturer Products and Documentation or otherwise in connection with this Agreement, even if Manufacturer has been advised of the possibility of such damages.

10. Termination of the Agreement

10.1 Rights of Termination

This Agreement may be terminated by either party giving the other party written notice of termination at least ninety (90) days prior to the effective date of termination. In addition, Manufacturer shall have the right to terminate this Agreement, by giving written notice of termination to Representative, for (a) any material breach or failure of performance by Representative, if within thirty (30) days after the giving of written notice to Representative of such failure of performance, Representative has not cured such failure, and (b) breach by Representative of any of its confidentiality obligations with respect to Manufacturer's proprietary information.

10.2 Insolvency

In the event that either party be adjudged insolvent or bankrupt by a court of competent jurisdiction, or upon the institution of any proceedings by or against it seeking relief, reorganization or arrangement under any laws relating to insolvency, or upon any assignment for the benefit of creditors, or upon the appointment of a receiver or trustee of any of its property or assets, or upon the liquidation, dissolution or winding up of its business, then and in any such event this Agreement may immediately be terminated or cancelled by the other party hereto.

10.3 Other Rights

Except as otherwise provided herein, termination of this Agreement shall terminate all further rights and obligations of Manufacturer and Representative hereunder provided that:

(a) If such termination is based on a breach by a party hereto, the other party shall be entitled to pursue any and all rights it has to redress such breach in law or equity; and

(b) The confidentiality provisions with respect to the Proprietary Manufacturer Products, Documentation and related materials set forth in the Agreement shall survive the termination of this Agreement.

11. Miscellaneous

11.1 Independent Contractor

The relationship between Manufacturer and Representative established by this Agreement is that of independent contractors and Manufacturer and Representative shall each conduct its respective business at its own initiative, responsibility and expense, and shall have no authority to incur any obligations on behalf of the other, except as otherwise provided herein.

11.2 Notices

All notices required or permitted under this Agreement shall be made in writing and shall be deemed to have been duly given if delivered personally or sent by registered or certified mail (return receipt requested). All notices shall be addressed to the parties at the respective addresses indicated above.

11.3 Governing Law

This Agreement and any transaction between Manufacturer and Representative hereunder shall be governed by, construed and interpreted in accordance with the laws of the State of New York. Representative hereby consents to the jurisdiction of the courts of the State of New York or the Federal courts sitting in New York and waives any objection to such venue.

11.4 Assignment

Neither party hereto may assign or otherwise transfer its rights and obligations under this Agreement, except that Manufacturer may assign or otherwise transfer its rights and obligations hereunder to any parent or subsidiary corporation of Manufacturer or to any purchaser of the business of Manufacturer which agrees to assume the obligations of Manufacturer hereunder.

11.5 Headings

The paragraph and section headings throughout this Agreement are for reference purposes only, and the words contained therein shall in no way be held to explain or aid in the interpretation, construction or meaning of the provisions of this Agreement.

11.6 Entire Agreement

This Agreement contains the entire agreement between the parties and this Agreement supersedes all previous agreements and proposals, oral or written, and all negotiations, conversations or discussions between the parties related to this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized officers as of the day and year first written above.