1. SALES REPRESENTATIVE AGREEMENT
This Agreement is made and entered into as of this ______ day of ________ 20 __ by
and between HWACHEON MACHINERY AMERICA, INC., an Illinois corporation with its
principal place of business at 50 Lakeview Parkway, Suite 119, Vernon Hills, Illinois 60061
(hereinafter referred to as “Company”), and _________________________________, a
________________________________________________, with its principal place of business
at _______________________________________ (hereinafter referred to as “Representative”).
WITNESSETH:
WHEREAS, Company is engaged in the sale and distribution in the United States of a
complete line of machine tools and related products (“Products”), as further defined in Schedule
A;
WHEREAS, Representative desires to be appointed as a sales representative for the
Products in the Territory, as defined herein, upon the terms and conditions set forth herein; and
WHEREAS, Company is willing to appoint Representative as its sales representative for
the Products in the Territory upon the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual promises and covenants of the
parties as hereinafter more fully set forth, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto, hereby agree as follows:
1. DEFINITIONS.
Definitions. For purposes of this Agreement, unless the context otherwise requires, the
following terms and variations thereof shall have the meanings specified or referred to in this
Section 1.
“Contract Price” shall mean the selling price (less all discounts, allowances and returns, all
of which may be negotiated by Company at its sole discretion) for the
Products provided for in a Sales Contract, but excluding all other items
such as, without limitation, nonrecurring engineering charges, service
and maintenance fees, taxes, cost of transportation, insurance and all
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2. other costs or charges of any kind.
“Customer” shall mean any customer or potential customer of the Products within the
Territory. “Customer” shall not include (i) any authorized distributors
appointed by Company, (ii) any specific customers which are identified
by Company in Schedule C attached hereto and made a part hereof (the
“House Accounts”). Company reserves the right to amend Schedule C,
upon notice to Representative, at any time, for any reason, and in any
way, including, but not limited to, listing additional House Accounts.
“Base Price” shall mean the price established by Company for the Products as between
Company and Representative.
“Products” shall mean the products of Company as more fully described in Schedule
A, attached hereto. Additional Products may be added to such list of
Products from time to time only by the mutual written agreement of the
parties. Any of the Products, as listed in Schedule A, may be modified,
replaced by a new or different product, or removed from Schedule A by
Company without prior consent or notice to Representative if such
modification, replacement or removal is the result of Company’s or
manufacturer’s action in the nature of design changes, model changes,
product discontinuance or product improvement with such changes,
replacement or improved products to be included under this Agreement.
“Sales Contract” shall mean a binding and effective written contract for the sale of the
Products, entered into by Company and a Customer. “Sales Contract”
shall not include: (i) a blanket purchase order, (ii) master purchasing
agreement or (iii) other similar arrangement pursuant to which a
Customer is not obligated to purchase any Products until the Customer
issues a release or other purchase order. No “Sales Contract” shall exist
until the Customer and Company have agreed upon the Products,
quantities, prices and shipping dates for a particular order.
“Territory” shall mean the specific geographic area, identified in Schedule B, in
which Representative has its primary market and its primary sales
responsibility.
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3. 3

4. 2. APPOINTMENT.
2.1 Appointment. Company hereby appoints Representative as a sales representative to
solicit Sales Contracts for Products from Customers located in the Territory, and Representative
hereby accepts such appointment, all in accordance with the terms and conditions set forth
herein. In consideration of the said appointment, Representative hereby agrees to exert its best
efforts during the term of this Agreement to vigorously promote the sale of the Products in the
Territory.
2.2 No Other Representatives Located In Territory. Company shall not appoint any other
sales representative for the Territory, except as provided in this Agreement. Notwithstanding the
foregoing, (i) nothing contained in this Agreement shall limit Company’s right to sell products
other than the Products in the Territory, (ii) Company reserves the right to directly contact any
Customer in the Territory at any time and (iii) Representative acknowledges that sales to
Customers in the Territory may result from the efforts of other representatives of Company and
such sales shall not be deemed a breach of this Agreement nor entitle Representative to
commission, except as provided in this Agreement. This Agreement shall apply to and govern
only the sale of the Products specified herein and no other different products, goods or
merchandise imported, sold or distributed by Company shall be encompassed within the terms
and provisions of this Agreement.
