EXHIBIT 10.9
MASTER DISTRIBUTOR AGREEMENT
This Agreement is entered into on April 1, 1999 (the "Effective Date")
by and between Digital Microwave Corporation ("Manufacturer") having its
principal place of business at 170 Rose Orchard Way, San Jose, California 95134
and Wireless Inc, ("Distributor") having its principal place of business at 19
Davis Drive, Belmont, CA 94002-3001.
1.0 PRODUCTS. Wherever used herein, the term "Products" shall mean only
those products which are specifically identified in Exhibit A attached hereto.
2.0 APPOINTMENT/TERRITORY/DISTRIBUTION.
2.1 APPOINTMENT. Except for customers specifically excluded and identified
in Exhibit B attached hereto, Manufacturer hereby appoints Distributor and
Distributor hereby accepts the appointment, as the nonexclusive distributor for
the Products within the Territory described in Exhibit B. Distributor agrees not
to sell or represent any products that compete with Manufacturer's products.
2.2 EXCLUSIVITY. Distributor will not have any exclusivity to a customer in
the Territory, except as set forth in Exhibit B. Manufacturer may appoint more
than one distributor or sales representative or may sell direct to the customer.
If more than one distributor is appointed, Manufacturer will support all
distributors equally, including the furnishing of any distributor price lists or
discounts.
2.3 PUBLIC TENDERS. If only one distributor is allowed to bid for
Manufacturer in a public tender, Manufacturer will decide which distributor will
submit the bid.
2.4 OTHER DISTRIBUTORS. It is Manufacturer's intent that there will be only
one Distributor involved with a customer or project. If a customer does go out
for bids to more than one distributor, then it is the customer's option to award
the contract or purchase order.
3.0 TERM. Except as provided in the section of this Agreement entitled
"Termination", this Agreement shall remain in effect for a period of one (1)
year from the Effective Date. At the end of such one (1) year period, this
Agreement shall automatically expire unless expressly renewed in writing. During
the term of this Agreement, in the event it is desirable that Manufacturer sell
directly to a customer, the Terms of Sales Representative Agreement set forth in
Exhibit D shall apply in lieu of those in Articles 5, 6.1, 7, 8, 10, and 11 and
Sections 14.2 and 14.3.
4.0 DUTIES OF DISTRIBUTOR.
4.1 EFFORTS. Distributor shall use its best efforts to introduce and
promote the sales of Products. Distributor shall devote as much time and
attention as shall be necessary to properly conduct such activities, take
actions as Manufacturer advises will be helpful to that end, and conduct its
activities in accordance with general instructions as Manufacturer may issue
from time to time.
[*] CERTAIN INFORMATION OF THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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4.2. ORGANIZATION. Distributor shall maintain at all times
business office facilities, a private fax, mailing lists and facilities for
catalog distribution. The Distributor shall provide after sales support to
customers within the Territory and shall coordinate between customers and
Manufacturer as is customary in the telecommunications industry.
4.3 RETURNS. Distributor shall make no allowance or adjustments in accounts,
or authorize any customer to return any Products, unless given specific advance
"Return Material Authorization" (RMA) in writing by Manufacturer to do so.
4.2 QUOTATIONS. Distributor agrees to send copies of all quotations
(non-private label) to Manufacturer for prior approval by the appropriate
Country Manager upon request. All products will be distributed as a Manufacturer
branded product unless otherwise agreed
4.4 POINT OF SALE REPORTS. Distributor agrees to send to Manufacturer a
monthly detailed report which includes the customer name, address, type of
Equipment sold, quantity and sales price.
4.6 REGISTRATION. All accounts, including private label products, shall be
registered with the appropriate Manufacturer's Country Manager and Corporate
Sales Organization. The list of all active accounts, including those in backlog
or forecast, is set forth in Schedule E. The list of existing distributors of
Distributor is also set forth in Exhibit E.
4.7 FORECASTS. Distributor agrees to provide a quarterly forecast of the
business opportunities. The forecast should be by account, name of country,
product and quantity and total dollars.
4.8 SUB-DISTRIBUTORS. Distributor shall not appoint any sub-distributors or
representatives within the Territory without the consent of Manufacturer, which
consent may be arbitrarily withheld. Any such attempt shall be deemed a breach
of this Agreement, and Distributor waives the notice period provided in Section
13.1.2.
