1.

INTERPRETATION:

1.1.

In this  Agreement,  the  following  words  and  expressions  shall  have  the  following meanings:

Business Day: means any day other than a Saturday, Sunday or any day which is a Public holiday in England;

Commission:  means  the  percentage  set  out  in  Part    of  Schedule  1  of  the  Gross Margin of all Products and Services for which the Channel Partner concludes a sale on behalf of CONNET pursuant to this Agreement and for which a sale contract is then entered into;

Competing products: means any products that compete with the Products;

Confidential Information: means any secret or proprietary information relating directly to Company's business and that of Company's affiliated companies, including but not limited to products, research programs, specific software, algorithms, computer systems, object and source codes, pricing policies, technology, employment records and policies, operational methods, marketing plans and strategies, product development techniques or plans, technical processes, designs and design projects, and other business affairs of Company and Company's affiliated companies.  The recipient must keep strictly confidential all Confidential Information and will not, without the Company’s express written authorization, signed by one of the Company’s authorized officers, use or sell, market or disclose any Confidential Information to any third person, corporation, or association for any purpose save to the extent that such information:

(i)

Is already in the public domain at the date of the disclosure; or

(ii)

Enters the public domain other than by a breach of an obligation of confidentiality;

Control: the right to control, directly or indirectly, the activities of a company, whether through ownership or the ability to control the voting powers of shares, the ability to control the board or management of such company or otherwise;

Default percentage: means the percentage set out in Part 5 of Schedule 1;

Effective Date: means the date of this Agreement;

Force  Majeure: means  any  cause  or  event  beyond  the  reasonable  control  of  the affected  Party  including  by  way  of  example  but  without  limitation,  act  of  God,  war, riot, civil commotion, fire, flood, or storm;   

Gross Margin: means the profit received by CONNET on a customer contract being the net  revenue  received  by  CONNET after  CONNET's  direct  cost  of  sales  have  been deducted.  his  will  vary  depending  on  the  costs  of  each  customer  contract  but  an example of the gross margin received on a contract is set out in the "margin" column of the spreadsheet in Schedule 2;

Group Company: means  in  relation  to  any  company,  any  body  corporate  which  is from time to time a holding company of that company, a subsidiary of that company or a  subsidiary  of  a  holding  company  of  that  company  (“holding  company”  and “subsidiary”  having  the  meanings  attributed  to  them  by  Companies  Act  1985  section
7 6) and “Group” shall be construed accordingly;

Initial Period: means the first twelve months of this Agreement;

Insolvency Event: means where a person ceases or threatens to cease to carry on business,  is  liable  to  be  found  to  be  unable  to  pay  its  debts  within  the  meaning  of the  Insolvency  Act  1986  section  12   (save  that  no  court  reference  shall  be necessary  in  order  for  this  to  apply),  has  an  administrator,  receiver,  administrative receiver  or  manager  appointed  over  the  whole  or  any  part  of  its  assets,  enters  into any composition with creditors generally, or has an order made or resolution passed for  it  to  be  wound  up  (otherwise  than  in  furtherance  of  any  scheme  for amalgamation  or  reconstruction)  or  undergoes  any  similar  or  equivalent  process  in any  jurisdiction,  and  a  person  shall  be  “solvent”  where  it  has  not  undergone  (or having undergone, is discharged from all affects of) an Insolvency Event;

Intellectual Property Rights: means patents, trade marks, design rights (whether registrable or otherwise), applications  for  any  of  the  foregoing,  copyright,  moral rights,  database  rights,    know-how,  secret  processes,  inventions,  trade  or  business names, domain names and any other intellectual property rights currently existing or created in the future in any jurisdiction together with the right to sue for and recover damages or other relief in respect of infringements of any of them;

Local Regulations: means laws and regulations applicable to the Products and Services in the country in which it is sold;

Products: those of CONNETS’s products set out in Part 8 of Schedule 1 together with any  other  products  developed  from  time  to  time  distributed  by  CONNET and  which CONNET may permit the Channel Partner by express notice in writing to promote and sell but excluding any products which CONNET ceases to manufacture or distribute;

Products and Services Intellectual Property:  Intellectual Property Rights owned or used by CONNET in respect of the Products or Services;

Quarter:  each  period  of  three  calendar  months  ending  on  1  March,  30  June,  30 September and 1 December in each Year;

Relevant Claim: any claim arising from the provision of the Products or Services;

Sales Targets: means in relation to the first Year, the amount of sales to be made by the Partner of the Products and Services as specified in Part 4 of Schedule 1 and In relation to subsequent Years, the amount of sales by the Partner of the Products and Services as agreed pursuant to Clause .1;

Services: means those  of  Connet’s  products  set  out  in  Part  8  of  Schedule  1  together  with any  other  products  developed  from  time  to  time  distributed  by  CONNET and  which CONNET may permit the Channel Partner by express notice in writing to promote and sell but excluding any products which CONNET ceases to manufacture or distribute;

Standard Terms and Conditions:  means Connet’s standard terms and conditions of sale as the same may be amended from time to time;

Support Fee’s: mean the annual fee payable by the Channel Partner in respect of busines sales and technical training, and other  support provided by CONNET to the Channel Partner

Support  Material:  means  the  material  and  sales  literature  provided  by  CONNET to the  Channel  Partner  for  the  purposes  of  promoting  and  selling  the  Products  and Services;

Term: has the meaning given to it in Part 2 of Schedule 1; 

Territory: means the territory set out in Part 6 of Schedule 1; 

TU E:  The transfer of Undertakings (Protection of Employment) Regulations 2006; and

Year: means the period of 12 months from the Effective Date and each consecutive period of 12 months thereafter during the term.

1.2

In  this  Agreement,  any  reference  to  the  granting  of  a  right  to  “sell”  the  Products  or Services shall be construed as referring to the grant of a right to solicit orders for the Products  or  Services  and  not  as  a  right  to  enter  into  contracts  for  the  sale  of  the Products or Services.

2

APPOINTMENT:

2.1

CONNET hereby  appoints  the  Channel  Partner  as  its  non-exclusive  Channel  Partner representative in  the  territory  to  promote  and  sell  the  Products  and  Services  on  the  terms  of  this Agreement  and  the  Channel  Partner  hereby  accepts  the  appointment  on  those terms.  For the avoidance of doubt, CONNET does not grant the Channel Partner the right to enter into contracts on Connet’s behalf and neither Party may bind or pledge the credit of each other in any way.

