Value Added Reseller Agreement

By submitting the Authorized Reseller Application, the Value Added Reseller (hereinafter referred to as VAR), listed on the Authorized Reseller Application agrees to become bound by the terms of this agreement, made by and between INTELLIGENT INSTRUMENTATION INCORPORATED, an Arizona Corporation, having its office at 3000 E. Valencia Road, Suite 100, Tucson, Arizona, 85706 (hereinafter referred to as III) and VAR . The terms of the agreement are effective as of the date signed by III. WHEREAS, III manufactures data collection and data acquisition systems and related hardware and software (hereinafter referred to as "Products") and desires to sell such Products to VAR.

WHEREAS, VAR desires to purchase Products from III for incorporation into its own systems for resale directly to end-users, and VAR is willing to provide to its customers the service and support necessary for systems so incorporated.

NOW, THEREFORE, the parties mutually agree to the following terms and conditions:

1. SALE
a. III hereby agrees to produce, sell and deliver to VAR during the term hereof and in accordance with the provisions of this Agreement, the Products set forth in the Price List, which, at III's sole discretion, may be amended from time to time in order to add new Products, and/or delete discontinued Products.

b. This Agreement is not a requirement contract and does not obligate VAR to purchase any quantity of Products hereunder, but rather it establishes the terms and conditions for such purchases if they occur. VAR may select from the then current Price List, the Products it wishes to purchase.

c. VAR agrees to the Standard Conditions of Sale Applying to Products Sold by III Corporation.

2. RELATIONSHIP
  INTELLIGENT INSTRUMENTATION INCORPORATED may appoint other value added resellers or representatives and distributors in the same territory and for the same or similar Products. VAR is not a distributor of III's Products nor shall VAR appoint or engage any third party to act on VAR's behalf as its agent, representative, or distributor to either purchase or sell III's Products under the terms of this Agreement. However, no term or condition of this paragraph shall act to preclude VAR from appointing or engaging an agent, representative, or distributor to either purchase or sell VAR's systems into which III's Products are incorporated.

3. QUALIFICATION
To qualify as a VAR of III Products, the following conditions must be met for sales, training and financial resources.

a. The VAR shall have sufficient technical staff, minimum of one full time person, to handle support for end users. The VAR must be able to provide end-users with a turn-key solution, including installation of III Products, appropriate software and network support.

b. The VAR shall have sufficient sales staff, minimum one full time sales person, to handle inquires regarding Products, and applications. The VAR's sales staff shall also be able to respond, within a reasonable time frame, to all sales leads provided by III.

c. The VAR's technical staff will attend periodic training as provided by III from time to time.

d. The VAR must establish a credit line with III accounting department that is sufficient to supply III Products, within a reasonable time frame to end users.

e. III has the expectation that a VAR will purchase approximately fifty thousand dollars or more of III Products annually.

f. III has the expectation that a VAR will purchase demonstration equipment in order to sufficiently support end user sales and technical inquires.

4. PURCHASE ORDERS
a. VAR may order Products listed in the current Price List within the Initial Term of this Agreement or any Renewal Term thereof. III reserves the right to amend Product Lines to add or remove Products at any time.

b. All orders shall be placed on VAR's Purchase Orders referencing this Agreement. Should there be any language in said Purchase Orders which negates, qualifies, contradicts or limits the terms and conditions of this Agreement, then said language shall be deemed to be without force and effect and the terms and conditions of this Agreement and III's Acknowledgment shall take precedence.

c. All Purchase Orders are subject to written acceptance by III.

5. DISCOUNT AND PAYMENTS
a. VAR shall purchase Products at discounts based on their program level in effect at the time the order is received by III.

b. In the event that VAR wishes to place purchase orders for Products and pay for such orders on credit terms, such credit terms shall be approved by III in advance of order acceptance by III.

c. The amount of any present or future sales, use, excise or other tax applicable to the sale or use of the Products sold hereunder shall be paid by the VAR, or in lieu thereof the VAR shall provide III with a tax exemption certificate acceptable to the taxing authority.

6. TERMINATION
  Either party may terminate this Agreement with or without cause upon thirty (30) days prior written notice. Written notice of termination of the Agreement shall be sent by registered mail, return receipt requested, to the other party at its address stated above or at such other address as may be designated from time to time. If III terminates the Agreement, III will honor quotations under this Agreement made by VAR prior to VAR's receipt of notice of termination provided that such quotations are received by III within five (5) working days after VAR's receipt of notice of termination. Termination of this Agreement shall not affect any obligations of VAR to make any payments due and owing hereunder at the time of such termination.