5.0 ORDER ACCEPTANCE AND DELIVERY.
5.1 ORDERS. Deliveries by Manufacturer shall only be made after written
purchase orders under this Agreement are received by Manufacturer from
Distributor. Any purchase order received by Manufacturer associated with written
prior approval will be deemed acceptable by Manufacturer. Such orders shall
specify the items to be delivered, the quantity and the prices, and the
requested delivery schedule.
5.2 SCHEDULES. All orders in Section 5.1 above shall become binding on
Manufacturer only upon acceptance in writing by Manufacturer, which acceptance
shall acknowledge the delivery dates of the orders. Unless frequency/channel
plans are provided by Distributor with the placement of the order, Distributor
shall provide such plans at or before a time, as determined by Manufacturer,
prior to the delivery as acknowledged by Manufacturer. Failure of Distributor to
timely meet this obligation shall be cause for adjustment to the schedule and/or
contract prices.
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5.3 DELIVERY. Shipments are made F.O.B. point of shipment, freight collect.
Title passes to Distributor and Distributor assumes risk of loss upon delivery
to the carrier at the F.O.B. point, the carrier acting as Distributor's agent.
Absent specific instructions from Distributor in selecting a carrier,
Manufacturer will exercise its own discretion.
5.4 CANCELLATION. Items scheduled for shipment within thirty (30) days of
the receipt of Distributors notice of cancellation or rescheduling may not be
terminated or rescheduled and must be accepted and paid for at the agreed upon
prices. Otherwise Distributor may terminate an order upon payment of all
Distributor reasonably incurred costs, including profit, which are allocable to
the terminated portion of the order.
6.0 COMPENSATION.
6.1 PRICES AND PAYMENTS. All prices and amounts paid under this Agreement
are in United States dollars. Such amounts in the United States are payable in
accordance with Exhibit C. Manufacturer may elect to make partial shipments and
bill Distributor upon delivery of each shipment.
6.2 EXPENSES. Distributor shall have no right to any compensation from
Manufacturer for services rendered pursuant to this Agreement or for the
reimbursement of any expenses, incurred by Distributor, including, but not
limited to, travel to Manufacturers facilities for training.
7.0 LICENSES AND PERMITS. Manufacturer shall have no responsibility for the
securing of permits, licenses or other local, state or federal governmental
approvals required in connection with any purchases hereunder.
8.0 PRODUCT ACCEPTANCE. Unless otherwise agreed, Distributor's acceptance of
Products shall be deemed complete if Distributor fails to notify Manufacturer in
writing of its rejection of Products within thirty (30) days from shipment.
9.0 CONFIDENTIALITY. If either party hereto receives from the other party
written information which is marked "Confidential" or "Proprietary", the
receiving party agrees not to use such information except in the performance of
this Agreement, and to treat such information in the same manner as it treats
its own confidential information for a period of three (3) years from the date
of disclosure. The obligation to keep information confidential shall not apply
to or shall cease to apply to any information that: (i) is already rightfully in
the possession of Distributor, (ii) is or becomes publicly available through no
wrongful act of Distributor, (iii) is rightfully received by Distributor from a
third party without an obligation of confidentiality to Manufacturer, (iv) is
disclosed to a third party by Manufacturer without restriction; or (v) is
approved for release by written authorization of Manufacturer. Without limiting
the foregoing, it is agreed that all communications between Manufacturer and
Distributor relating to bidding or sales activities of the Distributor are
confidential.
10.0 LIMITED WARRANTY. MANUFACTURER warrants to Distributor at the time of
delivery
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that the equipment will be free from defects in material and workmanship under
normal use and service. Manufacturer's sole obligation under this Warranty is
limited to replacing or repairing, at its option, at its factory, any equipment
which is returned to Manufacturer, transportation, duties, and taxes prepaid, *.
In the case of Equipment not of Manufacturers own manufacture, the warranty
under the terms of this Paragraph is available only for a period of one (1) year
after delivery. Manufacturer shall return the equipment to Distributor freight
prepaid. THIS WARRANTY IS EXPRESSED IN LIEU OF ALL OTHER WARRANTIES, EXPRESS,
IMPLIED OR STATUTORY, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, AND OF ALL OTHER OBLIGATIONS OR LIABILITIES ON
THE PART OF MANUFACTURER AND IT NEITHER ASSUMES NOR AUTHORIZES ANY OTHER PERSON
TO ASSUME FOR MANUFACTURER ANY OTHER LIABILITIES IN CONNECTION WITH THE SALE OF
EQUIPMENT. IN NO EVENT WILL MANUFACTURER BE LIABLE FOR CONSEQUENTIAL DAMAGES
EVEN IF MANUFACTURER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. This
Warranty does not apply to any of such Equipment which shall have been repaired
or altered, except by Manufacturer, or which shall have been subjected to
misuse, negligence, or accident or operation outside the environmental
specifications. Repairs or replacements of Equipment made during the warranty
period or thereafter will be warranted, as provided above, for the remainder of
the original warranty period or for ninety days from the date of return, as
applicable, whichever is longer.