2.2

Nothing  contained  in  this  Agreement  shall  be  deemed  to  limit  Connet’s  ability  to market  and  promote  the  Products  or  Services  directly,  through  other  Channel Partners,  affiliates,  distributors,  or  dealers,  or  through  any  other  channel  of distribution at any time in any area, as CONNET may determine in its sole discretion. 

3

SALES TARGETS

3.1

The Sales targets for the first Year of the term are set out in Part 4 of Schedule 1.  The  Parties  shall  agree  applicable  sales  targets  for  each  Quarter  thereafter  before the end  of  each  Year.    In  the  event  the  Parties  are  unable  to  agree  appropriate targets  for  any  Year  by  the  beginning  of  that  Year  then  the  Sales  Target  for  that Year  shall  be  the  Sales  Target  for  the  previous  Year  increased  by  the  Default Percentage. 

3.2

If  in  two  successive  Quarters,  the  Channel  Partner  does  not  achieve  the  Sales Targets  for  those  Quarters  or  if  in  any  one  Quarter  the  Channel  Partner  does  not achieve at least 75% of the Sales  Target for that Quarter then CONNET shall conduct a formal review of the Channel Partner’s performance during the relevant Quarter(s) and  consider  the  reasons  why  the  Sales  Targets  have  not  been  met.    Upon completion of this  review, CONNET shall have the right to (but is not obliged to) treat such  a  failure  to  meet  the  Sales  Targets  as  a  material  breach  and  terminate  this Agreement in accordance with Clause 12.

4

PARTNER’S OBLIGATIONS

The  Channel  Partner  undertakes  and  agrees  with  CONNET at  all  times  during  the term:

4.1

To act towards CONNET dutifully and in good faith, to look after the interests of CONNET and not to allow its interests to conflict with the duties that it owes to CONNET under this Agreement and the general law;

4.2

except as authorised by Connet, not to act in a way which will incur any liabilities on behalf of CONNET nor to pledge the credit of Connet;

4.3

to  inform  CONNET of  any  other  products  and  services  it  has  agreed  to  represent.  A failure to notify CONNET of any such other products and services shall be deemed a material breach of this Agreement;

4.4

To promote the Products and Services with all due care and diligence and to seek to improve Connet’s goodwill;

4.5

to  comply  with  all  reasonable  and  lawful  instructions  of  CONNET from  time  to  time concerning  the  promotion  and  sale  of  the  Products  and  Services,  and  generally  to carry  out  its  services  under  this  Agreement  in  such  manner  as  it  thinks  best  to promote the interests of Connet’;

4.6

to act in accordance with sound commercial principles in its relations with customers and potential  customers  (including  assessing  their  creditworthiness  and  where necessary obtaining  independent  assessments  of  their  creditworthiness  by undertaking  credit  checks  at  the  Channel  Partner’s  cost)  and  to  do  nothing  which CONNET acting  reasonably  considers  could  be  prejudicial  to  its  goodwill  or commercial interests; 

4.7

to describe itself in all dealings with the Products and Services and in all associated advertising and promotional material and (if any description is provided there) at its premises as “Channel Partner” of Connet’s;     

4.8

to  commit  its  sales  team,  as  well  as  its  back  office  to  work  with  CONNET operations as a liaison with the customer through the installation process;

4.9

to employ a sufficient number of suitably qualified dedicated personnel to ensure the proper  fulfilment  of  the  Channel  Partner's  obligations  under  this  Agreement, including without limitation attending (upon reasonable notice) meetings with CONNET to  discuss  the  marketing  and  selling  of  the  Products  and  Services(such  reviews  to be held at the frequency set out in Part 7 of Schedule 1), attending trade exhibitions and  other  sales  outlets  as  CONNET considers  appropriate,  and  making  regular  and sufficiently  frequent  calls  on  customers  or  potential  customers  to  promote  the Products and Services, in each case at its own expense;

4.10

to  keep  CONNET fully  informed  of  its  activities  concerning  the  promotion  and  sale  of the  Products  and  Services,  to  provide  CONNET with  up  to  date  accurate  monthly forecast  and  pipeline  reports  on  request  and  to  input  all  data  it  holds  relating  to customers  and  potential  customers  of  CONNET onto  CONNET ’s  databases  as requested by CONNETfrom time to time;

4.11

to  keep  CONNET fully  and  promptly  informed  of  conditions  and  developments  in  the market  for  use  of  the  Products  and  Services  (whether  advantageous  or disadvantageous to Connet’s), of Competing Products and Services and the activities of CONNET ’s competitors and to perform market research accordingly; 

4.12

promptly  to  inform  CONNET of  the  details  of  any  complaint  or  after-sales  enquiry received by the Channel Partner concerning the Products and Services;

4.13

to  maintain  a  list  of  customers  and  potential  customers  for  the  Products  and Services from time to time, and on request to supply CONNET with an up-to-date copy of  that  list  for  the  purpose  of  CONNET making  contact  with  such  customers  or  using such data for marketing or its internal business purposes; 

4.14

Not  without  prior  reference  to  and  express  written  consent  from  CONNET (and  then only acting strictly on Connet’s express instructions) on behalf of CONNET to take part in  any  dispute  or  commence  or  defend  any  court  or  other  dispute  proceedings  or settle or attempt to settle or make any admission concerning any such proceedings; 

4.15

to  do  nothing  that  would  tend  to  discredit,  injure  the  reputation  of,  or  reflect adversely upon CONNET or its products or services.  

5

SALE OF PRODUCTS AND SERVICES:

5.1

All  negotiations  for  sales  of  the  Products  and  Services  by  the  Channel  Partner  on behalf  of  CONNET shall  be  at  Connet’s  list  prices  as  specified  in  the  price  lists provided  from  time  to  time  by  CONNET to  the  Channel  Partner  for  this  purpose, subject to any discounts or deductions as CONNET may allow.

5.2

All  negotiations  for  sales  of  the  Products  and  Services  by  the  Channel  Partner  on behalf  of  CONNET shall  be  on  the  Standard  Terms  and  Conditions  or  on  such  other terms  and  conditions  as  CONNET may  at  any  time  specify  in  writing  to  the  Channel Partner

5.3

The  Channel  Partner  shall  ensure  that  CONNET is  notified  of  the  progress  of  all negotiations  for  the  sale  of  Products  and  Services.    In particular, the Channel Partner shall ensure that CONNET is kept informed of dates upon which execution of a  contract  and  performance  and  delivery  of  the  Products  and  Services  is anticipated.  

