Distribution Agreement Template1

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Appendix 2 Sample of Agreement

DISTRIBUTION AGREEMENT

THIS AGREEMENTis effective as of , 2012 (the Effe!ti"e Date#) B$ AND BET%EEN:

O%NER,a company incorporated under the laws of Canada, and havingits head office at , (hereinafter referred to asO%NER#) and

OF !" F#$% &'$ and

&' a !ompan( in!orporated )nder t*e la+, of and *a"ing it, *ead offi!eat -.*ereinafter referred to a,DISTRIBUTOR#)

O/ THE SE0OND 1ART

and

& ' a !ompan( in!orporated )nder t*e la+, of and *a"ing it, *ead

offi!e lo!ated at -' .*ereinafter referred to a, GUARANTOR#

O/ THE THIRD 1ART

%HEREAS-

O%NER is the manufacturer of the &roduct (as hereinafter defined)*

O%NERhas determined that to enhance the development of the mar+et and increase the

sales of its &roduct in the erritory, it would e advantageous to coordinate its distriutionactivities with a distriutor in the erritory who possesses a readily availale and e-tensivesales networ+ in the erritory* and

DISTRIBUTORwishes to enter into this 'greement with O%NERwherey DISTRIBUTORwillunderta+e the distriution and sale of &roduct in the erritory on the terms and su.ect to theconditions contained herein*

NO% THERE/ORE THIS AGREEMENT %ITNESSES that in consideration of the mutualpromises and covenants herein contained and for other good and valuale consideration (thereceipt and sufficiency of which are herey ac+nowledged) the parties herey agree as follows:

DE/INITIONS

.1 /henever used in this 'greement, the following terms shall have the following

meanings respectively, unless otherwise specified:

Affiliate# of a party means any &erson which directly or indirectly

controls, is controlled y, or is under common control with, such party* as used herein,the term control or controls means possession of the power to direct, or cause the


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direction of the management and policies of such &erson, whether through theownership of voting securities, y contract, law or otherwise, and the term controlledshall have the meaning correlative to the foregoing3

Agreement# means this distriution agreement, the recitals set forth in

the preamle herein, and all schedules attached hereto, as well as all amendments,additions, restatements or modifications made hereto and thereto and all otherdocuments incorporated herein or therein y reference, all of which are herey made

an integral part of and will e read as if included within the te-t of this distriutionagreement*

B),ine,, Da(# means each of 4onday, uesday, /ednesday,

hursday and Friday, e-cept when any such day occurs on a statutory holidayoserved in the erritory*

0onfidential Information# means any and all information,

documentation or +nowledge in any form, relating to the usiness and assets ofO%NER, not generally +nown to the pulic, disclosed to, or which may e otaineddirectly or indirectly y, the DISTRIBUTOR, or which may e derived in any way y it asa conse5uence of the performance of its oligations hereunder, including, without

limitation, information relating to O%NER6s present and contemplated products andservices* product designs* inventions, improvements* standards, specifications,systems, methods and operating procedures* techni5ues and modes of manufacturing,compounding or preparing products, formulations and recipes* merchandising,mar+eting plans and strategies* tests and reports* profits, costs, pricing, productsourcing and sales policies and strategies* uying haits and preferences of presentcustomers of O%NERas well as prospective and potential customers, their names andaddresses* trade secrets, +nowhow, data, research and development* patent, trademar+, copyright, industrial design and all other intellectual property and proprietaryrights and shall also include terms of this 'greement*

Effe!ti"e Date# means, 2012*

3atent Defe!t means a defect in any &roduct which was caused y

O%NER in the manufacturing process or in the design or pac+aging of the &roduct,which renders it not useale in the ordinary course of the usiness of DISTRIBUTOR ornot fit for its intended purpose and that is not identifiale y a asic e-amination ofsuch &roduct*

Minim)m Ann)al 1erforman!e Re4)irement,#means those minimum

annual performance targets re5uired to e satisfied y the DISTRIBUTORas set outmore specifically in %chedule 7 attached hereto*

1er,on# means any person, individual, firm, association, syndicate,

partnership, .oint venture, trustee, trust, corporation, division of a corporation,unincorporated organi8ation or other entity or a government agency or politicalsudivision thereof*

1rime# means, at any time, the rate of interest per annum e5ual to the

rate which the principal office of the 7an+ of 9ova %cotia in the city of oronto, Ontario,Canada, 5uotes, pulishes and refers to as its prime rate and which is its referencerate of interest for loans in Canadian dollars made in Canada to Canadian orrowers,

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ad.usted automatically with each 5uote or pulished change in such rate, all without thenecessity of any notice to a party hereto*

1rod)!t#means the finished goods products manufactured and sold

y O%NERas set forth more specifically in %chedule ' attached hereto as the samemay e supplemented y O%NER, in its sole discretion, from time to time*

Term# means the term of this 'greement as set forth in 'rticle ###

comprising the #nitial erm and any $enewal erm*

Territor(#means the country of * and

Trade5mar6,#means all the trademar+s and trade names, whether or

not registered, which are owned and used y or under license from O%NERand whichappear on the &roduct including without limitation, the trademar+s 3

.2 he following schedules are incorporated into this 'greement y reference

and form an integral part hereof:

%chedule ' ist of &roduct and &roduct &rices

%chedule 7 4inimum 'nnual &erformance

$e5uirements

DISTRIBUTION GRANT

.1 O%NER herey grants to DISTRIBUTOR and DISTRIBUTORherey accepts

from O%NER the &non5e-clusive right to distriute the &roduct in the erritory, uponand su.ect to all terms and conditions set forth in this 'greement3 DISTRIBUTORcovenants and agrees to purchase the &roduct for its own account e-clusively fromO%NER and to mar+et, distriute and sell such &roduct only in the erritory3DISTRIBUTOR ac+nowledges and agrees that the rights granted pursuant to this

'greement are limited to the erritory and confer no rights upon DISTRIBUTORwithrespect to the distriution of any &roduct outside the erritory, and nothing in this

'greement shall restrict O%NERfrom selling &roduct to any other &erson &in,ide oroutside the erritory3 /ithout limiting the generality of the foregoing, DISTRIBUTORshall not, directly or indirectly, including through any agents, distriute or sell any&roduct outside the erritory and shall not solicit orders for &roduct, advertise the&roduct or +eep any stoc+ of the &roduct outside the erritory3 DISTRIBUTORfurthercovenants and agrees not to distriute, mar+et or sell such &roduct to any &ersonwithin the erritory if DISTRIBUTOR+nows or has any reason to elieve that such&roduct will e resold y such &erson, directly or indirectly, outside the erritory3 #fDISTRIBUTORecomes aware that any &erson to whom DISTRIBUTOR supplies any&roduct is mar+eting or selling, or is planning to mar+et or sell, the &roduct outside the

erritory, DISTRIBUTORshall immediately notify O%NER and shall cease forthwith tosupply such &erson with &roduct3 &All en4)irie, re!ei"ed 7( O%NER regarding t*ep)r!*a,e of 1rod)!t in t*e Territor( ,*all 7e referred to DISTRIBUTOR d)ring t*eTerm of t*e Agreement8 &Onl( appli!a7le if arrangement i, ex!l),i"e8

.2 DISTRIBUTORshall inform O%NERin writing of, and O%NERshall have the

right to approve or disapprove, any sudistriutor(s) proposed to e appointed yDISTRIBUTOR in respect to the sale and distriution of &roduct in the erritory,provided, however, that the appointment of any such sudistriutor(s) y

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DISTRIBUTOR, following approval y O%NER, shall not relieve DISTRIBUTORof anyof its oligations hereunder3

.3 DISTRIBUTORcovenants and agrees that all en5uiries with respect to and

any orders for &roduct received, directly or indirectly, y DISTRIBUTOR from outsidethe erritory shall e referred to O%NER3