11.0 PATENT INFRINGEMENT. Manufacturer will defend any action, including a
claim or suit, against Distributor claiming that Products infringe any patent,
and will pay all costs and damages finally awarded in any such action, provided
that Manufacturer is notified promptly in writing of the action and at
Manufacturer's request and at its expense is given control of such action and
all requested information and assistance to settle or defend the same. Should
use of Products be enjoined as a result of such action, then Manufacturer shall
in a reasonable time either: (a) obtain for Distributor the right to continue to
use the Products; (b) modify or replace the Products with noninfringing
Products; or (c) request the return of the Products and upon their return refund
the value of the Products as amortized over a presumed five (5) year
depreciation period, as well as transportation costs. Manufacturer shall have no
obligation to defend any claims arising out of combinations of the Products when
used in combination with other products not supplied by Manufacturer. THE
FOREGOING STATES THE SOLE AND EXCLUSIVE LIABILITY OF MANUFACTURER FOR PATENT
INFRINGEMENT AND IS IN LIEU OF ANY OTHER WARRANTY AGAINST INFRINGEMENT OF ANY
KIND, EXPRESS, IMPLIED, OR STATUTORY.
12.0 DAMAGE LIMITATION. INDEPENDENTLY OF ANY OTHER LIMITATION HEREOF AND
REGARDLESS OF WHETHER THE PURPOSE OF ANY REMEDY SET FORTH HEREIN IS SERVED, IT
IS AGREED THAT IN NO EVENT SHALL MANUFACTURER BE LIABLE FOR SPECIAL, INCIDENTAL
OR CONSEQUENTIAL DAMAGES OF ANY KIND UNDER THIS AGREEMENT.
13.0 TERMINATION AND CONSEQUENCES.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE
OMITTED PORTIONS.
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13.1 TERMINATION. This Agreement may be terminated by either party as
follows:
13.1.1 CONVENIENCE. For any reason upon ninety (90) days prior
written notice.
13.1.2 BREACH. Upon breach of a material provision by the other party
and such party does not cure such breach within thirty (30) days after
notice from the terminating party.
13.1.3 INSOLVENCY. Immediately should the other party (a) become
insolvent; (b) make an assignment for the benefit of creditors; (c)
file or have filed against it a petition in bankruptcy or seeking
reorganization; (d) have a receiver appointed; (e) institute any
proceedings for liquidation or winding up.
13.2 CONSEQUENCES
13.2.1 SOLICITATION. Manufacturer shall have the right after any
termination of this Agreement to deal with, and solicit orders from any
and all persons who dealt with or placed orders with Distributor
without liability of any kind to Distributor.
13.2.2 PRODUCTS. Unless Manufacturer terminates the Agreement under
Section 13.1.2 or 13.1.3 above, Manufacturers only obligation to sell
Products to Distributor are those Products which Distributor is
contractually obligated to furnish to a customer subject to
Manufacturer having previously agreed to such sales on a case by case
basis.
13.3.2 ORDERS. For termination under 13.1.2 or 13.1.3 above, the
terminating party may terminate any outstanding orders placed hereunder
and cease all performance.
13.3 SURVIVAL. The obligations and duties trader Sections 6, 9, 10, 11, 12,
13.2, and 14.5 shall survive and remain in effect beyond any expiration or
termination hereof.
14.0 GENERAL.
14.1 AGENCY. Neither party shall have, nor shall represent that it has, any
power, right, or authority to bind the other party, or to assume or create any
obligation or responsibility, express or implied, on behalf the other party or
in the other parties name except as expressly set forth herein. Nothing stated
in this Agreement shall be construed as constituting Manufacturer and
Distributor as partners, or as creating the relationships of employer and
employee, franchiser and franchisee, master and servant, or principal and agent
between the parties hereto.