5.4

The Channel Partner shall, in the course of dealing with customers and prospective customers for the Products and Services, bring to their notice that:

5.4.1

All orders placed by such customers are subject to acceptance by CONNETand shall be  fulfilled  by  CONNET on  the  Standard  Terms  and  Conditions  which  shall  be incorporated into the contract of sale;

5.4.2

That contracts of sale will be executed by CONNET at its discretion; and

5.4.3

delivery  and  payment  will  be  dealt  with  by  CONNET or  such  other  person  as  may  be notified to the Channel Partner by CONNET from time to time.

5.5

The Partner shall not without Connet’s prior written consent make or give verbally or in  writing  any  representations,  warranties  or  other  promises  concerning  the Products  and  Services  beyond  those  contained  in  the  Standard  Terms  and Conditions.

5.6

CONNET shall  use  its  reasonable  endeavours  to  give  the  Channel  Partner  0 Business Days’ notice of any changes in the prices of the Products and Services or in its standard terms and conditions of sale. 

5.7

CONNET will  use  its  reasonable  endeavours  to  give  the  Channel  Partner  at  least  0 Business Days’ notice of its intention to discontinue supplies to the Channel Partner of  any  of  its  ranges  of  Products  and  Services  but  shall  not  be  obliged  to  notify  the Channel Partner if it extends its Products and Services ranges.

6

CONNET UNDERTAKINGS:

CONNET undertakes and agrees with the Channel Partner during the term:

6.1

To act at all times in its relations with the Channel Partner dutifully and in good faith;

6.2

To supply to the Channel Partner with the Support Material;

6.3

to  notify the Channel Partner in writing of any acceptances/orders for Products or Services arising from Channel  Partner’s performance of  its obligations under this Agreement within 10 Business Days of the same being made; 

6.4

to give the Channel Partner  reasonable notice if at any time it expects that  the volume  of  sales  of  the  Products  or  Services  will  be  significantly  lower  than  the volume that the Partner would expect under normal circumstances; and

6.5

to  provide a named representative who will  liaise  with  the  Channel  Partner  on  all matters relating to this Agreement.

6.6

CONNET may  in  its  sole  discretion  accept  or  reject  any  prospective  customer submitted  to  CONNET by  the  Channel Partner and may terminate  or  assign  any agreement for Products or Services with any customer in accordance with CONNET ’s agreement with such customer.

6.7

If  a  prospective  or  current  customer of CONNET has  been  sold  to,  by  both  the Channel  Partner  and  either  another  independent  authorised  sales  agent, another Channel Partner or an employee of Connet’s, CONNET reserves the right to determine the  amount  of  Commission  payable  to  each  party  and  how  such  parties  will  be credited with such customer or order, and the Channel Partner agrees to be bound by Connet’s decision in this regard.

7

COMMISSION AND PAYMENTS:

7.1

CONNET shall (subject  to  the  Channel  Partner  performing  its  obligations  under  this Agreement) pay to the Channel Partner the Commission.  Commission shall not be paid  to  the  Channel  Partner  as  a  result  of  any  set-up  fees or advances on rentals invoiced  or  collected  by Connet’s.  

7.2

Commission shall only become due to the Channel Partner upon receipt by CONNET of  the  price  for  the  relevant  Products  or  Services  in  cleared  funds  from  the customer.  Where  the  relevant  sale  contract  provides  for  payment  of  the  price  by instalments,  a  proportionate  part  of  the  Commission  shall  become  due  to  the Channel  Partner  as  soon  as  such  instalments  are  so  received  by  Connet,  that proportion  being  equivalent  to  the  proportion  which  such  instalments  bear  to  the total contract price.

7.3

Where the Channel Partner is appointed as a successor to an agent for CONNET for the  marketing  and/or  sale  of  the  Products  or  Services  in  the  territory  and  that previous  agent  is  entitled  to  commission  on  any  sales  of  the  Products  or  Services made  to  customers  in  the  territory  after  the  appointment  of  the  Channel  Partner under  this  agreement,  the  Channel  Partner  accepts  that  it  is  not  entitled  to  any commission  in  respect  of  such  sales,  notwithstanding  that  they  were  made  after  its appointment  under  this  Agreement,  and  undertakes  not  to  seek  any  commission  in respect of such transactions.   

7.4

The  Channel  Partner  shall  invoice CONNET in  respect  of  Commission  monthly  in arrears – i.e.  at  the  end  of  each  month  following  the  month  for  which  services  are billed  to  end-customers. Such invoices shall be valid VAT  invoices and shall be payable within 30 days of CONNET’s receipt of the same.

7.5

Interest on late payments shall be payable at the rate of the base rate of The Bank of England in force at the due date both before and after judgment.

7.6

If any sales contracts concluded by the Channel Partner are cancelled or terminated in the first ninety (90) days of the term of such contract and the Channel Partner has already  been  paid  the  relevant  Commission  for  such  Products  or  Services,  then CONNET shall  be  entitled  to  deduct  such  Commission  paid  from  the  Channel Partner’s  next  month’s  invoice  and  if  there  is  no  subsequent  invoice  due,  then  the Channel  Partner  shall  repay  CONNET such  Commission  within  30  days  of  such rejection.  

7.7

In  the  absence  of  contrary  agreement,  Commission  will  be  paid  to  the  Channel Partner in the same currency in which payment of the price under the relevant sale contract was made. 

7.8

If  any  dispute  arises  as  to  the  amount  of  Commission  payable  by  CONNET to  the Channel  Partner  (but  not  as  to  the  liability  to  pay  the  same),  the  Channel  Partner shall  have  thirty  ( 30)  days  from  the  receipt  of  any  Commission  payment  to  dispute the accuracy  of  such  payment.    If such dispute is not resolved within this 30 day period then the same shall be referred to CONNET's auditors for settlement and their certificate shall be final and binding on both Parties.

7.9

All  sums  payable  under  this  Agreement  are  exclusive  of  any  value  added  tax (“VAT”)  or  other  applicable  sales  tax,  which  shall  be  added  to  the  sum  in  question.  A VAT invoice will be provided against any payment.

