NON-RESALE AGREEMENT
This Non-Resale Agreement (the “Agreement”) is entered into and becomes effective upon the date of sales by and between the Gallery and the Buyer. This Agreement confirms and supplements the Sales Agreement.
- Non-resale; right of consignment:
(a) The Buyer agrees that the Artwork(s) is sold on condition that, during the Non-Resale Period (defined below), the Buyer shall not sell (including in the form of offering the Artwork(s) for a private sale or through a public auction), transfer, lease, or create a security interest in the Artwork(s) (each, a “sale”) during a three (3) - year period starting from the date of the sales invoice issued by The Gallery (the “Non-Resale Period”).
(b) For the duration of the Non-Resale Period, the Buyer hereby grants to the Gallery the first right to purchase or consign the Artwork(s), if it is offered for sale. The Buyer shall notify the Gallery of which of the Artwork(s) they intend to sell, and details of the proposed sale, including e.g. buyer, intermediary, price, date, etc., to the extent known at such time. Upon receipt of the Buyer’s notice, Gallery shall have 30 days to notify the Buyer of its intent to purchase or consign the Artwork(s). In such event:
(i) If the Gallery elects to purchase the Artwork(s), the Buyer shall, within 90 days of receiving the Gallery’s notice, sell the Artwork(s) to the Gallery for the original price listed on the Invoice;
(ii) If the Gallery elects to consign the relevant Artwork(s) for resale, the Buyer shall consign the relevant Artwork(s) to the Gallery for a period of six (6) months, and the Gallery shall use its best endeavors within such period to achieve the best price given the then prevailing market; in such event, the Buyer agrees to pay the Gallery commission of 20% (plus any applicable tax) of the resale price of the relevant Artwork(s) for handling the sale. Any consignment sale would be subject to the Gallery's standard conditions of sale at such time. The Gallery will also be authorized to offer a 10% discount on the consignment price for the benefit of a third-party buyer, such discount being equally shared between the parties.
For the avoidance of doubt, the Buyer acknowledges that the Gallery is under no obligation to purchase or consign the Artwork(s) and has made no commitment or undertaking, express or implied, to successfully resell the Artwork(s).
(c) If the Buyer does not receive a response from the Gallery within 30 days of Buyer’s initial notice of proposed sale, the Buyer shall issue a second notice to the Gallery. If the Gallery does not respond to such second notice within 30 days, the Gallery shall be deemed to have waived its right to repurchase/consign, but the Buyer shall still be prohibited from offering the Artwork(s) for sale for the duration of the Non-Resale Period. For the avoidance of any doubt, without express written permission from the Gallery, the Buyer must respect the remaining Non-Resale Period.
(d) Any material change to the proposed sale terms, or delay of 3 months or more of the proposed sale date, shall be considered a new proposed sale with all of the Gallery’s rights intact, and shall require fresh notice to the Gallery of the proposed sale.
(e) The Buyer acknowledges that its obligations herein do not unduly burden its ownership and enjoyment of the Artwork(s) in question, and that such obligations are a condition to its purchase of the Artwork(s). In addition to any other remedies available hereunder or under law, if the Buyer is found to be in violation of any of the above provisions, the Buyer shall indemnify the Gallery in an amount equivalent to the gain (direct, indirect, in-kind or otherwise) realized by the Buyer or any affiliate on the unauthorized resale of the Artwork(s) or, if the Gallery cannot obtain information about the gain realized on the resale, an amount equivalent to three (3) times the Artwork(s)’s initial purchase price as listed on the Invoice.
2. Intellectual property:
The Buyer further acknowledge that the artist of the Artworks(s)reserves all copyrights and moral rights related to the Artwork(s). Without the express written permission of the artist, provided through the Gallery, the Buyer shall not (a) alter, modify, develop, copy, or reproduce the Artwork(s), or (b) exploit, develop or adapt the Artwork(s) into any new work(s), by any means, method or process now known or later developed, including, without limitation, so called “fair use” reproductions, for any purpose.
3. Miscellaneous:
(a) The parties agree that the provisions in the preceding paragraphs and Terms and Conditions of Sale have been negotiated between them, constitute additional consideration in respect of the purchase of the Artwork(s) and are deemed by both parties to be reasonable. This agreement will be binding on and insure to the benefit the parties’ respective heirs, successors and assigns.
(b) The Buyer certifies that it is the final buyer of the Artwork(s) or that it is properly authorized by the final buyer to enter into this agreement, and that it has disclosed the identity of the final buyer to the Gallery. In case of breach of this agreement, the Buyer will be directly responsible to the Gallery on its own behalf and on behalf of any final buyer.
4. Notices:
All notices hereunder shall be given in writing by mail (postage prepaid), email or instant messenger to the contact information as set forth in the Invoice. Date of notice shall be deemed to be the earlier of (a) actual receipt; (b) three (3) days after the date of mailing; or (c) in case of email or instant messenger, the notice will be deemed received at the time when the message enters the recipient’s mail or instant messenger server.
5. Governing law & disputes:
The validity, interpretation, performance and dispute resolution of this Agreement shall be governed by laws of the People’s Republic of China. Any disputes or claims arising hereunder shall be submitted to Beijing Arbitration Commission (“BAC”) for arbitration in accordance with the BAC’s arbitration rules in effect at the time of applying for arbitration. The arbitration tribunal shall consist of three arbitrators, one to be appointed by the Buyer and one to be appointed by the Gallery. The third arbitrator shall be appointed as the Presiding Arbitrator by the Chairman of BAC and shall not be of PRC citizenship or held in the past PRC citizenship. The arbitral award shall be final and binding upon all parties. Unless otherwise specified in the arbitral award, the arbitration fees shall be borne by the losing party.
By paying the purchase price, the Gallery and the Buyer accept and agree to all of the terms and conditions hereof and in the Invoice.