14.2 TAXES. All prices set forth in this Agreement are exclusive of any
sales, use, excise, property or any other taxes imposed by any government
applicable to the sales, use, or delivery of the Products, including import
duties and withholding taxes, now or hereafter enacted, all of which will be
paid by Distributor separately or added by Manufacturer to the invoice where
Manufacturer is required by law
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to collect the same, unless Distributor provides Manufacturer with a proper
tax-exemption certificate.
14.3 FORCE MAJEURE. The failure of either party to perform any obligation
otherwise due as a result of governmental action, law, order, regulation,
direction or request, or as a result of events, such as war, act of public
enemy, strike or other labor disturbance, delays of subcontractors, fire, flood,
acts of God or any causes of like or different kind beyond the control of the
Manufacturer is excused for so long as said cause exists to the extent such
failure is caused by any such event.
14.4 TRADEMARKS. The name, Digital Microwave Corporation, and any trademarks,
trade names and logos associated with Manufacturer's Products may only be used
as authorized in writing by Manufacturer.
14.5 PUBLICITY. All notices to third parties and all other publicity
concerning this Agreement or using either parties name must be approved in
writing in advance by the other party, such approval not to be unreasonably
withheld. The parties hereto further agree that neither party shall disclose
either the existence, the terms or conditions, or the subject matter of this
Agreement without prior written consent of the other party.
14.6 LANGUAGE. This Agreement is in the English language only, which language
shall be controlling in all respects, and all versions hereof in any other
language shall be for accommodation only and shall not be binding upon the
parties hereto.
14.7 GOVERNING LAW. This Agreement is deemed entered into in San Jose,
California, and shall in all respects be governed by and construed under the
laws of the state of California as such laws are applied to agreements between
California residents entered into and performed entirely within California. Any
litigation or other dispute resolution between the parties relating to this
Agreement will take place in Santa Clara County, California.
14.8 COMPLIANCE WITH LAW. Distributor warrants with respect to any export of
Manufacturer Products that Distributor will comply fully with the export control
laws and regulations of the United States Government.
14.9 CORRUPT PRACTICES. Distributor agrees to comply in all respects with the
U.S. Foreign Corrupt Practices Act of 1977 (FPCA), as amended, which provides
generally that: under no circumstances will foreign officials, representatives,
political parties or holders of public offices be offered, promised or paid any
money, remuneration, things of value, or provided any other benefit, direct or
indirect in connection with obtaining or maintaining contracts or orders
hereunder.
14.10 ASSIGNMENT. Neither party shall assign any of its rights or privileges
hereunder without the prior written consent of the other party except to a
successor in ownership of all or substantially all of the assets of the
assigning party and provided further that the successor shall expressly assume
in writing the performance of all of the terms and conditions of this Agreement
to be performed by the assigning party.
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14.11 WRITTEN NOTICE. Written notice provided for any reason pursuant to this
Agreement shall be effective as of the date of mailing when sent to the other
party via registered or certified mail, return receipt requested to the address
shown below:
To Manufacturer To Distributor
Digital Microwave Corp. Wireless Inc.
170 Rose Orchard Way 5452 Betsy Ross Dr.
San Jose, CA 95134 Santa Clara, CA 95054-1101
Attn: C.F.O. Attn: CFO
14.12 WAIVER. The failure of either party at any time to require performance
by the other of any provision hereof shall not affect the right of such party to
require performance at any time thereafter, nor shall the waiver of either party
of a breach of any provision hereof be taken or held to be a waiver of a
provision itself.
14.13 SEVERABILITY. If any provision of this Agreement is held to be
ineffective, unenforceable or illegal for any reason, such decision shall not
affect the validity or enforceability of any or all of the remaining portions
thereof.
14.14 DISPUTES. The Vice Presidents of Sales of both parties will arbitrate
all issues that cannot be settled at a lower level in the organizations.
14.15 INTEGRATION. This Agreement embodies the entire understanding of the
parties as it relates to the subject matter hereof. This Agreement supersedes
any prior agreements or understandings between the parties as to this subject
matter. No amendment or modification of this Agreement shall be valid or binding
upon the parties unless in writing and signed by an officer of each party.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed in their respective corporate names.
