rmdxdistagree.htm


    
      

      

    

    Exhibit 10.29

    EXCLUSIVE
DISTRIBUTION AGREEMENT

    


    This
DISTRIBUTION AGREEMENT (the “Agreement”) is made and entered into effective
September 20, 2007 (“Effective Date”), by and between SecureAlert, Inc., a Utah
corporation (“Company”), with its principal executive office located at 150 West
Civic Center Drive, suite 400, Sandy, Utah 84070, and Electronic Monitoring
Services Corporation (“Distributor”), with its principal executive office
located at P.O. Box 364744, San Juan, Puerto Rico 00936.

    


    WITNESSETH:

    


    WHEREAS,
Company is, among other things, the manufacturer and seller of electronic
location monitoring devices (the “Device”) and provider of services relative to
the monitoring, maintenance and repair of the Device (hereinafter referred to as
the “Device Services”); and

    


    WHEREAS,
Company and Distributor now desire to enter into a business arrangement whereby
Distributor will have the exclusive rights to promote, market, and sell the
Device Services within the Territory (as hereinafter defined) under the terms
and conditions set forth herein;

    


    NOW
THEREFORE, in consideration of the mutual promises, covenants, representations
and good and valuable consideration hereinafter set forth, the adequacy of which
is herby acknowledged, the parties hereto agree as follows:

    


    
      	
              1.

            	
              Term.

            


    

    


    
      	
            	
              1.1

            	
               Initial
      Term.  The initial
      term of this Agreement (hereinafter referred to as the “Initial Term”)
      shall commence as of the Effective Date and shall continue until the
      earlier of (i) three (3) years after the Effective Date and (ii) the date
      of this Agreement is earlier terminated in accordance with the provisions
      hereof.

            


    

    


    
      	
            	
              1.2

            	
               Renewal
      Term. This Agreement
      will automatically renew for consecutive three (3) years term under the
      same terms and conditions set forth herein (each, hereinafter referred to
      as a “Renewal Term”, and collectively with the Initial Term, the
      “Term”).

            


    

    


    
      	
              2.

            	
              Appointment;
      Assignment of Duties;
Territory.

            


    

    


    
      	
            	
              2.1

            	
              Appointment. The Company hereby
      appoints the Distributor as exclusive distributor to promote, market, and
      sell the Device Services within the
Territory.

            


    

    


    
      	
            	
              2.2

            	
              Duties.

            


    

    


    
      	
            	
              2.2.1

            	
              Distributor
      Duties. During the Term,
      Distributor shall, at its own cost and expense, within the
      Territory:

            


    

    


    


    
      
        
           


        

        
          1

          
            

          

        

        
           


        

      

    

    


    
      	
               
      

            	
              (a)

            	
              use
      commercially reasonable efforts to identify, locate and obtain potential
      users of the Device Services (the
  “Subscribers”);

            


    

    


    
      	
               
      

            	
              (b)

            	
              deliver
      units of the Device to the Subscribers, train them in its use, and
      otherwise assist the Subscribers by providing information upon
      request;

            


    

    


    
      	
               
      

            	
              (c)

            	
              provide
      additional guidance and advice to the Company with regard to the Company’s
      strategy to exploit its products and services, and such other support for
      the Company’s products and services as they may agree;
  and

            


    

    


    
      	
               
      

            	
              (d)

            	
              have
      on hand a sufficient number of Devices, trained professional staff, and
      facilities and resources, necessary to perform the Distributor’s Services
      in accordance with the terms
hereof.