7.10

The  Channel  Partner  shall  keep  separate  accounts  and  records  giving  correct  and adequate  details  of  all  enquiries  received  and  transactions  conducted  by  the Channel  Partner  on  CONNET's  behalf  and  separate  files  of  vouchers,  invoices  and receipts  relevant  to  this  agreement,  and  the  Channel  Partner  shall  permit  the  duly appointed  representatives  of  CONNET at  all  reasonable  times  to  inspect  all  such accounts and records and to take copies thereof.  

7.11

We shall have the right not to pay commission or bonus of minimum orders, if their frequency or the number of customers introduced falls below any minimum set by the CONNET from time to time but may aggregate such amounts and pay them out when such minimum levels have been exceeded. The Company may set off any amount due from the Company to the Channel Partner from any amount due from the Channel Partner to the Company as and when they arise. Provided that if such change or changes shall alter any financial obligation of the Independent Partner Channel under the terms of this Agreement then the Company shall give to the Independent Partner Channel at least 30 days advance written notice thereof.

8

ADVERTING AND PROMOTION:

8.1

Upon CONNET’s request, the Channel Partner shall provide CONNET with a marketing and  business  plan  that  specifies  the  Channel  Partner’s  resources,  marketing programmes and sales goals.

8.2

The Channel Partner shall only use CONNET-approved marketing materials and shall not develop or use any other product literature or modify any materials provided by Connet.  

8.3

CONNET shall  provide  to  the  Channel  Partner  (i)  CONNET approved  literature  and marketing  materials  describing  CONNET and  the  Products  and  Services  at  prevailing prices and (ii) a general product overview.  

8.4

The Channel Partner shall:

8.4.1

Make  no  representations  or  warranties  relating  to  the  Products  or  Services  except as set out in literature approved in writing by Connet;

8.4.2

Display advertising materials and other signs provided by CONNET ; and

8.4.3

Observe all directions and instructions given to it by CONNET in relation to promotion and advertisement of the Products and Services.

8.5

CONNET grants  the  Channel  Partner  for  no  consideration  a  royalty-free,  non-exclusive licence  of  the  Products  and  Services  Intellectual  Property  for  the  Term solely for the extent necessary for it to discharge its obligations under this Clause 8.

9

INTELLECTUAL PROPERTY:

9.1

The  Channel  Partner  acknowledges  that  CONNET ’s  rights  to  the  Products  and Services Intellectual Property and other Intellectual Property Rights used in relation to  CONNET ’s  business  and  the  goodwill  connected  with  that  are  and  shall  remain CONNET ’s property, and shall ensure for the benefit of CONNET.

9.2

The Channel Partner accepts that:

9.2.1

it  is  only  permitted  to  use  the  Intellectual  Property  for  the  purposes  of  this Agreement, and during the term and only as authorised by CONNET pursuant to the terms of this Agreement;

9.2.2

Other than to that extent, it has and will have no right to use or to allow others to use the  Products  and  Services  Intellectual  Property  or  any  part  of  it.  The Partner shall not  seek  to  register  any  Intellectual  Property  on  behalf  of  CONNET without  CONNET ’s express consent;

9.2.3

it  will  not  use  any  trade  mark  or  trade  names  or  get-up  which  resemble  CONNET ’s trade  marks  or  trade  names or get-up and which  would  therefore  be  likely  to confuse or to mislead the public or any section of the public;

9.2.4

it  will  not  remove,  alter  or  otherwise  tamper  with  any  trade  marks,  trade  names, logos, numbers or other means of identification on the Products or the packaging of the Products which come into the Channel Partner’s possession, custody, or control and will not place any trade mark or trade name of its own upon the Products or any packaging or other materials used in connection therewith;

9.2.5

It will not do or omit to do or authorise any third party to do or to omit to do anything which could invalidate or be inconsistent with the Products and Services Intellectual Property; and

9.2.6

It will make a statement in any  advertising  material  and  promotional  literature produced  by  or  for  it  in  connection  with  the  Products  and  Services  as  to  the ownership of any relevant Intellectual Property used or referred to therein.

9.3

The Channel Partner shall notify CONNET of:

9.3.1

Any  actual,  threatened  or  suspected  infringement  of  any  Products  and  Services Intellectual Property of which the Channel Partner becomes aware; and

9.3.2

Any claim by any third party of which it becomes aware that the sale of the Products and  Services  or  any  other  activity  under  this  agreement  infringes  any  rights  of  any other person.

9.4

The  Channel  Partner  shall,  at  the  request  and  expense  of  CONNET and  on  a  full indemnity  basis  (but  not  otherwise),  take  all  such  steps  during  the  term  of  this agreement  as  CONNET may  reasonably  require  to  assist  CONNET in  maintaining  the Products  and  Services  Intellectual  Property  as  valid  and  effective  or  to  take  or defend  any  court  or  other  dispute  proceedings  concerning  intellectual  property matters.

10

 PRODUCT LIABILITY AND INSURANCE:

10.1

The  Channel  Partner  shall,  immediately  it  becomes  aware  of  a  matter  which  may result  in  a  Relevant  Claim  (whether  against  the  Channel  Partner  or  only  against CONNET ):

10.1.1

Give notice to CONNETof the details of the matter;

10.1.2

Afford  access  to  CONNET and  permit  copies  to  be  taken  of  any  materials,  records  or documents as CONNET may require to take action under sub- Clause 10.1. ;

10.1.3

Allow CONNET the exclusive conduct of any proceedings and/or take whatever action as  CONNET shall  direct  to  defend  or  resist  the  matter,  including  the  use  of professional advisers nominated by CONNET ; and

10.1.4

Not admit liability or settle the matter without the prior written consent of CONNET.

10.2

The Channel Partner undertakes to maintain appropriate up-to-date and accurate records  to  enable  the  immediate  recall  of  any  of  the  Products  from  the  customers. These  records  shall  include  records  of  deliveries  to  customers  (including  details  of batch  numbers,  quantities,  delivery  date,  name  and  address  of  customer,  and telephone  number  and  fax  or  telex  number  (and  e-mail  address  if  available)).  The Channel  Partner  shall  provide  access  to  this  data  as  CONNET may  require  without restriction. 

10.3

The  Channel  Partner  shall,  at  CONNET 's  cost,  give  such  assistance  as  CONNET shall require  for  the  purpose  of  recalling  as  a  matter  of  urgency  any  of  the  Products  or any of them from the customers.