DIGITAL MICROWAVE CORPORATION DISTRIBUTOR
By /s/ Ryan Panos By /s/ Donald MacLeod
-------------------------------------- ----------------------------------
Title VP Global Accounts Title Sr. Vice President Sales &
Marketing
------------------------------------ -------------------------------
Date April 16, 1999 Date Aug 10, 1999
------------------------------------ -------------------------------
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EXHIBIT A: PRODUCTS
PRODUCTS DISTRIBUTION/REPRESENTATIVE PRIVATE LABEL
- -------- --------------------------- -------------
Altium YES NO
Spectrum II YES NO
XP-4 YES YES
XP-2 (Dart) YES YES
DXR-100 YES NO
DXR-200 YES NO
DXR-700 YES NO
EXHIBIT B: TERRITORY/CUSTOMERS
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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EXHIBIT C: PAYMENT TERMS
THE APPROPRIATE PAYMENT TERM IS TO BE INSERTED AFTER CREDIT APPROVAL.
All invoices are due and payable thirty (30) days from the date of invoice,
subject to a $750,000 credit limit.
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EXHIBIT D: TERMS OF SALES REPRESENTATIVE AGREEMENT
4.0 DUTIES OF REPRESENTATIVE
4.7 QUOTATIONS. Representative shall quote only such prices, terms and
conditions and make only such representations about the Products, including but
not limited to any warranty, as are expressly authorized in writing by
Manufacturer.
4.8 COLLECTION. Representative shall forward immediately to Manufacturer any
and all monies or remittances in any form which may be sent to it by Customers
or accounts in the Territory in payment of Manufacturer invoices. Representative
shall assist Manufacturer, upon Manufacturers request, in the collection of
overdue accounts by making available to Manufacturer all data regarding any
Customer to which Representative may reasonably have access.
5.0 ORDER ACCEPTANCE AND SHIPMENT
5.1 ORDERS. All orders solicited by Representative shall become binding on
Manufacturer only upon acceptance in writing by Manufacturer. Manufacturer may,
at any time, reject any order submitted by Representative or any Customer and
shall have no liability to Representative as a result of its rejection of any
such orders.
5.2 SHIPMENTS. All Products for which orders are accepted by Manufacturer
will be shipped and billed by Manufacturer directly to the Customer. All
payments shall be made directly to Manufacturer. Representative shall have no
authority to collect funds or accept payment of any invoices issued by
Manufacturer.
5.3 CHANGES. Manufacturer may change or withdraw any quotation made by it,
or acceptance of any order, at any time without obtaining the consent of
Representative, and Manufacturer shall have no liability to Representative, nor
shall Representative be entitled to any compensation, by reason thereof.
6.0 COMPENSATION.
COMPENSATION. Representative's sole source of compensation shall be the
commissions payable pursuant to the terms of this Agreement. Commission will be
paid on the Net Sales within thirty (30) days after receipt of payment by
Manufacturer of the proceeds of the sale to a customer in the Territory. As used
in this Exhibit D, "Net Sales" means the gross sales revenue received by
Manufacturer from the sale, lease or license of a product or any transfer
thereof for value, accounted for in accordance with generally accepted
accounting principles, after deduction for rebates, allowances, discounts,
returns, freight, costs of packing, freight insurance, taxes, duties and similar
charges, if any. Commissions shall be at the rate of *. Where DMC is calling on
an account and decides that Representative's participation is involved, a
commission will be payable at the rate of * for all orders booked in that
account for a one year period.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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CREDITS. If any amount collected by Manufacturer is credited to a Customer
because of a Product return or other reason (at the sole discretion of
Manufacturer) commissions already paid to Representative on such amounts shall
be returned to Manufacturer by Representative. Manufacturer may charge back such
commissions against any monies which Manufacturer shall then or thereafter owe
to Representative.
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EXHIBIT E
LIST OF ACTIVE ACCOUNTS
List of Distributors Existing Distributors
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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EXHIBIT F
* Unit Prices and Ordering Information
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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Price *
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO
THE OMITTED PORTIONS.
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[DIGITAL MICROWAVE LETTERHEAD]
April 14, 2000
Wireless Inc.
5452 Betsy Ross Dr.
Santa Clara, CA 95054
Attn: Mr. Bill Palumbo
President & CEO
Subject: Master Distributor Agreement extension
Reference: DMC/Wireless MDA Dated 4/1/99
Dear Mr. Palumbo,
Digital Microwave Corporation hereby extends the validity of the
above referenced agreement for one (1) year as defined in paragraph 3.0 TERM.
The Effective Date of the agreement will now be April 1, 2000 with termination
scheduled for March 31, 2001 unless otherwise extended.
Regards,
/s/ Ryan Panos
- ----------------------------
Ryan Panos
Vice-PResident Global Accounts
RP/sm