EXHIBIT 10.13
DISTRIBUTION AGREEMENT
AGREEMENT made this 22nd day of December, 1997, by and between
OVATION
PRODUCTS CORPORATION, a New Hampshire corporation having its
principal offices
at 6 Southgate Drive, Nashua, New Hampshire 03062 ("Supplier"), and
Wilfred
Sherman, d/b/a WMS Enterprises, with principal offices at 790
Boylston Street,
Suite 11H, Boston, Massachusetts __________ ("Distributor").
WHEREAS, Supplier is in the business of manufacturing and
selling
various appliances and equipment including but not limited to, an
on-site waste
water treatment system (all such appliances and equipment and each
model thereof
available or offered for sale by Supplier, as each may be modified
or replaced
from time to time, being referred to herein as the "Products");
and
WHEREAS, Distributor possesses relevant market knowledge and
marketing
and selling experience to sell the Products; and
WHEREAS, Supplier and Distributor have agreed that Supplier will
grant
to Distributor, and Distributor will accept, the rights to market
and sell the
Products on a non-exclusive basis under the terms and conditions
set forth
herein;
NOW, THEREFORE, in consideration of the mutual understandings
and
agreements contained herein, One Dollar, and other good and
valuable
consideration, the receipt and sufficiency of which is hereby
severally
acknowledged, the parties hereto hereby agree as follows:
1. Grant of Rights. Supplier hereby grants to Distributor the
non-exclusive right to market and sell the Products.
2. Term. The initial term of this Agreement shall be for a period
of 60
months commencing on the first date any Product (other than a
product which is
subject to the terms of that certain License and License Rider
executed between
the parties dated August 21, 1997) has been manufactured with
Underwriter
Laboratories approval. Thereafter, this Agreement shall be renewed
for three
successive five-year periods (the initial term and each such
successive term
being referred to herein as a "Contract Period"), unless
Distributor, in its
sole discretion, reduces the term of this Agreement to the then
current Contract
Period by written notice to Supplier executed no less than sixty
(60) days prior
to the expiration of the then-current Contract Period.
3. Prices; Shipments. The prices to be charged during the term
hereof
shall be negotiated from time to time, provided however that at all
times
Supplier shall offer Distributor a discount rate on all Products no
less than
the best discount then being offered to, and other terms equal to
the best then
being offered to, any of Supplier's customers. Supplier agrees that
general
increases in its prices shall be effective upon a minimum of sixty
(60) days
written notice to Distributor. All orders received by a Supplier
for current
shipment (within normal lead time) prior to the effective date of
the price
increase shall be at the price in effect prior to such
increase.
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4. Obligations of Distributor. Distributor covenants and agrees
with,
and warrants to, Supplier that:
(a) Distributor shall use reasonable efforts to market and
promote
the sale of the Products.
(b) Distributor, in conjunction with Supplier, shall train its
personnel in the handling, demonstration and sale of the Products,
and shall
provide such support to them as is necessary or appropriate to
adequately
support the Products.
(c) Distributor shall maintain adequate liability insurance to
cover
all reasonably foreseeable events and conditions connected with the
operation of
its business, including but not limited to, product liability
insurance, and
shall name Supplier as an additional named insured on all such
insurance
policies.
5. Obligations of Supplier. In consideration of the efforts to be
made
by Distributor in marketing the Products in the Territory, Supplier
covenants
and agrees with, and warrants to, Distributor that it will:
(a) Upon the express written request of Distributor, provide
Distributor (at no cost to Distributor) with such technical and
other data,
expertise, and other information, advertising materials, and
literature relating
to the Products as is necessary or advisable to allow Distributor
to perform
hereunder and to market the Products;
(b) Allow personnel of Distributor to visit the plant and
facilities
of Supplier and its affiliated companies for the purpose of
obtaining their
assistance in explaining the practices and expertise of Supplier or
its
subsidiaries or affiliates in the use and distribution of the
Products, and
otherwise assist Distributor in an advisory capacity and train
Distributor
personnel in the use of the Products;
(c) Make available and sell the Products to Distributor
promptly
upon receipt of Distributor's purchase orders therefor, and deliver
or cause to
be delivered the Products ordered by, or in conjunction with,
Distributor at its
principal office (or to such other destination as Distributor may
designate from
time to time) within a reasonable period of time after the date of
the order;
(d) Render such other assistance to Distributor from time to time
as
may reasonably be necessary or advisable; and
(e) Use its best efforts to maintain the highest standards of
quality for its Products purchased, sold and distributed by
Distributor.
6. Warranties. Distributor agrees to pass through to the
ultimate
consumer the Supplier's standard warranty without change or
modification (which
Supplier agrees will be for a period of not less than one year from
the date of
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sale to the ultimate consumer). Such warranty shall be binding upon
Supplier,
provided that the Products are handled, installed and used in the
manner
prescribed by Supplier. Distributor may perform repairs on Products
in
accordance with Supplier's specifications (and Supplier shall
provide
Distributor with a consignment of repair and replacement parts for
such
purposes) or may forward any such Products to Supplier, at
Supplier's expense,
for repair or replacement. EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE, UNDER
NO CIRCUMSTANCES SHALL DISTRIBUTOR BE RESPONSIBLE FOR ANY OTHER
DAMAGES,
INCLUDING CONSEQUENTIAL DAMAGES, AND SUPPLIER AGREES TO INDEMNIFY
AND HOLD
HARMLESS THE DISTRIBUTOR FROM AND AGAINST ANY AND ALL LIABILITIES,
CLAIMS,
LOSSES, SUITS, ACTIONS, JUDGMENTS OR CAUSES OF ACTION, ASSESSMENTS,
COSTS AND
EXPENSES (INCLUDING, WITHOUT LIMITATION, ATTORNEYS' REASONABLE
FEES), ASSERTED
AGAINST, RESULTING TO, IMPOSED UPON, OR INCURRED OR SUFFERED BY
DISTRIBUTOR
ARISING IN ANY WAY FROM ACTUAL OR ALLEGED DEFECT, BREACH OF
WARRANTY OR
INFRINGEMENT BY THE PRODUCTS. Notwithstanding the foregoing,
Distributor shall
be responsible for, and indemnify and hold harmless Supplier from
and against
any and all liabilities, claims, losses, suits, actions, judgments
or causes of
action, assessments, costs and expenses (including, without
limitation,
attorneys' reasonable fees), asserted against, resulting to,
imposed upon, or
incurred or suffered by Supplier arising in any way from any (1)
failure by
Distributor to perform any repairs in a manner specified by
Supplier; or (ii)
modification or expansion by Distributor of the Warranty set forth
above.
7. Proprietary Rights.
(a) Supplier's Rights. Distributor hereby acknowledges and
agrees
that (i) Supplier's ownership of and other rights in patents and
patent
applications relating to the Products and agrees that it sh