10.4

The Channel Partner shall notify CONNET as soon as possible after becoming aware of any matter which may justify a recall by CONNET under Clause 10.

11

REPRESENTATIONS AND WARRANTIES:

11.1

Each party acknowledges and warrants that:

11.1.1

Its  entry  into  and/or  performance  of  this  Agreement  will  not  be  in  breach  of  any express  or  implied  terms  of  any  contract  with  or  other  obligation  to  any  third  party; and

11.1.2

It is solvent and able to perform all of  its obligations  under  this  Agreement  and  will remain so throughout the  term.

11.2

The Channel Partner represents and warrants that:

11.2.1

At  its  own  expense,  it  is  in  compliance  with  and  shall  continue  to  be  in  compliance with  all  laws  and  regulations  applicable  to  its  performance  under  this  Agreement and  it  shall  maintain  in  full  force  and  effect  all  licenses  and  permits  required  for  its performance under this Agreement.

11.2.2

In  performing  its  duties  under  this  Agreement,  the  Channel  Partner  shall  be governed  in  all  dealings  with  members  of  the  public  by  professional  standards  of honesty, integrity and fair dealing;

11.2.3

It shall make no representations or guarantees concerning CONNET or its products or services which are false, misleading or inconsistent with the representations set out in  promotional  materials,  literature,  manuals  and  price  lists  published  and  supplied by CONNETfrom time to time;

11.2.4

It  shall,  at  all  times  during  the  term  of  this  Agreement,  maintain  at  its  sole  expense (i)  employers  liability  in  accordance  with  all  applicable  statutory  limits;  (ii)  public liability  insurance  for  claims  of  bodily  and  personal  injury,  death  and  property damage  and  (iii)  insurance  to  cover  its  obligations  and  liabilities  under  this
Agreement.    Such  insurance  shall  provide  coverage  in  the  amount  of  at  least  10 million  pounds  (£10,000,000.00)  per  occurrence.    Upon request by CONNET , the Channel  Partner  shall  provide  satisfactory  evidence  to  CONNET that  all  required insurance coverage is in full force and effect. 

12

TERMINATION:

12.1

Either Party may terminate this Agreement immediately on written notice:

12.1.1

If at any time the other Party:

12.1.1.1

Commits any irremediable material breach of this Agreement (and for the avoidance of doubt, but without limitation, any breach of Clauses 5.1  and  5.2  (Sale  of  Products  and  Services),  Clause  9  (Intellectual Property) and Clause 11 (Warranties) shall be deemed to be an irremediable material breach for the purposes of this Clause 12.1.1); 

12.1.1.2

Commits any remediable breach of this Agreement and fails to remedy  such  breach  within  a  period  of  twenty  (20)  Business  Days from the service on it of a notice specifying the breach and requiring it  to  be  remedied  or,  having  so  remedied,  subsequently  commits  a similar breach within the next twenty (20) Business Days;

12.1.1.3

Undergoes  an  Insolvency  Event  (or  if  an  individual,  dies  or  becomes otherwise  incapacitated  by  reason  of  disability  to  perform  its obligations under this Agreement); or 

12.1.1.4

In accordance with Clause 19 (Force Majeure).

12.2

CONNET may  terminate  this  Agreement  where  the  Channel  Partner  undergoes  a change  of  Control  other  than  a  transfer  to  another  Group  Company  where  the ultimate parent company remains the same. 

12.3

CONNET may give notice in writing to the Channel Partner terminating this Agreement with immediate effect if:

12.3.1

The  Channel  Partner  fails  in  any  two  successive  Quarters  to  meet  the  Sales  target for those Quarters or the Channel Partner fails in any Quarter to meet at least 75% of  the  Sales  target  for  that  Quarter  and  in  each  case  CONNET has  conducted  a formal  review  of  the  reasons  why  the  Channel    Partner  has  not  met  the  relevant targets pursuant to Clause  .2; 

12.3.2

There is a change of Local Regulation which in the opinion of CONNET means that it is no  longer  viable  to  continue  with  the  sale  of  the  Products  and  Services  or  any  part thereof;

12.3.3

The Channel Partner participates or engages in fraudulent activity or if the Channel Partner falsifies or forges any order;

12.4

Either  Party  may  terminate  this  Agreement  without  cause  at  any  time  by  giving  the other Party notice as follows:

12.4.1

One month for the first Year (to be served by the terminating Party at least one month prior to the end of the Initial Period);

12.4.2

Two months for the second Year (to be served by the terminating Party at least two months prior to the end of the second Year);

12.4.3

Three months for the third Year (to be served by the terminating Party at least three months prior to the end of the third Year); and

12.4.4

Three  months  if  the  term  lasts  longer  than  three  years  (to  be  served  by  the terminating Party  at  least three months  prior to the end  of any  subsequent renewal period) And for the purpose of this Clause, the end of  the period of written notice need not coincide with the end of a calendar month.

12.5

The  rights  set  out  in  this  Clause  12  are  the  only  rights  to  terminate  this  Agreement available to the Parties.

12.6

If a Party, acting in good faith, exercises a right of termination, its subsequent failure or  refusal  to  perform  any  of  its  current  or  future  obligations  under  this  Agreement shall not be a breach of this Agreement (whether repudiator or otherwise).

13

CONSEQUENCES OF TERMINATION:

13.1

The  Channel  Partner  agrees  that  CONNET may,  during  the  period  of  three  months ending  on  the  date  of  termination  or  expiry  of  this  Agreement,  appoint  a  successor to  the  Channel  Partner  and  may  introduce  that  successor  to  customers  and potential  customers  and  allow  that  successor  to  make  itself  known  as  CONNET
partner  so  as  to  be  able  to  commence  business  from  the  day  after  expiry  of  this Agreement.

13.2

Upon termination of this Agreement for any reason:

13.2.1

The  Channel  Partner  shall  cease  to  promote,  market,  advertise  or  sell  the  Products and Services.

13.2.2

The Channel Partner shall immediately cease to describe itself as a Channel Partner of CONNET and cease to use all trade marks or trade or brand names of CONNET ;

13.2.3

The Channel Partner shall at its own expense within 30 days return to CONNET :

13.2.3.1

All samples of the Products;

13.2.3.2

Any advertising, promotional or sales material;

13.2.3.3

Any Confidential Information relating to the Products and Services; and 

13.2.3.4

Any order books and customer databases which are at the date of termination in the possession of the Channel Partner.