.4 DISTRIBUTORagrees to provide to O%NERfrom time to time and promptly

upon re5uest y O%NER, a list of all other manufacturers and products represented yDISTRIBUTOR3

.5 DISTRIBUTORagrees to provide to O%NERfrom time to time, and promptly

upon re5uest y O%NER'a list of the different distriution channels in which &roduct iseing distriuted or intended to e distriuted y DISTRIBUTOR, the names of all sudistriutors engaged y DISTRIBUTOR, and the margins up to the end price to theconsumers3

TERM

.1 he initial term of this 'greement shall come into effect on the "ffective ;ate

and, unless terminated earlier in accordance with the terms of this 'greement, shallcontinue in full force and effect for a period of () years (the #nitial erm)3

.2 &rovided DISTRIBUTORshall have complied with all the terms and conditions

hereof, and achieved the 4inimum 'nnual &erformance $e5uirements, this 'greementshall e automatically renewed at the end of the #nitial erm or any $enewal erm, asthe case may e, on the same terms and conditions as set forth herein, save ande-cept the 4inimum 'nnual &erformance $e5uirements which shall e increased inaccordance with the terms hereof, for successive periods of () year(s) (in eachcase a $enewal erm), unless either party shall have provided written notice to theother party that it does not intend to renew this 'greement at least daysprior to the e-piration of the #nitial erm, or any $enewal erm, as the case may e3

1UR0HASE ORDERS AND SU113$ O/ THE 1RODU0T

.1 ;uring the erm, DISTRIBUTOR shall purchase all of its re5uirements of

&roduct e-clusively from O%NER, which shall not, in any event, e less than the4inimum 'nnual &erformance $e5uirements for any year as set forth in %chedule 7hereto,and O%NER shall sell such &roduct to DISTRIBUTORupon and su.ect to theterms of this 'greement3

.2 't the outset of the 'greement, O%NERshall supply DISTRIBUTOR with pre

pac+aged and laelled &roduct at prices applicale thereto for the erritory as set forthin the price list, the current form of which is attached as %chedule ' hereto3

.3 DISTRIBUTOR shall place a firm written order with O%NER on

DISTRIBUTOR6s &,tandardpurchase order forms for the 5uantity of &roduct to epurchased3 Only such orders placed y DISTRIBUTORand accepted y O%NERshalle inding on the parties hereto3 /here there is a conflict etween the terms andconditions stated in such &,tandardpurchase order form and the provisions of this

'greement, the provisions of this 'greement shall prevail despite any statement to thecontrary in such &,tandard purchase order form or otherwise3 For the purposes of

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clarity, notwithstanding anything herein to the contrary, the terms and conditions of this'greement will govern all &roduct sold y O%NERto DISTRIBUTOR3

.4 he ris+ of loss and damage to &roduct shall pass to DISTRIBUTOR

immediately upon &roduct eing pic+ed up y or on ehalf of DISTRIBUTOR, its agentor transport carrier, at O%NER6s warehouse in, and thereafter O%NERshall not eresponsile for any loss or damage to the &roduct3 DISTRIBUTORwill e the importerof record into the erritory for all &roduct purchased y it and will e responsile for the

accuracy of the information presented and the payment of all duties and ta-es, and wille liale for any fines or penalties resulting from any missing or inaccurate information

.5 DISTRIBUTOR shall anticipate its future re5uirements for &roduct and shall

purchase and +eep sufficient stoc+ of &roduct on hand and shall maintain ade5uatelytrained and e-perienced sales staff as well as appropriate premises and warehousefacilities and e5uipment (including vehicles) for stoc+ing and sales of the &roduct inorder to meet the erritory mar+et demand therefor, which in any event shall e aminimum of three (?) months6 re5uirements of &roduct, with reference to the 4inimum

'nnual &erformance $e5uirements set forth in %chedule 7 hereto to e satisfied yDISTRIBUTORpursuant to the terms of this 'greement3

.6 ;uring each year of the erm, whether during the #nitial erm or any $enewalerm, DISTRIBUTORcovenants and agrees to purchase from O%NER, for distriutionwithin the erritory, not less than the minimum 5uantities of &roduct re5uired in order tomeet the 4inimum 'nnual &erformance $e5uirements3 #n the event thatDISTRIBUTORshall purchase more than the prescried 4inimum 'nnual &erformance$e5uirement for a particular year, the e-cess shall not e credited towards the4inimum 'nnual &erformance $e5uirement in any suse5uent year3 #n the eventDISTRIBUTOR does not achieve the re5uisite 4inimum 'nnual &erformance$e5uirement for any year during the erm or any $enewal erm, as the case may e,then O%NER may terminate this 'greement at any time thereafter upon si-ty (@0) days6notice to DISTRIBUTOR3

.7 9ot less than si-ty (@0) days prior to the e-piry of the #nitial erm or any$enewal erm, as the case may e, the parties shall mutually agree to and set the4inimum 'nnual &erformance $e5uirement to e met y the DISTRIBUTORin each ofthe ensuing three (?)years, whereupon %chedule 7 hereto shall e deemed amendedaccordingly to reflect such 4inimum 'nnual &erformance $e5uirements agreed to forsuch ensuing () year period3 #n the event DISTRIBUTORand O%NERare unaleto mutually agree to and set the 4inimum 'nnual &erformance $e5uirement to e mety the DISTRIBUTOR in &ea!* of the ensuing () years, not less than si-ty (@0)days prior to the e-piry of the #nitial erm or any $enewal erm, as the case may e,the parties agree that the 4inimum 'nnual &erformance $e5uirement for &ea!* oftheensuing () year(s) will automatically e set as follows and %chedule 7 heretoshall e deemed amended accordingly to reflect such revised 4inimum 'nnual&erformance $e5uirements:

in the first year of any $enewal erm, an amount e5ual to &one *)ndred

and t+ent( per!ent .92:;


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in the second year of any $enewal erm, an amount e5ual to of the greater of (i) the 4inimum 'nnual&erformance $e5uirement applicale to the immediately preceding year as calculatedin accordance with paragraph (a) aove* or (ii) the actual gross sales reali8ed y theDISTRIBUTORin the erritory during such immediately preceding year* and

in the third year of the $enewal erm, an amount e5ual to &one *)ndred

and t+ent( per!ent .92:;s warehouse in , Canada3 'll charges that may e incurred inconnection with the delivery of the &roduct to DISTRIBUTOR, including, withoutlimitation, in respect to freight, e-port duties, import duties, all applicale ta-es,appropriate insurance and storage costs or any other payments re5uired to process the

products from O%NER6s warehouse in

, Canada are the sole and e-clusiveresponsiility of DISTRIBUTOR3

.2 &O%NER ,*all not 7e o7ligated to !on,ider a!!epting an( order pla!ed 7(

DISTRIBUTOR p)r,)ant to Se!tion I?8@)nle,,' prior to or toget*er +it* ,)!* order7eing pla!ed 7( DISTRIBUTOR' DISTRIBUTOR ,*all ma6e pa(ment to O%NER inan amo)nt e4)al to t+ent(5fi"e per!ent .2=;< of t*e aggregate pri!e of ,)!* order'determined +it* referen!e to t*e pri!e, ,et fort* in S!*ed)le A# *ereto8

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(i) a depo,it of 2=; "ia +ire tran,fer to O%NER>, 7an6 a!!o)nt in '.parti!)lar, of +*i!* +ill 7e pro"ided to DISTRIBUTOR< !on!)rrentl(+it* t*e order 7( DISTRIBUTOR'

.ii< 2=; "ia +ire tran,fer in t*e ,ame manner a, afore,aid prior to,*ipment 7( O%NER' and