2.3 Certain Limitations. Notwithstanding anything to the contrary, if, in Company’s sole
judgment made in good faith, Representative shall have materially defaulted under this
Agreement, then Company may: (i) assign to another sales representative or Company’s own
sales department any of the duties of Representative with regard to any or all of the affected
Territory or Customers; (ii) unilaterally delete any or all Customers from this Agreement; or (iii)
exercise its rights under (i) and (ii) above, in addition to any other rights provided by law or this
Agreement. Company shall give ten (10) days prior written notice of the Company’s action(s).
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5. 3. RELATIONSHIP BETWEEN PARTIES.
3.1 Independent Contractor. Nothing in this Agreement shall be construed to constitute
Representative as an employee, co-contractor, agent, partner, or joint venture of Company or any
affiliate or shareholder of Company. Representative is and shall remain an independent
contractor of Company solely responsible for Representative’s own actions. Without limitation,
Representative shall have no authority to bind Company, to accept service of process, to receive
notice or to perform any act on Company’s behalf. Representative acknowledges that
Representative is not acting as a dealer or distributor of any goods but only as an independent
sales representative.
3.2 Representative’s Functions. Representative shall have only those authorities granted
under this Agreement.
4. COMPANY’S OBLIGATIONS.
4.1 Company shall supply to Representative, from time to time without charge, reasonable
quantities of catalogs, circulars and other printed materials that Company deems necessary or
useful for Representative to conduct sales and marketing of the Products.
4.2 Company shall offer factory training, technical advice and assistance to Representative to
assist Representative to render sales assistance and servicing to its customers.
5. REPRESENTATIONS AND WARRANTIES; OBLIGATIONS AND
RESPONSIBILITIES OF REPRESENTATIVE.
5.1 Warranties and Representations of Representative. Representative represents and
warrants to Company that if Representative is a corporation or other registered organization, it is
duly organized, existing and in good standing under and by virtue of the laws of the state under
which Representative has been organized. Representative shall not change its state or
organization, change its form of business or organization, or change its legal name, without
providing Company at least thirty (30) days prior written notice.
5.2 Sales Responsibility. Representative shall sell the Products in the Territory by all
legitimate means, and in connection therewith, shall:
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6. A. Establish and maintain adequate facilities and personnel as may be
necessary to meet the obligations assumed hereunder;
B. Furnish Company at its address indicated on the first page hereof with
written monthly reports to be provided before the 5th of each month on forms provided by
Company regarding acceptability of the Products within the Territory, pricing data
regarding competitive products, state of the machine tool market within the Territory,
state of the leads it is following, suggestions for additional features, or other
improvements of the Products, and similar information or data;
C. Plan and execute, at its own expense, an effective advertising, promotional
and marketing campaign for the Products in the Territory, and cooperate with Company
at all times in conducting promotional campaigns for the Products;
D. Attend and represent the Company at the biennially held International
Manufacturing Technology Show (IMTS) in Chicago, Illinois, and such other appropriate
seminars and trade shows promoting the Products and cooperate with Company
personnel in connection therewith to keep the Products in the forefront of the market for
the Products in the Territory;
E. Supply to Company sales data as may be reasonably requested by
Company from time to time according to such system and on such forms as Company
may designate to assist Company in its production planning and to provide a basis for
evaluating Representative's performance;
F. Use its best efforts in promoting the sale of Products, striving at all times
for maximum and full representation of the Products in the Territory, and specifically in
furtherance thereof:
(i) collect technical and engineering requirements from the
Customers and assist in the adaptation of the Products to the Customer’s
applications;
(ii) act as a liaison and coordinator between the Customers and
Company in meeting both the Customers and Company requirements for technical
specifications, manufacturing schedules, delivery schedules, and other terms and
conditions of sale; and
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7. (iii) follow up on quotations made to prospective Customers and follow
up with the Customers to determine that the Products have satisfactorily met such
Customer’s requirements and cooperate with Company in effecting warranty and
post-warranty servicing of the Products by Company;
G. Promptly advise Company of any sales leads or potential Customers that
are located outside the Territory;
H. Co-operate with Company in obtaining all necessary financial and secured
financing documentation relating to sales to the Customers; and
I. Upon Company’s request, use its best efforts to assist Company in the
collection of the Contract Price or any other fees from the Customers in the Territory, which
such Contract Price or fees shall be remitted directly to Company.