            


    

    


    
      	
            	
              2.2.2

            	
              Company’s
      Duties.  During the Term, Company shall, at its own cost
      and expense:

            


    

    


    
      	
               
      

            	
              (a)

            	
              supply
      contractual, marketing, promotion and training materials to be used by
      Distributor in connection with the marketing and distribution of the
      Device Services.  All materials will be in
      English.  Any materials to be used in a language other than
      English will be at the expense of Distributor and the content of such must
      be approved by the Company.  No materials shall be used by
      Distributor except for those provided by the Company or that are otherwise
      pre-approved in writing by the
Company;

            


    

    


    
      	
               
      

            	
              (b)

            	
              maintain
      a Monitoring Center and related staff, customer service support, and
      services, to support both English and Spanish speaking Subscribers and
      Users (as hereinafter defined);

            


    

    


    
      	
               
      

            	
              (c)

            	
              upon
      Distributor achieving 1,000 Spanish speaking users of the Device (“Users”)
      in the Territory excluding Florida, the Company will establish a
      Monitoring Center in Puerto Rico to handle offenders and
      Users.

            


    

    


    
      	
               
      

            	
              2.3

            	
              Territory.  The
      definition of Territory includes all of Central and South America, the
      Caribbean, Puerto Rico, the State of Florida, but excludes
      Mexico.

            


    

    


    
      	
              3.

            	
              Purchases,
      Subscribers Pricing; Distributor’s Compensation.  The
      Company agrees to provide the Devices and the Device Services for
      Distributor’s customers under the terms and conditions set forth
      herein.

            


    

    


    


    
      
        
           


        

        
          2

          
            

          

        

        
           


        

      

    

    


    
      	
               
      

            	
              3.1

            	
              Purchases. Except for
      Florida, all Devices deployed by Distributor must be bought by Distributor
      from Company.  Company agrees to give to Distributor six month
      term on payment for the Devices.  As consideration for this
      Exclusive Distribution Agreement in the, Distributor agrees to initially
      purchase 2,000 Devices at Company’s current price of $500.00
      each.  The prices for the Device shall be determined by the
      Company.  The Company shall inform the Distributor of any
      pricing change in writing and any such change will become effective upon
      receipt by Distributor of notice
thereof.

            


    

    


    
      	
               
      

            	
              3.2

            	
              Subscribers
      Pricing.  The current
      retail price for the Device Services, equipment warranty, and
      non-emergency airtime for Subscribers is $8.00 per day per in service
      Device (the “Rate Plan”).  Changes to the Rate Plan shall be
      determined by the Company.  The Company shall inform the
      Distributor of any Retail Price Change in writing and any such change will
      become effective upon receipt by Distributor of notice thereof, and
      applicable to Subscribers contracted by Distributor
      thereafter.

            


    

    


    
      	
               
      

            	
              3.3

            	
              Distributor’s
      Compensation, Payment.

            


    

    


    
      	
               
      

            	
              3.3.1

            	
              Compensation.  In
      consideration of this Agreement, Distributor shall pay Company, per Device
      in service:

            


    

    


    (A)  in
Florida - $6.50 per day; and

    


    (B) in
the other Territory - $5.50 per day

    


    If the
Rate Plan or the Device Price is changed by the Company, in no case will
Distributor net receipt (after payment to Company) thereon be in that case the
Company and the Distributor will share proratedly in the increase or decrease in
the rate change.

    


    


    
      	
              4.

            	
              Upgrades;
      First Option.   Company agrees that (i) as it or entity
      controlling Company (“Parent), or any entity directly or indirectly
      controlled by Company or Parent (“Affiliate”) develops hardware or
      software upgrades to the Device or the Device Services same will be
      incorporated, free of charge, into Distributor’s product and service; and
      distributor shall have the first option to distribute any and all
      monitoring devices, location or otherwise, which are developed by Company,
      Parent or Affiliate.

            


    

    


    
      	
              5.

            	
              Exclusivity.
      The rights and authorities given to Distributor in this Agreement
      are on an exclusive basis to the Territory subject to the following
      exceptions:

            


    

    


    
      	
               
      

            	
              (A)

            	
              The
      Company currently has contracts in the State of Florida and will be able
      to continue those contracts with no remuneration going to
      Distributor.

            


    

    


    


    
      
        
           


        

        
          3

          
            

          

        

        
           


        

      

    

    


    
      	
               
      

            	
              (B)

            	
              The
      Company has a Territory Account Manager (“TAM”) over Florida that may from
      time to time originate additional contracts in Florida.  For
      those accounts originated by the Company’s TAM during the Term,
      Distributor agrees to pay TAM the amount of commission agreed between the
      Company and TAM not to exceed $.50 per day per
  device.

