-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Oiopm48nXtbmnLjFXIfrY8ew3giReQ38JXRtFUT2IQJoW3Dbm8A3mgtieC0TCtTg xSGGEkyyJrxm2zPpFKbl9A== 0001144204-06-008412.txt : 20060302 0001144204-06-008412.hdr.sgml : 20060302 20060302120216 ACCESSION NUMBER: 0001144204-06-008412 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20060228 ITEM INFORMATION: Entry into a Material Definitive Agreement FILED AS OF DATE: 20060302 DATE AS OF CHANGE: 20060302 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEOMEDIA TECHNOLOGIES INC CENTRAL INDEX KEY: 0001022701 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 363680347 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21743 FILM NUMBER: 06658578 BUSINESS ADDRESS: STREET 1: 2201 SECOND ST STE 600 STREET 2: STE 600 CITY: FORT MYERS STATE: FL ZIP: 33901 BUSINESS PHONE: 6303554404 MAIL ADDRESS: STREET 1: 2201 SECOND STREET STREET 2: SUITE 600 CITY: FORT MYERS STATE: FL ZIP: 33901 FORMER COMPANY: FORMER CONFORMED NAME: DEVSYS INC DATE OF NAME CHANGE: 19960911 8-K 1 v036895_8k.txt U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ------------------------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of Earliest Event Reported): February 28, 2006 NEOMEDIA TECHNOLOGIES, INC. (Exact Name of Registrant as Specified in its Charter) DELAWARE 0-21743 36-3680347 - --------------------------- ------------------------ ----------------------- (State or Other Jurisdiction (Commission File Number) (IRS Employer Incorporation) Identification No.) 2201 SECOND STREET, SUITE 600, FORT MYERS, FLORIDA 33901 - ---------------------------------- ----------------------------- (Address of Principal Executive (Zip Code) Offices) (239) - 337-3434 -------------------------- (Registrant'sTelephone Number, including Area Code) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT DISTRIBUTION AGREEMENT On February 28, 2006, NeoMedia Technologies, Inc. ("NeoMedia") signed a 10-year exclusive supply agreement with Beijing Sino-US Jinche Yingang Auto Technological Services Limited ("Jinche"), a Beijing-based joint venture operating under the laws of the People's Republic of China specializing in automobile sales, financing, insurance and repair. "Automart" is the brand name of Jinche, with which NeoMedia signed a distribution agreement in August 2005. The new agreement expands on the previous agreement, giving Jinche the exclusive rights to distribute NeoMedia's micro paint repair products to their own stores and others throughout China, Hong Kong, Macao, and Taiwan, and also guaranteeing that Jinche will purchase at least 70% of its non-micro paint products through NeoMedia as its distributor. The agreement is attached hereto as Exhibit 16.1. On March 2, 2006, NeoMedia issued a press release with respect to the agreement, attached hereto as Exhibit 16.2. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. NeoMedia Technologies, Inc. ------------------------------------ (Registrant) Date: March 1, 2006 By: /s/ Charles T. Jensen ------------- -------------------------------- Charles T. Jensen, President, Chief Executive Officer and Director 3 EXHIBIT INDEX EXHIBIT NO. DESCRIPTION ----------- ----------- 16.1 Sole Agent Agreement between NeoMedia and Beijing Sino-US Jinche Yingang Auto Technological Services Limited 16.2 Press release dated March 2, 2006 4 EX-16.1 2 v036895_ex16-1.txt EXHIBIT 16.1 ------------ SOLE AGENT AGREEMENT THIS AGREEMENT IS MADE AS OF THE 28th DAY OF FEBRUARY, 2006, by and between NeoMedia Technologies, Inc., a Delaware corporation with its principal place of business at 2201 Second Street, Suite 600, Fort Myers, FL, 33901, USA, ("Supplier") and Beijing Sino-US Jinche Yingang Auto Technological Services Limited, a Joint Venture operating under the laws of the People's Republic of China, with its principal place of business at IV-2-3-20, Building No. 3, Wen Liu Xin Ji Yuan Xia Yuan, Haidian District, Beijing, China, ("Sole Agent"). ARTICLE I DEFINITIONS When used in this Agreement, the following terms shall have the meanings indicated. The meanings shall be applied whether the singular or the plural form of the term is used. "Affiliate" means any company controlled by, controlling, or under common control with Supplier. "Agreement" means this agreement, and the exhibits, together with all amendments thereto. "Attachment" means any form or exhibit attached to this agreement. "Customer" means any person who purchases Products from Sole Agent. "Shipping Point" means any facility designated by Supplier as the origination point for shipment of the Products. "Products" means the products described in the attached Attachment A. Products may be deleted from or added to Attachment A and Supplier may change the specifications and design of Products at its sole discretion at any time by mailing written notice of such changes to Sole Agent. "Territory" means the geographic area or areas set forth in Attachment B. "Trademark" means any trademark, logo, or service mark, whether or not registered, used to represent or describe the Products of Supplier. ARTICLE II APPOINTMENT OF SOLE AGENT 1.1 Appointment. Supplier hereby appoints Beijing Sino-US Auto Technology Services Ltd. (hereunder referred to as AutoMart) as Supplier's Sole Agent in the Territory of China (including Taiwan, Hong Kong, and Macao); Supplier cannot supply Products for sale or use with the non-exclusive portions of the Territory to the other units or people. 