7. DELIVERY
a. All scheduled or quoted delivery dates are approximate and are based upon prompt receipt of all necessary information from the VAR.

b. Unless otherwise agreed to, in writing by III, delivery of the Products hereunder shall be made FOB Tucson, Arizona, with transportation expenses and insurance paid by VAR. Risk of loss or damage to Products in transit shall fall upon VAR, whose responsibility it shall be to file claims with the carrier and/or the insurance company. Title shall pass to VAR at FOB point.

8. CONFIDENTIAL INFORMATION, TRADEMARKS AND TRADE NAMES
a. To enhance the effectiveness of the VAR's selling, III may from time to time divulge certain confidential information and proprietary trade and/or manufacturing secrets to the VAR. VAR shall preserve in strict confidence any confidential or proprietary information obtained by VAR concerning the business or affairs of III and affiliated entities, including but not limited to trade secrets, price lists, marketing strategies, customer lists, mail lists, and information concerning the design or methods of manufacture of III Products, and shall refrain from disclosing, during the term of this Agreement or at any time thereafter, any such information to any person or persons, natural or corporate.

b. VAR acknowledges and agrees for all purposes that any registered or unregistered trademarks, trade names, or identifying slogans affixed to Products or any accompanying labels, containers, cartons, and promotional literature constitute the exclusive property of III and shall not be used by VAR except in connection with promoting and selling Products.

9. EXPORT
a. VAR agrees to abide by any restrictions of conditions respecting the export or re-export of III Products now or hereafter imposed by the United States Government pursuant to Part 379 U.S. Export Administration Regulations, as amended from time to time.

b. VAR and III will observe all applicable provisions of the Foreign Corrupt Practices Act and the Anti-Boycott regulations of the Department of Commerce, and each will assist the other in complying with these laws.

10. LIMITATION OF III'S LIABILITY
a. VAR shall at all times act as an independent contractor and shall not have any right or authority to make any representation or warranty on behalf of III, nor in any manner to assume or create any obligation or responsibility, express or implied, on behalf of, or in the name of, nor act for, nor bind III in any respect. VAR is not an agent nor an employee of III, nor is VAR a legal representative of III. Except as herein specifically provided, VAR agrees to defend, hold harmless, and indemnify III with respect to any claim, action, suit, or other proceeding asserted or instituted against III arising out of or related to any actions taken by VAR. VAR agrees not to act in any manner or make any representation which would lead any third party to consider that III is in any way responsible for the acts of VAR or that VAR is an agent of III. Except as provided by express written warranties offered by III, III shall not be responsible for the handling, installation, use or service of Product(s) after sale by III to VAR, FOB III factory.

b. Notwithstanding any provision contained herein to the contrary, the maximum liability of III to VAR, or to any person whomsoever arising out of or in connection with any sale, use, or other application of any Product delivered to VAR hereunder, whether such liability arises from a claim based upon contract, warranty, tort, or otherwise, shall not under any circumstance exceed the actual amount paid to III by VAR for the Product delivered hereunder.

c. III SHALL NOT BE LIABLE FOR ANY OF VAR'S LOSS OF PROFITS, LOSS OF BUSINESS, LOSS OF USE OR LOSS OF DATA, INTERRUPTION OF BUSINESS, NOR FOR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF ANY KIND WHETHER UNDER THIS AGREEMENT OR OTHERWISE, EVEN IF III HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSS. In no case will III be liable for any representation or warranty made by VAR, or any agent of VAR.

11. GENERAL PROVISIONS
a. ENTIRE AGREEMENT. This instrument contains the entire and only agreement between the parties hereto relating to the subject matter hereof and any representation, affirmation of fact, and course of prior dealings, promise or condition in connection therewith or usage of the trade not incorporated herein shall not be binding on either party. This agreement supersedes any previous agreement executed between the parties related to the subject matter hereof. The rights and obligations contained herein shall inure to and be binding upon the parties, their legal representatives, successors, and permitted assigns.

b. ASSIGNMENT. Any assignment of this Agreement, or of any rights or obligations hereunder, by the VAR or III without the written consent of the other party shall be void.

c. APPLICABLE LAW. This Agreement and matters connected with the performance thereof shall be construed, interpreted, applied and governed in all respects by the laws of the State of Arizona.

d. MODIFICATION. No change, modification, recision, discharge, abandonment or waiver of this Agreement shall be binding upon III unless made in writing and signed on its behalf by an authorized employee.