            


    

    


    
      	
              6.

            	
              Warranties
      and Representations.  Distributor agrees that it shall
      not make any warranty or representation to any person regarding the
      nature, capability, dependability or terms of sale or service regarding
      the Device or Device services which are not made in Company provided or
      Company approved marketing or promotional materials or that are not
      otherwise pre-approved in writing by the Company.  Company
      warrants that the life of the Device will be three
  years.

            


    

    


    
      	
              7.

            	
              Indemnity.

            


    

    


    The
Company’s Indemnity.  The Company agrees to indemnify and hold
harmless Distributor, and Distributor’s parent, subsidiaries, affiliates,
successors, assigns, officers, directors, members, governors, shareholders,
employees and agents (the “Distributor Indemnified Parties”) from and against
any and all losses, damages, liabilities, obligations, judgments, reasonable
attorneys fees and costs, settlements, costs and other expenses (each, a “Loss”)
incurred or suffered by the Distributor Indemnified Parties as during the Term
in connection with Distributor-initiated customers.  Notwithstanding
anything to the contrary, the Company’s total liability for any indemnification
obligations hereunder shall not exceed the lesser of (i) the payments by the
Company to Distributor pursuant to Section 3.3, over the 12 month period
immediately preceding any Loss.

    


    Distributor’s
Indemnity.  Anything herein to the contrary notwithstanding,
Distributor hereby agrees to indemnify and hold harmless the company and its
subsidiaries, affiliates, successors, assigns, officers, directors, members,
governors, shareholders, employees and agents (the “Company Indemnified
Parties”) from and against any Loss that directly or indirectly arises from, or
is related to, any material breach by Distributor of this Agreement during the
Term, including, without limitation, any Loss resulting from the negligent or
intentional misrepresentation by Distributor, its employees or agents, to any
person with respect to the Devices or Device Services covered by this
Agreement.

    


    Indemnification
Procedure.  The indemnifying party will assume the defense, at
its sole expense and with legal counsel reasonably acceptable to the indemnified
parties, of any claim or proceeding as to which such indemnifying party has an
indemnification obligation hereunder.  If the indemnifying party fails
to do so, the indemnified parties will have the right to assume their own
defense, and the indemnifying party will be obligated to reimburse the
indemnified parties for any and all reasonable expenses (including but not
limited to reasonable attorney’s fees and costs) incurred in there defense of
such claims or litigation, in addition to indemnifying party’s other indemnity
obligations hereunder.  An indemnifying party may not enter into any
settlement or compromise of any claim without the prior written consent of the
indemnified parties unless such settlement or compromise is solely for money
damages or will have no continuing effect in any material respect on the
indemnified parties.

    


    


    
      
        
           


        

        
          4

          
            

          

        

        
           


        

      

    

    


    
      	
              8.

            	
              Non-Solicitation.  Without
      the prior written consent of the other party, during the Term and for a
      period of one (1) year after the termination of this Agreement, each of
      the parties hereto agrees not to hire or sub-contract any employee or
      agent of the other party for purposes of providing services similar to
      those contemplated by this
Agreement.

            


    

    


    
      	
              9.

            	
              Termination;
      Obligation Upon termination.

            


    

    


    Termination.

    


    Term
Expiration.  This Agreement may be terminated by either party
upon delivering written notice to the other party at least ninety (90) days but
not more than one hundred twenty (120) days prior to the end of the then
existing term.

    


    Company’s
Termination.  This Agreement may be immediately terminated by
the Company by written notice to Distributor upon (i) the Distributor failure to
comply with laws and regulations which materially affect its contracting rights
or reputation and where such failure is not cured within thirty (30) days of
receipt of written notice thereof or (ii) the occurrence of material breach of
this Agreement or fraud by Distributor.