13.3

It  is  not  intended  by  the  Parties  that  the  Commercial  Agents  (Council  Directive) Regulations 199   (the  “Regulations”)  will  apply  to  this  agreement.    However if a court of competent jurisdiction finds that the Regulations do apply to the agreement then the Parties agree that upon termination of this Agreement, the Channel Partner shall  only  be  entitled  to  be  indemnified  in  accordance  with  Regulation  17  and  the cap set out in Regulation 17(4) shall apply.

13.4

For  the  avoidance  of  doubt,  the  provisions  of  Clause  7  shall,  notwithstanding termination,  continue  in  force  in  relation  to  all  sales  of  the  Products  and  Services where the sale has been concluded before the date of termination

13.5

Termination  shall  not  affect  the  operation  of  any  provision  of  this  Agreement  which is clearly intended to survive termination and remain in full force and effect.

13.6

Subject  as  herein  provided  and  to  any  rights  or  obligations  accrued  prior  to termination,  neither  Party  shall  have  any  further  obligation  to  the  other  under  this Agreement.

13.7

We shall during the continuance of this Agreement pay to the Partner Channel, and in accordance with schedule 1, a commission relating to services provided to customers introduced by the Channel Partner (“the commission”) during the continuation of this agreement and for a period of 1-month after termination or expiry of this agreement.

14

TUPE

14.1

The  Parties  do  not  intend  that  either  the  commencement,  termination  or  expiry  of this Agreement will have the effect of transferring the contract of employment of any persons or any collective agreement from one of the Parties to another. 

14.2

If  following  the  commencement,  termination  or  expiry  of  this  Agreement,  the contract  of  employment  or  liabilities  arising  from  a  contract  of  employment  or  its termination  of  any  person  employed  by  one  Party  (for  the  purposes  of  this  Clause 14  the  “Original  Employer”),  or  any  collective  agreement,  has  effect  following  the date of termination or expiry as if originally made between that person and the other Party (for the purposes of this Clause 14 the “New Employer”) or between the New Employer and the relevant trades union, as the case may be:-

14.2.1

The  New  Employer  may  terminate  such  contract  of  employment  or  the  collective agreement within  30 Business Days after becoming aware of that effect; and 

14.2.2

The  Original  Employer  shall  indemnify  the  New  Employer  against  any  liabilities  it may  incur  which  arise  before  or  after  the  contract  of  employment  or  collective agreement has effect as if originally made with the New Employer:-

14.2.2.1

In relation to its employment of such persons including any obligation to  pay  remuneration  and  other  costs  (including  accrued  holiday  pay) or any amounts agreed or determined to be paid to any such person whether in contract or in tort or by way of remedy for unfair dismissal or redundancy or in relation to sex, race or disability discrimination or other  breach  of  statute  or  other  law  by  the  Original  Employer  or  the New Employer’s predecessor; 

14.2.2.2

Arising out of such termination and against any sum payable to or in respect of that person or any liabilities incurred to or on behalf of the relevant  trades  union  except  to  the  extent  that  they  arise  from  any breach  of  statutory  duty,  contract  or  obligations  by  the  Original Employer or the New Employer’s predecessor; and 

14.2.2.3

Arising  out  of  any  failure  to  comply  with  the  obligation  to  inform  or consult pursuant to  TUPE where such liability arises as a result of the act or omission of the Original Employer.

14.3

For the purposes of this Clause 14, the term Original Employer and New Employer shall  include  any  Group  Company,  contractor,  assign,  predecessor  or  successor  to such Party as may be relevant. 

15

CONFIDENTIALITY:

15.1

Each Party shall keep confidential all Confidential Information.  Each Party may disclose  Confidential  Information  to  its  professional  advisers  but  otherwise  will  only disclose  Confidential  Information  to  those  of  its  employees,  officers  and  sub-contractors who  (i)  need  to  know  it  for  the  purpose  of  exercising  or  performing  its rights  and  obligations  under  this  Agreement;  (ii)  have  been  informed  of  the confidential  nature  of  the  Confidential  Information  divulged;  and  (iii)  agree  to  act  in compliance with the confidentiality requirements of this Agreement.

15.2

Neither  Party  will  disclose  Confidential  Information  to  any  third  party  except  as otherwise permitted in this Agreement.

15.3

Notwithstanding  any  other  provision  of  this  Agreement,  it  shall  not  be  a  breach  of this Agreement for either Party to:

15.3.1

Disclose any Confidential Information pursuant to a court order or a binding request from  a  regulatory  (or  other  analogous)  authority  with  jurisdiction  or  from  any  other third party with power to require the disclosure of such information, provided that (to the  extent  it  is  permitted  to  do  so)  the  affected  Party  gives  all  reasonable  notice  of such disclosure to the other Party; or

15.3.2

Disclose the existence and terms of this Agreement to an actual or genuine potential purchaser  of  that  Party  or  of  all  or  any  part  of  that  Party’s  business,  provided  that such  disclosure  is  made  under  conditions  of  confidentiality  at  least  as  onerous  as those set out in this Clause 15 and enforceable by the non-disclosing Party.

15.4

In addition, the Channel Partner shall not make any public announcement including but  not  limited  to  press  releases  regarding  this  Agreement  or  any  relation  between the Channel Partner and CONNET , without prior written consent from CONNET. 

16

NON SOLICITATION: 

16.1

During  the  term  of  the  Agreement, the Channel Partner shall not (i)  directly  or  indirectly  solicit  any  customer  of  Consulting Networks  on behalf  of  a  competitor  of  (“CONNET”) and,  or  induce  any  such  customer  to  discontinue  its  relationship  with  Consulting Networks  or  (ii)  directly  or  indirectly induce  or  solicit  any  person  employed  by  or  under  contract  with  (“CONNET”) ,  its  Group Companies,  employee’s or  its  other  Channel  Partners  to  terminate his or her relationship with CONNET.

16.2

For a 60-month period after the termination of this Agreement, the Channel Partner agrees not Solicit the custom of or attempt to solicit the custom of any undertaking which was a Customer of Consulting Networks at any time during the 60 month prior to termination of this Agreement, or who at the date of termination was in the process of negotiation or contemplating and entering into a Customer Agreement; or Employ anyone who is at the date of termination or expiry of this Agreement, or was during the currency of this Agreement, an employee of Consulting Networks.