5.3 Trademarks. Representative shall not use any trademark, trade name, service mark, logo
or commercial symbol owned by Company (the “Trademarks”), either alone or with any other
word or words as part of Representative’s trade or corporate name, without the express written
permission of Company. Representative shall not remove any such Trademarks from the
Products. Upon request by Company, and in any event upon termination of this Agreement,
Representative shall discontinue completely any use of any of the Trademarks for any purpose
whatsoever, including use in Representative’s trade or corporate name.
5.4 Non-competition. During the term of this Agreement, Representative shall not solicit
orders or otherwise engage, directly or indirectly, in the sale or promotion of products the
Company reasonably deems to be in competition with the Products. Representative shall send to
Company on at least a quarterly basis a list of all entities for which Representative is a
representative or distributor and the specific product lines sold and/or promoted by
Representative.
5.5 Compliance with Laws. Representative shall comply with all applicable laws and
regulations relating to the sale and/or promotion of the Products in the Territory.
6. SALES TERMS AND PROCEDURE.
6.1 Orders. All orders for the Products from the Customers within the Territory,
regardless of by whom such orders are procured, shall be subject to the final approval of
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8. Company and shall be further subject to Company’s specifications, delivery terms, payment
terms and other terms and conditions of sale established by Company. All such orders shall
designate Company as seller. Any and all terms and conditions of the orders from Customers are
subject to acceptance or rejection by Company. In the event that representative does buy and
Company agrees to sell to Representative, each sale shall be subject to each terms and conditions
as shall then be agreed upon including appropriate security.
6.2 Reservation of Rights. Company reserves the right to reject or cancel, in whole or
in part, any order procured by Representative, to accept any and all returns of Products from
Customers or to grant any allowances to Customers as Company in its sole and absolute
discretion may deem proper. Company shall have the sole right to approve or disapprove the
credit rating of any Customer procured by Representative in the Territory. Company shall have
the right at any time to contact any Customer within the Territory directly for any purpose.
6.3 Parts Orders. All of the parts for Products, sold to the Customers by Company
hereunder, shall be sold and delivered by or on behalf of Representative to such Customers, and
Representative shall be solely responsible for accepting or rejecting any and all of the orders for
the parts to the Products and providing services relating thereto during the term of this
Agreement.
7. COMMISSIONS.
7.1 Commissions. On all sales of new Products under the Sales Contracts within the Territory
which are procured by Representative and consummated by actual delivery of the Products to the
Customers and payment in full by the Customer to Company, Company shall pay to
Representative, and Representative shall be entitled to, the Commission, as defined herein,
subject to the following conditions:
A. For each Sales Contract, the “Commission” shall mean the amount equal
to the Contract Price less the Net Price.
B. Costs or charges not included in the Contract Price shall not be
commissionable.
C. No Commission shall be paid on sales of the Products in which Company
is not the direct seller such as, for example, but not by way of limitation, sales in which a
parent, subsidiary, related or affiliated organization of Company is the seller.
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9. D. No Commission shall be earned by, accrued or owed to, or paid to
Representative until Company receives payment in full from the Customer.
E. No Commission shall be payable on any sale of the Products with respect
to which a reasonable claim is pending, until such time as the claim has been finally
adjusted, and the Commission shall then be payable only upon the adjusted net invoice
amount.
F. No Commission shall be payable on any sale of used Products not sold by
Hwacheon Machinery America.
G. All Commissions earned by or credited to Representative but not paid by
Company shall not be assigned by Representative during the term of this Agreement but
all such Commissions, subject to the adjustment hereinabove provided, shall in any event
inure to the benefit of the Representative or his heirs.
H. Notwithstanding the foregoing, Company and Representative may agree,
in writing, to Commission different from any amount set forth in this Agreement, prior to
acceptance of an order by Company.