    


    Distributor
Termination. This Agreement may be immediately terminated by Distributor
by written notice to Company upon (i) the Company’s failure to comply with laws
and regulations which materially affect its contracting rights or reputation and
where such failure is not cured within thirty (30) days of receipt of written
notice thereof of (ii) the occurrence of material breach of this Agreement or
fraud by Distributor.

    


    Consent.
  This Agreement may also be terminated by the written
agreement of the parties.

    


    Obligations Upon
Termination.

    


    Distributor’s
Obligations.  In the event of any termination of this
Agreement, Distributor shall stop all Distributor Services, and surrender to
Company all Devices in its possession and not being utilized by Subscribers and
all and other documentation provided to it by Company with respect to the
Distributor Services that company may deem necessary or appropriate, including,
without limitation, marketing, promotion and training materials.

    


    Company’s
Obligations. In the event of any termination of this Agreement, Company
shall:

    


    
      	
            	
               
      

            	
              (A)    reimburse
      to distributor the purchase price of all    Devices
      surrendered pursuant to Section 9.2.1;
and

            


    

    


    


    
      
        
           


        

        
          5

          
            

          

        

        
           


        

      

    

    


    
      	
            	
               
      

            	
              (B)    continue
      to compensate (as provided in section 3.3.1) Distributor for all Devices
      then in use by Subscribers originated by Distributor prior to the
      termination, until the calendar termination of the related
      Subscriber.

            


    

    


    
      	
              10.

            	
              Dispute
      Resolution.

            


    

    


    Disputes.
The parties agree that in the event of any dispute arises between them under
this agreement, they desire to avoid litigation.  Accordingly, the
aggrieved party will give notice of the dispute to the other party and both
parties will attempt to settle the dispute amicably during the thirty (30)-day
period following such notice.

    


    Mediation.
If the dispute remains unsettled, the parties agree to then submit the
dispute to mediation.  If the parties cannot agree on a mediator, each
will select a mediator and the two mediators so selected will select a third
mediator who shall alone hear the dispute.  Mediation will, if
possible, be conducted during the ninety (90)-day period following expiration of
the thirty (30)-day period.

    


    Arbitration.  If
mediation fails to resolve the dispute within the above described ninety
(90)-day period, the parties agree that the dispute will be submitted to final
and binding arbitration in accordance with the rules of the American Arbitration
Association (“AAA”); but the parties agree that this reference to the rules of
the AAA shall not constitute appointment of AAA as the authority or the body
that will hear and resolve the dispute.  A single arbitrator will be
selected in the same manner described above for the selection of a single
mediator.  If the parties cannot agree on a single arbitrator, each
will select an arbitrator and the two arbitrators so selected will select a
third arbitrator.  Unless otherwise directed by the arbitrator(s), the
expiration of the ninety (90)-day period previously specified for
mediation.

    


    Situs.  Any
mediation or arbitration hearing or meeting held hereunder shall take place at
the Company’s offices in Salt Lake City, Utah.

    


    Costs.  The
costs of mediation (including the mediator’s fees and expenses and costs
directly related to the conduct of mediation, but excluding each party’s direct
costs for transportation, attorneys, etc., for which each will be solely
responsible) will be shared equally by the parties.  The costs of
arbitration shall be allocated among or between the parties as determined by the
arbitrator.

    


    
      	
            	
              11.

            	
              Assignment.  This
      Agreement in part or in whole maybe assigned with the consent of both
      parties.  Distributor may not assign or delegate to any other
      person, firm, or entity any of its duties hereunder without the prior
      written consent of the Company.

            


    

    


    


    
      
        
           


        

        
          6

          
            

          

        

        
           


        

      

    

    


    
      12.  Miscellaneous.

    

    


    Compliance
with Laws.  Distributor shall fully comply with all applicable
laws, regulations, ordinances, court or agency decisions and other issuances
having the authority of law regarding the matters that are in the subject of
this Agreement.

    


    Authority.  Each
of the persons who signs this Agreement represents and warrants that he or she
has full power and authority to execute this Agreement on behalf of the party
for whom he or she is signing, and that upon execution hereof, this Agreement
will be valid, binding and enforceable against the party in accordance with its
terms.