(iii) t*e 7alan!e of =:; +it*in .:< da(, from t*e in"oi!e ,*ipping date

7( irre"o!a7le letter of !redit' i,,)ed in US Dollar f)nd, 7( arep)ta7le international 7an6 appro"ed 7( O%NER and it, 7an6' or a0anadian 0*artered S!*ed)le I Ban6 a!!epta7le to O%NER' ,o longa, O%NER i, a7le to ,e!)re and re!ei"e t*e !ontin)ing g)arantee ofExport De"elopment 0orporation in re,pe!t to an( amo)nt o+ing 7(DISTRIBUTOR from time to time8 DISTRIBUTOR +ill pa( intere,t ono"erd)e a!!o)nt, at a rate of prime pl), t*ree per!ent .@;


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.2 DISTRIBUTORshall, promptly following receipt of the &roduct, e-amine such

&roduct and satisfy itself that it meets its re5uirements3 o e valid, any claim inrespect to shortshipment or for defective &roduct (other than with respect to atent;efects) must e made in writing y DISTRIBUTOR to O%NERwithin fourteen (1)days (#nvestigation &eriod) of the date such &roduct arrived at ;istriutor6swarehouse, and such shortshipment or defect must not have een caused while the&roduct was in transport from O%NER>, warehouse to DISTRIBUTOR>,warehouse orwhile in storage y or on ehalf of DISTRIBUTOR3 #f DISTRIBUTORhas not notified

O%NERthat it has re.ected any &roduct as defective y the end of the #nvestigation&eriod, then it shall e deemed to have accepted the &roduct ('ccepted &roduct)3 #fO%NERagrees with DISTRIBUTOR that any re.ected &roduct is defective, O%NERwill replace such defective &roduct with replacement &roduct free of defect and thisreplacement &roduct shall constitute the sole and e-clusive liaility of O%NER inrespect to defective &roduct3

.3 O%NERmay ma+e modifications to &roduct at any time or discontinue the

sale of, or limit its production of, any &roduct without therey incurring any liailitywhatsoever to DISTRIBUTOR with respect to any order placed y DISTRIBUTOR3O%NERwill endeavour to give DISTRIBUTORsi-ty (@0) days6 prior notice in the eventof any such discontinuance3

1A0AGING AND %AREHOUSING RES1ONSIBI3ITIES

.1 DISTRIBUTORshall provide O%NERwith all necessary information pertaining

to pac+aging and pac+aging laelling with respect to the local re5uirements in each.urisdiction within the erritory3

.2 DISTRIBUTOR will use its est efforts to ensure that warehousing and

transportation to and within the erritory are effected in such a manner so as not tohave a negative effect on the 5uality of the &roduct3 he physical flow of &roduct fromthe warehouse shall e ased on a firstin, firstout system3

.3 /ithout limiting the generality of the foregoing, DISTRIBUTORunderta+es toperform, at its sole e-pense, the following services and activities in connection with andfor the enefit of maintaining &roduct:

suitale warehousing with appropriate climate control as per O%NER

re5uirements as they may e revised y O%NER, in its sole discretion, from time totime* and

stac+ing the &roduct so as not to e-ceed O%NER6s prescried

standards with respect thereto3

.4 DISTRIBUTOR shall assume full responsiility for and shall indemnify and

save O%NERharmless from any damage, claim, liaility, loss or e-pense (includingany legal costs) which O%NER may suffer or incur y reason of DISTRIBUTOR6spac+aging, stoc+ing, warehousing, storage, use, sale andDor distriution of the &roduct3

1RODU0T REGISTRATION

.1 #t is ac+nowledged y oth parties hereto that the import and distriution of

&roduct in the erritory may e dependent upon prior registration of such &roduct withthe appropriate local government authority in the erritory3 DISTRIBUTOR shall

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investigate and so advise O%NER in this regard and, should &roduct registration orother mar+et authori8ation e re5uired to import and sell &roduct in the erritory,DISTRIBUTORac+nowledges and agrees that it shall e responsile for securing theregistration of the &roduct or other mar+et authori8ation, as the case may e, for, andon ehalf of, and in the name of, O%NER3

.2 #n furtherance of the foregoing,DISTRIBUTORagrees to use its est efforts to

arrange for and complete the registration of the &roduct in O%NER6s name in a timely

manner, which in any event must occur within one hundred and eighty (1E0) days of the"ffective ;ate of this 'greement, or within one hundred and eighty (1E0) days of theeffective date of any amendment to the list of &roduct in %chedule ' attached hereto,in the case of additional finished goods products eing added thereto, andDISTRIBUTOR shall pay all costs relating to such registration of &roduct, in accordancewith all applicale laws, rules and regulations of the erritory and shall indemnify andsave harmless O%NER in respect to the same3 DISTRIBUTORshall +eep O%NERinformed in writing of the progress of any re5uired application for registration, and anyproposed sumissions relating to such &roduct registration must e forwarded toO%NER for its approval prior to eing sumitted to the appropriate governmentauthority3 hereafter, upon registration of the &roduct, DISTRIBUTOR will informO%NERand provide copies and official government receipts in respect thereto3 Bpon

receiving the official registration documents and the receipts evidencing payment in fullfor such registration y DISTRIBUTOR, in O%NER6s name, O%NER will reimurseDISTRIBUTORfor the cost of such &roduct registration3 DISTRIBUTORagrees that itwill e responsile for the cost of any &roduct registration that is sumitted without theprior approval of O%NER3

.3 O%NER shall retain title to all &roduct registrations and rademar+s3

.4 o the e-tent that &roduct registration has een effected in the name of

DISTRIBUTOR' DISTRIBUTORwill cooperate fully in the transfer of such registrationsto O%NERor any &erson designated y O%NER8

SA3ES AND MARETING O/ THE 1RODU0T

.1 DISTRIBUTORwill resell all &roduct purchased hereunder in compliance with

all applicale laws in the erritory and only in the pac+aging supplied or approved yO%NER3 DISTRIBUTORis responsile for mar+eting and promotional activities in theerritory and for compliance with all applicale laws and regulations, including, withoutlimitation, laws and regulations regarding health and safety, nutritional medicinalproducts, mar+eting practices, etc3 DISTRIBUTORrepresents and warrants that it hasotained all permits, licences, registrations and other approvals re5uired y everynational, local or municipal government or agency, in respect of the performance ofDISTRIBUTOR6s oligations under this 'greement3

.2 DISTRIBUTOR shall use its est efforts, at its own e-pense, to mar+et,

promote and sell the &roduct in the erritory and shall use the same channels andmethods and e-ercise the same diligence, including ma+ing regular and sufficientcontact with present and prospective customers of &roduct in the erritory, whichDISTRIBUTORuses in mar+eting its other noncompeting products3 'll advertising yDISTRIBUTORin any medium shall e conducted in a dignified manner that will reflectfavouraly upon the goodwill and reputation of O%NER, and shall conform to thehighest standards and shall display the rademar+s only in a manner approved yO%NER3 DISTRIBUTOR shall forward to O%NER copies or samples of all

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advertisements and promotions for its approval and DISTRIBUTORagrees to withdrawany advertisements or promotions which are considered unsuitale y O%NER3DISTRIBUTOR further ac+nowledges that all advertising and promotional materialsrelating to the &roduct or earing the rademar+s shall remain the property of O%NERwho shall retain the sole and e-clusive ownership of all copyright therein3

.3 9otwithstanding %ection =32, O%NERmay provide, in its sole and asolute

discretion, a mar+eting allowance to offset costs associated with DISTRIBUTOR6s

performance of its oligations set forth in %ection =32, the details of which mar+etingallowance, if any such allowance is provided, shall e communicated to DISTRIBUTORy O%NERseparately, it eing understood that O%NERshall have the right in its solediscretion to amend or discontinue any such mar+eting allowance, upon si-ty (@0) days6written notice to DISTRIBUTOR3