I. .Representative will receive a reasonable commission should Company add a Formatted: Numbered + Level: 1 +
Customer to the House Accounts Schedule at a time when Representative is Numbering Style: I, II, III, … + Start at: 1 +
Alignment: Left + Aligned at: 1" + Indent at:
currently and actively working on the sale of Product to said Customer
1.5"
Formatted: Indent: Left: 0", First line: 0",
Tab stops: 1.5", Left
7.2 Multiple Territories/Interstate Transactions. Company shall have the right, at its sole
discretion, to establish and, from time to time and effective at any time, to change its policy for
determining what factors shall be considered in apportioning Commissions among Company’s
territories and its various representatives. Representative agrees to the following general terms
involving multiple representatives and/or multiple territories/interstate transactions:
A. Where an order is placed by a Customer’s office in one territory and the
Products will be shipped to another territory, one-third (21/3) of the Commission shall be
paid to the representative whose sales effort obtained such order, and two-third (21/3) of
the Commission shall be paid to the representative which shall be responsible for follow-
up and servicing of the Customer.
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10. B. A representative into whose territory the Products are shipped shall not
receive any portion of the Commission, except where such representative is actively
involved in and necessary for the sales efforts or the servicing of the Customer, as stated
herein.
C. Notwithstanding anything to the contrary in this Agreement, if more than
one representative or territory is involved with a particular order, Company shall have
absolute discretion to determine the actual Commission due and payable to each
representative, and such good faith determination shall be binding on all representatives.
7.3 Payment of Commissions. Notwithstanding anything to the contrary contained in this
Agreement, no Commission shall be earned by or owed to Representative until Company has
received payment of the Contract Price in full from the Customer. The Commission shall be
paid to Representative within thirty (30) days after Company’s receipt of full payment of the
Contract Price from the Customer. No Commission shall be earned or owed on any orders which
are received before full execution of this Agreement or after its termination or expiration, or
which were obtained due to the efforts of any prior or subsequent representative for the Territory.
7.4 Reservations by Company. If the Sales Contract is terminated or cancelled for any
reason, or if any payment received by Company is deemed avoidable or refundable according to
the bankruptcy laws or any other law, Representative shall not be entitled to any Commission,
unless the Sales Contract is reinstated; and if part or all of such Commission has been paid to
Representative before such termination, cancellation or avoidance, Company may elect in its sole
discretion either to debit such Commission from the Representative’s future Commissions or to
require Representative to refund the amount of Commission or part thereof received by
Representative. Notwithstanding anything to the contrary in this Agreement, no Commission
shall be earned by or due to Representative for any Sales Contracts for which Company, in its
sole judgment, has turned over the collection of the Customer’s debt under the Sales Contract to
a collection agency or attorney or for which Company, in its sole judgment, has agreed to an
installment payment plan due to the Customer’s financial difficulties.
8. CONSIGNMENT.
8.1 Consignment of Products. Company may consign Products (“Consigned Products”)
at Representative’s location in the Territory. Representative hereby grants to Company, and
Company retains, a continuing purchase money security interest in the Consigned Products
heretofore or hereafter consigned to Representative by Company. Company is and shall remain
at all times the owner and titleholder of the Consigned Products. The Consigned Products shall
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11. not be carried on Representative's books as an asset of Representative, nor shall its cost be
carried as a liability. The Consigned Products shall at all times be subject to the direction and
control of Company, and Company may request return of all or any part thereof at any time, or
Company may sell the same to others without prior approval of Representative.
8.2 Representative’s Obligations With Respect To Consigned Products. Representative
agrees as follows:
A. Representative hereby authorizes Company to, (i) authenticate on behalf of
Representative such additional records as may be required from time to time to create, extend,
continue, maintain or perfect the security interest described herein or otherwise granted to or
retained by Company and (ii) to make/undertake such filings or registrations with governmental
officials or offices and take such other actions as Company deems appropriate to perfect,
continue and/or maintain the perfection of the security interests created hereby or otherwise
granted to or retained by Company.