1.2 Relationship of Parties. Supplier and Sole Agent are each independent contractors and nothing in this Agreement will be construed or interpreted as creating an employer/employee, agency, joint venture or any similar relationship between the parties. Consequently, (a) Sole Agent is and will remain an independent purchaser and user of the Products, (b) neither party will have or exercise any right or authority to assume or create any obligations or responsibilities, including without limitation contractual obligations, on behalf of or in the name of the other party, and (c) each party hereto will be exclusively responsible for paying all income and other taxes and costs and all expenses relating to its respective business. 1.3 Sale of Products by Sole Agent. Sole Agent shall use its best efforts to distribute the Products and to fully develop the market for the Products within the Territory. 1.4 Competing Products. Sole Agent agrees that it will not distribute any Products in the Territory that compete with the Products during the term of this Agreement or any extensions thereof. Supplier agrees not to invest any other party inside the Territory with full power of this agreement within the agreement period or the extended period. 1.5 Advertising. Sole Agent shall be entitled, during the term of the distributorship created by this Agreement and any extension thereof, to advertise and hold itself out as an authorized Sole Agent of the Products. At all times during the term of the distributorship created by this Agreement and any extension thereof, Sole Agent shall use the Trademarks in all advertisements and other activities conducted by Sole Agent to promote the sale of the Products. Sole Agent shall submit samples of all proposed advertisements and other promotional materials for the Products to Supplier for approval and Sole Agent shall not use any such advertisements or promotional materials without having received the prior written consent of Supplier to do so. Sole Agent shall not, pursuant to this Agreement or otherwise, have or acquire any right, title or interest in or to Supplier's Trademarks. 1.6 New Products. If Supplier or any Affiliate now or hereafter manufactures or distributes, or proposes to manufacture or distribute, any product other than the Products, Supplier shall immediately notify, or cause such Affiliate to notify, Sole Agent of that fact and of all details concerning that product. Sole Agent may request from Supplier distribution rights for that product in the Territory, or any portion thereof, and if so requested, Supplier shall grant, or shall cause the subject Affiliate to grant, such distribution rights to Sole Agent on terms and conditions no less favorable than those provided in this Agreement with respect to Products. If Sole Agent does not obtain those distribution rights or obtains them only for a portion of the Territory, and Supplier or an Affiliate later desires to offer those distribution rights for the Territory or any portion thereof to another party, Supplier shall first, or shall cause such Affiliate to first, make that offer in writing to Sole Agent on terms and conditions which shall be specified fully in that offer. That offer shall contain a full description of the subject product and its operation. Sole Agent may request, and Supplier shall promptly provide, or shall cause such Affiliate promptly to provide, further information concerning the product or the offer. If Sole Agent fails to accept such offer, Supplier or the Affiliate may then offer the product to another party for distribution in the Territory, but may not offer it on terms and conditions more favorable than those offered to Sole Agent. If Supplier or the Affiliate desires to make a better offer to another party, Supplier shall first, or shall cause the affiliate first to, make such better offer to Sole Agent in accordance with the procedure set forth above. 1.7 Sole Agent Sales, Service and Storage Facilities. Sole Agent shall, at its expense, engage and maintain a sales, service and storage organization in the Territory, staffed with such experienced personnel as are necessary to enable Sole Agent to perform its obligations under this Agreement. Sole Agent shall, at its expense, maintain facilities and personnel in the Territory that will enable it promptly and satisfactorily to perform, at a reasonable price, all inspection, maintenance and other necessary servicing of Products sold by Sole Agent. Sole Agent shall, at its expense, at all times store and maintain its inventory of Products in accordance with current, applicable instructions issued by Supplier from time to time. Sole Agent shall, at its expense, fully explain and demonstrate to the customer the proper method of operating and maintaining the Products. 