.4 he determination of sales and mar+eting strategies and DISTRIBUTOR6s

selling prices for the &roduct within the erritory shall e the responsiility ofDISTRIBUTOR, after consultation with O%NERwho may provide DISTRIBUTORwith asuggested resale price list as well as advice in regard to usiness processes, salespolicies, procedures and systems, mar+eting programmes and promotions3 /hileDISTRIBUTOR is under no oligation to accept such suggested resale prices for

&roduct, it shall ensure that the retail prices of the &roduct are as competitive aspossile so as to ma-imi8e and increase the sales of &roduct in the erritory3DISTRIBUTOR shall report regularly to O%NER in regard to any mar+et trends orconditions or regulations affecting or which may affect the sale of &roduct in theerritory that come to its attention, or of any new products which might e competitivewith the &roduct, providing details thereof including prices and copies of any +nownpromotional materials, and any potential infringements, and will sumit to O%NERannually, during the erm, not less than si-ty (@0) days efore the anniversary of the"ffective ;ate, its usiness plan for the upcoming year, including an analysis ofmar+ets, competition and competitors6 activities, planned promotional activities andDISTRIBUTOR6s estimate of sales y month for the upcoming year3 DISTRIBUTORwillalso, upon re5uest y O%NER, furnish such further information concerningDISTRIBUTOR6s usiness and operations as O%NER in its sole discretion deemsnecessary from time to time3

.5 #n performing its duties hereunder, DISTRIBUTORagrees not to ma+e any

representation or give any warranty with respect to any of the &roduct other than thosecontained in any current rochures, leaflets or other printed matter relating to such&roduct, which may e issued from time to time y O%NER3 #n the event thatDISTRIBUTORdoes ma+e any representation or warranty in violation of the foregoing,then DISTRIBUTORagrees to indemnify and save O%NERharmless from any claims,demands, suits, proceedings, damages, liailities, costs or losses of any nature or +indwhatsoever (including any legal costs) suffered or incurred, or which may e suffered orincurred, y O%NER arising out of or in any way connected with any suchrepresentation or warranty3

.6 he restrictive covenants imposed on the DISTRIBUTOR hereunder shall

e-tend and apply to any affiliates of the DISTRIBUTOR and their respectiveshareholders, directors, officers, employees and representatives as if they were alsoparties to this 'greement and DISTRIBUTORshall cause such &ersons to comply withsuch restrictive covenants and will e responsile to O%NERfor the actions of all such&ersons in contravention thereof3

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ADDITIONA3 OB3IGATIONS O/ DISTRIBUTOR

.1 ;uring the currency of this 'greement, in addition to any other oligations set

forth herein, DISTRIBUTORshall:

use its est efforts in the performance of its oligations under this

'greement, including without limitation, in respect to the active solicitation of orders inthe erritory for the purchase of &roduct*

commit and adhere to the highest standards of operation, including

those standards that may e prescried y O%NERfrom time to time*

provide to O%NERongoing mar+et evaluations for &roduct and use its

est efforts to develop and enhance the O%NERname and rand image in order toincrease mar+et awareness and sales of such &roduct within the erritory*

supply O%NER with records of all contacts made with present and

prospective customers in the erritory, including the nature of such contacts*

comply with and cause any sudistriutors or other &ersons appointed

y it to comply with all applicale laws, rules, regulations andDor guidelines in theerritory relating to the use, storage, handling, transportation, mar+eting, advertisement,distriution, sale, transfer andDor disposal of the &roduct, as well as with the terms andconditions of this 'greement* and

+eep complete and accurate records with respect to any and all &roduct

purchased from O%NER and sold y DISTRIBUTOR in the erritory, andDISTRIBUTOR shall provide to O%NER' on a monthly asis, a written sales andinventory report setting forth a summary of all sales y DISTRIBUTORto customers inthe previous month (and year to date), as well as a summary of inventory on hand, inorder to e received y O%NERno later than fifteen (1) days after the end of themonth to which such figures pertain3

RE1RESENTATIONS AND %ARRANTIES O/ DISTRIBUTOR

.1 DISTRIBUTOR represents and warrants to O%NER, ac+nowledging that

O%NER is relying upon such representations and warranties in connection with itsentering into this 'greement, as follows:

DISTRIBUTORis a valid susisting corporation incorporated pursuant to

the laws of*

DISTRIBUTOR has all re5uisite power and authority to e-ecute and

deliver this 'greement and has all necessary power and authority to perform theoligations of DISTRIBUTORas set out herein*

the entering into of this 'greement will not result in the violation of any of

the terms and provisions of any agreement, written or oral, to which DISTRIBUTORmay e a party*

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the e-ecution and delivery of this 'greement has een duly authori8ed

y all necessary action on the part of DISTRIBUTORand this 'greement, when dulye-ecuted and delivered y DISTRIBUTOR'will constitute a legal and inding oligationof DISTRIBUTORenforceale in accordance with its terms*

the performance y DISTRIBUTOR of all its oligations hereunder,

including the sale of the &roduct, will e conducted in compliance with all applicalelaws in the erritory* and

DISTRIBUTOR possesses a readily availale and e-tensive sales

networ+ in the erritory3

TRADE5MARS

.1 he &roduct will e mar+eted and sold y DISTRIBUTOR solely under the

rademar+s3 DISTRIBUTOR will not alter, oscure, remove, cancel or otherwiseinterfere with any mar+ings (including without limitation any rademar+s, logos, tradenames or trading style of O%NER) and other indications of origin, which may e placedon &roduct3 DISTRIBUTORac+nowledges that O%NERis the e-clusive owner of therademar+s and DISTRIBUTORhas no right, title or interest whatsoever in the rade

mar+s and any goodwill association therewith and that all goodwill associated with therademar+s is owned y and shall enure e-clusively to and for the enefit of O%NER3Furthermore, DISTRIBUTORagrees not to represent in any manner that it has ac5uiredany ownership rights in the rademar+s3 'ny goodwill en.oyed y DISTRIBUTORfromuse of the rademar+s shall vest in and ecome the asolute property of O%NERandDISTRIBUTOR underta+es and agrees, at the re5uest and e-pense of O%NER,whether efore or after termination of this 'greement, to e-ecute all such instrumentsand to do all such acts and things as may e necessary and desirale to vestasolutely in O%NERall such rademar+s and the goodwill therein3 DISTRIBUTORshall, during the erm of this 'greement and su.ect to due compliance with theprovisions of this 'rticle G##, have the right to use and display O%NER>,rade4ar+sand copyrighted material in the erritory solely in connection with the mar+eting, sale,

distriution and support of the &roduct in such erritory in accordance with the terms ofthis 'greement and, e-cept as may e otherwise permitted in writing y O%NER, for noother purpose whatsoever3 #t is the responsiility of DISTRIBUTORto ensure that thepac+aging materials for &roduct are in conformity with all applicale legislation in theerritory3

.2 #n connection with the foregoing, DISTRIBUTOR covenants and agrees as

follows:

to mar+et, distriute and support the &roduct only under the rade

mar+s, and not under any other trademar+ or logo of any other &erson*

to otain from O%NER written approval for all promotional material,alternative product pac+aging including, without limitation, lister pac+aging andcartons, and to comply with all instructions issued y O%NERrelating to the form andmanner in which O%NER6s rademar+s shall e used and to discontinue forthwith,upon notice from O%NER, any practice relating to the use of O%NER6s rademar+swhich in O%NER6s opinion would or might adversely affect the rights or interests ofO%NERin such rademar+s*