B. Representative shall safeguard the Consigned Products at all times and keep said
Consigned Products insured at all times at Representative's own expenses against all risk of fire
and other damage (including so-called extended coverage), theft and such other risks as
Company may reasonably require. All proceeds of such insurance shall be payable to Company.
Upon Company's request, Representative shall furnish certificates of insurance or other evidence
of coverage.
C. Representative shall keep the Consigned Products free from any adverse lien,
security interest or encumbrance and pay all taxes which may be levied thereon and pay all rent
for the premises at which the Consigned Products are located and not waste or destroy the
Consigned Products or any part thereof or use the Consigned Products in violation of any statute
or ordinance.
D. Representative shall keep the Consigned Products and its proceeds separate and
distinct from any other inventory and assets of Representative, and keep the Consigned Products
clearly labeled and identified as Company's property.
E. Representative shall indemnify and hold harmless Company from and against any and
all claims, actions and suits, proceedings, damages and liability, (including, but not limited to,
those relating to personal injury and/or death) and all costs and expenses relating thereto,
including reasonable attorneys fees, arising out of, in connection with or resulting from,
Representative's possession, use, operation, demonstration, exhibition, repair or maintenance of
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12. the Consigned Products; and, in furtherance thereof, maintain at its sole cost and expense, bodily
injury and third party property damage insurance with limits of not less than $2,000,000 per
person and $2,000,000 per accident, and property damage of not less than the full unit price of
the Consigned Products. Company shall be named as an additional party insured upon and with
respect to all such insurance and upon Company's request, Representative shall furnish
certificates of insurance or other evidence of coverage.
9. CONFIDENTIALITY.
9.1 Confidential Information. Representative covenants and agrees to maintain as
confidential all proprietary and/or confidential technical, commercial or financial information or
know-how of Company or third parties from whom Company has received such information, and
any and all information and data whenever and however furnished to Representative by
Company hereunder (collectively, the “Confidential Information”). Confidential Information
shall not include information which Representative can establish (i) is generally known by
Company’s competitors, (ii) has been independently developed by Representative without
reference to Company’s Confidential Information; (iii) is already known to Representative
before receiving the Confidential Information; or (iv) was rightfully received by Representative
from a third party without a duty of nondisclosure and without breach of similar obligations of
such party to Company. Representative shall take all reasonable measures necessary to protect
the Confidential Information. The Confidential Information shall be property of Company and
shall be entrusted only to Representative’s officers or employees approved in writing by the
Company. Representative agrees to notify said officers and employees of their duty to comply
with this Section 9 and shall promptly notify Company if Representative becomes aware of any
breach of such duty.
9.2 Termination. Upon termination of this Agreement, or at such earlier time as Company
shall request, Representative shall promptly return to Company all Confidential Information, as
well as any other data, correspondence with Customers, documents, notes, memoranda,
advertising and sales materials or equipment relating to this Agreement.
9.3 Injunction. Representative acknowledges that the unauthorized disclosure or use of any
Confidential Information will may cause irreparable injury to Company. Representative agrees
that Company shall have the right to an injunction to prevent any wrongful disclosure or use by
Representative of any Confidential Information.
9.4 Survival. Representative’s duties set forth in this Section 9 shall survive the termination
of this Agreement.
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13. 9.5 Prior Relationships with Other Companies. Representative agrees that it will not at any
time use the confidential or proprietary information or intellectual property of any other
company or person in performing its duties under this Agreement. Representative further
represents and warrants that it is not subject to any restrictive covenants or other restrictions of
any sort, including but not limited to confidentiality obligations, which would prevent or affect
Representative’s performance of its duties under this Agreement.
10. WARRANTY AND SERVICING.
10.1 Warranty. All Products sold by Company pursuant to this Agreement are sold subject
to a standard one (1) year warranty of Company as may be in effect from time to time, and
Representative is not authorized to assume on behalf of Company any other obligation or
liability in connection with the sale of the Products except as specifically approved by Company
in writing. THE WRITTEN WARRANTY OF COMPANY SHALL BE THE SOLE AND
EXCLUSIVE WARRANTY OF COMPANY AND IS IN LIEU OF ALL OTHER
WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, INCLUDING BUT NOT LIMITED
TO ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS, AND
COMPANY NEITHER ASSUMES NOR AUTHORIZES REPRESENTATIVE TO ASSUME
FOR IT ANY OTHER OBLIGATIONS OR LIABILITIES IN CONNECTION WITH THE
PRODUCTS WITHOUT COMPANY’S PRIOR WRITTEN CONSENT. To the extent
Representative attempts to modify the terms of Company’s standard warranty without the prior
written consent of Company, Representative shall indemnify and hold Company harmless from
and against any and all claims and damages related thereto or asserted in connection therewith.