1.8 Legal Compliance. Sole Agent and its affiliates shall each comply with all national, state or provincial, and local or municipal laws, ordinances, by-laws, rules, regulations, orders, rulings and permits applicable to its performance under this Agreement. Sole Agent and its affiliates agree to promptly make all reports to and filings with governmental agencies required by applicable laws, by-laws, rules and regulations and to obtain all approvals, licenses, permits and permissions necessary for its operations under this Agreement. Sole Agent shall pay its own costs incurred in making such filings and reports and in obtaining such approvals, licenses, permits and permissions. 1.9 period Both parties agree on the period of cooperation to be 10 years, that is from 1st January, 2006 to 31st December, 2016; on the expiration of the agreement, Sole Agent has the prior in negotiation of the dealership. ARTICLE III TERMS OF PURCHASE AND SALE OF PRODUCTS 2.1 Purchase of Product. Sole Agent shall purchase its requirements for the Products from Supplier. Such requirements shall include purchasing and maintaining an inventory of Products that is sufficient to enable Sole Agent to perform its obligations hereunder. Supplier shall supply to Sole Agent sufficient Products to enable Sole Agent to meet the full demand for Products in the Territory. All orders for Products transmitted by Sole Agent to Supplier shall be deemed to be accepted by Supplier at the time such orders are received by Supplier to the extent that they are in compliance with the terms of this Agreement and Supplier shall perform in accordance with all accepted orders. Supplier shall confirm its receipt and acceptance of each order within 3 days of receipt of the order. 2.2 Purchases for Resale. All Products purchased by Sole Agent shall be purchased solely for commercial resale to, or use by, retail facilities owned or franchised by Sole Agent, excepting those Products reasonably required by Sole Agent for advertising and demonstration purposes. 2.3 Order Procedure. Each order for Products issued by Sole Agent to Supplier under this Agreement shall identify that it is an order and shall further set forth the description and quantity of Products which are to be delivered on each of such dates. The individual contracts for the sale of Products formed by Sole Agent's submission of orders to Supplier pursuant to the terms and conditions hereof shall automatically incorporate, to the extent applicable, the terms and conditions hereof, shall be subject only to those terms and conditions (together with all terms in orders which are contemplated by this Agreement) and shall not be subject to any conflicting or additional terms included in any documents exchanged in connection therewith. Notwithstanding anything in this Section, Supplier and Sole Agent may, by written agreement, modify the terms and conditions of this Agreement. 2.4 Cancellation of Orders. All cancellation of orders by Sole Agent shall be in writing, or if not initially in writing, shall be confirmed in writing. If Sole Agent cancels an order, which has been accepted by Supplier, Sole Agent shall reimburse Supplier for any cost incident to such order incurred by Supplier prior to the time it was informed of the cancellation. 2.5 Purchase Price. The prices for Products, and any discounts applicable thereto, are set forth in Attachment A. All prices are F.O.B.the Shipping Point. If the price for any Product is not set forth on Attachment A and Sole Agent nevertheless orders such a Product from Supplier, the parties hereby evidence their intention thereby to conclude a contract for the sale of that Product at a reasonable price to be determined by the Parties mutually negotiating in good faith. 2.6 Price Changes. Supplier reserves the right, in its sole discretion, to change prices or discounts applicable to the Products. Supplier shall give written notice to Sole Agent of any price change at least 30 days prior to the effective date thereof. The price in effect as of the date of Sole Agent's receipt of notice of such price change shall remain applicable to all orders received by Supplier prior to that effective date. 2.7 Packing. Supplier shall, at its expense, pack all Products in accordance with Supplier's standard packing procedure, which shall be suitable to permit shipment of the Products to the Territory; provided, however, that if Sole Agent requests a modification of those procedures, Supplier shall make the requested modification and Sole Agent shall bear any reasonable expenses incurred by Supplier in complying with such modified procedures which are in excess of the expenses which Supplier would have incurred in following its standard procedures. 