Sales Agency Contract (Page 4 of 6) in pdf

Article 15

Earlier termination

15.1

Each party may terminate this contract with immediate effect, by notice given in writing by means

of communication ensuring evidence of date of receipt (e.g. registered mail with return receipt,

special courier), in case of substantial breach by the other party of the obligations arising from the

contract, or in case of exceptional circumstances justifying the earlier termination.

15.2

Any failure by a party to carry out all or part of his obligations under the contract resulting in such

detriment to the other party as to substantially deprive him of what he is entitled to expect under

the contract, shall be considered as a substantial breach for the purpose of article 15.1, above.

Circumstances in which it would be unreasonable to require the terminating party to continue to

be bound by this contract shall be considered as exceptional circumstances for the purpose of

article 15.1, above.

15.3

The parties hereby agree that the violation of the provisions under Articles 8 - 10.1 of the present

contract is to be considered in principle, unless the contrary is proved, as a substantial breach of

the contract. Moreover, any violation of the contractual obligations may be considered as a

substantial breach, if such violation is repeated notwithstanding a request by the other party to

fulfil the contract obligations.

15.4

Furthermore, the parties agree that the following situations shall be considered as exceptional

circumstances

that

justify

earlier

termination

the

other

party:

bankrupcy,

moratorium,receivership liquidation or any kind of composition between the debtor and the

creditors, or any circumstances that are likely to affect substantially one's party's ability to carry

out his obligations under this contract.

15.5

If a party terminates the contract according to this article, but the judges ascertain that the

reasons put forward by that party did not justify the earlier termination, the termination will be

effective, but the other party will be entitled to damages for the unjustified earlier termination.

Such damages will be equal to the average commission for the period the contract would have

lasted in case of normal termination, unless the damaged party proves that the actual damage is

higher (or, respectively, the party having terminated the contract proves that the actual damage is

lower). The above damages are in addition to the indemnity which may be due under article 16.

Article 16

Indemnity in case of termination

16.1

The Agent shall be entitled to an indemnity ("goodwill indemnity") if and to the

extent that:

he has brought the Principal new customers or has significantly increased the volume of

business with existing customers and the Principal continues to derive substantial benefits

from the business with such customers, and

the payment of this indemnity is equitable having regard to all the circumstances and, in

particular, the commission lost by the Agent on the business transacted with such

customers.

16.2

The amount of the idemnity shall be equivalent to an indemnity for one year calculated from the

Agent's average annual remuneration over the preceding five years and, if the contract lasted for

less than five years, the indemnity shall be calculated on the average for the period in question.

16.3

The Agent will lose the right to idemnity if he does not claim the idemnity in writing within one

year from contract termination.

16.4

The Agent shall have no right to indemnity in the following cases:

Sales Agency Contract Page 4

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