10.2 Notice of Warranty and Policies. Representative shall provide each Customer with a
notice of the Company’s warranty and policies as set forth in Section 10 prior to the procurement
of an order from such Customer. Neither the standard warranty and related policies of Company
as set forth herein nor the Product descriptions and specifications referred to may be altered by
Representative without the prior express written consent of Company.
10.3 Limitation. Notwithstanding the provisions of Section 10.1 above, Company assumes
no responsibility if any Products shall fail to function during any warranty period by reason of
any one or more of the following causes:
A. Abuse or misuse of the Products;
B. Improper preventive maintenance of the Products by the user;
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14. C. Alteration or modification of the Products, which may result in damage to
the Products, or failure to operate in accordance with specifications;
D. Improper repair, modification or servicing of the Products performed by
any unauthorized service personnel;
E. Use or operation of the Products in conjunction with any accessories or
auxiliary equipment not specifically approved by Company in writing; or
F. Force majeure, including natural disaster, fire, flood, accidents and the
like.
10.4 After-Sales Service of Customers. Representative understands that effective use of the
Products by the Customers depends upon proper training and customer assistance after the sale.
Accordingly, Representative agrees that a material consideration of Representative’s
appointment hereunder is Representative’s agreement to assist in performing reasonable and
necessary after-sales servicing and support of the Customer. Representative acknowledges and
agrees that Representative shall be responsible, at Representative’s expense, for service
obligations during the warranty period and that the commission paid to Representative under this
Agreement shall serve to compensate Representative for such warranty service. This provision
shall not be construed as limiting Company’s obligation to a Customer under a Sales Contract.
11. LIMITATION OF LIABLITY; DISCLAIMER OF CERTAIN DAMAGES.
Limitation of Liability. EXCEPT AS SPECIFICALLY AND EXPLICITLY PROVIDED
IN THIS AGREEMENT, IN NO EVENT SHALL COMPANY HAVE ANY LIABILITY,
WHETHER IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT, ANY TERMINATION OR EXPIRATION OF
THIS AGREEMENT, FOR PUNITIVE DAMAGES OR FOR ANY COMPENSATION,
REIMBURSEMENT OR DAMAGES ON ACCOUNT OF ANY LOSS OF PROSPECTIVE
PROFITS ON ANTICIPATED SALES OR ON ACCOUNT OF EXPENDITURES,
INVESTMENTS, LEASES OR OTHER COMMITMENTS RELATING TO THE BUSINESS
OR GOOD WILL OF REPRESENTATIVE. COMPANY SHALL HAVE NO LIABILITY TO
REPRESENTATIVE ARISING OUT OF OR IN CONNECTION WITH ANY FAILURE OF
THE PRODUCTS TO PERFORM OR ANY LOSS OF THE CUSTOMERS OR END-USERS
FOR ANY REASON. IN NO EVENT SHALL COMPANY OR ANY MANUFACTURER OF
THE PRODUCTS OR ANY PART OR COMPONENT THEREOF BE LIABLE FOR
SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING
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15. WITHOUT LIMITATION, ANY DAMAGES RESULTING FROM LOSS OF PROFIT OR
LOSS OF BUSINESS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT
OR THE PERFORMANCE OF THE PRODUCTS, WHETHER OR NOT COMPANY HAS
BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
12. TERM, RENEWAL AND TERMINATION.
12.1 Term and Renewal. Subject to the provisions of Section 12.2 hereof, this Agreement
shall take effect on the commencement date as set forth on the first page hereof and shall
continue in full force and effect for a period of one (1) year. Thereafter, this agreement shall
continue until terminated by either party at any time, with or without cause, upon thirty (30) days
prior written notice delivered to the other party.