16.3

If the Partner Channel is found to be in gross breach of the abovementioned non-solicitation clause, then the Partner Channel hereby agrees unconditionally to compensate CONNET with a one-off payment of whichever is the lesser of (a) £100,000 or (b) the gross annual salary of the officer, employee, agent or contractor of the other so solicited or induced.

17

NOTICE:

17.1

Any  notice  required  or  permitted  under  the  terms  of  the  Agreement  or  required  by statute, law or regulation shall be in writing and shall be delivered in person or sent by recorded delivery post, properly posted and fully pre-paid in an envelope properly addressed or sent by facsimile transmission to the other party at its address set out at  the  head  of  this  Agreement  or  such  other  address  as  it  may  notify  to  the  other party in writing for this purpose.  Any such notice shall be considered to have been given  at  the  time  when  actually  delivered,  if  delivered  in  person,  when  sent,  if  by facsimile  transmission  or  two  (2)  days  after  it  was  mailed  in  accordance  with  this Agreement.

18

DISPUTE RESOLUTION: 

18.1

Where  any  dispute  arises  between  the  Parties  in  relation  to  the  Parties’ performance  of  their  obligations  under  this  Agreement,  other  than  any  claim  as  to mis-use  of  Intellectual  Property  Rights  (a  “Dispute”),  the  Parties  shall  refer  such Dispute in accordance with the following escalation procedure:

18.1.1

Where  the  Dispute  cannot  be  resolved  by  CONNET Sales  Director,  and  the equivalent personnel at the Principal within 10 Business Days of the Dispute arising, any of the Parties may notify the other Parties of the Dispute in writing.

18.1.2

Within  five  Business  Days  from  the  written  notice  given  under  Clause  18.1.1,  the Parties  will  jointly  develop  a  document  describing  the  issue,  the  positions  of  both Parties  and  the  relevant  impacts  on  this  Agreement  and  the  provision  of  the services  (the  “Joint  Statement  of  Issues”). If the Parties cannot agree the Joint Statement  of  Issues in writing within this period then they will exchange individual statements of issues within a further five Business Days.

18.1.3

Within  five  Business  Days  of  the  Parties  receiving  either  the  Joint  Statement  of Issues or exchanging the individual statements of issues, a meeting (which may be made  by  telephone  or  in  person)  will  be  held  with  the  respective  Chief  Executive Officers of the Parties.

18.2

If the Parties cannot resolve the Dispute to the satisfaction of all Parties pursuant to Clause 18.1. then  any  of  the  Parties  may  take  such  legal  action  as  it  in  its discretion deems appropriate.

19

FORCE MAJEURE:

19.1

If  either  Party  is  prevented  or  delayed  in  the  performance  of  any  of  its  obligations under  this  Agreement  by  Force  Majeure,  that  Party  shall  forthwith  notify  the  other Party  specifying  the  nature  and  extent  of  the  circumstances  giving  rise  to  Force Majeure,  and  shall,  subject  to  service  of  such  notice,  and  to  Clause  19. , have no liability in respect of the performance of such of its obligations as are prevented by the Force Majeure events during the continuation of such events, and for such time after they cease as is necessary for that Party, using all reasonable endeavours, to recommence its affected operations in order for it to perform its obligations and the corresponding obligations of the other Party shall be suspended to the same extent.

19.2

Force  Majeure  which  affects  the  sub-contractor  or  supplier  of  a  Party  shall  be deemed to affect that Party.

19.3

If any Party is prevented from performance of its obligations for a continuous period in excess of six months, the other Party may terminate this Agreement forthwith on service  of  written  notice  upon  the  Party  so  prevented,  in  which  case  neither  such Party  shall  have  any  liability  to  the  other  except  that  rights  and  liabilities  which accrued  prior  to such termination shall continue to subsist and all amounts  due  to the Parties pursuant to the Agreement shall be paid.  

19.4

The  Party  claiming  to  be  prevented  or  delayed  in  the  performance  of  any  of  its obligations  under this Agreement by reason of Force  Majeure shall use reasonable endeavours  without  hereby  being  obliged  to  incur  any  expenditure  to  bring  the Force Majeure event to a close or to find a solution by which the Agreement may be performed despite the continuance of the Force Majeure event.

20

ASSIGNMENT:

20.1

Subject to Clause 20.2, the Channel Partner shall not assign, delegate or otherwise transfer  the  Agreement  or  any  of  its  rights  and/or  obligations  under  this  Agreement to any third party without the prior written consent of CONNET.

20.2

The  Channel  Partner  shall  be  permitted  to  appoint  a  sub-agent  to  perform  its obligations under this Agreement on condition that:

20.2.1

Prior  to  any  sales  of  Products  or  Services  by  a  sub-agent  of  the  Channel  Partner (“Sub-Agent”),  the  Channel  Partner  shall  enter  into  an  enforceable  written agreement with such Sub-Agent ("Sub-Agent Agreement") that

20.2.1.1

requires such Sub-Agent to comply with the terms of this Agreement; and

20.2.1.2

expressly  names  CONNET as  an  intended  third  party  beneficiary  with the  right  to  rely  on  and  directly  enforce  the  terms  of  that  Sub-Agent Agreement;

20.2.2

The  Channel  Partner  shall  enforce  each  Sub-Agent  Agreement  and  shall  notify CONNET of  any  breach  or  suspected  breach  of  any  obligation  under  a  Sub-Agent Agreement that comes to its attention.  

20.2.3

The Channel Partner and Sub-Agent shall cooperate with CONNETin any legal action to prevent or to stop unauthorised use or sales of Products or Services.

20.2.4

CONNET may  at  any  time  assign,  transfer,  charge  or  deal  in  any  other  manner  with this Agreement or any of its rights under it.

21

OTHER PROVISIONS:

21.1

Further assurance

Each  of  the  Parties  shall  do  or  procure  to  be  done  all  such  further  acts  and  things and execute or procure the execution of all such other documents as may from time to  time  be  required  for  the  purpose  of  giving  the  other  Party  the  full  benefit  of  the provisions of this Agreement.

21.2

Agency Agreement

Nothing  in  this  Agreement  is  intended  to  or  shall  operate  to  create  a  partnership, employment  relationship  or  joint  venture  of  any  kind  between  the  Parties  or  to authorise  either  Party  to  act  as  Partner  for  the  other,  and  neither  Party  shall  have authority to act in the name or on behalf of or otherwise to bind the other in any way (including  the  making  of  any  representation  or  warranty,  the  assumption  of  any obligation or liability and the exercise of any right or power).  