2.8 Delivery: Title and Risk of Loss. All deliveries of Products sold by Supplier to Sole Agent pursuant to this Agreement shall be made F.O.B. the Shipping Point, and title to and risk of loss of Products shall pass from Supplier to Sole Agent at the Shipping Point. Supplier shall be responsible for arranging all transportation of Products, but if requested by Supplier, Sole Agent shall, at Supplier's expense, assist Sole Agent in making such arrangements. Supplier shall also procure insurance for the transportation of the Products, and such insurance shall be of a kind and on terms current at the port of shipment. In the event that 2.9 Inspection and Acceptance. Promptly upon the receipt of a shipment of Products, Sole Agent shall examine the shipment to determine whether any item or items included in the shipment are in short supply, defective or damaged. Within 10 days of receipt of the shipment, Sole Agent shall notify Supplier in writing of any shortages, defects or damage, which Sole Agent claims existed at the time of delivery. Within 30 days after the receipt of such notice, Supplier will investigate the claim of shortages, defects or damage, inform Sole Agent of its findings, and deliver to Sole Agent Products to replace any which Supplier determines, were in short supply, defective or damaged at the time of delivery. Unless notice is given as provided in this Section, Sole Agent shall be deemed to have accepted such Products and to have waived all claims for shortages, defect or damage. 2.10 Warranty. NMPR MAKES NO WARRANTY WHATSOEVER CONCERNING THE PRODUCTS OR THE SYSTEM. THE PRODUCTS AND THE SYSTEM ARE SOLD "AS IS" WITHOUT EXPRESS OR IMPLIED WARRANTY OF ANY KIND. NMPR FURTHER DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF TITLE, NONINFRINGEMENT, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR ARISING FROM A COURSE OF DEALING OR USAGE OF TRADE. SOLE AGENT ACKNOWLEDGES THAT THE ENTIRE RISK ARISING OUT OF THE USE OR PERFORMANCE OF THE PRODUCTS AND THE SYSTEM REMAINS WITH DISRIBUTOR. TO THE EXTENT THAT A PARTICULAR JURISDICTION DOES NOT ALLOW FOR THE EXCLUSION OF IMPLIED WARRANTIES, ANY IMPLIED WARRANTIES UNDER THIS AGREEMENT ARE LIMITED TO THIRTY (30) DAYS WITHOUT AFFECTING ANY OTHER LIMITATION CONTAINED IN THIS AGREEMENT 2.11 Payment. Supplier will invoice Sole Agent for each purchase order received by Supplier upon the complete shipment of the Products specified in the purchase order. All the shipment of products shall be delivered into Sole Agent's warehouse, and Sole Agent will pay invoices after 60 days of their receiving the products. All payments by Sole Agent under this Agreement shall be payable to Supplier by Sole Agent in the official and legal currency of the United States of America. Such payment shall be made by wire transfer of immediately available funds to an account specified by Supplier. Without prejudice to the other provisions of this Section or any other right or remedy of Supplier , if Sole Agent is in arrears with respect to any payment due to Supplier , or in the reasonable opinion of Supplier , Sole Agent is or will be unable to pay its debts as they fall due, then: (a) Supplier may elect not to deliver the Products except against contemporaneous payment by Sole Agent in cash in full of all amounts due and owing to Supplier ; and (b) all amounts owed to Supplier by Sole Agent shall become immediately due and payable. 2.12 Labeling. Supplier will deliver all Products to Sole Agent's common carrier properly packaged and labeled in shipping cases. Sole Agent will instruct Supplier at the time of placing its order as to whether the Product containers themselves should be labeled by Supplier. If so instructed, Supplier will apply labels supplied by Sole Agent to the Products at the sole cost of Sole Agent. Sole Agent will provide a copy of each of the labels to Supplier for its review and approval before final printing, such approval not to be unreasonably withheld. Before final printing, Sole Agent will make all changes to the label designated by Supplier in writing as necessary to comply with laws or regulations. In the event that Sole Agent instructs Supplier not to label containers, Sole Agent will be responsible for the cost of labeling the Products at or en-route to their destination. 2.13 Condition of Agreement. Sole Agent agrees to give NeoMedia Micro Paint 70% of their Macro Paint volumes purchased at any and all of the Sole Agent facilities. According to international practice, NeoMedia shall provide Sole Agent with technical support and share expenses for advertisement and promotion of products to sell. ARTICLE III TERMINATION 3.1 Termination. Either party may terminate this Agreement for any reason by providing 30 months notice of such termination to the other party. Such notice will be in effect immediately upon the receipt of the notice by the other party. The expiration or termination of this Agreement will not release or affect the obligations of either party to timely pay all amounts then or thereafter due to the other party. Upon the termination or expiration of the Agreement with or without any reason, the Sole Agent shall disclose its accounting information through financial reports, customer list and sales information, and the logistic channels to Supplier within ten (10) days after the termination or expiration of the Agreement. 