12.2 Termination. The provision of Section 12.1 to the contrary notwithstanding, this
Agreement may be terminated prior to the expiration hereof as follows:
A. By Company, immediately, if any one or more of the following events
occurs:
(i) legal proceedings have been instituted against
Representative in bankruptcy or under insolvency laws which proceedings are not
vacated within ten (10) days from the date of filing;
(ii) Representative makes an assignment of all or part of its
assets for the benefit of creditors;
(iii) Representative, or if a partnership, any partner of
Representative, shall be or admit that it is insolvent;
(iv) Representative, if a corporation or other registered
organization, ceases to exist;
(v) there occurs a death, removal, resignation, withdrawal, or
elimination of the current principal managers of Representative;
(vi) a misrepresentation is made to Company as to the
ownership or financial condition of Representative;
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16. (vii) there is a sale, transfer or relinquishment of any substantial
interest in the ownership or active management of Representative, or an attempted
assignment of this Agreement shall occur without prior written approval of
Company; or
(viii) Representative shall fail to cause Company to be informed
in writing immediately on the happening of any event specified in this section.
B. By Company, if Representative shall (i) fail to pay any sums due to
Company under this Agreement or (ii) otherwise breach this Agreement, and Company
shall have given written notice of such default, and Representative shall fail to remedy
such breach or default within ten (10) days of receipt of such notice.
12.3 Rights and Obligations upon Termination or Expiration.
A. Upon termination or expiration of this Agreement, Representative shall
immediately wind up its duties on behalf of Company and shall within ten (10) days of
termination or expiration, among other winding up duties, submit to Company a written
list of all written orders and contracts actually procured and physically received by
Representative as of the date of termination or expiration which have not been delivered
or sent to Company as of the date of termination or expiration. Representative shall be
entitled to Commissions only as to those orders for the Products submitted to Company
or Representative prior to termination or expiration and which are consummated by
actual shipment of the Products and payment in full by the Customer within one hundred
eighty (180) days of the date of termination or expiration, subject to the provisions of
Section 7, Commissions, hereof. Company may, if it shall elect, retain from the amounts
due to Representative a reasonable sum for a period not to exceed six (6) months from the
date of termination or expiration as a reserve for any adjustment in the sales that may be
required to be made after termination or expiration of this Agreement. Representative
shall not be entitled to any Commission for orders relayed to Representative or Company
by Customers after the termination date or expiration date. No Commission shall be paid
on sales for which Company received payment from the Customer more than one
hundred eighty (180) days from the date of termination or expiration.
B. Upon termination or expiration of this Agreement and upon payment of all
Commissions due Representative, Company shall thereafter have no further obligation to
Representative with respect to any future sales of the Products made to any Customers in
the Territory, including specifically any Customer originally procured through the efforts
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17. of Representative during the term of this Agreement or prior thereto, and Company shall
be free to appoint a successor representative in the Territory or to make any and all sales
directly to such Customer or Customers.
13. INDEMNIFICATION.
Representative shall defend, indemnify and hold harmless Company, its directors, officers,
representatives and employees from all liability, damage, cost and expense (including reasonable
attorneys’ fees) imposed as a result of any claim by a Customer or other third party arising out of
acts or omission of Representative or breach of any representation, warranty, covenant or
agreement under this Agreement by Representative, including but not limited to any failure of
Representative to notify Customers of the terms of the product warranty or Company’s policies
thereunder, or any representation or commitment by Representative which creates liabilities or
obligations beyond such warranty or policy.
14. GENERAL PROVISIONS.
14.1 Assignment. This Agreement has been entered into in reliance upon the personal
qualifications of the principals, who actively and substantially participate in the ownership or
operations, or both, of Representative. As such, Representative understands and agrees that its
rights and obligations under this Agreement are not transferable or delegable, and may not be
assigned or delegated by Representative to any other individual or business entity without the
prior written approval of Company, such approval to be at the discretion of Company.