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to conduct usiness in a manner that reflects favouraly at all times on

the &roduct and reputation ofO%NERin order to develop, promote and maintain samewith customers and to protect and preserve the goodwill and image of O%NER and the&roduct*

not to use or permit any entity controlled y it or affiliated with it to use

the rademar+s or any other trademar+s or trade names or trade dress of O%NERorany trademar+s, trade dress, words, names, symols, or designs which could

reasonaly e e-pected to e considered confusingly similar thereto, as part of itscorporate or trading name or style, or on any of its products*

not to infringe O%NER6s rights in and to any of the rademar+s and not

to dispute, contest, attac+ or impair the validity or ownership of the rademar+s or doany act which tends to impair the validity of the rademar+s or the title of O%NERtoany rademar+s, trade names, copyrights and registrations used in connection with the&roduct, nor to effect any applications or registrations thereof without the e-presswritten consent of O%NER, and not to ta+e any action to the detriment of O%NER6sinterest therein or which would or could dilute the value of the goodwill attaching to therademar+s*

not to effect or permit the removal, renewal or alteration of any rademar+s, trade names, notices, name plates, or ;3#3936s or 9&96s or serial numersaffi-ed to any of the &roduct or its pac+aging*

to impose similar conditions on any $epresentatives or affiliated

companies of DISTRIBUTORto those set out in this 'rticle G## and to ta+e such actionas O%NERmay re5uire at any time in respect to the use y any other &erson ofO%NER>,rademar+s3

.3 DISTRIBUTOR shall provide prompt notice to O%NER of any claims,

allegations, actions and demands that the mar+eting andDor distriution of the &roductinfringes or may infringe the intellectual property rights of any other &erson and once

such notice has een duly given, O%NER shall have full carriage of any resultingaction andDISTRIBUTORshall e-tend its full cooperation to O%NER in the defencey O%NERof any such claim, action or demand3

.4 DISTRIBUTOR shall immediately report to O%NER any actual or potential

infringements of the rademar+s or any matter which may give rise to any infringementof the rademar+s, or any imitation of &roduct of which DISTRIBUTOR is or mayecome aware, and DISTRIBUTORshall cooperate with O%NERin protecting suchrademar+s and &roduct from any such infringement3 DISTRIBUTORshall not initiateany protective action with respect to the rademar+s or &roduct without prior writtenauthori8ation of O%NER3

.5 Bpon termination of this 'greement for any reason whatsoever,DISTRIBUTORshall discontinue forthwith all use of O%NER6s rademar+s and tradenames, and DISTRIBUTOR shall return to O%NERall price lists, catalogues, salesliterature, advertising literature and all other materials relating to the &roduct orConfidential #nformation in DISTRIBUTOR6s possession or over which it has control3

.6 DISTRIBUTORagrees that the provisions of this 'rticle G## are reasonale

having regard to the necessity ofO%NERto protect its ownership rights in the rademar+s and that any reach of the terms contained in this 'rticle G## shall e deemed a

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material reach of this 'greement andin addition to any other remedies which may eavailale to it, O%NER shall e entitled to enforce its rights hereunder y specificperformance or other in.unctive or e5uitale relief so as to protect all its rights in and toits rademar+s3

0ON/IDENTIA3 IN/ORMATION AND NON50OM1ETITION

.1 /hen and if re5uired, O%NER will furnish DISTRIBUTOR the necessary

information so that DISTRIBUTOR can fulfill its oligations hereunder regarding theregistration of the &roduct to e distriuted in the erritory3 his information shallconstitute part of the Confidential #nformation defined in %ection 131(d)3

.2 From time to time, O%NERmay periodically provide DISTRIBUTORwith new

or upgraded data that has ecome availale, documentation, tests, reports or otherpertinent information relating to the &roduct or otherwise, which information will alsoform part of the Confidential #nformation and which will assist in +eeping DISTRIBUTOR+nowledgeale in regard to the &roduct and maintaining a competitive edge in themar+eting and sales of the &roduct3

.3 DISTRIBUTOR ac+nowledges that in its relationship with O%NER andDor y

virtue of the performance of this 'greement, it andDor its employees, shareholders,officers, directors, principals, agents and contractors (collectively, $epresentatives)will e and shall hereafter continue to e entrusted with Confidential #nformation, thedisclosure of any of which to competitors of O%NERor to the general pulic would ehighly detrimental to the est interests of O%NER3 DISTRIBUTOR furtherac+nowledges that the right to maintain confidential such Confidential #nformationconstitutes a proprietary right of O%NER' which O%NER is entitled to protect3

'ccordingly, and notwithstanding anything to the contrary herein e-pressed,DISTRIBUTOR covenants and agrees with O%NER:

that it shall not use or copy, or permit the use or copy of any of the

Confidential #nformation, directly or indirectly, for any purpose other than the discharge

of its duties and oligations arising from its appointment as a DISTRIBUTOR hereunderand only in the est interests of O%NER*

that it will maintain the asolute confidentiality of the Confidential

#nformation and that it will not (without the prior written consent of O%NER) eitherindividually, or in partnership or .ointly, or in con.unction with any other &erson, asprincipal, agent, shareholder, or in any manner whatsoever, disclose, reveal, release,utili8e, sell, assign, supply, or transfer to any person at any time, any of the Confidential#nformation, e-cept to the e-tent necessary to discharge its duties and oligationsrelating to its appointment hereunder and only in the est interests of O%NER*

that it will ta+e all necessary action and will do all that is reasonaly

within its power to prevent the disclosure, release or supply of any of the Confidential#nformation to any &erson, including y any of its $epresentatives, e-cept to the e-tentnecessary to discharge its duties and oligations hereunder and only in the estinterests of O%NER*

in furtherance of the aove, DISTRIBUTOR will advise its

$epresentatives, and any other &ersons who are given access to the Confidential#nformation, of the confidential and proprietary nature of the Confidential #nformationand of the restrictions imposed y this 'greement and, if appropriate, shall re5uire each

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of them to signify in writing their agreement to aide y the terms of this 'greement andmaintain the confidentiality of the Confidential #nformation3 9otwithstanding any suchagreement, y any of such $epresentatives, DISTRIBUTORac+nowledges that it shalle fully responsile and liale to O%NERfor any and all damages and costs (includinglegal fees) suffered or incurred y it as a conse5uence of any reach y any ofDISTRIBUTOR6s $epresentatives, andDor any other &ersons given access to theConfidential #nformation, of the restrictive covenants contained herein3

.4 DISTRIBUTOR shall not, directly or indirectly, develop, manufacture ordistriute any products similar to or competitive with the &roduct in the erritory orelsewhere3 DISTRIBUTORherey further covenants and agrees that during the ermof this 'greement, and for a period of one (1) year following the termination of this

'greement DISTRIBUTOR shall not, for whatever reason, either individually or inpartnership or .ointly or in con.unction with any &erson as principal, agent, employee,shareholder, owner, investor, partner or in any other manner whatsoever, directly orindirectly, carry on or e engaged in or e concerned with or interested in, or advise,lend money to, guarantee the dets or oligations of or permit its name or any partthereof to e used or employed y any &erson engaged in or concerned with orinterested in, the usiness of manufacturing, developing, producing, mar+eting,distriuting, supplying or selling, for wholesale or retail, nor shall it hold in stoc+ or

solicit or e directly engaged or interested in soliciting orders for, any products similar toor competitive with the &roduct within the erritory3

.5 DISTRIBUTOR ac+nowledges that the restrictions contained in %ections 1?3?

and 1?3 are reasonale and valid and necessary for the protection of the usiness andoperations of O%NER and that any reach of the provisions will cause O%NERsustantial and irreparale harm which may not e ade5uately compensated for ymonetary award of damages to O%NER3 'ccordingly, it is e-pressly agreed yDISTRIBUTORthat in the event of any such reach, in addition to any other remedieswhich may e availale to it, O%NERshall e entitled to and may see+ an order forspecific performance and other in.unctive and e5uitale relief as may e considerednecessary or appropriate to restrain or en.oin DISTRIBUTORfrom any further reach ofthe terms hereof and DISTRIBUTOR herey waives all defences to the strictenforcement y O%NERof the restrictions herein3