3.2 Limitation of Liability. Neither Sole Agent will be liable to Supplier nor Supplier will be liable to Sole Agent due to the termination or expiration of this Agreement in accordance with its terms. Neither party will be entitled to any compensation, reimbursement or damages from the other for: (a) loss of prospective compensation, profits or income or other consequential damages; (b) loss of anticipated sales; (c) goodwill or loss thereof; or (d) expenditures, expenses, investments, leases or any type of commitment made in connection with, or in reliance upon, this Agreement. ARTICLE IV CONFIDENTIAL INFORMATION AND AMANDMENT 4.1 Confidential Information. Sole Agent covenants and agrees that it shall not, directly or indirectly, during the term of this Agreement, or at any time thereafter, take any steps or induce any other party to reproduce, reverse engineer or otherwise ascertain the formulas for any such Product, nor shall it attempt or induce any other party to manufacture or produce such Product. Those items shall at all times and for all purposes be held by Sole Agent in a confidential capacity and shall not, without the prior written consent of Supplier, (i) be disclosed by Sole Agent to any person, firm or corporation, excepting those salaried employees of Sole Agent who are required to utilize such items in connection with the sale, inspection, repair or servicing of Products during the term of the distributorship created by this Agreement or any extension thereof, or (ii) be disclosed to any person, firm or corporation, or copied or used by Sole Agent, its employees or agents at any time following the expiration or termination of this Agreement or any extension thereof. Supplier may require as a condition to any disclosure by Sole Agent pursuant to this Section that any salaried employee to whom disclosure is to be made sign a confidentiality agreement, enforceable by Supplier, containing terms satisfactory to Supplier. 4.2 Non-tampering Agreement. Sole Agent agrees to refrain from ,tempering with, altering or modifying the Products without the express written consent of Supplier. In order to ascertain that Sole Agent is complying with this obligation, Supplier shall be entitled, at any reasonable time, to remove and test samples of the Products from Sole Agent's inventory or the inventory of Sole Agent's affiliates, sub-Sole Agents, franchisees or dealers. Supplier will not be required to pay for these samples. Supplier will promptly replace all such samples at its cost. Supplier will take the smallest quantities reasonably necessary for testing and will not take a quantity of the Products at any affiliate, sub-distributors, franchisees or dealers location that will impair the ability of the affiliate, sub-distributors, franchisees or dealers to serve its customers. An independent certified laboratory selected by Supplier will do all testing of these samples. The cost of such testing will be borne by Supplier unless the testing demonstrates that the Products sampled were not supplied to Sole Agent by Supplier or have been tampered with, altered or modified without the written consent of Supplier, in which case the cost of testing will be borne by Sole Agent. All intellectual properties relating to any products that were the result of any tampering conduct, such intellectual properties shall belong to Supplier. ARTICLE V DISPUTE RESOLUTION 5.1 Unaided Negotiations. All disagreements, disputes and controversies (each, a "dispute") between the parties arising from or relating to this Agreement, including, but not limited to, allegations of fraud and misrepresentation, shall be settled by the procedures specified in this Article. If one party believes the other party has breached this Agreement, that party shall promptly notify the other party in writing. The party receiving such a notice shall respond in writing within seven (7) days after receipt. If the dispute is not promptly resolved there shall follow, within twenty (20) days, after written notice, a meeting of the representatives of the parties. The purpose of the meeting shall be to discuss and negotiate in good faith, a resolution of any outstanding dispute. All negotiations pursuant to this Article are confidential and shall be treated as compromise and settlement negotiations. 5.2 Mediation. If unaided negotiations fail to bring about a prompt resolution of the dispute, then within twenty (20) days following the meeting of the parties, the parties shall initiate a voluntary, non-binding mediation conducted by a mediator mutually-agreed upon by the parties. If the parties are not able to agree upon a mediator, they shall request that the Canadian or Chinese Arbitration Association appoint a capable mediator for them. The parties shall bear equally the costs and expenses of this mediation and endeavor in good faith to resolve their differences. Mediation pursuant to this Article is confidential and shall be treated as compromise and settlement negotiations. 