    


    Governing
Law.  This Agreement shall be construed according to and
governed by the laws of the State of Utah, without giving effect to principles
of conflict of laws.  The parties agree that jurisdiction over and
venue in any legal proceeding arising out of or relating to this Agreement will
exclusively be in the state or federal courts located in Salt Lake City,
Utah.

    


    Notices.  All
notices, demands or other communications which are required or permitted to be
given pursuant to this Agreement shall be in writing and shall be delivered
personally, sent by telecopy or mailed by prepaid registered mailto the affected
party at the following address (or to such other address as such party may from
time to time advice the other party hereto in writing):

    


    
      	 
      	
              If
      to Company:

            
	 
      	 
      	 
      
	 
      	 
      	
              SecureAlert,
      Inc.

            
	 
      	 
      	
              150
      West Civic Center Drive

            
	 
      	 
      	
              Suite
      400

            
	 
      	 
      	
              Sandy,
      UT 84070

            
	 
      	 
      	 
      
	 
      	 
      	
              ATTN:
      [President] indicated for such party herein.

            
	 
      	 
      	 
      
	 
      	
              If
      to Distributor:

            
	 
      	 
      	 
      
	 
      	 
      	
              Electronic
      Monitoring Services Corporation

            
	 
      	 
      	
              P.O.
      Box 364744

            
	 
      	 
      	
              San
      Juan, Puerto Rico 00936

            
	 
      	 
      	 
      
	 
      	 
      	
              ATTN:
      Hector Gonzalez

            


    

    


    Amendments.  This
Agreement may not be amended, modified, supplemented or waived orally, and may
only be so amended, modified, supplemented or waived by an instrument in writing
executed by the parties hereto.

    


    


    
      
        
           


        

        
          7

          
            

          

        

        
           


        

      

    

    


    Binding
Effect.  This Agreement and all the terms and provisions hereof
shall be binding upon and inure solely to the benefit of the parties hereto and
their respective permitted successors and assigns.

    


    Counterparts.  This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which, when taken together, shall constitute one
and the same instrument.

    


    Entire
Agreement.  This Agreement contains the entire understanding
and Agreement of the parties hereto with respect to the subject matter hereof
and supersedes all prior agreements, whether written or oral, between the
parties.

    


    Severability.  In
the event that in any legal proceedings before a competent tribunal it is
determined that any of the sections of this Agreement or any subsection,
provision or, part thereof is invalid, such section, subsection, provision or
part thereof shall be deemed to be severed from this Agreement for the purposes
only of particular legal proceedings in question, and this Agreement, and the
said section, subsection, provision or part thereof, shall in every other
respect continue in full force and effect.

    


    


    REMAINDER
OF PAGE INTENTIONALLY LEFT IN BLANK

    


    SIGNATURE
PAGE FOLLOWS

    


    
      
        
           


        

        
          8

          
            

          

        

        
           


        

      

    

    


    IN
WITNESS WHEREOF, the parties have executed this Distribution Agreement as of the
Effective Date.

    


    
      	 
      	
              COMPANY:

            
	 
      	 
      
	 
      	
              SecureAlert,
      Inc.

            
	 
      	 
      
	 
      	 
      
	 
      	
              By:
      ____________________

            
	 
      	
              Name:__________________

            
	 
      	
              Title:
      ___________________

            
	 
      	 
      
	 
      	 
      
	 
      	
              DISTRIBUTOR:

            
	 
      	 
      
	 
      	
              Security
      Monitoring Services Corporation

            
	 
      	 
      
	 
      	 
      
	 
      	
              By:____________________

            
	 
      	
              Name:  Hector
      L. Gonzalez

            
	 
      	
              Title:  President

            


    

     

    


    


    
       

      
        	AGREED AND
      ACCEPTED	 
	 	 
	RemoteMDx
      Inc.	 
	 	 
	 	 
	By:___________________	 
	Name:________________	 
	

                Title:
      _________________

              	 


      

       

    

    


     

    


    


     

     

     

     

     

     

     

     

     

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