.6 Bpon termination of this 'greement for any reason, DISTRIBUTOR shall

immediately return to O%NERany Confidential #nformation and shall thereafter refrainfrom using or disclosing any such Confidential #nformation to any &erson for anypurpose whatsoever3

TERMINATION

.1 9otwithstanding any other provision herein, the parties hereto agree that this

'greement shall automatically terminate without re5uirement of notice to the defaultingparty or an opportunity to cure, upon the occurrence of the following events:

if a decree or order of a court having competent .urisdiction is entered

ad.udging a party an+rupt or approving as properly filed a petition see+ing or windingup of such party under the Companies Creditors Arrangement Act (Canada) or theWinding up and Restructuring Act (Canada) or under any analogous, comparale orsimilar law in the erritory or other applicale .urisdiction, or under any other process ofe-ecution or similar effect against any sustantial part of the property of such party,including, without limitation, the appointment of a receiver in respect thereto, or

15


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ordering for the winding up or li5uidation of its affairs, and any such decree or ordercontinues unstayed and in effect for a period of thirty (?0) days*

if a party admits in writing its inaility to pay its dets as they ecome

due, ma+es any assignment in an+ruptcy or ma+es any other assignment for theenefit of creditors, ma+es any proposal under the Bankruptcy and Insolvency Act(Canada) or any comparale or similar law in the erritory or other applicale

.urisdiction, see+s relief under the Companies Creditors Arrangement Act(Canada), the

Winding-up and Restructuring Act (Canada) or any other an+ruptcy, insolvency, oranalogous, comparale or similar law in the erritory or other applicale .urisdiction, isad.udged an+rupt, files a petition or proposal to ta+e advantage of any act ofinsolvency, consents to or ac5uiesces in the appointment of a trustee, receiver, receiverand manager, interim receiver, custodian, se5uestrator or other person with similarpowers to itself or of all of any sustantial portion of its property or assets, or files apetition or otherwise commences any proceeding see+ing any reorgani8ation,arrangement, composition or read.ustment under the applicale an+ruptcy, insolvency,moratorium, reorgani8ation or other similar law in the erritory or other applicale

.urisdiction affecting creditors6 rights or consents to or ac5uiesces in, the filing of such apetition*

if a governmental regulatory order or final .udgment or decree in any.urisdiction which materially and adversely affects the aility of a party to fulfill itsoligations to the other party under this 'greement shall have een made, issuedotained or entered against such party and such order, .udgment or decree shall nothave een vacated, discharged or stayed pending appeal within the applicale timeperiod* or

DISTRIBUTORassigns or attempts to assign this 'greement or any of

the rights or oligations hereunder without the prior written consent of O%NEReinggiven3

.2 O%NERmay, without pre.udice to any other rights, immediately terminate this

'greement y notice to DISTRIBUTORif:

DISTRIBUTOR fails to achieve the 4inimum 'nnual &erformance

$e5uirement in any year during the erm as set forth in %chedule 7 hereto (asdeemed to e amended y %ection 3H hereof)*

any change occurs in the constitution, management or control or the

financial or other circumstances of DISTRIBUTOR which, in the sole opinion ofO%NER' is materially detrimental to the interests of O%NER including, withoutlimitation, as a result of any interest in DISTRIBUTOReing ac5uired y any &ersonengaged in a usiness that is competitive with the usiness of O%NER* or

the &roduct has not een duly registered for sale in the erritory within

the time period prescried pursuant to the terms of this 'greement, including %ectionE32 hereof3

.3 #n the event O%NERshall deem it necessary to recall the &roduct from the

erritory, whether as a conse5uence of issues discovered y O%NER, or if re5uired ythe local authorities in the erritory, O%NER shall e entitled to terminate this

'greement upon three (?) months6 notice3 #n such case, neither of the parties shall e

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oliged to pay any compensation, loss of income, or goodwill to the other party, e-ceptthat O%NER shall indemnify DISTRIBUTOR in respect to any liailities incurred yDISTRIBUTORin respect to any claims made y any &erson against DISTRIBUTORasa direct conse5uence of and relating specifically to such recall of &roduct, provided thatsuch &roduct recall was not caused y or necessitated y any actions or omissions onthe part of DISTRIBUTOR8

.4 Furthermore this 'greement may also e terminated y either party at any

time in the event that the other party commits a material reach of any provision of this'greement and such other party fails to remedy such reach within thirty (?0) daysafter receipt of written notice specifying the reach from the nondefaulting party3

.5 "arly termination pursuant the aove paragraphs shall not relieve either party

of any oligation arising hereunder prior to such termination including, withoutlimitation, DISTRIBUTOR>, oligation to (i) purchase &roduct covered y purchaseorders sumitted y DISTRIBUTOR to O%NERFand (ii) pay O%NERfor the &roductshipped or to e shipped pursuant to purchase orders accepted prior to earlytermination, or O%NER>, oligation to ship &roduct on accepted orders, or relieveeither party of its liaility for reach of its oligations pursuant to the terms andconditions of this 'greement incurred prior to such early termination* nor shall it deprive

either party of its right to pursue any other remedy availale to it

.6 9otwithstanding the termination or e-piration of this 'greement all rights and

oligations of the parties, which y their nature survive the termination or e-piration ofthis 'greement, including those estalished pursuant to %ections @3 H3, =3, =3, 1231,1232, 123, 123@, 1?3?, 1?3, 1?3, 1?3@, 13?, 13, 13H, 131, 1@31, 1@32, 1@3?, 1=31and 1=32 shall survive the termination or e-piration of this 'greement3

.7 Bpon termination of this 'greement for any reason whatsoever:

all rights granted y O%NER to DISTRIBUTOR will e immediately

relin5uished y DISTRIBUTORwho shall immediately pay all amounts due and owing

y i t to O%NER forthwith, and in any event within ten (10) days of the date oftermination of this 'greement*

DISTRIBUTOR shall promptly return to O%NER all Confidential

#nformation, advertising and promotional material and any other materials anddocuments given to DISTRIBUTORand relating to this 'greement or otherwise to theusiness of O%NER*

DISTRIBUTOR shall cease use of O%NER6s rademar+s and shall

thereafter refrain from holding itself out as an authori8ed distriutor of O%NER' andDISTRIBUTOR will forthwith remove and thereafter discontinue all advertisements,signs and notifications stating or implying that it is a distriutor of &roduct or in any way

connected with O%NERF

O%NERshall have the option, ut not the oligation, to repurchase from

DISTRIBUTOR any of the &roduct in DISTRIBUTOR6s inventory y refunding toDISTRIBUTORits net cost for such &roduct, provided, however, that O%NER may setoff and deduct from the repurchase price any amount then due and owing yDISTRIBUTOR to O%NER as well as any freight charges and duties relating to thedelivery of such &roduct to O%NER*

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O%NER shall not e liale to DISTRIBUTORy reason of the proper

termination of this 'greement for any damages, whether direct, conse5uential orincidental, on account of the loss of prospective profits on anticipated sales or onaccount of e-penditures, investments, leases or commitments in connection with theusiness, arising from such termination of this 'greement* and

during the period of ninety (=0) days immediately prior to the date of

termination or e-piration, O%NERmay appoint one or more distriutors in the erritory

and may supply &roduct directly to any customers in the erritory and DISTRIBUTORwill have no claim for compensation or damages on account of any such appointmentor supply8

.8 #f O%NERcontinues to supply &roduct to DISTRIBUTORafter termination of

this 'greement, such supply will not e construed as a waiver of any such termination,or as a renewal of this 'greement3