5.3 Choice of Law, Litigation. This Agreement will be construed under and subject to the laws of the State of Florida, USA and the laws of China, but does is entitled to other remedies under local laws and regulations. The parties agree to waive any provision in the United Nations Convention on the Law Applicable to the International Sale of Goods or any other treaty or international convention to which Canada or the USA are or may become signatories which might lead to a different choice of law. The parties hereto agree to submit all disputes arising from or relating to this Agreement to the Canadian or Chinese Arbitration Association for arbitration in accordance with its rules and regulations. There shall be three (3) arbitrators, one selected by Supplier, one selected by Sole Agent, and the third selected by the arbitral institution with mutual consents of both Parties, who shall concurrently serve as Chairman of the arbitration panel. The arbitration award shall be final and binding upon the parties. The costs of arbitration shall be borne by the losing party or as otherwise determined by the arbitration panel. Any award of the arbitration shall be enforceable by any court having jurisdiction over the party or parties against which the award has been rendered, or wherever assets of the party or parties against which the award has been rendered are located. The parties hereby waive any claim or right to immunity for itself, or any of its assets, from the jurisdiction of any court with respect to enforcement of an arbitral award rendered pursuant to this Agreement. An arbitration clause does not prevent any party from requesting interim conservatory measures from the courts. In resolving of the dispute, except for the disputed part, other parts of the Contract shall be performed accordingly. ARTICLE VI INDEMNIFICATION AND LIABILITY LIMITATION 6.1 Sole Agent Indemnification of NMPR. Sole Agent agrees to comply with all municipal, cities, Provincial and Federal laws, by-laws, regulations, ordinances and any other regulations with which it must comply. Sole Agent shall indemnify and hold Supplier, its officers, directors, employees, agents, successors and assigns harmless against, and will reimburse Supplier for, all losses, claims, damages, judgments, costs and expenses of whatever form and nature, including, without limitation, attorneys' fees, court costs and litigation expenses, whether direct or indirect, that Supplier, or any of is officers, directors, employees, agents, successors or assigns, may sustain or incur as a result of: (a) any failure by Sole Agent and/or its directors, officers, employees, dealers, affiliates, franchisees and sub-distributors (collectively, the "Sole Agent Parties") to comply with any municipal, city, Provincial and Federal law, by-law, regulation, ordinance or any other regulation, (b) any distribution, sale, use or misuse of the Products by the Sole Agent Parties; (c) any loss, claim or action based on the negligence, misfeasance or nonfeasance of the Sole Agent Parties, including, but not limited to, actions by each or any Sole Agent Party involving or administering training concerning the Products or any environmental liability involving, relating to or arising from the Products, or (d) any liability arising due to or as a result of the labeling of the Products. (A) Supplier shall not be obligated or liable for any injury or death of any person or damage to any property caused by the Sole Agent's action, failure to act, negligence or willful conduct, nor for any liability of the Sole Agent, whether or not the same be covered by insurance arranged pursuant to this Agreement. For purposes of this Agreement, if the Sole Agent can control or cause the actions or omissions of any Sole Agent Party, or can control or cause any Sole Agent Party's to omit to take any action, Supplier shall not be obligated or liable for any injury or death of any person or damage to any property caused by the any Sole Agent Party's action, failure to act, negligence or willful conduct, nor for any liability of the Sole Agent Party, whether or not the same be covered by insurance arranged pursuant to this Agreement or otherwise. (B) The Sole Agent shall indemnify and save Supplier and its affiliates and its and their respective shareholders, directors, officers, partners, members, employees and agents harmless from: (I) All fines, suits, proceedings, claims, demands or actions of any nature or kind whatsoever, directly or indirectly arising out of, or in any manner whatsoever associated or connected with the Sole Agent's operations, including without limitation, all claims made in respect of loss of or damage to customer's vehicles or the contents thereof; (II) All costs, expenses and damages, including legal costs on a solicitor and client basis incurred by Supplier in enforcing the provisions of the Agreement against the Sole Agent; and against any and all damages, costs, expenses and fees incurred by