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Exhibit 2.
DISTRIBUTION CONTRACT
Alpha Pro Tech, Inc., as “Supplier” and VWR International Inc., as “Distributor” hereby enter into this Distribution Contract (Agreement) effective January 1, 2006; and, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, agree as follows:
1. Grant of Distributorship
Supplier hereby grants to
Distributor the Exclusive right to sell and distribute under the Critical Cover
trade name, and the non-exclusive right to sell and distribute Supplier branded
products, for all mutually agreed to products manufactured by Supplier (the
“Products”) throughout the Territory. Distributor
accepts such grant for the term and on the conditions stated in this Agreement.
The term “Territory” shall mean all domestic and international
clean room and industrial markets supported by Distributor.
2. Term and Renewal
The initial term of this Agreement shall be for three (3) years, beginning January 1, 2006 and ending December 31, 2008. Thereafter, this Agreement shall be automatically renewed for additional and successive terms of one (1) year each, unless and until terminated as provided in Section 6 of this Agreement or by either party upon written notice given to the other party one hundred and eighty (180)days prior to the end of the initial or a renewal term.
3. Supplier Duties
a.
Take out and maintain product liability
insurance with endorsements for product and completed operations blanket (and
broad form vendors liability) on all Products with insurers satisfactory to
Distributor with minimum limits of $1,000,000/ $3,000,000 for bodily injury and
$300,000 for property damage and immediately furnish to Distributor a
certificate of insurance issued by the carrier evidencing the foregoing
endorsements, coverage’s and limits and that such insurance shall not be
Cancelled without at least thirty (30) days prior written notice to
Distributor. Such policy of insurance shall name Distributor as an additional insured
there under.
b.
Notify Distributor immediately in writing
should Supplier become aware of any defect or condition which may render any of
the Products in violation of the Food, Drug and Cosmetic Act, (or similar laws
within the Territory) or in any way alters the specifications and quality of
the Products. Notify Distributor of any Products affected by
holds or recalls, and reimburse Distributor for the full price paid for any Products returned to Distributor by a customer, or to Supplier by Distributor, due to a recall or other manufacturing defect, plus all taxes, transportation and other costs and expenses incurred by Distributor in the return thereof.
4. Patents and Trademarks
Supplier agrees to repurchase from Distributor, at a price equivalent to the full purchase price paid by Distributor (including freight, duty, tax, etc.), any quantity of products in Distributor’s inventory which products Distributor reasonably believes it should not or cannot sell, based on a reasonable opinion of Distributor’s counsel that future sales by Distributor may result in patent or trademark infringement, by Supplier of a third party’s patent or trademark, or because of a decision, whether interlocutory or final, rendered in any patent or trademark infringement action concerning an infringement by Supplier of a third party’s patents or trademarks.
5. Product Warranties
Supplier specifically warrants to Distributor that the Products:
a. Are in compliance with Supplier’s specifications.
b.
Are not adulterated or misbranded within
the meaning of the Federal Food, Drug and Cosmetic Act, as amended, and the
regulations issued there under (the “Act”), or any comparable
state, municipal or local law or regulation applicable state, municipal or
local law, ordinance, regulation or order with in the “Territory”.
c.
Supplier authorizes Distributor to pass
through all warranties to Distributor’s customers.
d.
Supplier shall promptly replace, at no
cost to Distributor, any Product which, is defective or non-conforming, with a
non-defective or conforming Product (as applicable) or, credit
Distributor’s account for all amounts paid with respect to the defective
or non-conforming Product. Supplier shall pay all taxes, transportation,
duties and other reasonable and agreed upon expenses incurred in the
replacement of any defective or non-conforming Product.
6. Termination
Either party shall have the right to terminate this Agreement on written notice if the other (a) commits or suffers any act of bankruptcy or insolvency, or (b) fails to cure any material breach in the provisions of this Agreement within thirty (30) days after written notice of such breach, or (c) declares an event or events of force majeure that last in the aggregate more than 180 days.
7. Procedures on Termination
a. Windup
On the termination of this Agreement, for whatever reason, Supplier shall continue to honor Distributor’s orders for products up to the effective date of termination and for a period of sixty (60) days thereafter.
b. Repurchase of Inventory
Within thirty (30) days after termination of this Agreement, upon written request from Distributor:
i. Supplier shall repurchase Distributor’s inventory of the Level 2 Products, (Supplier Brand), within 90 days of receipt of such notice at Distributor’s acquisition cost thereof, less a 15% restocking fee. Distributor shall ship such Level 2 Products to the location designated by Supplier on CIF terms.
ii. Distributor shall purchase Supplier’s entire inventory of level 1 (Exclusive Distributor Critical Cover Private Label) and level 3(Exclusive, Unique market branding as defined by Distributor) finished goods, work in process and raw materials for level 1 & 3 products.
c. Product Service