EISTING STO0

.1 #n case of termination of this 'greement, O%NERwill grant DISTRIBUTORa

reasonale period of time to sell its e-isting stoc+ of &roduct, which shall in any event

not e longer than ninety days (=0) from the date of termination of this 'greement3

3IMITATION O/ 3IABI3IT$ AND INDEMNITIES

.1 "-cept as e-pressly provided in this 'greement, there are no representations

or warranties, e-press or implied, statutory or otherwise, relating to the &roduct,including, without limitation, any implied warranty of merchantaility or fitness for anyparticular purpose3 he parties herey e-pressly e-clude the application of the Bnited9ations Convention on Contracts for the #nternational %ale of Ioods and the Bniformaw on the %ale of Ioods and the Bniform aw on the Formation of Contracts for the#nternational %ale of Ioods3 DISTRIBUTOR assumes all ris+ and liaility for any loss,damage or in.ury resulting from the sale and use of the &roduct, either alone or in

comination with other products3

.2 DISTRIBUTOR herey agrees to defend, indemnify and hold harmless

O%NER against any liaility, losses, damages or costs (including any legal costs)incurred or suffered y O%NERas a result of any reach, negligent act or omission orwilful default on the part of DISTRIBUTOR, or its $epresentatives arising either directlyor indirectly from the performance (or nonperformance) y DISTRIBUTORor any of its$epresentatives of any oligations under this 'greement3

.3 O%NER shall not e liale to the DISTRIBUTOR for any special, indirect,

conse5uential, punitive or e-emplary damages, including for greater certainty anydamages on account of the loss of prospective profits on anticipated sales or on

account of e-penditures, investments, leases or commitments in connection with theusiness3

.4 9otwithstanding anything to the contrary herein, if O%NER notifies

DISTRIBUTOR that any of the &roduct needs to e recalled or otherwise withdrawnfrom the mar+et, and DISTRIBUTORrefuses or otherwise fails to do so in a timelyfashion, DISTRIBUTORagrees to indemnify O%NER, its affiliates, and their respectiveofficers, directors, employees, agents and shareholders, from and against any and all

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liaility, loses, damages or costs, including legal costs, incurred or suffered y O%NERas a result of any such failure or refusal3

/OR0E MAEURE

.1 9o failure or omission y O%NER or DISTRIBUTOR in the performance of

any oligation under this 'greement shall e deemed a reach of this 'greement orcreate any liaility if the same arises on account of force ma.eure, which term shall

include any event or cause eyond the control of O%NER or DISTRIBUTOR, as thecase may e, including ut not restricted to acts of Iod, acts or omissions of anygovernment, or agency thereof, reellion, insurrection, riot, saotage, invasion,5uarantine, restrictions, stri+e, loc+ out and transportation emargoes, provided thatthe party relying on this %ection shall forthwith after any such event give written noticeto the other party of its inaility to perform such oligation and the reasons therefore3 #fforce ma.eure continues for a period of more than three (?) months, without the partieshereto eing ale to develop an alternative satisfactory arrangement, then either partyhas the option of immediately terminating this 'greement3

MIS0E33ANEOUS

.1 'ny notice, re5uest, demand, consent or other communication re5uired orpermitted under this 'greement shall e in writing and shall e given y personaldelivery (including courier) y prepaid registered or certified mail or y fa- (confirmedy mail) addressed to the party for which it is intended at the address elow and shalle deemed to e given on the day of delivery or transmission if during normal usinesshours, or, if after usiness hours, on the ne-t following 7usiness ;ay, or if mailed yregistered or certified mail, on the day which is seven (H) 7usiness ;ays after suchnotice is mailed during normal postal conditions3 #n the event of a postal disruption, anynotice mailed will e deemed received on the seventh (H th) 7usiness ;ay followingresumption of regular postal service:

if to O%NER:

O%NERC'9';'el3:Fa-:"mail:

'ttention:

if toDISTRIBUTOR:

el: Fa-3:

"mail: 'ttention:

&if to GUARANTOR-

Tel-

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/ax8- Email- Attention-

.2 "ither party may change its address for notices and other communications

upon notice to the other party in the manner aforesaid3

.3 "-cept as otherwise provided herein, this 'greement may not e amended or

otherwise modified e-cept in writing signed y oth parties3

.4 his 'greement, including all schedules attached hereto, constitutes the entire

agreement and understanding etween the parties with respect to all matters hereinand supersedes all prior oral or written agreements and understandings etween theparties with respect to the su.ect matter of this 'greement3

.5 he words hereof, herein, hereunder and similar e-pressions used in any

section of this 'greement relate to the whole of this 'greement (including anyschedules attached hereto) and not to that section only, unless otherwise e-pressly

provided for or the conte-t clearly indicates to the contrary3 /ords importing thesingular numer only will include the plural and vice versa and words importing themasculine gender will include the feminine and neuter genders and vice versa3 heword including will mean including without limitation3

.6 O%NER may sell, transfer and assign any or all of its rights and oligations

arising from this 'greement to any &erson, upon notice to DISTRIBUTOR, providedthat the assignee shall agree in writing to e ound y the covenants and agreementscontained herein and so assigned y O%NER8 Bpon such assignment andassumption, O%NERshall e under no further oligation hereunder with respect to anyof the rights and oligations so assigned3 DISTRIBUTORshall not assign or transfer itsrights or oligations under this 'greement or any document relating to this 'greement

to any &erson without the prior written consent of O%NER3 his 'greement shall einding upon and enure to the enefit of the parties hereto and their respectivesuccessors and permitted assigns3 'ny attempted assignment in violation of this%ection 1E3@ shall e void and of not effect3

.7 he status of DISTRIBUTOR shall e that of an independent contractor3

9othing in this 'greement shall constitute or e deemed to constitute a partnership or.oint venture etween the parties or constitute or e deemed to constituteDISTRIBUTOR as the agent of O%NER for any purpose whatsoever andDISTRIBUTOR shall have no authority or power to ind O%NER in any mannerwhatsoever or to assume or incur any oligation or responsiility, e-press or implied, foror on ehalf of, or in the name of O%NER, e-cept as specifically provided for herein3

DISTRIBUTOR shall not list, print or display O%NER6s name in any manner so as toindicate or imply that there is an employeremployee or a principalagent relationshipetween O%NER and DISTRIBUTOR3 'll e-penses related to DISTRIBUTOR6sperformance of this 'greement shall e orne y DISTRIBUTORwho shall e solelyresponsile for the payment thereof3

.8 he failure y either party at any time to re5uire performance y the other

party of any provision of this 'greement shall in no way affect its right to re5uireperformance at any time thereafter, and no term or provision of this 'greement is

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deemed waived and no reach e-cused unless such waiver or consent is in writing andsigned y the party to have so waived or consented3 'ny consent y any party to, orwaiver of, a reach y the other party, whether e-pressed or implied, does notconstitute a consent to, waiver of, or e-cuse for, any other different or suse5uentreach y such other party of the same or any other provision3

.9 ime shall e of the essence of this 'greement3

.10 #f any provision of this 'greement shall, to any e-tent, e held to e invalid orunenforceale, it shall e deemed to e separate and severale from the remainingprovisions of this 'greement, which shall remain in full force and effect and e indingas though the invalid or unenforceale provision had not een included3

.11 "ach of the parties hereto covenant and agree to e-ecute and deliver such

further and other agreements, assurances, underta+ings or documents, cause suchmeetings to e held, resolutions passed and ylaws enacted, e-ercise their votes andinfluence and do and perform and cause to e done and performed any further andother acts and things as may e necessary or desirale in order to give full effect to this

'greement3

.12 Bnless otherwise specifically provided for herein, all monetary amountsreferred to herein shall e in lawful B3%3 dollars3

.13 he division of this 'greement into articles and sections is for convenience of

reference only and shall not affect the interpretation or construction of this 'greement3