on behalf of any of the foregoing in the investigation, prosecution or defense of any and all such suits, proceedings, claims, demands or actions. NMPR shall have the right to pay, settle or compromise any claim as it sees fit in its sole and unfettered discretion, without in any way limiting its rights hereunder. (C) The Sole Agent shall indemnify and hold Supplier and any of its affiliates and its and their respective directors, shareholders, officers, partners, members and employees harmless from and against any and all taxes that the Sole Agent may be required by applicable law to pay. (D) This Agreement, the documents incorporated by reference herein, and the exhibits hereto constitute the entire agreement between the parties and all prior negotiations, commitments, conditions, representations, warranties and undertakings are merged herein. Except as herein provided, there are no oral or written conditions, representations, warranties, undertakings or agreements made by Supplier to the Sole Agent relating to the subject matter hereof. Supplier and Sole Agent specifically acknowledge and agree that the Sole Agent has entered into this Agreement after making an independent investigation of the operations of Supplier and not upon any representation made by Supplier as to the profits which the Sole Agent might expect to realize, nor has anyone made any other representation which is not expressly set forth herein to induce the Sole Agent to execute and deliver this Agreement. The Sole Agent hereby represents and warrants to Supplier that all written statements made by the Sole Agent to Supplier prior to the execution of the Agreement, including, without limitation, all statements pertaining to the Sole Agent's financial standing, were true when made and continue to be true at the time of execution of this Agreement (unless subsequently corrected in writing), and in the event that such representation or warranty is untrue, Supplier shall, at its option, be entitled to terminate this Agreement without prejudice to any other remedies that it may have. (E) Nothing in this Agreement shall be interpreted as requiring the Sole Agent to sell any product or provide any service at a price stipulated by Supplier or any other person. However, Supplier may establish, maintain and advertise a suggested schedule of retail prices, although the Sole Agent shall be under no obligation whatsoever to comply with same, and shall suffer no penalty from Supplier for non-compliance. (F) The Sole Agent acknowledges that Supplier may receive compensation from suppliers of Supplier or the Sole Agent in respect of purchases made by Supplier or Sole Agent and expressly acknowledges and confirms that the Sole Agent shall have no rights in respect of, or entitlement to, such rebates. (G) This Agreement shall inure to the benefit of and be binding upon the Sole Agent and its successors and assigns but shall be personal to and non-assignable by the Sole Agent, except with the prior written consent of Supplier, which may not be unreasonable withheld. Any purported assignment of the rights of the Sole Agent hereunder without such consent by Supplier shall permit NMP Supplier R to immediately terminate this Agreement without notice. For the purpose of this provision the term "assignment" shall include any sale, assignment, transfer, pledge, hypothecation, encumbrance or other disposition of this Agreement or of the Sole Agent's rights hereunder, including, but not limited to, any transfer or assignment resulting from the death of the Sole Agent, bankruptcy of the Sole Agent, or otherwise resulting by operation of law. In the event that this Agreement is made with or assigned to a corporation, the term "assignment" shall also include any change in voting control of the Sole Agent from the person or persons who hold(s) such control on the date of this Agreement. 6.2 Right to Raise Claim. The right to raise a claim of the Sole Agent will be reserved after the Supplier's violation of this agreement and all the regulations in all the schedules. IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized officers or employees. NEOMEDIA TECHNOLOGIES, INC. By: /s/ Paul Grzebielucha --------------------------- Name: Paul Grzebielucha ------------------------ Title: VP/GM, NeoMedia Micro Paint Repair ---------------------------------- SOLE AGENT: Beijing Sino-US Jinche Yingang Auto Technological Services Limited - ------------------------------------------------------------------ By: /s/ Wang Shanhui ---------------------------- Name: Wang Shanhui ------------------------- Title: Director - Vice President ------------------------- EX-16.2 3 v036895_ex16-2.txt EXHIBIT 16.2 ------------ For Immediate Release Press Contacts: Charles T. Jensen David A. Kaminer - --------------- NeoMedia Technologies, Inc. The Kaminer Group +(239) 337-3434 +(914) 684-1934 cjensen@neom.com dkaminer@kamgrp.com NEOMEDIA REACHES $1 MILLION IN ORDERS TO CHINA IN 3 MONTHS -- SIGNS 10-YEAR EXCLUSIVE SUPPLIER AGREEMENT WITH AUTOMART FORT MYERS, Fla., March 2, 