14.2 Notice. All notices permitted or required shall be in writing, executed by an officer of
Company or by any principal of Representative, and shall be sent by means not slower than
registered or certified mail and such notice shall be effective as of the date of delivery as
evidenced by return receipt signature. Any such notice actually or personally delivered to an
officer of Company, or to any principal of Representative, shall be effective as of the date of
such delivery. All notices shall be sent to the addresses on the first page hereof or such address
as may be designated by either party from time to time.
14.3 Entire Agreement. This Agreement, together with all attachments hereto, constitutes the
entire agreement between the parties and supersedes any and all previous agreements,
memoranda or other understandings of the parties. The parties agree that all terms and
conditions of this Agreement are necessary and essential for the proper representation and sale of
the Products in the Territory. This Agreement may be amended only in writing.
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18. 14.4 Severability. A judicial or administrative declaration in any jurisdiction of the invalidity
of any one or more of the provisions hereof shall not invalidate the remaining provisions of this
Agreement in any jurisdiction, nor shall such declaration have any effect on the validity or
interpretation of this Agreement outside of that jurisdiction, unless such declaration relates to an
essential part of the agreed exchange.
14.5 Waiver of Compliance. Any failure by any party hereto to enforce at any time any term
or condition under this Agreement shall not be construed as a waiver of that party’s right
thereafter to enforce each and every term and condition of this Agreement.
14.6 Force Majeure. Any party hereto shall be excused from non-performance or delay in
case of force majeure, labor disputes, wars, revolutions, civil strikes, riots, disturbances, strikes,
and acts of enemies, accidents, unavailability of raw materials, typhoons, hurricanes, floods,
fires, earthquakes, diseases and other like causes beyond the control of either party hereto.
14.7 Binding Upon Successors. This Agreement shall be binding upon the successors and
legal representatives of the parties hereto.
14.8 Arbitration. The parties agree that all disputes arising out of this Agreement (or the
breach thereof) and/or the relationship of the parties shall be settled by submission to arbitration
in accordance with the Commercial Arbitration Rules of the American Arbitration Association.
Such proceedings shall be held before the American Arbitration Association in Chicago, Illinois
before three (3) arbitrators. Any judgment upon any award rendered by the arbitrators may be
entered in any court having jurisdiction thereof. If any suit or proceeding be brought in any
court, the court shall, on application of one of the parties, stay the trial of the action until such
arbitration has been had in accordance with the terms of this Representation Agreement.
14.9 Governing Law. THE AGREEMENT SHALL BE GOVERNED AND CONSTRUED
UNDER AND IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS
(WITHOUT REFERENCE TO ITS CONFLICTS OF LAW RULES) which shall bind the
parties in all questions arising hereunder, regardless of the jurisdiction in which any action or
proceeding may be initiated or maintained. The United Nations Convention on the International
Sale of Goods shall not apply to this Agreement.
14.10 Export Control Laws. Representative acknowledges and agrees that Company is subject
to the United States laws and regulations controlling the export of technical data, computer
software, laboratory prototypes and other commodities (including the Arms Export Control Act,
as amended and the Export Administration Act of 1979) (hereinafter the “Export Laws”), and
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19. that Company’s obligations and Representative’s rights hereunder are contingent on compliance
with the applicable United States Export Laws. The transfer of certain technical data and
commodities may require a license from the appropriate agency of the United States government
and/or written assurances by Representative that Representative will not export data or
commodities to certain foreign countries without prior approval of such agency. Representative
shall comply with the Export Laws to the extent that its activities are governed by such laws, and
shall cooperate with Company regarding Company’s compliance with any such laws.
14.11 Counterparts. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in
duplicate originals by their duly authorized representatives the date and year set forth below.
[Signature Page Follows]
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20. HWACHEON MACHINERY AMERICA, INC
BY:
TITLE:
REPRESENTATIVE:
BY:
TITLE:
DATE:
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21. SCHEDULES TO SALES REPRESENTATIVE AGREEMENT
BETWEEN
HWACHEON MACHINERY AMERICA, INC
AND
_____________________
DATED: , 20__
SCHEDULE A
(Products)
The Products covered by this Agreement are:
SCHEDULE B
(Territory)
The Territory covered by this Agreement is:
___________________________________________
SCHEDULE C
(House Accounts)
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