.14 he language of all communications etween the parties pursuant to this

'greement, including notices and reports, will e the "nglish language3

.15 his 'greement may e e-ecuted in identical duplicate counterparts, each of

which shall e deemed an original, and oth of which together shall constitute one andthe same instrument3 he delivery y facsimile transmission of an e-ecuted

counterpart will e deemed to e valid e-ecution and delivery of this 'greement andeach party hereto underta+es to provide each other party hereto with a copy of the

'greement earing original signatures as soon as possile after delivery of thefacsimile copy3

GO?ERNING 3A% AND ARBITRATION

.1 he parties agree that the validity, operation and performance of this

'greement shall e governed y and interpreted in accordance with the laws of the&rovince of Ontario and the federal laws of Canada applicale therein (notwithstandingconflict of law rules), and the parties do e-pressly and irrevocaly attorn to the

.urisdiction of courts of Ontario with respect to any matter or claim, suit, action or

proceeding arising under or related to this 'greement3 o the fullest e-tend permittedy applicale law, DISTRIBUTORwaives and agrees not to assert, as a defense orotherwise, (i) any claim that it is not su.ect to the .urisdiction (in personam orotherwise) of any such court, (ii) any o.ection that it may now or hereafter have to thelaying of venue in any such court, or (iii) any claim that any action, suit or proceedinghas een rought in an inconvenient forum3

.2 'ny dispute concerning the su.ect matter of this 'greement, or the reach,

termination or validity thereof (a ;ispute) will e settled e-clusively in accordance with

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23/27

defen,e, in re,pe!t of an( ,)!* !laim ot*er t*an an( defen,e 7a,ed on t*ein,ol"en!( or 7an6r)pt!( of DISTRIBUTOR8

.3 T*e G)arantor ,*all pa( all !o,t, and expen,e, .in!l)ding legal fee, and

expen,e,< rea,ona7l( in!)rred 7( or on 7e*alf of O%NER in enfor!ing t*eo7ligation, of t*e G)arantor )nder t*e G)arantee8

.4 To t*e extent of an( pa(ment 7( t*e G)arantor to O%NER *ere)nder' t*e

G)arantor ,*all ,)!!eed to all !orre,ponding !laim, t*at O%NER ma( *a"e andot*er+i,e ,*all 7e ,)7rogated to t*e rig*t, of O%NER again,t DISTRIBUTOR inre,pe!t t*ereof8

.5 An( fail)re on t*e part of O%NER to perfe!t' maintain or enfor!e an(

rig*t, again,t DISTRIBUTOR ,*all not pre)di!e O%NER +it* re,pe!t to it, rig*t,p)r,)ant to t*i, G)arantee' and ,*all not di,!*arge or limit or le,,en t*e lia7ilit(of t*e G)arantor p)r,)ant to t*e term, *ereof8 O%NER ,*all not 7e 7o)nd toex*a),t it, re!o)r,e again,t DISTRIBUTOR or an( ot*er 1er,on 7efore 7eing

entitled to pa(ment or performan!e )nder t*i, G)arantee and t*e G)arantor+ai"e, an( rig*t, to re4)ire O%NER to fir,t pro!eed again,t DISTRIBUTOR andreno)n!e, all 7enefit, of di,!),,ion and di"i,ion and expre,,l( agree, t*at a,7et+een t*e G)arantor and O%NER' t*e G)arantor ,*all 7e !on,idered a,primaril( lia7le for an( ,)!* pa(ment or performan!e8

.6 T*e G)arantor f)rt*er +ai"e an( defen!e ari,ing 7( rea,on of an(

di,a7ilit( or ot*er defen!e of DISTRIBUTOR' or t*e !e,,ation from an( !a),e+*at,oe"er of t*e lia7ilit( of DISTRIBUTOR' and f)rt*er t*e G)arantor +ai"e an(rig*t of ,et5off' !o)nter5!laim' ,)7rogation' reim7)r,ement' indemnifi!ation' and!ontri7)tion .!ontra!t)al' ,tat)tor( or ot*er+i,e


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.8 An( o7ligation, of DISTRIBUTOR to t*e G)arantor' no+ or *ereafter

exi,ting' in!l)ding 7)t not limited to an( o7ligation, to t*e G)arantor a, ,)7rogeeof DISTRIBUTOR or re,)lting from t*e G)arantor>, performan!e )nder t*i,G)arantee are *ere7( a,,igned to O%NER and po,tponed and ,)7ordinated tot*e inde7tedne,,8 An( ,)!* o7ligation, of DISTRIBUTOR to t*e G)arantorre!ei"ed 7( t*e G)arantor ,*all 7e re!ei"ed in tr),t for O%NER and t*e pro!eed,t*ereof ,*all fort*+it* 7e paid o"er to O%NER on a!!o)nt of t*e inde7tedne,, ofDISTRIBUTOR to O%NER' 7)t +it*o)t red)!ing or affe!ting in an( manner t*e

lia7ilit( of t*e G)arantor )nder t*e pro"i,ion, of t*i, G)arantee8 T*i, a,,ignmentand po,tponement i, independent of and ,e"era7le from t*i, G)arantee and ,*allremain in f)ll for!e and effe!t +*et*er or not t*e G)arantor i, lia7le for an(amo)nt )nder t*i, G)arantee8

.9 T*e G)arantor a!6no+ledge, and agree, t*at an( a!!o)nt ,ettled or

,tated 7( or 7et+een O%NER and DISTRIBUTOR' or' if an( ,)!* a!!o)nt *a, not7een ,o ,ettled or ,tated immediatel( 7efore demand for pa(ment )nder t*i,G)arantee' an( a!!o)nt ,tated 7( O%NER' ,*all 7e a!!epted 7( t*e G)arantor a,prima fa!ie e"iden!e of t*e amo)nt +*i!* at t*e date of t*e a!!o)nt ,o ,ettled or,tated i, d)e 7( DISTRIBUTOR to O%NER or remain, )npaid 7( DISTRIBUTOR toO%NER8

.10 If an( pro"i,ion of t*i, G)arantee i, determined in an( pro!eeding in a

!o)rt of !ompetent )ri,di!tion to 7e "oid or to 7e +*oll( or partl( )nenfor!ea7le't*at pro"i,ion ,*all for t*e p)rpo,e, of ,)!* pro!eeding' 7e ,e"ered from t*i,G)arantee at O%NERK, option and ,*all 7e treated a, not forming a part *ereofand all t*e remaining pro"i,ion, of t*i, G)arantee ,*all remain in f)ll for!e and 7e)naffe!ted t*ere7(8

.11 T*i, G)arantee ,*all not 7e ,)7e!t to or affe!ted 7( an( promi,e or

!ondition affe!ting or limiting t*e lia7ilit( of t*e G)arantor ex!ept a, expre,,l( ,etfort* *erein and no ,tatement' repre,entation' agreement or promi,e on t*e partof O%NER or an( offi!er' emplo(ee or agent t*ereof' )nle,, !ontained *erein'form, an( part of t*i, !ontra!t or *a, ind)!ed t*e ma6ing t*ereof or ,*all 7edeemed in an( +a( to affe!t t*e lia7ilit( of t*e G)arantor *ere)nder8

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IN %ITNESS %HEREO/, the parties have caused this 'greement to e e-ecuted as of theday and year first written aove3

O%NER

&er:

&er:

&er:

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S0HEDU3E A

(o the ;istriution 'greement effective as of , 2012)

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S0HEDU3E B

(o the ;istriution 'greement effective as of , 2012)

MINIMUM ANNUA3 1ER/ORMAN0E REUIREMENTS

Year Annual Period Dollar Amount

1

2

3

4

5

Distribution Agreement Template1

Documents

Transcript of Distribution Agreement Template1