2006 - NeoMedia Micro Paint Repair, an innovative developer and international supplier of auto rejuvenation products and processes and a business unit of NeoMedia Technologies, Inc. (OTCBB: NEOM), today announced the escalation of business in China with orders of more than $1,000,000 in proprietary paint and related products in China over the last 3 months. In addition, NeoMedia said that it had signed a 10-year exclusive supplier agreement with Automart, a Beijing-based joint venture (operating under the laws of the People's Republic of China) that specializes in automobile sales, financing, insurance and repair. The automotive market in China is expected to be the largest in the world within two decades (Source: Tuck School of Business at Dartmouth 04/05). NeoMedia is positioning itself to become a formidable player in the automotive aftermarket segment through its developing relationship with Automart, one of the fastest growing companies in this market. "As is evident from the business dealings we've had over the last three months, there is much synergy between our organizations," said Paul Grzebielucha, vice president and general manager of NeoMedia Micro Paint Repair. "We look to the future with great anticipation of what we can accomplish in China with such a professional, savvy business partner. " NEOMEDIA & AUTOMART DEVELOPMENTS OVER THE LAST 3 MONTHS: - NeoMedia secures 10-year exclusivity to supply micro paint and related products and will also supply 70% of macro paint sales at Automart facilities; - Automart gains sole distributorship of NeoMedia products in China, Hong Kong and Taiwan for this 10-year period, with the initial 30 Automart facilities to use NeoMedia Micro Paint products and processes. NeoMedia has completed training the staffs at these facilities on exterior and interior repairs; - The first order to the 30 facilities of $380,000 is placed by Automart, with additional orders bringing the total to more than $1,000,000 for the last three months; - NeoMedia's Micro Paint Repair technology is a significant factor in Automart signing the top seven Chinese insurance companies to directly send vehicles to the Automart repair facilities; - Automart features NeoMedia Micro Paint Repair products and training personnel with live demonstrations at the 2006 China International Automotive Aftermarket Industry Fair. Currently, NeoMedia launches new interior product line with Automart at the event; "The signing of this 10-year agreement will help Automart expand our leadership in auto services within China and enable us to add to our profitability," said Mr. Pang Gui-san, the company's chairman and president. "We are very pleased with the technologies and products that NeoMedia has brought to Automart and that we have the only isocyanate-free micro paint repair process in China. This agreement expands the existing Sino-American relationship of NeoMedia Technologies and creates a dominant position for Automart and NeoMedia Technologies in the fast growing Chinese Auto Aftermarket industry." Mr. Grzebielucha added, "NeoMedia is also in discussions with Automart to supply additional product lines and offerings to augment Automart's auto rejuvenation services, complementing its current image as an entity with cutting-edge technology and customer-oriented service - areas that have great synergy with NeoMedia's business philosophy. "We are all very excited about bringing leading-edge technology and environmentally-friendly products to China, and to have such a wonderful partner with whom to accomplish this venture," he said. ABOUT NEOMEDIA MICRO PAINT REPAIR, INC. - --------------------------------------- NeoMedia Micro Paint Repair, Inc. (www.micropaint.net) is an international developer, supplier and trainer to the automotive aftermarket sales, offering a comprehensive line of technologically advanced automotive rejuvenation and preservation products, processes and systems. We focus on quality, efficiency, innovativeness and environmentally sound products and technologies so that our clients can deliver expert solutions and a positive experience to the end consumer. ABOUT NEOMEDIA TECHNOLOGIES, INC. - --------------------------------- NeoMedia Technologies, Inc. (www.neom.com) is a diversified global company offering leading edge, technologically advanced products and solutions to its clients developed out of market-identified needs. From mobile marketing [to telecommunications] to auto rejuvenation, NeoMedia delivers powerful end-to-end solutions for companies and consumers built upon its solid family of patented products and processes, and management experience and expertise. This press release contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. With the exception of historical information contained herein, the matters discussed in this press release involve risk and uncertainties. Actual results could differ materially from those expressed in any forward-looking statement. Trademarks are properties of their respective owners. -----END PRIVACY-ENHANCED MESSAGE-----