21.3

Waiver and remedies
The  failure  to  exercise  or  delay  in  exercising  a  right  or  remedy  provided  by  this Agreement or by law does not constitute a waiver of the right or remedy or a waiver of other rights or remedies. A  waiver  of  a  breach  of  any  of  the  terms  of  this Agreement or of a default under this Agreement does not constitute a waiver of any other  breach  or  default  and  shall  not  affect  the  other  terms  of  this  Agreement. A waiver  of  a  breach  of  any  of  the  terms  of  this  Agreement  or  of  a  default  under  this Agreement will not prevent a party from subsequently requiring compliance with the waived obligation. The rights and remedies provided by this Agreement are cumulative and (subject as otherwise provided in this Agreement) are not exclusive of any rights or remedies provided by law.

21.4

Severance

21.4.1

If any provision of this Agreement shall be found by any court or administrative body of  competent  jurisdiction  to  be  invalid  or  unenforceable,  such  invalidity  or unenforceability  shall  not  affect  the  other  provisions  of  this  Agreement  which  shall remain in full force and effect.

21.4.2

If  any  provision  of  this  Agreement  is  so  found  to  be  invalid  or  unenforceable  but would  be  valid  or  enforceable  if  some  part  of  the  provision  were  deleted,  the provision  in  question  shall  apply  with  such  modification(s)  as  may  be  necessary  to make it valid and enforceable.

21.4.3

The  Parties  agree,  in  the  circumstances  referred  to  in  Clause  21.4.1  and  if  Clause 21.4.2  does  not  apply,  to  attempt  to  substitute  for  any  invalid  or  unenforceable provision  a  valid  and  enforceable  provision  which  achieves  to  the  greatest  extent possible  the  same  effect  as  would  have  been  achieved  by  the  invalid  or unenforceable provision.  

21.5

Variation

No variation of this Agreement shall be effective unless and until it is in writing and signed by (or by some person duly authorised by) each of the Parties.

21.6

Entire agreement

21.6.1

Each of the Parties acknowledges and agrees that in entering into this Agreement it does not rely on any statement, representation, warranty or understanding (whether negligently  or  innocently  made)  of  any  person  (whether  party  to  this  Agreement  or not) other than as expressly set out in this Agreement. 

21.6.2

Each of the Parties acknowledges and agrees that the only remedy available to it for breach  of  this  Agreement  shall  be  for  breach  of  contract  under  the  terms  of  this Agreement. Nothing  in  this  Agreement  shall,  however,  operate  to  limit  or  exclude any liability for fraud.

21.6.3

This  Agreement  constitutes  the  entire  agreement  and  understanding  of  the  Parties and supersedes any previous agreement between the Parties relating to the subject matter of this Agreement.

21.7

Third Party rights

No term of this Agreement shall be enforceable under the Contracts (Rights of Third Parties) Act 1999 by a third party.

21.8

Headings

The  headings  of  the  clauses  in  the  Agreement  are  inserted  for  convenience  of reference  only  and  are  not  intended  to  be  part  of  or  to  affect  the  meaning  or interpretation of the Agreement.

22

Fee’s

22.1

A annual support fee of £175.00 is payable to Consulting Networks, upon CONNET appointing the Channel Partner as an independent non-exclusive distributor, and;

22.1.2

The fee is renewable annualy on the the hereo. We reserve the right to alter this amount on giving 30 days notice to the Channel Partner.

23

Liability

23.2

Save as expressly provided by this Agreement Consulting Networks Ltd shall not be liable for any debts or liabilities whatsoever incurred by the Independent Partner Channel whether or not the same have been incurred during the term of this Agreement. The independent Partner Channel hereby agrees to release Consulting Networks from all claims, including but not limited to loss or earnings, tort (including negligence) or otherwise, or otherwise, for indirect or consequential loss howsoever caused. “Consequential loss” shall be interpreted to include (without limitation) loss of profit, loss of contract and loss of goodwill.

24

Governing Law and Jurisdiction

24.1

The parties hereby agree that this Agreement shall be construed in accordance with the laws of England and they both agree to submit to the non-exclusive jurisdiction of the English courts in respect of any dispute arising under or in connection with it.

Part 1

Name: 

Company Number: 

Registered Office:   

Part 2

This Agreement shall commence on the Effective Date and, unless sooner terminated, shall continue for the Initial Period and thereafter shall continue automatically for subsequent periods of one year unless notice to terminate is served by CONNET in accordance with Clause 12.4.

Part 3

Commission:

Part 4

Sales Targets:

Quarter 1:

Quarter 2:

Quarter 3:

Quarter 4:

Part 5

Default percentage:

Part 6

Territory:

United Kingdom and other territories as confirmed in writing from time to time between the Parties.

Part 7

Performance Review:

Review of Channel Partner’s performance by CONNET to take place at least once per Quarter.

Part 8

Products & Services: 

Voice & Data

PSTN  Services  - inbound  and  outbound  geographic  and  non-geographic  telecommunications services  including  fixed  line  rental  services  and  voice  carrier  services, provided  by  CONNET, other voice carriers and/or British  Telecommunications Plc. 999 and related services, directory assistance. Voice Hosted Services. Private Lease Lines (E1’s)

Internet Services

Internet  Protocol  (IP)  telephony  and  facsimile,  video  conferencing  services  and  voice-mail services, High  speed  internet  access  data  interconnect  access  (including  virtual  private  networks)  and service  (both  dedicated  and  dial-up  connections),  email  services,  web  hosting  (content hosting),  server  co-location  management  or  application  outsourcing,  E-commerce  services, consolidated billing and other video and audio content-based broadband services;

Mobiles:

 Mobile Connectivity (o2, Vodafone, 3G, Orange and T-Mobile.

Professional Services:

Web Developement, Graphics Design, Web Marketing, Software Development, Consultancy Services, and Project Management.

Service Maintenance:

IT & Telecommunication Engineering Services

Hardware & Software:

Products and Services are subject to stock availability. Refer to Consulting Networks online store at www.consulting-networks.co.uk for up-to-date product listings.

_________________________________________

_________________________________________

Managing Director

For and on behalf of the [Channel Partner]